The great divide Part I

THE SIGNS ARE CLEAR THE FUTURE IS INEQUALITY

by Ian Angel

As Markets become global and the traditional workplace gives way to cyberspace, only the élite will have anything to offer to the world's economies. Ian Angell predicts mass unemployment for the unskilled, and a slow death for the nation state.

'Many too many are born. The state was devised for the superfluous ones'. With these pitiless words from another century, Friedrich Nietzsche heralds the demise of the nation state as we enter the next. The industrial Age and its need for an over-supply of humanity spawned the nation state. But what is to be done with the glut as we enter the Information Age?

There will be no nice, tidy transition, rather a severe and total distortion with the past. One thing is certain: the masses will not win in the natural selection for dominance of an increasingly élitist and cosmopolitan world. Because of new technology the costs of production have dropped to a point where a billion new workers have entered the job-market. Companies are globalising and mobilising, chasing "spot markets" in cyberspace. The costs of overcoming time and space no longer buffer the impact of cheap labour. The state has to be part of the global economy, so it is incapable of fending off foreign incursions. Mass unemployment is a cancer infecting every nation state, sending shock waves through their workforces.



The electronic transfer of money offshore has made tax avoidance a bigger business than narcotics.
The next stop is off-planet banking. Unhindered by national barriers, corporations will be truly global. They can communicate globally, and their shareholders, executives and employees are spread out across the globe. They will relocate, physically, fiscally and electronically, to where the profit is greatest and the regulation least. Their profits are declared in low-tax countries, while they continue to operate in high-tax ones. The global company no longer supports the aspirations of the country of its birth. Companies large and small move. When a British plastics company switched its polythene bag factory from Telford to China, 150 British jobs were lost, but its payroll bill was cut by 90 per cent. Despite all the patriotic bleating, companies know that to remain competitive they can no longer afford to carry a large and overpriced inventory of a national "people product" of varying value and quality.

It is no accident that most companies are presently downsizing, delayering and outsourcing. Routine production jobs can be performed by robots or exported anywhere on the globe, so wages will converge world-wide to Third World levels.

"Social Dumping" is also dragging down wages for service work, a sector which is itself being increasingly automated. In 1994 the International Labour Organisation claimed that there were 800 million sub-employed people in the world; the West must now suffer its fair share. Job losses are not the result of some temporary downturn in the economic cycle, but are the result of structural changes. It is no good waiting for the upturn.