Hamburg News: Trade and Finance. High-class shopping area in the city centre shown.
© Prof. Dr. Henning Vöpel HWWI

New responses needed to globalisation after U.S. election

Prof. Dr. Hennig Vöpel, head of HWWI, mulls repercussions of Trump's election on global issues and for Hamburg in a guest contribution

Surging right wing populism has now gained the greatest possible political power with Donald Trump’s election to the office of the President of the United States of America – the biggest economy, the strongest military power and the most important democracy. Coupled with Brexit, which also hit the world with equal force and surprise, you can say – whether you wish to or not – that the globalisation of old, which reached a turning point with the financial crisis, has been voted out democratically in 2016. We must reach a deeper understanding of occurrences in many societies to find a better answer than the one promised by these populists. Whether it’s Boris Johnson or Donald Trump – their crude recipes and promises are as false as they are dangerous.

Possible repercussions for Hamburg

Trump’s course remains unclear. If he lives up to his election announcements and pursues protectionist economic policies, international trade would be dampened in the medium term. Hamburg, as Germany’s most important trade hub, could suffer the repercussions. The U.S. is Hamburg’s fifth most important economic partner worldwide and handling in the Port of Hamburg would be dealt a blow. New protectionism and increasing isolationism could turn back globalisation. Trump’s foreign and security policy may lead the world into an era of instability and weaken the global economy. First Brexit and now Trump’s win – 2016 has shown clearly that globalisation is at a political crossroads.

Trust must be regained

Globalisation has left a fragmented and partially frustrated society in its wake. Democracy’s promise and that of the market economy to generate equitable prosperity have not been kept and especially not in the country of social advancement, of the American dream and liberal capitalism. The middle-class, so crucial to the stability of society, has not had a sufficient share in the benefits of globalisation. Trust in politics, institutions and the elite has been badly damaged as a result. The Brexit decision and Trump’s election amount to a win by the old over the young, the province over the city, emotions over rationality, and offer an explanation but not an answer.

The crisis of globalisation is essentially one of legitimacy. Acceptance can only be regained with a new globalisation model. Europe can play an important role therein and gain a new kind of unity instead of being divided by populism. Voting out globalisation of old should under no circumstances mean relapsing into the nationalism and protectionism of hundred years ago.
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By Prof. Dr. Hennig Vöpel, Head of HWWI

Sources and further information:
www.hwwi.org

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