For the 25 years of my life, Ireland has been a major benefactor of globalisation. The Irish have been such embracers of a globalised world that it is hard to contend with the idea of an insular and inward looking Ireland that existed in the early protectionist years of our independent nation. Opening our economy to trade and foreign investment has transformed Ireland and her identity. We are consistently looking outward to new and wider frontiers. Our people travel and are spread all over the world.
Globalisation has brought large amounts of foreign business to Irish shores, primarily from the United States. The low corporation tax and favourable business environment has helped to fuel an incredible period of economic growth and development in Ireland. Globalisation and free open markets saw an influx of foreign capital into Ireland which massively raised living standards for our citizens transforming us from a relatively poor European nation to one of its wealthiest. Ireland has carved a great position for ourselves to the envy of many other small countries and other larger European nations. As a political position, even the most left-wing politicians in Ireland are opposed to raising the country's corporation tax given the impact it has on Ireland's economy.
However, recent political events suggest that this world order may not last forever. Political shocks such as Brexit, the election of Donald Trump and the rise of right-wing populism suggests that the political downsides of globalisation have begun to outweigh the economic advantages for many nations. Nationalism and economic populism are on the rise in the political conversations of some of our biggest trading partners such as the UK and America. Within the U.S, Trump supports an America-First policy, shifting the country towards a more inward focus and prioritising new policy goals such as curbing immigration into America, reshoring American business back to the US and pursuing a much less interventionalist foreign policy than his predecessors. In the UK, similar patterns are playing out. Britain are preparing to rip up an enormously successful trade agreement which allowed seamless trade with the rest of the European Union in an effort to look inward and take back control from bigger global forces.
The recent global forces of immigration and global competition have greatly impacted these larger economies in recent decades and are today seen the root cause of some of modern society's problems. These political shocks suggest that globalisation is losing its political favourability despite the economic advantages it has brought to the developed and developing world, especially countries such as Ireland.
We are currently watching the political effects of the Brexit and Trump elections playing out. These results are important in predicting what way the future is steered. While there is a massive level of unpredictability to what the future holds in the short-term, I would be confident in predicting that the idea of globalisation (and most certainly the term) will be one of the biggest losers of the recent elections. The 2008 financial crash may well have been the peak of our globalised world with so much capital passing seamlessly between borders. The shock elections of 2016 felt like a massive rebuke of this globalisation ideology. Even if power changes hands in America and a Democratic administration takes control, political dialogue has massively shifted to an America-First agenda that seeks to look out for the disenfranchised working-class and pessimistic middle-class voters. An American politician campaigning for globalisation in 2020 would be incredibly alienating and off-the-mark from the most pertinent issues in America today.
Likewise in European countries such as Britain, France and Germany, whatever the outcome of the next elections, it is highly unlikely that any politician will campaign for a return to the status quo of "pre-2016". In prior years, there was probably too much of a dogma surrounding globalisation. Politicians and economists were massive advocates of this phenomenon as it delivered fabulous wealth to bigger economies and helped lift millions of people out of poverty in the developing world. However, it was rare to hear the idea of globalisation challenged and there was a dismissmal of some of the obvious flaws such as immigration pressures and jobs lost to more competitive low-wage countries. While pre-2016, it was rare for leaders to challenge some of these flaws, there is a wider conversation occurring now. Hopefully this more open dialogue will give us a greater understanding of people's concerns of unlimited globalisation which is having negative short-term economic impact on people's lives. Then we can work on real multilateral solutions to these cross-border problems.
By not discussing these real and pressing issues, we got awful and broken solutions from the only people who did challenge the status quo. Far-right populism succeeded in bringing these issues to the centre of the table, but they brought no tangible solutions to help the disenfranchised whose votes they sought. Brexit will not increase living standards for Britain's working class. Trumpism will not restore the American middle-class. Yet these campaigns and ideas connected with people by having a conversation with voters that other people and parties were not prepared to have. The positive effect is that these elections appear to have awoken a lot of people to the reality that globalisation has some negative side effects and that perhaps we need to identify ways to protect people and mitigate the damages. Without doubt, that's a really challenging proposition. It is hard to predict what our next generation of leaders will do, but based on current evidence, globalisation as an economic ideology has lost a lot of its popularity and been kicked off its pedestal.
A question that really interests me is what this means for Ireland? A small island nation that is pushing pro-globalisation in a world where the idea is losing it's flavour? Our government should be making contingencies for that outcome. Right now, our economy is incredibly leveraged towards Foreign Direct Investment (FDI) and the presence of multi-nationals providing thousands of jobs to our economy. This is a dangerous position to place ourselves in. Our economy is so frightening directly linked to so many factors outside of our control. The 2008 financial crisis was a clear example of that. Events in America lit a fuse that blew up the Irish economy. In more recent times, Brexit has shown how inextricably linked we are to the British economy. While the Northern Ireland issue is a geographical and political one, our economy is disproportionately affected by a British exit from the EU compared with most other EU countries.
It is time for Ireland to diversify our economy to prevent overreliance on these multinationals and potential external risk. Ireland should be doing more to support innovation and entrepreneurship and creating an environment where people can set up companies and access the US and European market. We need our own big employers and companies that will domicile in Ireland. Watching the Web Summit depart Dublin, and many leading Irish entrepreneurs complaining that this is not a good environment to build and keep companies is poor form and we should do more to change it. Dublin needs to put itself on the map as a dynamic city capable of hosting the biggest events. If globalisation does diminish in importance, we're going to need a Plan B. Let's get started on this now. What have we got to lose?