Globalisation refers to a variety of events that are rapidly changing the world. The machine that powers globalisation, however, is the global economy. At the heart of the global economy are the twin policies of privatisation and deregulation, which national governments have adopted worldwide since the 1980’s. Terms like free market economy, level playing field, monetarism, market economy, and neo-liberalism embrace processes such as privatisation and deregulation.
Privatisation is about putting governments out of business. The economic theory behind privatisation is that, Business knows best. In this age of globalisation, our governments cheerfully tell us that they are too incompetent to manage our economy, so as a service to the public they will instead let the free market run it. Then our governments sell off publicly owned businesses and assets, which usually end up controlled by multinationals and financed by public shareholders. Competition within the marketplace rather than government management, we are told, will allegedly produce lower prices and better services for consumers. This is called a better standard of living, which implies that the public are better off for having a privatised economy so they should be happy about it.
The strange part is that governments streamline their businesses, making them efficient and profitable, before they offer them for sale. If governments can do that before they privatise, why were they not doing it all along? Also, if governments are competentto get their businesses profitable and efficient, why not keep running them that way in the future rather than sell them? If governments genuinely are that incompetent, how can the public trust their competence to manage anything?
Why also do governments sell businesses that were always running profitably and were never losing money? All these actions contradict the stated reason why privatisation is allegedly necessary. They also imply a lazy, if not negligent attitude from government towards citizens, whose assets they are selling off, often at undervalued prices.
Deregulation takes several forms. Within a country, the lifting of trade restrictions and easing of government regulation in business is meant to allow business to run more efficiently. The best businesses will survive the competition to give consumers a better standard of living, that is, more material goods for lower prices.
Deregulation also applies to national currencies. Currency is no longer pegged at a certain value by government decree or gold reserves, but its value is floatedin the global market place, where it will find its own natural level in the ocean of other global currencies.
Deregulation does not just apply within a country though. Deregulation also involves opening a country up to foreign competition. Foreign businesses can operate in our country, on the basis that our country’s businesses can trade in other foreign countries.
What is the benefit from all this? A better standard of living through a wider range of cheap goods is what globalisation is all about. This is what the media, politicglobalians and multinationals keep telling the public.