> LO: Are issues such as trade and globalization more
> relevant to the long-term effects of the economy?
>
> PK: I have to say those issues – they seemed terribly
> big issues a few years ago. And I’d like to imagine us
> back to a situation where they become top issues.
>
> But at this point, they’re really second-order.
>
> The key thing, in terms of the state of the world right
> now, is that the United States has gone mad.
>
> Let’s get some return to fiscal and environmental and
> general governmental sanity in this country, and then
> we can talk about we manage globalization.
>
> LO: Having been considered a proponent of globalization,
> how do you feel that has worked in practice? Has it
> helped developing countries raise incomes for the
> impoverished?
>
> PK: It’s a mixed picture…There are dramatic success
> stories, mostly in Asia. There’s a lot of disappointment
> and worse, especially in Latin America.
>
> If we ever get back to the point where we can even
> talk about these issues seriously, then I think we’re
> going to have to ask: is there a way to get the good
> stuff without the bad stuff?
>
> Clearly, disruptive movement of speculative capital
> [and] currency crises…have undermined the case
> for globalization a lot.
>
> I was a pretty strong proponent of globalization. I
> still cling to the hopes, because all of the real
> movement up, all of the cases where desperately
> poor countries have made it into the ranks of
> countries with a reasonably decent standard of
> living have involved production for the export market.
>
> So I’m pro-globalization in the general sense, because
> it seems to be the way out of poverty. But I have to
> admit there have been some real bad stories.
>
> LO: Like Argentina?
>
> PK: Well, Argentina or Indonesia have got to be the
> two worst. Argentina, in particular, is a tragedy.
>
> They bought into the advice coming from Washington
> and New York, and had themselves a few years that
> looked really good, and then plunged into the abyss.
> So this has got to be a cautionary tale.
>
> For what it’s worth…I saw it coming a little bit before
> most people did, and I think it’s possible to separate
> the good advice from the bad advice.
>
> My dream for America would be to return to a situation
> in which people of decency and good will can have
> vicious arguments of globalization again. Right now,
> that seems to be a luxury we can’t afford.
>
> LO: We are seeing some talk from the Democratic
> candidates at least about NAFTA, that whatever
> help it was to the economy in the 1990s, that you’re
> starting to see jobs being shipped away that aren’t
> being replaced.
>
> And so, perhaps we should renegotiate those
> agreements and incorporate some more labor and
> environmental standards for other countries. Is that
> the right way to go?
>
> PK: I think you have to be very careful.
>
> A certain amount of labor standards and
> environmental standards are a good thing. It’s
> actually one of those cases where we can do good
> for everybody by putting it in.
>
> But if no jobs are shipped out, then there’s no gain.
> There has to be some rearrangement of who works
> where. That actually is, in a way, the point of NAFTA…
>
> ...I actually think that a lot the new questioning of
> NAFTA, isn’t really about NAFTA. It isn’t really about
> Mexico. It’s really about the depressed US economy,
> the fact that we’re not generating jobs at home.
>
> If you think about it, the jobs in North Carolina,
> that are now being lost to foreign competition, are
> jobs that were once in New England, and were lost
> to competition from North Carolina. There is a
> cycle in these things.
>
> That can sound very callous, because you say, “What
> about the people who lose their jobs?”
>
> The answer is you ought to have a booming economy
> that creates new jobs to replace the old ones, and you
> also have a decent social safety net, so that people
> aren’t that much at risk.
>
> If we ever emerge from this tunnel of policy insanity
> that we’re in right now, then I’m happy to have a
> discussion.
>
> And I think probably we’ll find that people who
> thought that they were bitterly opposed on policy
> towards international trade and globalization will
> discover that after seeing how many values we
> share, there’s probably a lot more room for finding
> common ground.
more @
http://www.liberaloasis.com/krugman.htm
-- Shane
________________________________________________________________ The best thing to hit the internet in years - Juno SpeedBand! Surf the web up to FIVE TIMES FASTER! Only $14.95/ month - visit www.juno.com to sign up today!