Too much protectionism will kill the world
Some key words have defined the eras of humanity. These discourses, of course, change from country to country or across different ideologies. At the end of the day, humans succeed in agreeing on few. To describe today’s world, let me note “the rise of protectionism,” whose generous dashing of populism have left a bad taste in the mouth. Some trends bring things for the better, some others for the worse. The rise of protectionism certainly seems to fall into the second category.
With inspiration from Queen’s great song “Too Much Love Will Kill You,” allow me to further explain why.
Since Donald Trump took office in the United States, protectionism has become, more or less, a buzzword. If the U.S. implements this, it is a big problem. If the world altogether tries to apply this, this will be a really big problem.
I believe that one of the largest moves on the road to fostering protectionism is the latest move against some key air hubs and airlines from the Middle East and Turkey. On March 21, the U.S. banned larger electronic devices from the passenger cabins on flights from some airports in Turkey, the Middle East and North Africa, citing unspecified threats. The new rules affect 10 airports across the region, many of which serve as busy gateways for global business and tourism traffic, including Istanbul Atatürk Airport.
Britain followed this move as well. More will follow.
If there is serious “intelligence about a potential terror attack” behind this move, these reasons should be elaborated further. A key question must be asked here: Are U.S.-based or European airlines subject to these restrictions if they are to fly to the mentioned airports?
The addressed airports will likely lose ground especially in business tourism. According to the Washington-based Global Business Travel Association, around 49 percent of business travelers prefer to stay connected and get work done while flying. Many companies recommend staff travelling on business to keep their devices close because they may contain sensitive information, according to the same report.
It will be difficult for such travelers to choose the affected airlines, for sure.
It’s not just about this move. Such protectionist suits have become dangerously popular, by the U.S. against China, by the U.S. against Mexico, by even Turkey against Russia or vice versa.
Any country can take such measures in a bid to “give a lesson to another,” or “foster its own domestic economy,” or just out of populist concerns.
As can be seen, these are all vague terms or reasons. Unfortunately, the vagueness is not altering general trend.
But crazy trends generally follow crazier ones. Therefore, countries should think twice when taking some steps that may result in global income inequality becoming worse or even further strengthening radical movements.
We have recently seen many warnings regarding this trend. For instance, protectionist trade policies may increase, rather than reduce, a country’s trade deficit, the European Central Bank said in a study on March 22, just days after finance chiefs of the world’s top 20 economies dropped their pledge for open trade.
The World Bank’s newly appointed chief executive gave a spirited defense of globalization during her first official visit to China, saying it had helped richer and poorer countries, and economic integration made it hard for any nation to walk away.
Such reports or announcements will be seen a lot. The point is to see solid policies applied. Otherwise, we will likely see radical economic moves following social and political ones.
It may be a harsh concluding comment, but let me note how economist John Maynard Keynes reacted to the peace treaties at the end of World War I. Germany signed the Treaty of Versailles with the Allies, officially ending the war. Keynes, who had attended the peace conference but then left in protest at the treaty, was one of the most outspoken critics of the punitive agreement. Keynes predicted that the stiff war reparations and other harsh economic terms imposed on Germany would lead to the financial collapse of the country, which in turn would have serious economic and political repercussions on Europe and the world.
We all know what happened next. The more global income is shared more or less equally, the more the world will enjoy the peace dividend. At the same time, some countries can and will be “great again.” Yet, it is quite obvious that too much protectionism will likely cause great damage – especially to things that humanity has created “for the better.”