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What I would point out to people who take the view that globalization has gone too far is that you'll miss it when it's gone.

We can't roll up those supply chains and cut ourselves off from other countries about dramatically changing the way we live.

I'm Stephanie Flanders, head of Government and Economics at Bloomberg and This is Trump Pnomics, the podcast that looks at the economic world of Donald Trump, how he's already shaped the global economy.

What on earth is going to happen next this week?

Why you'd miss globalization if it went Probably a lot more than you think.

There's been a lot of books written in the last few years about globalization, deglobalization and the populist threats to integration.

But one that's a bit different is Ben Choose Exile Economics.

What happens if globalization fails.

Ben is the policy and analyst correspondent at BBC Verify and was previously economics editor of BBC Newsnight, a job I used to have million years ago.

What's distinctive in Ben's approach is he's taking the arguments against integration.

You might say both seriously and literally he's asking not just whether it's desirable for nations to shun globalization to be self sufficient, whether it's even possible.

I sat down with him in late June at an event organized by The Conduit in London to discuss his reporting, his style of storytelling, and how his own family history played a part in the development of the book.

I thought it was worth sharing with you an edited version of that conversation.

I started by asking Ben why he decided to write the book.

On that question, I feel incredibly honored to have had a sort of front row seat to see the impact of globalization firsthand.

And of course what does that mean.

We've all seen globalization in our lives.

But because my family came from China, my father's family came from China in the in nineteen sixty he came over to the UK.

I was born here, but he's still got family back in China, and I first visited.

I write about this in the book, but I first visited China in nineteen eighty five.

When I went there, I was a quite young child, and I still remember it incredibly vividly, the lives they were living those forty odd years ago, and it was incredibly uh frugal.

Really, you know, in family of six lived in about three rooms.

They would pull out mattresses from under the beds and all sleep on the floor, just simply because that's the only way they could live.

They didn't have things like washing machines, microwaves.

We were living in Hong Kong at the time, so they asked us to sort of go to this special friendship store, which is the only place where you could get western white goods, and you had to be a foreigner to buy them, might from not from China.

And then we bought it and then get gifted it to them.

And it's crazy now because you think, how out have you ever been to ch I'm sure a lot of you being just like how CONSUMERISTI all is.

You can get anything there that you can get here, iPhone's laptops, certainly washing machines.

So to see first hand how their lives have changed in my lifetime, and I think it is very largely due to globalization.

So I suppose the question is why did I want to write this book?

Because I think that I could bring something a sort of bit of personal experience, if you like, to seeing how the good that globalization has done to my own family, and to see it very vividly in a personal way really brings it home.

And when we hear people like Robert Leitheiser, who is Donald Trump's first trade advisor in his first term, he wrote this book that says it with the title No Trade is Free, and he very explicitly states that it was a mistake to trade with China or allow China specifically into the World Trade Organization in two thousand and one.

It was a mistake.

And I just kind of like incredibly jarring, because what comes into my mind when I hear that is my own family backing Gangdhou in southern China.

Well, really wasn't a mistake for them.

And now we can talk about the ways which China does create very serious problems for the world trading system in many many ways.

But I think on a very personal and human level, I think I really wanted to tell that the other side of the story actually and bring that personal experience to bear.

I think, and of course I find that criticism about the Entry's wto jarring for a whole other reason because when I was at the US Treasury, we were just negotiating the China entry to the WTO, and since then almost everyone thinks that that was a mistake, including many of the people who were involved in negotiating it, because various assumptions were made about what was going to happen to China after that, that they would basically become more like us and sort of market driven, that being part of the global economy would push them on this same path that we've all been on, and that clearly has not happened, And you engage very directly with that in the book.

We should part that briefly, but I guess we should also slightly lay out your stall in terms of, you know, what's the architecture of the book?

How did you decide that there are real things that people are responding to when they're nervous of globalization?

Yeah?

Absolutely so.

The gestination of this book was really in the pandemic, when the question that was arising in lots of people's minds was, hang on, has globalization gone a bit too far?

Are we a bit too interconnected?

Has it made us vulnerable where we thought it was making us more prosperous.

We all remember in the pandemic the shortages of things like masks, medicines, and hard on the heels of that, of course, we had Russia's invasion of Ukraine in twenty twenty two, where there was a big shock to global oil prices and food prices, and there was a real sense that we were a bit too exposed and maybe we should start to do produce more at home, that those supply chains shouldn't be as extensive as they are, and that maybe, as I said, globalization had gone a bit too far.

I really started the idea of writing this and it came out of it.

Actually a BBC radio series I did called The New Age of Autarchy with a question actually rather than an answer, and that question was is it possible to actually do those things to be more self sufficient in terms of things like food and energy and medicine, you name it.

It was a good faith exploration of whether it was possible or not.

And as I started to write it, explore these supply chains in more detail and go into some of the complexities of the way the global value and supply chains have constructed, it became more and more clear to me that actually the answer probably is no.

At least we can't roll up those supplies chain and cut ourselves off from other countries about dramatically changing the way we live.

And I think on some level we all know that, don't we, Because you know globalization if you think, well, just look around you.

We wake up in the morning and you brush your teeth and toothpastes from Poland, and you go and have your breakfast and the grapes from Egypt, and then you put on your clothes and it was perhaps it sticks together in Bangladesh, and then you drive your German made car to the office.

That's the typical way someone describes how globalization shapes our lives, and it's all true.

But what I discovered in this researching this book and lots of other people that made this point as well, And it's not just about those consumer goods which are the fruits of globalization.

It's the components which make those consumer goods which are unfathomably globalized as well.

Just talking about semiconductors, you know, we hear about those and we took Trump and others and Biden all wanted to make them in America rather than import them.

But if you look at the supply for something like semiconductors, they're so unfathomably complex, coming from hundreds of different countries, these raw materials and the machines that make them that it really is impossible to see any single country having a fully nationalized supply chain in something like semiconductors, computer chips, and it goes for many other things as well, and I talk about lots of examples of these in the book.

So Yes.

I started out I guess with a question, and I came increasingly to an answer, which is that, you know, don't take globalization for granted, or don't assume that it's going to be simple or easy, which is obviously what a lot of the exile economic exponents populist politicians say it's going to be quite easy to do these things.

It really won't be.

It'd be very expensive.

And you know, I'm a BBC journalist.

It's not my job to say what people should want or what politicians should do.

What I'm trying to do in this book is say, be aware of the costs, be aware of the implication it's impossible.

Well, you know, if people genuinely think that it's worth it, then that's fine, but I would like them to do it with the full facts.

In mine.

You mentioned semi conductors.

I think with electronics generally people will sort of understand that it's a pretty complicated supply chain, and in fact, that is what we're discovering.

You know, with the tariffs.

Donald Trump sort of outraged the thought that even with various high tariff rates, Apple's still not going to want to make iPhones in the US and to your point, cannot make iPhones in the US because there's so many things coming from different parts of the world.

But food, how hard could it be to be self sufficient in food?

Well, that was one of the most fascinating journeys I've been on actually in the book, because that was the one where I started out was I think, I'm sure many of you will will will have this sense that do we really need to import so much food from abroad?

You know, the UK provides about or supplies about sixty percent of the food that we consume in so, you know, pretty reliant on the rest of the world for food.

And why not, as the farmers say, you know, produce more at home, consume more at home.

It'd be good for good for farmers, good for the economy, and good for food security.

And I think that is quite an intuitive argument.

It's a very common argument that you hear.

What I've discovered in the book is that it's really for a large part of the world, it's just not feasible to rely only on the food that can be grown in that individual country.

So there's a striking cistic from a study done in twenty twenty which I imagine, if everyone on the planet had a one hundred kilometer circle drawn around them, what proportion of the world's population could feed themselves from staple foods grown within that one hundred kilometer radius.

And the answer is it's only twenty five percent, So only a quarter of the global population could feed themselves within that area.

So how big would that circle need to be around every single person on the planet so that they could feed themselves on staple foods like wheat and corn and potatoes and what have you.

It would have to be two thousand kilometers.

And what that tells you is, given the size of countries, given the size of the planet, is that if we're going to feed ourselves as a world, as a planet, we're going to be incredibly reliant on trade in food.

This idea and food self sufficiency is a non starter for probably most people on the planet.

And that's really sobering thought, isn't it, Because we often hear this line, as I said, we just do it at home.

Just do it at home.

Well, it's not going to happen.

At least we're not going to have the kind of diets that we used to, increasing reliance on meat in large parts of the world, the variety of food.

But simply we can't feed ourselves as a planet with just national production.

Although that fact does cast some light on why Donald Trump w with want Canada, because I think the Americans will probably do quite well if they could just take all of the Canadian planes.

Well, that was another interesting thing about it, because America, on the face of it, is very abundant in food.

It produces more than it consumes.

It's a big agricultural exporter to the rest of the world in net terms.

But even America relies on fertilizer imports quite a lot of them from Canada.

So even if you say America doesn't need the rest of the world when it comes to food, well, it actually needs chemicals from the rest of the world to make its agriculture so productive.

In your chapter about food, you also you have a distinction which I think is used for in another areas as well, because you think of self sufficiency, as we often painted politically, as being the same as security.

If you're making it your own, then you're not at the behest of foreign powers and dictators.

But you make the point, especially with food, that food security is very different from that and is often just related to poverty.

Yeah.

I had a look at countries ranked by by food self sufficiency, so how much of their own consumption they're producing at home, and also about their levels of food security.

Is the proportion of the populations who are struggling to feed themselves.

So just to take two examples which I've plucked out in the book, which I think are really illustrative, So the Zambia in Africa, which is only seven percent reliant on imports according to the measures of the which I was looking at, so it basically produces more or less all that it consumes when it comes to agriculture, but it has food insecurity levels which are extremely high, so more than fifty percent.

And if you look at a country like Mauritius in the Indian Ocean, which has a food self sufficiency ratio which is incredibly low, so almost the inverse of Zambia, but its food security was incredibly high.

And what's the difference between those two countries.

Mauritius is a much richer country than Zambia is.

So precisely as you said, I think the lesson is what leads to food insecurity is not reliance on imports.

It's poverty and you need to solve that if you want people to be well fed, rather than obsessing about local production.

And actually, and you made the very obvious point which I hadn't thought about, that you could be completely self sufficient, but if you have a crop failure, if you've also closed yourself off from the world, then you are instantly less secure just through that factor.

Lae.

Yeah, I mean we all know this in a way because we all saw the example of Ukraine.

Ukraine it has this reputation of the bread basket of Europe going back for decades, and it is it is.

On paper, it's incredibly food secure, it produces more than it consumes.

It's a big exporter to the rest of the world.

But when it got invaded by Russia in twenty twenty two, it had to rely on the World Food Program to feed three million of its population.

That just shows you how just have a large amount of agricultural production doesn't necessarily make you secure.

So it's fair to say we've not overplanned this conversation.

But you have taken me perfectly to the subject of Ukraine and Russia.

Because energy is the other example where I think it's the most intuitive to people that we just can't depend on other nations for our energy, or at least it would be much better if we weren't.

And the celebrated example which you go through, but I think a lot of people were have in their heads is you know, the way Europe, especially Germany.

But Europe allowed itself to become very dependent on Russian gas, despite that the risk of overreliance on Russia being identified by Americans and the American intelligence community and others.

So what about energy.

Surely it is better for us to be independent in our energy supply, especially now we can get all of this nice you know wind.

And so yeah, yeah, well, I mean it takes me back again to twenty twenty two when this was what the politicians were saying.

This, as you said, Stefinitie, it shows the folly of relying on energy imports.

A country like Russia can hold you hostage and cut off the supply and then you having to have power cuts or rationing.

I found it very compelling that argument in twenty twenty two.

But when you start as you were paying your gas.

Bill, yeah, absolutely, I'm sure we all felt this, didn't we And it does tell so perfectly, doesn't it with the argument that we should decarbonize and rely on renewables.

And it's all true to some extent.

But if you again, if you go into the weeds, go into the supply chains of all these renewable technologies, you just see how distributed they are right around the world.

Just for example, the battery that goes into an electric vehicle, the amount of critical minerals that it relies on is vastly greater than a petrol car.

And those critical minerals are spread right across many, many different countries.

There's no single country can realistically source all those critical minerals at home and have a national supply chain.

Goes for China, goes to America, certainly goes for the UK.

And so you just go through all these renewable technologies and you realize that actually we are going to be reliant on imports if we're going to have a renewable energy generating sector.

So that's not to say that it shouldn't be done.

It's to say that, actually, be wary of the rhetoric of self sufficiency or tarchy when it comes to energy, just as you should be wary of it when it comes to food, or semiconductors or medicines.

If you read the book, we can sort of take it as read that he goes through quite a few things, medicine, steel, semiconductors.

It's really hard, all of them to be self sufficient.

If Donald Trump was sitting here, he would say, yeah, to right, it's really hard because we've had thirty years on the wrong path.

You know, we took the cheaper option, the easier option.

We took advantage of like falling to transportation costs, companies becoming more global, the fact there was a sort of broadly peaceful global environment.

Countries are all seemed to be moving in the right direction.

So businesses created these enormously complicated supply chains that they never should have done.

And yes, it's going to be really painful to aren't pick it all.

But if we don't, we're going to wake up tomorrow and everything we want is you know, being made by China.

Yeah, well, Donald Trump has changed his tune on this, hasn't he, Because I'm sure you remember definitely in the campaign trail he wasn't talking about the long, difficult journey to a more resilient American economy.

Now you're right, he has started to talk about how this will be hard and there are other you know, there will be sacrifices a long way.

But I think how would I try and persuade Donald Trump?

Just tim right?

The Biden administration in some ways institutionalized his kind of gut instinct slash tweets, and he did.

They did sort of focus more on resilient, focus more on industrial bis.

But it was based on that same negation of the original idea of global or what a driven the previous version of globalization, which is we have to think about the long term costs our strategic position with regard, particularly with regard to China, not just the short term cost benefits.

Yeah.

I think Richard Baldwin, I think you've interviewed recently, had a great phrase that Trump was not how did he put it, He said he wasn't a new turn.

He was a culmination of something that had been going on for a very long time in politics, this gradual sense of, you know, globalization is not working the way we thought it, we hoped it would, and we need to think more about pulling inwards and turning inwards and doing things differently.

Because you're absolutely right, Joe Biden had a lot of those same instincts as well.

His administration had a lot of the same instincts, and they were quite protectionists when it comes to things like Chinese electric vehicles, Chinese batteries, and you know, really took on what Trump had done in his first term and took it to a whole new level.

And when it comes to when it came to making it harder for China to source the most advanced microchips, they were much more proactive than the Donald Trump had been.

So I think that's really important to recognize that this isn't something that just don't just started when Trump came to the White House.

What I would point out to people who were not Trumpian but sort of take the view that globalization has gone too far is that you'll miss it when it's gone.

I think it's probably the right way to frame it because we have taken it for granted that some of the huge benefits, not just in terms of like my family in China, but all our lives have been enhanced and we've been made much more productive and wealthier as a result of globalization over these past fifty years.

In a sense, trade is being used as a scapegoat for the failures of domestic politics to redistribute those gains and to compensate the low from it.

So I would say, I suppose if Trump was here saying, you know, there are undoubtedly problems in America, economic problems, communities which are suffering, but don't make the story all about trade.

Make it about how you can use the immense resources of America to improve their lives.

It's quite interesting.

I was listening to JD.

Vans, who's slightly more sophisticated figger than Trump when it comes to making these arguments.

And he gave a speech in March to the American Dynamism Conference, and he said the problem of the American and global economies that has been too addicted to cheap labor, both at home and talking about immigration and abroad, meaning outsourcing American multinationals sending their supply chain to broad cheap labor.

And he said that as undermined American innovation, which is pretty crazy because America is the most innovative and dynamic economy by far in the world.

If it's had a net negative impact on American innovation, it's pretty hard to see it in the statistics.

But well, you mentioned Jadevance.

I mean, I think it's interesting because it comes through more strongly in what he says and that speech.

Part of the kind of rebellion against globalization that jade Vance represents is kind of rebellion against modernity, against the modern global economy and what's happened to communities and day to day life from only get going for the most productive, the cheapest way of making things.

You know, America's moved to a massively service based economy.

And I think his argument would be, and lots of people say this that those service sector jobs, even if you can afford to buy lots of stuff with them, because you've got all these cheap things that were being made in China, we quote un quotes were happier when we were making that stuff ourselves.

And maybe we had a bit less, but we had community and we didn't have you know, endless insecure jobs and other things So how is it if you're a politician, how do you tease out that argument against trade from the sort of broader sense that we've sort of culturally gone the wrong direction because of this advanced industrialization.

Well, it's incredibly difficult.

I mean, Dave the Evans, You're right, he does talk in that sort of nostalgia we must bring back manufacturing, and others in the administration in America talk about Americans screwing the little screws into iPhones and returning to a manufacturing economy.

At other times he's more with the tech bros.

In fact, he was in this conference he was talking about innovation.

But I think it comes down to a fundamental problem with the argument that you reindustrialize America through tariffs and reindustrialize it full stop to create great jobs.

Is that as many people have pointed out, But it's absolutely true.

What you're going to get if you bring American if you bring more manufacturing back to America, is not a huge amount of really high paying jobs.

And the turning back of the clock to the nineteen fifties where everyone took their lunch pale to the factory.

You're going to have robots now that will create higher incomes for some people, but it's not going to fundamentally shift the structure of the American economy the labor force back to the way it was all those decades ago.

So I think I think the honest answer is that, yes, there's a big seam of nostalgia that people like Jdvans and many others in America are mining, but it's not one that is going to be actually deliverable.

I guess one other sort of obvious response to some of what you've said is if it's also inevitable, if there are all these forces technology and other things that are putting on us a path to integration and making it extremely hard to unpick these supply chains, then maybe we don't have to worry about protectionism after all.

Maybe you know, if it's going to all prove in a few years time, if it's going to prove to be completely counterproductive and or prohibitively costly, shouldn't we just like sit back and wait for it all to play.

Wait, wait for it, yeah, wait for people to come to their senses.

I think that is compelling in some ways, and I think there's a bit of a debate actually when you look at analysts because some say, look what deglobalization.

You know, in some measures in terms of data flows across borders.

If you look at the actual complexity of supply chains, we have never been more more globalized than we are today.

Notwithstanding these these many years of politicians making these policies to withdraw us inwards and attempt to resure and friendshure, et cetera.

If that's the result, then you know, why why are we even talking about this term deglobalization.

I think my answer would be, on the one hand, that's true, but if you look at the number of actual acts that politicians have taken to put barriers up, it is definitely glowing going up.

You are seeing a trend of politicians to fight against this global integration.

And my answer would be that you're effectively It may continue, the wheels may keep turning, but you're throwing sand in the gears of it.

This is one of the greatest engines of prosperity that we've seen ever, is globalization.

And if you make it harder, then your living standards will not rise as rapidly as they otherwise would have countries, and that's in developing, that's in rich countries and developing countries are going to find it harder to get onto that economic ladder of having better lives and integrating into it into global supply chains in the way that China did in the past, in a way that countries in Africa are trying to now so effectively pulling up the ladder.

So I think, yes, I think there is a strong case for saying that we are not going to deglobalize.

It will just be too hard.

But I think we can still make life very difficult for ourselves and much more difficult than it needs to be.

And the response to the strategic worry that we will wake up in twenty years time and find that a very different government, very strong government, with very different value system certainly doesn't believe in journalists of Newsnight has control over key parts of our economy because we've decided to buy all our solar panels from them, and all of our electric batteries and all our electric cars.

How do we get around that?

Well, that is that is an extremely tough one.

China.

I mean, I've talked, I started talking about how the miracle of globalization in China.

I've seen the benefits of it, but I've also seen the downsides.

I've seen the dark side of what the new China, what the Chinese regime is in terms of the crushing of personal freedoms of people in China, in terms of its economic mismanagement.

I mean, everyone's talks about China as this great economic success, and in many dimensions it is, but it's also really messed up the property market.

It's it's got deep set economic problems as well, and I've seen that in the same way I've seen the benefits.

I've seen that up close in terms of my own family in China, and it's a very I can understand why Western politicians say we should be pus much distance between ourselves and this regime as possible.

I completely understand that.

At the same time, we take an issue like decarbonization, China has such a head start when it comes to the technology of solar panels and electric batteries and also wind turbines that it's simply not feasible for the world to decarbonize by twenty fifty, as nations have signed up to do without relying very, very heavily on Chinese renewable energy.

Kit that's just the reality, and governments are going to have to choose there.

And also I think that China is so integrated into global supply chains that this fantasy, you know, I think it is a fantasy saying that it's simply a case of you just turn the switch and it's and it's removed.

And I think Donald Trump has actually found this out since Liberation Day.

He started out very bullishly about the ability of him, you know, decoupling from China, as he put it, and within a couple of months they're making the deal.

And I think a lot of American retailers went to see him, called him and said, the reality is, if you don't change course on this, you're going to have empty shelves, You're going to have prices spiking.

And I think that message got through.

Actually, I was in Hong Kong last week and I was struck by there's quite a few people.

I sort of asked their investor types, market types.

But what's surprised you most in the last six months or even the last twelve months.

None of them said anything to do with Donald Trump.

It was all how fast China has progressed in ex technology or why technology.

There's so many articles you read now or reports on any subject, whether it's trade, technology, innovation, and you could just have a sub headline China's going to win.

I mean, is that what you're basically saying that we should just accept that China's going to end up dominant in all these areas and we will just lose out by trying to be more, more diversified and less reliant on it.

Well, I think going back to the what JD.

Evans was saying and linking that to the ev picture of China's got such that amazing lead in electric vehicles.

You know BYD you'll be seeing a lot more of those, I think on our streets, their electric vehicles in the coming months and years.

But what JD.

Evans was saying was that innovation needs a barrier, he needs trade walls with the rest of the world, and then American companies will innovate more.

I think the evidence suggests the exact opposite will happen.

If American wars itself off, it will not be subject to competition from companies like BYD, from a Chinese battery makers, etc.

And they will stagnate behind those walls.

What you are more likely to get and you have a bit of confidence and faith in Western companies actually faced with that competition.

I think they can do well.

I think they can innovate and they can properly compete.

Don't forget China only moved into this space, what was it, you know ten to fifteen years ago, been an incredibly rapid development.

So if you think about it in those terms, I don't see why Western carmakers or Western technology companies can't compete with China and through competition, I think what's more likely to happen is if you put up trade barriers and you don't compete, you will stagnate and you will fall further behind.

Okay, well that was fantastic.

Thank you very much, Thank you, Thank you all.

Thanks for listening to Trump and Noomics from Bloomberg.

It was hosted by me Stephanie Flanders and I was joined by Ben Chu at the Conduit in London.

Trump and Nomics is produced by Summer, Sadi and Moses and with help from Amy Keen and special thanks this week to Asher de Lenarole and Lily black Cell at the Conduit.

Sound design is by Blake Maples and Sage Bowman is the head of Bloomberg Podcast.

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