Coping with Downsides
It is not sufficient that, by and large, globalization advances both economic and social agendas. Everything does not necessarily improve every time! There are occasional downsides. And we must be prepared to cope with them with appropriate policy responses. If the policy maker retreats behind the unpersuasive claim that—more or less, and over time—the difficulties will always be surmounted and the globalization tide will surely lift all boats, she is on treacherous ground.
Creating Institutions to Address It If and When It Occurs
After half a century of experimentation with planning, some in the form of detailed Kafkaesque restrictions and commands on the basis of inherently fragile forecasts and plans, as happened disastrously in the case of the Soviet Union and in developing countries such as India and Egypt, we have learned that, generally speaking, the way to address potential downsides is not to act on the pretense that we can forecast their occurrence with certainty. Rather, the smart way to cope with downsides is to devise institutions and policy responses that kick in if and when the potential downside occurs.
In the city of Ahmedabad in the state of Gujarat in India, where my forefathers came from and where Mahatma Gandhi had his famous ashram, one sees today a monumental victim of the thinking, common to many in civil society today, that downsides must be eliminated fully at their source. Indian planners began a series of five-year plans in 1951. They were worried that the expansion of the large-scale cotton mills in