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Globalisation and the Third Way

By Mark Latham - posted Wednesday, 15 August 2001

Internationalism was once an important theme for left-of-centre politics. It was said that the working people of the world needed to work together to end the exploitation of labour. The current campaign against globalisation, however, reflects a feeling of ultra-nationalism within elements of the Left. The Third Way aims to restore the primacy of internationalism to our economic and social policies.

Globalisation and the Information Age are tailor-made for a new era of progressive politics. The knowledge economy has freed the labour force from the heavy machines and degrading work of industrial capitalism. Highly skilled workers have a strong economic bargaining position. In effect, they now have ownership of their surplus value. The purpose of social democracy must be to deliver these opportunities to all workers, to give everyone a stake in the new economy.

Globalisation has also delivered benefits to the Third World. Over the past 30 years, trade liberalisation has generated the greatest poverty reduction program in the history of humankind. The embrace of economic openness and export production in East Asia has lifted 150 million men, women and children out of abject poverty.


The social benefits of internationalism are also strong. Only by bringing people closer together, through advanced communications and the crossing of cultural boundaries, can we create a more tolerant and cooperative society. Imagine the good that comes from millions of school students from different countries communicating and working together on the Internet each day. Globalisation of this kind is the natural enemy of bigotry. It is the future for our side of politics.

The challenge for modern citizenship is to cross the boundaries of prejudice and parochialism. Our loyalties to the local, the regional and the national now need to coexist with the ideals of good international citizenship. So too, the identities of modern life - racial, gender and sexual characteristics - need to sit easily together, without prejudice.

The problem with economic nationalism is that it promotes a narrow, inward-looking kind of citizenship. Tariffs and other forms of protection are the economic equivalent of racism. They encourage Australians to think poorly of people from other countries and to believe that we would be better off isolated from the rest of the world. If the Labor movement is willing to discriminate against other nations on economic grounds then what credibility do we have in arguing against social discrimination?

Protectionism is not a viable option. No nation has ever prospered by aiming at economic self-sufficiency. No society has ever advanced its culture through an ethos of isolationism. No community has ever become more capable by locking itself away from the new frontiers of technology. Just as much, no political movement can succeed in the coming century by turning its back on the possibilities of internationalism.

This is not to suggest, of course, that globalisation is perfect or that the role of government is irrelevant. Globalisation is not an outcome. It is a process, full of threats as well as opportunities. Its impact depends on how well nations respond to this reality. In a world of constant change and uncertainty, the role of public policy is all-important. New strategies and policies are needed to maximise the benefits of globalisation.

Our first priority must be to strengthen the role of international economic governance. If nations are to successfully regulate global capital then they need to co-operate in global forums. The European Union offers a good example of this process. The integration of political power is a logical response to the global integration of economic power. This is why the Third Way takes an internationalist stance.


At an inter-governmental level, the work of the WTO and the ILO needs to be more effectively linked. It is absurd, for instance, that the WTO bans imports made by prison labour, but not those produced by slave labour or child labour. The IMF and World Bank also have a role to play in lifting labour and social standards in developing nations. It is possible for free trade to coexist with civilised corporate behaviour.

A second strategy involves the development of a learning society. Whereas nations once relied on machine and muscle power to generate wealth and prosperity, they must now harness the brainpower of their people. Across the economy, production is becoming less resource-intensive and more knowledge-intensive. A small country like Australia can only succeed in the global chase for capital through the creation of a well-educated population and workforce.

This is also the best way of rebuilding social capital. As a nation, we do not have to choose between the values of community and the economics of capitalism. A highly skilled population can enjoy the benefits of both. Education is a unique public investment. It not only generates a more efficient economy, it creates a more cohesive and trusting society.

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About the Author

Mark Latham is the former Leader of the Opposition and former federal Labor Member for Werriwa (NSW).

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