The era of globalization doesn’t have a single, universally agreed-upon starting point, as it evolved gradually through several phases. There was the early globalization (1500s-1800s) that some historians trace to the beginnings to the Age of Exploration and the establishment of maritime trade routes connecting Europe, Asia, Africa, and the Americas. There was also the Columbian Exchange of goods, people, and ideas between hemispheres, marking an early form of global interconnection. The Columbian Exchange was a widespread transfer of plants, animals, culture, human populations, technology, diseases, and ideas between the Americas, Europe, and Africa following Christopher Columbus’s arrival in the Americas in 1492.
The Columbian Exposition, officially known as the World’s Columbian Exposition, was a world’s fair held in Chicago in 1893 to commemorate the 400th anniversary of Christopher Columbus’s arrival in the Americas. This was where the fabled “White City”, the exposition’s centerpiece of neoclassical buildings constructed around a central basin, painted white, giving it a gleaming appearance that impressed visitors. It covered more than 600 acres and featured nearly 200 new buildings and was attended by 27 million people who visited during its six-month run. The fair introduced many Americans to electricity on a large scale, including electric lighting of buildings and grounds, the first Ferris Wheel and more. The exposition significantly influenced American architecture, arts, and urban design, helping inspire the “City Beautiful” movement
The Exposition was enormously influential in American culture and showcased American industrial might, technological innovation, and cultural aspirations at a time when the United States was emerging as a world power. Its aesthetic influenced everything from public buildings to furniture design for decades afterward. This was the culmination of the Columbian Exchange which contributed to population growth in Europe, Africa, and Asia through new nutritious crops, while simultaneously leading to demographic collapse in the Americas (among the indigenous people). This massive transfer of species dramatically altered ecosystems on both sides of the Atlantic and shaped the modern world in profound ways. Sounds a bit like what might be happening right now, doesn’t it?
The first modern wave of globalization (1870-1914) saw dramatically increased international trade, investment, and migration. Technological innovations like steamships, railroads, and the telegraph, significantly reduced transportation and communication costs and the gold standard provided stability for international transactions. After the pause caused by WWII, there was a resurgence of globalization. The Bretton Woods system (1944) established institutions like the IMF and World Bank, the with the GATT/WTO frameworks, progressively reduced trade barriers. The United States emerged from this as a dominant economic power, promoting open markets.
Even in the most contemporary period of globalization (1980s-present), the economic reforms of China beginning in 1978 and the fall of the Soviet Union in 1991 integrated major economies into the current global system. The technological revolution in computing, internet, and telecommunications facilitated this. And trade liberalization accelerated with significant reduction of tariffs and capital controls. Most scholars consider the contemporary phase beginning in the 1980s as the period when globalization, as we now understand it, truly accelerated and became a defining feature of the world economy. Truly the golden era for world prosperity.
But now Donald Trump suddenly knows better and he wants to liberate us from all this boring prosperity. The old adage, “if it ain’t broke, don’t fix it” has never occurred to him, apparently. Where’s the fun in leaving successful things be? It seems not to have occurred to him that no one has benefited more from globalization than the United States. He fails to see that the prosperity of other nations is good for us. As the old cartoon goes, it is not enough that we succeed, cats must also fail. And by cats, I mean ANYONE else. It is a dangerously primordial way of thinking.
Today in the Rose Garden (did he ever promise us a Rose Garden? I think not.), Trump revealed his “Liberation Day” plan to inflict tariffs on pretty much the entire world (except, of course, Russia). Why just attack just friends and foe when you can attack every country in the world? His tariff retaliation math was particularly interesting to economists. Paul Krugman, a Nobel economist, said he had no idea where Trump’s numbers had come from, but financial journalist James Surowiecki figured out that the White House “just took our trade deficit with [each] country and divided it by the country’s exports to us.” He called it “extraordinary nonsense.” Washington Post economic writer Catherine Rampell posted that she was reluctant to amplify Surowiecki’s theory that the tariff rates were based on such a “dumb calculation,” but then the Office of the U.S. Trade Representative confirmed it. This all makes Reagan’s “Voodoo” supply-side economics look like intelligent policy by comparison. It brings us back to a moment in economic thinking that would make Adam Smith blush with embarrassment for our president. I would dust off my old t-shirt that says in ten languages “Sorry about our president” except I would need one with another 60 languages to be thorough.
This “Liberation Day” will do a wonderful job of liberating us all from our wealth. “Never before has an hour of Presidential rhetoric cost so many people so much,” former treasury secretary Lawrence Summers posted. “The best estimate of the loss from tariff policy is now [close] to $30 trillion or $300,000 per family of four.” Even other Republicans are in shock. They thought he was kidding about all this tariff nonsense…or just using it for talking and negotiating points. Clearly it’s Trump’s attempt to eliminate income tax, but at what expense? “The Trump Tariff Tax is the largest peacetime tax hike in U.S. history,” posted former vice president Mike Pence.
Markets are going crazy. The world is entering a downward economic spiral that may or may not collapse the entire world economy. The list of leaders from both allies (as it were) and enemies are expressing their concern. No one benefits when a crazy man is driving the ship of state of the world’s largest economy over the edge of the earth. Even China, Russia and Iran are probably worried. I’m betting North Korea might like this, since they can’t even remember what foreign trade is anyway.
Welcome to Liberation Day 2025, the end of our economic way of life as we’ve known it and the start of something altogether uncharted. We are back to heading out into waters where there be dragons.