The First Globalization Debate By Craufurd D. Goodwin, Duke University, Centre for the History of Political Economy
Most of us have read and enjoyed Daniel Defoe’s Robinson Crusoe and Jonathan Swift’s Gulliver’s Travels, two novels written in the early 18th century, as wonderful tales of adventure. But these classics can be read at many different levels and Goodwin claims that they could be interpreted as two contrasting views of globalization.
This is not the first time that Robinson Crusoe has been used by economists. He has been one of their favourite characters, the idea of an isolated individual in a deserted island intent on maximizing his utility appealing greatly to neo-classical economics.
Karl Marx saw Crusoe as the first Economic Man, Homo Economicus. Goodwin sees economics everywhere in the story. He points out that after he is shipwrecked, Crusoe removes from the ship only “those high value capital goods, like carpenter tools and critical raw materials that are likely to have the greatest use in future production; he prefers tools to gold that can have no value because there is no market”. Crusoe demonstrates what a rational, optimizing, economic man can achieve from the most unpromising circumstances.
But there are other aspects of the story that, says Goodwin, demonstrate Crusoe’s love for globalization. He makes complimentary remarks about Spanish merchants, although the Spanish were enemies of the English. This prompts Goodwin to say that trade is an effective means of “constraining the dangerous human passions”. The fact that Crusoe was shipwrecked when on a voyage in search of slaves for a “start-up” plantation of his in Brazil, Goodwin treats as a parable of globalization.
In the little-known sequel to the book, Defoe brings in settlers to the island and establishes a model society there, based on “hard work, property rights, self-interest and a well-motivated incentive system”. Goodwin sees a parallel between this and Milton Friedman’s belief that global integration and the growth of international trade and development could have salutary social and political effects, as well as economic ones.
Jonathan Swift, of course, was a well-known satirist and Gulliver’s Travels has for long been viewed as a social satire. How else could one view the two parties of the Lilliputian empire, distinguished by wearing low and high heels? Or indeed, the main dispute of whether to crack open boiled eggs by their big or small ends? Mahatma Gandhi saw the book as an ironic condemnation of modern civilization.
Unlike the rational humans in Robinson Crusoe, who could civilize even savages, the people Gulliver meets are decidedly odd, frequently ruled by their passions and irrational. Says Goodwin, “Clearly international relations in Gulliver’s world could be far more complex and problematic than in Crusoe’s. The arguments found in Gulliver’s Travels are often reminiscent of those voiced during the second half of the twentieth century by skeptics of such extensions abroad as the European Union for Britain, NAFTA for the United States…”
Goodwin also compares the absurd wars of the Lilliputians with the Iraq and Afghanistan wars. The inhabitants of Laputa were so enamoured of their intricate theories that they became paranoid about their environment. Goodwin compares them to “denizens of the area within the Washington Beltway, or the staffs of the international organizations”. And this is Gulliver’s description of foreign trade to the autarkic Houyhnhnms, “in order to feed the Luxury and Intemperance of the Males, and the Vanity of the Females, we sent away the greatest Part of our necessary Things to other Countries, from whence in return we brought the Materials of Diseases, Folly, and Vice, to spend among Ourselves”.
Whether these classics are indeed the “expressions of opposing positions on the desirability of a nation pursuing integration within a world economy” is debatable. But it is nonetheless an immensely enjoyable debate.
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