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The Origins and Progress of the Industrial Counterrevolution
- Historically Speaking
- Johns Hopkins University Press
- Volume 5, Number 3, January 2004
- pp. 17-21
- 10.1353/hsp.2004.0076
- Article
- Additional Information
January 2004 Historically Speaking1 7 Free Trade and Modern History: A Forum In bis Against the Dead Hand: The Uncertain Struggle forwhich were the two worldwars and the Great Depression. Here Global Capitalism (John Wiley & Sons, 2002) Brink LindseyLindsey presents his views in an essay drawnfrom that book, argues that much ofthe history ofthe 20th century was shapedbyAlfred Mierzejewski and Liah Greenfeld respond to his essay, negative attitudes towardfree trade, some ofthe consequences offollowedby Lindsey's concluding reply. The Origins and Progress of the Industrial Counterrevolution Brink Lindsey The buzzword is of relatively recent vintage, but the reality it describes is nothing new. Globalizationwas in full swing a century ago. Indeed, it was remarkably advanced, even by contemporary standards . It is fair to say that much ofthe growth of the international economy since World War ? has simplyrecapitulated the achievements ofthe era prior to World War I. The first world economy was made possible by the staggering technological breakthroughs ofthe Industrial Revolution, a burst of technological creativity that demolished the natural barriers to trade posed bygeography . At the same time, it created entirelynew possibilities for beneficial international exchange. In the core ofthe new global economy , the factories of the North Atlantic industrializing countries pumped out an everwidening stream of manufactured goods desired around the world. Those factories, in turn, relied on access to cheap natural resources and raw materials. And in the less advanced periphery ofAsia, Africa, and Latin America, newtechnologies allowed those natural resources and raw materials to be grown or extracted more cheaply than ever before. So arose the initial grand bargain on which the first global division of labor was based: the core specialized in manufacturing, while the periphery specialized in primary products. For Great Britain, the first industrial power, manufactured goods constituted roughly three-quarters of its exports. The sprawling United States, on the other hand, straddled both core and periphery. The urbanized East took industrialization to a new level and carried America past Great Britain in economic development. The West, meanwhile , followed the path ofother temperate "regions of European settlement" (Canada, Australia, New Zealand, and Argentina) and specialized in the production ofgrains, meats, leather, wool, and other high-value agricultural products. Finally, the South roughly followed the tropical pattern of development, focusing on such products as rubber, coffee, cotton, sugar, vegetable oil, and other lowvalue goods. While far-flung foreign trade is as old as human history, this was somediing new. No longerwas such commerce a marginal matter, limited to a few high-value luxuries. Now, for the first time, specialization ofproduction on a worldwide scale was a central element ofeconomiclife in allthe countries thatparticipated. But it was not to last. The global economic order that arose and flourished in the waning years ofthe 19di century was swept away by the great catastrophes ofthe 20th: world wars, the Great Depression, and totalitarian dictatorships. Onlyin the past couple ofdecades has a trulyglobal division oflabor been able to reemerge. What happened? Why did the first episode ofglobalization end so badly? These questions are more than mere historical curiosities. They have a vital bearing on the controversies that swirl around globalization today. According to contemporary critics of global trade, the sad fate ofthat earlier epoch reveals the inherent dangers ofunregulated markets. Then as now, they argue, economic forces had slipped all proper constraints; then as now, the ideology of laissez-faire ran roughshod over social needs. The consequences in the past were tragic: the excesses of unchecked markets, with their brutality and volatility, ultimatelytriggered the catastrophes of totalitarianism, depression, and war. Today, the resurgence ofUtopian faidi in markets threatens a new cycle ofdisasters. William Greider adopts this line in his book One World, Ready orNot (1997). In particular , Greider cites the historical analysis of Karl Polanyi, author of The Great Transformation (1944). Polanyi argued that the catastrophes ofhis time couldultimatelybe traced back to the evils oihissez-faire: "The origins ofthe cataclysm lay in the Utopian endeavor ofeconomic liberalism to set up a self-regulatingmarketsystem ." Greider contends that we are once again on the road to ruin: "Today, there is the same widespread conviction that the marketplace can sort out large public problems forus far better than anymere morchie essay is...