Who Wins From Globalisation?


As bouts go, it probably didn’t qualify as heavyweight. But the first of two debates between Nick Clegg and Nigel Farage, the leaders of Britain’s Liberal Democrat and UK Independence (UKIP) parties, revealed as much about the country’s politics as anything currently involving Labour and the Conservatives. The two will clash again in the UK on Wednesday night.

On the back of recent polls showing ambivalence over European integration and hostility towards current immigration levels, last week's debate on Britain’s EU membership laid bare a fundamental clash over the nation’s response to globalisation.

In one corner was Clegg, the enthusiastic internationalist. According to the Liberal Democrat leader, European integration is about ensuring regional investment and trade and the 3 million jobs that allegedly depend on it. It’s about “leading in the world” and creating a “Great Britain, not a little England”.

In the other corner was Farage, the wary nationalist. The UKIP leader repeated his central message, claiming that the EU is undemocratic, socially corrosive and economically damaging. Citing the EU’s free movement of people, he argued that mass immigration is both transforming traditional neighbourhoods and suppressing working wages.

Far from being a localised dispute over policy, or a simple dispute over philosophy, these positions can only understood in the broader context of globalisation and its transformation of domestic politics around the developed world.

Economic globalisation comes with many virtues but one of its major consequences is a tectonic shift in skilled and unskilled employment. For skilled workers, the dissolution of borders means new markets to sell to and more lands to work in; for unskilled workers, competition with low wage countries can often mean stagnant wages and greater insecurity.

It’s no coincidence that, in Britain, the Liberal Democrats and UKIP represent demographics that respectively benefit from, and struggle under, these forces.

The Liberal Democrats’ base is socially distinct. The party’s supporters are Britain’s most educated (31 per cent hold a postgraduate degree, almost double Labour’s 17 per cent) and, alongside the Conservatives, are most likely to be employed in a white-collar profession. In short, they’re best positioned to thrive in a globalised world.

The story is very different for UKIP. As a study by Matthew Goodwin and Robert Ford recently found, the party is the “most working-class-dominated party since Michael Foot’s Labour in 1983”. Farage is winning over working class voters because “they feel left behind by Britain’s rapid economic and social transformation”.

The fact that Farage is an ex-stockbroker and that UKIP offers little in the way of tangible social protection seems to matter little: in the politics of globalisation, they offer the clearest rejection of an order that, since the glory days of social democracy, has seen their industries outsourced and their neighbourhoods changed.

In Australian history, the UKIP’s closest parallel was the rise and fall of One Nation. While Pauline Hanson was a less polished media performer than Farage, her policy and appeal were similar. Like UKIP, she repudiated the new liberal global order, though her party went further in advocating industrial protectionism. Significantly, One Nation also received disproportionate support from the working class.

Since Hanson’s decline, globalisation and sovereignty haven’t formed the basis of any new, insurrectionary parties. This is largely because we don’t face anything like the EU’s free movement of people, as well as the fact that we avoided the type of economic crisis still being endured there.

The politics of sovereignty does, however, continue to re-tilt the balance within existing parties. Like in Britain, the clearest examples involve immigration.

If you study Sydney’s geography, economy and politics, a number of things begin to stick out. One of them is the correlation between a suburb’s average level of educational attainment and, due to the value of skills in global markets, its annual wage growth. Low skills overwhelmingly match stagnant incomes.

As the ABC’s 2013 Election Compass showed, these suburbs also tend to exist in electorates most suspicious of immigration, and most adamant about border security. On the other hand, highly skilled suburbs with rising incomes tend to be more open to fluid internationalism.

For centre-left parties like Australian Labor, this poses a dilemma: how can they reconcile universalism with their historic protection of those left behind in the market place?

One response is protectionism, both cultural and economic. Like with Britain’s "Blue Labour" movement, this suggests that social democrats should resist top-down imposition of "progressive" ideas, and accept strains of working class conservatism. But substance aside, it’s hard to see how this could be implemented without alienating progressive advocates of universalism and ethnic communities.

The other response is to more aggressively narrow the gulf between skilled and unskilled workers. This includes ensuring more equal access to quality education, funding retraining schemes that genuinely bridge professions and defending unions. It’s to accept that change occurs and, as is the assumption in Scandinavia, that it’s the state’s role to protect citizens from the inevitable dislocation.

This cleavage is not going away anytime soon. According to 57 per cent of viewers, Nigel Farage was more convincing than Nick Clegg, and the forces driving inequality between the West’s skilled and unskilled populations are, without intervention, only going to continue. If the 21st century left has a purpose, these interventions have to be at its core.

Launched in 2004, New Matilda is one of Australia's oldest online independent publications. It's focus is on investigative journalism and analysis, with occasional smart arsery thrown in for reasons of sanity. New Matilda is owned and edited by Walkley Award and Human Rights Award winning journalist Chris Graham.