美学者：全球化抛弃中等收入国家(中英对照)

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美学者：全球化抛弃中等收入国家



　　全球化是近年来最引人瞩目的国际性争议话题之一，虽然全球化趋势难以阻挡，但是，未必所有国家都能从中获得好处。美国加州大学洛杉矶分校国际学院副院长兼国际关系中心主任加勒特（Geoffrey

Garrett）最近在美国《外交事务》杂志（2004年11、12月号）上发表题为《全球化中失落的中等收入国家》（Globalization's

Missing

Middle）的文章，他指出，全球化已造成财富分配两极化现象，高收入与低收入国家都能从全球化进程中获得好处，可是中等收入国家却被甩在后面，为解决这种不公平现状，作者对中等收入国家提出了多项建议，以下是此文主要内容。



　　有关自由贸易和国际资本流动的效益之争，看法截然对立，呈两极化态势，支持与倡导全球化的人士坚称，自由贸易与国际资本流动，对于富国穷国、发达国家与发展中国家来说，都是一个双赢局面，但是，全球化的批评者则认为，只有一小撮全球精英中饱私囊，而其它人的利益都被牺牲掉了。



　　这种善恶之争掩盖了如下一个重要事实：即虽然全球化让许多人获得了好处，但不论在一国内部或在国际体系中，处于不上不下的中等阶层利益却遭漠视和被压榨。在目前的全球市场上，想要占据领先地位，只有两种方法。人们及国家要么在知识经济上具有竞争力，要么以低工资经济与他人展开竞争。知识经济奖励具备技术者以及促进尖端技术创新的制度；低工资经济则是利用普遍的技术，以尽可能低廉成本从事一般工作。在这两类经济中均处于弱势的竞争者，既包括了富国中昔日中产阶级，也包含处于全球收入分配中处于中游位置大部分国家，尤其是拉美国家和中东欧地区的国家。



加勒特指出，如果要衡量全球化所带来的经济变迁，一个简单方法就是根据世界银行所划分的三类国家群体，追踪世界各国人均收入变化情况。位于最上面25%的国家被称为高收入国家，其中包括属于经济合作与发展组织的国家，以及少数中东石油输出国和象新加坡这种以贸易立国的国家。位于底层的30%的国家属于低收入国家，涵盖全球60亿人口中半数以上，主要是在亚洲和非洲次撒哈拉沙漠（撒哈拉沙漠以南）地区。其余45%是中等收入国家，包括拉丁美洲和前苏联绝大部份国家，以及亚洲四小龙与多数中东国家。



1980年（前全球化时期末），低收入国家群体人均国内生产总值不足300美元，中等收入国家群体人均国内生产总值约为2500美元，高收入国家群体人均国内生产总值则超过2万美元（以1995年美元市场汇率换算，并考虑到通货膨胀因素）。在国家经济逐渐融入国际市场的20年后，也即到2000年，在1980年被列为高收入的国家，其人均实质收入增加了约50%，这多半应归功于生物科技、信息以及通信技术进步所带动的创新。另一方面，全球最贫穷国家表现则更为突出。在上个世纪80、90年代，其人均实质收入增幅超过160%，这种增长奇迹不但靠农产品的销售，也归功于标准化工业品的大规模外销。



  

为何在全球化进程中，中等收入国家表现令人失望呢？答案似乎是它们并未在全球市场中找到发展基准，它们无法在由富裕经济体所占据的高附加值市场上与他国展开竞争，由于其劳动力技术水平较低，法律与银行体系也不够完备，所以它们可以选择的余地不多，只能停留在以相对陈旧的技术制造标准化产品市场上，与低收入经济体竞争，然而，由于本国工资水平较高，中等收入国家势必无法长久抗衡。



　　自由贸易论者辩称，虽然中等收入群体国家遇到各种问题，但是，那些走全球化路线的国家表现不错，可是，实际情况却恰恰相反。据世界银行提供的资料，在上个世纪80、90年代，关税降幅较小的中等收入国家，其经济增长幅度超过了那些开放步伐较快但关税降幅较小的国家。



　　当年，亚洲四小龙被归类为“开放”经济体，其实颇有不少问题。日本、韩国及台湾在经济起飞阶段都采取了同样发展策略：扶植诸如电子和汽车等幼稚产业，提供优惠的融资政策，保护它们免受国际性竞争，并竭尽全力为这些产品寻找外销市场。由于撤除本地与本国市场的贸易保护主义壁垒，是迈向自由贸易的一项重要指标，所以，东亚经济体不能被标榜为走全球化路线的范例。



　　加勒特认为，当前中等收入国家所面临主要挑战是，它们必须设法在全球技术链上升级，打入全球知识经济，不应再停留在标准化制造业与标准化服务业领域与他国进行竞争，必须致力于教育改革，培养一大批具有技术和有创意的劳动力，建立良好政府治理、确保产权并强化金融体系，打击贪污腐化与解决工作低效等问题。

（周岳峰摘编）





Globalization's Missing Middle

Geoffrey Garrett

Foreign Affairs, 5 November 2004







The polarized debate over the effects of free trade and international

capital flows has become a fixture of world politics. Boosters of

globalization assert that it is a win-win proposition for the rich and the

poor, developed and developing countries alike. President George W. Bush has

said that \"a world that trades in freedom ... grows in prosperity,\"

reiterating a theme Bill Clinton championed in the 1990s. But critics see a

small global elite lining its pockets at the expense of everyone else. John

Kerry's decrying of outsourcing by \"Benedict Arnold CEOs\" is this year's

version of Ross Perot's 1992 forecast that the North Atlantic Free Trade

Agreement (NAFTA) would make a \"giant sucking sound\" by drawing jobs out of

the United States.

All this good-versus-evil rhetoric obscures one key fact: while

globalization has benefited many, it has squeezed the middle class, both

within societies and in the international system. In today's global markets,

there are only two ways to get ahead. People and countries must be

competitive in either the knowledge economy, which rewards skills and

institutions that promote cutting-edge technological innovation, or the

low-wage economy, which uses widely available technology to do routine tasks

at the lowest possible cost. Those who cannot compete in either include not

only the erstwhile industrial middle class in wealthy nations, but also most

countries in the middle of the worldwide distribution of income, notably in

Latin America and eastern and central Europe.

This tripartite account of globalization's results does not fit neatly into

either of the paradigms that dominate the current debate. On the one hand,

globalization's supporters-who maintain that all countries should gain from

opening their economies-try to explain the poor performance of the

middle-income countries by invoking factors other than globalization, such

as the trauma of eastern Europe's rupture with its socialist past or endemic

corruption and inefficiency in Latin America. On the other hand, critics of

globalization, who refuse to accept that it has benefited anyone in the

developing world save a tiny Westernized elite, fixate on various injustices

(using terms such as \"sweatshop labor\") and discount its positive effects as

the product of other processes, such as the modernization of agriculture in

China. But simple evidence demonstrates that both views are inexact. In

fact, middle-income countries have not done nearly as well under globalized

markets as either richer or poorer countries, and the ones that have

globalized the most have fared the worst.

The question is, how can they be helped? Displaced American manufacturing

workers would probably rather get jobs at Microsoft or Genentech than at

McDonald's or Wal-Mart. But for most of them this just is not a realistic

option. On the global stage, countries such as Mexico and Poland would

similarly like to compete with Japan and Germany in the U.S. market for

high-value-added goods and services. But their work forces are not skilled

enough and their economic institutions not sufficiently supportive of

investment or innovation to take advantage of the knowledge workers they do

have. As a result, the middle-income countries have been forced into

unwinnable battles with China for market share in standardized manufacturing

and, increasingly, with India for low-wage service-sector exports.

In the United States and the rest of the Western world, the challenge of

helping the disaffected middle class \"tech up\" (rather than dumb down) is

well understood. People must be given access to the education and training

that can transform them into successful knowledge workers. Likewise,

middle-income countries must be helped up the global skill chain. Meaningful

educational reform is long overdue, but it is only the beginning.

Middle-income countries need broad and deep institutional reforms in

government, banking, and law to transform economies that stifle innovation

into ones that foster it with strong property-rights regimes, effective

financial systems, and good governance.

The stakes are high-and not only for politicians vying to control the

electoral center in Western democracies. For more than a decade, citizens in

middle-income countries have been told by international financial

institutions and by their own governments that opening to the global economy

will bring large and widely shared benefits. But all too often the troubling

reality has been persistently high unemployment and stagnant incomes. In

both eastern Europe and Latin America, the stark disjuncture between lofty

rhetoric and grim reality has proved fertile ground for populist backlashes

against global markets and their perceived American masters. The world's

leaders must find ways to empower middle-income countries so that the fruits

of globalization can be enjoyed by their people too.

ANOTHER COUNTRY

Princeton economist Paul Krugman lamented in The New York Times two years

ago that \"the middle-class America of my youth was another country.\" He was

right. According to the Bureau of Labor Statistics, manufacturing

employment, the quintessential American middle-class occupation, has fallen

from one-fifth to one-tenth of total American jobs in just the last two

decades. Meanwhile, employment in \"professional and business services,\"

which pay higher salaries to more skilled workers, has more than doubled,

overtaking manufacturing in the process. At the same time, the number of

low-paying jobs in \"leisure and hospitality\" industries has also essentially

doubled and now rivals total manufacturing employment. Jobs on the American

factory floor have thus been replaced, in more or less equal measure, by

\"junk\" jobs such as flipping burgers and cleaning floors and by the new

glamour professions of writing software and managing money. The result is

that the distribution of income in the United States has been stretched at

both the high and low ends, significantly increasing social inequality.

A similar process has been taking place at the global level. The world's

wealthiest countries have grown richer in recent decades as a result of

dramatic advances in technology, and the rate of economic advance has been

even faster in the new manufacturing dynamos among the world's poorest

countries. Squeezed between these two success stories, the countries in the

middle have floundered.

One easy way to measure these changes is to track per capita national income

worldwide according to the three major country groupings created by the

World Bank. The top 25 percent of countries are labeled \"high income,\" a

category that comprises the nations in the Organization for Economic

Cooperation and Development, plus a few small Middle Eastern oil exporters

and trading states such as Singapore. The bottom 30 percent are labeled \"low

income.\" This group includes more than half of the world's six billion

people, chiefly in the countries of Asia and sub-Saharan Africa. The

remaining 45 percent of countries-almost all of Latin America and the former

Soviet bloc as well as the Asian tigers and much of the Middle East-are

\"middle income.\"

In 1980 (a useful ending date for the preglobalization period), the

differences in per capita income among these three groups of countries were

enormous: roughly 1,000 percent both between the low-and middle-income

countries and between the middle-and high-income countries. Average GDP per

capita was less than $300 in the low-income group, roughly $2,500 in the

middle-income group, and more than $20,000 in the high-income group (in 1995

dollars at market exchange rates and adjusted for inflation). After two

decades of integration of national economies into international markets, by

2000, per capita incomes in the countries categorized as high income in 1980

had increased by roughly 50 percent in real terms, due in no small part to

innovation fueled by advances in biotech and information and communications

technology.

At the other end of the spectrum, the world's poorest countries fared even

better-indeed much better. During the 1980s and 1990s, their real per capita

income increased by more than 160 percent. This growth miracle was spurred

not by sales of agricultural products (the focus of ongoing debate over the

future of the World Trade Organization), but by large-scale exports of

standardized manufactured goods, ranging from steel to shoes to computer

hardware. Exports of all goods and services increased in the low-income

countries from less than 15 percent of GDP in 1980 to 28 percent in 2000.

Over the same period, the share of manufacturing in total exports tripled,

rising from 15 percent to more than 45 percent.

To be sure, profound inequalities remain in the cross-national distribution

of income (even if one uses comparisons based on purchasing-power parity,

which substantially increase estimates of per capita income in developing

countries, rather than comparisons based on market exchange rates). But the

big story of the past two decades is that the income ratio between the

countries characterized as high and low income in 1980 has essentially been

cut in half. Moreover, the growth led by manufacturing exports seems to have

benefited wide cross-sections of the population in low-income countries. As

journalists Nicholas Kristof and Cheryl WuDunn have pointed out, the

factories that liberals denounce as sweatshops have nonetheless provided

opportunities for people with limited skills to move from subsistence

farming and penury into much-better-paying manufacturing jobs.

This \"modernization through globalization\" has undoubtedly had its

deleterious consequences, including heightened inequalities between rural

and urban populations and between hinterland and coastal regions,

precipitating large-scale internal migrations. As the recent elections in

India showed, such problems can lead to powerful political resistance from

those left behind. Nonetheless, in India, China, and other countries in

which the social pie has been rapidly expanding, these difficulties are

easier to handle than in more stagnant economies.

Although proponents of globalization can point to record growth in

low-income countries as proof of their wisdom, they should be troubled by

the economic stagnation in middle-income countries. Supporters of NAFTA are

wont to label the treaty a success for middle-income Mexico because it has

stimulated trade and manufacturing across the border from the United States.

And it is true that exports in the middle-income world increased from less

than 20 percent of GDP in 1980 to more than 30 percent in 2000, while the

share of manufacturing in total exports increased from under 30 percent to

more than 50 percent. But despite the export growth, this group of nations

has fallen even further behind the West, defying the age-old logic of \"catch

up,\" by which poorer countries reap the rewards of technology developed in

richer nations. Real per capita income in the middle-income group grew by

less than 20 percent during the 1980s and 1990s, less than half of the

growth rate achieved in the high-income world and less than one-eighth of

that in low-income countries. As a result, the ratio of per capita incomes

of high-and middle-income countries actually increased by about 20 percent

during the past two decades, while the ratio between high-and low-income

countries dropped by 50 percent. These figures are all the more troubling

because middle-income countries tend to have better-developed economic and

political institutions and more educated labor forces-which development

economists consider key drivers of growth-than their low-income

counterparts.

Why has globalization been disappointing for countries in the middle? The

answer seems to be that they have not found a niche in world markets. They

have been unable to compete in high-value-added markets dominated by wealthy

economies because their work forces are not sufficiently skilled and their

legal and banking systems are not sophisticated enough. As a result, they

have had little choice but to try to compete with China and other low-income

economies in markets for standardized products made with widely available

and relatively old technologies. But because of their higher wages, the

middle-income nations are bound to lose the battle.

These economic woes have been compounded by the speed with which

middle-income countries opened their financial markets to the outside world,

particularly in the 1990s. In theory, developed-world capital can fuel

development in lagging economies. But in reality, capital account

liberalization in Latin America and eastern Europe, as well as in Asia, has

brought instability, volatility, and, on more than one occasion, full-blown

financial crisis. Now, even the International Monetary Fund (IMF) admits how

misguided was its blanket support for liberalizing financial markets in

developing countries with weak domestic financial institutions and fixed

exchange rates (implemented in response to high inflation). The new

orthodoxy thus favors sequencing: developing strong domestic financial

markets and banking systems first and opening to international financial

markets later. But this rethinking is of little comfort to countries

recently ravaged by boom-and-bust cycles of hot money.

SEARCHING FOR EXPLANATIONS

The success of globalization in both high-and low-income countries can be

readily explained by mainstream economics. Technological change and the

international integration of markets have spurred growth in high-income

nations, reversing the slowdown of the 1970s. Low-income countries have

exploited their comparative advantage in cheap labor to gain large shares of

the global marketplace.

The failure of middle-income countries to compete in global markets for

either knowledge or low-wage products is decidedly less well understood,

however. It flies in the face of many economists' core belief that all

countries should gain from opening their markets to the outside world by

doing what they do best, even if they do not do it as well as their

competitors. As a result, supporters of \"free trade for all\" try to explain

the poor performance of middle-income nations by pointing to causes other

than their inability to find a productive niche in the global economy. These

true believers argue that the integration of the middle tier into

international markets is not at fault for these countries' recent dire

economic record and that freer trade has ameliorated, not exacerbated, their

problems.

One common argument brackets the experiences in the 1990s of the countries

of the former Soviet bloc. For all the promise of their velvet revolutions,

their transition from communist pasts to capitalist futures has been

painful, and it would be a stretch to portray globalization as the principal

culprit in this difficult birth of free-market democracy. Yet, even

excluding ex-communist nations, per capita income in the remaining

middle-tier countries increased by only 25 percent from 1980 to 2000, half

the growth rate of the top tier and one-sixth that of the bottom tier.

Blaming the problems of all middle-income countries on the collapse of the

Soviet system is thus not persuasive.

Another attempt to resuscitate the classic case for free trade juxtaposes

middle-income globalizers and nonglobalizers to argue that, whatever the

problems of the middle-income group, the globalizers in it have fared

better. In fact, the opposite is true. According to World Bank data,

middle-income countries that cut tariffs less during the 1980s and 1990s

grew more than those that opened up faster to globalization and cut tariffs

more. A comparison of the experience of Latin America and eastern Asia, for

example, casts serious doubt on a central shibboleth of development

economics: that underperforming Latin American states are victims of their

insularity and protectionism whereas overachieving eastern Asian states are

the beneficiaries of their wholesale endorsement of global markets.

As careful observers such as Alice Amsden and Robert Wade pointed out long

ago, it is misleading to characterize the first Asian tigers as having

\"open\" economies. Japan, South Korea, and Taiwan all pursued the same

strategy in their takeoff phases: nurture infant industries such as

electronics and automobiles with preferential credit and protection from

international competition and then do whatever possible to find export

markets for these products. Since removing protectionist barriers to the

home market is a critical expression of a state's move toward free trade,

the eastern Asian countries cannot be held up as paragons of virtuous

globalization. During the Cold War, because of security imperatives, the

United States nonetheless allowed these countries unfettered access to U.S.

markets. It was only in the mid-1980s, when Asian competition came to be

seen as a threat to the U.S. economy, that Washington pushed hard for

reciprocal access to eastern Asian markets.

In contrast, when, after decades of stifling protectionism, Latin American

countries opened their economies with a vengeance in the 1980s and 1990s,

they scored decidedly mixed results. They did exactly what the U.S.

Treasury, the IMF, and the World Bank told them to do-open up, deregulate,

privatize-arguably liberalizing more thoroughly than any other region in the

developing world. (Average tariff rates in Latin America were cut in half

from the mid-1980s to the late 1990s, compared with reductions of about 10

percent in other middle-income countries and 30 percent in low-income

nations.) If the conventional diagnosis of Latin America's historical

problems were correct, the continent would have reaped large rewards from

liberalization or, at least, larger rewards than other middle-income

countries that opened up less. But in fact, economic growth was even slower

in Latin America than in the rest of the (already underperforming)

middle-income world. Per capita incomes in Latin America increased by less

than 10 percent from 1980 to 2000, compared with almost 30 percent for the

remaining middle-income nations. Within the region itself, moreover, the

countries that cut their tariffs the most grew the most slowly.

UNCONVENTIONAL WISDOM

Proponents of openness tend to square their predictions with the experience

of Latin American states by blaming domestic conditions such as widespread

corruption, poor infrastructure, and underdeveloped economic institutions.

Most Latin American countries could no doubt use better policies and better

institutions. So too, of course, could low-income countries that suffer from

political problems, such as civil wars and coups, that most Latin American

countries have finally put behind them. If low-income countries have

benefited from liberalization at least in part because it generated pressure

for domestic reform, why, proponents of globalization might ask, have those

in Latin America not similarly benefited?

Conventional economic analysis offers no clear answer to this question. One

theory ventures that the true anomaly is not the relative underperformance

of middle-income countries, but exceptional cases among low-income countries

that have led analysts to find a spurious correlation between openness to

trade and economic success. It suggests that a couple of gargantuan

outliers, China and India, could skew the figures in favor of the low-income

category.

With one-third of the world's population between them, China and India do

loom large in any discussion of recent economic development. After three

decades of Maoist rule, the Chinese government began economic liberalization

in 1978, spurring more than 20 years of double-digit growth rates. India's

liberalization came more than a decade later, but dropping long-standing

quasi-socialist policies also brought the country spectacular results. In

both cases, economic openness, particularly tariff reductions, was

essential. From the mid-1980s to the late 1990s, China cut its average

tariff rate in half, to 20 percent, and India cut its rates from around 90

percent to 30 percent. Thus, it is far from clear that these countries

should be excluded from an analysis of the effects of globalization on the

low-income world.

But even when the staggering achievements of China and India are discounted,

it is still true that remaining low-income countries fared better in the

1980s and 1990s than did the middle-income world (with increases in per

capita income of 55 percent against 20 percent). Savvy observers of the

world economy might find these figures difficult to believe: after all,

virtually all sub-Saharan African countries qualify as \"low income,\" yet

their recent record has been anything but miraculous. Per capita incomes in

poor sub-Saharan Africa have indeed stagnated in recent decades, for reasons

ranging from pestilence and disease to ethnic heterogeneity to dictatorships

to mineral wealth. But even so, overall, African countries seem to have

benefited from liberalization and integration into international markets.

Consider, again, the impact of tariffs. African economies today are still

less open to international markets and less globally integrated than other

low-income countries: tariffs in sub-Saharan Africa as a whole were no lower

in the late 1990s than they had been in the mid-1980s. Thus, one reason some

African states have not benefited from globalization is that, unlike China

and India, they have not jumped into world markets with both feet. But where

it has been implemented in Africa, freer trade has helped. Although their

positive effects have been minimal so far, lower tariffs may eventually

stimulate African exports in agriculture, raw materials, and even

manufacturing. In highly competitive global manufactures markets, Africa's

low-wage work force will continue to offer an advantage over middle-income

nations.

FROM MISSING TO MODERNIZED

Counter to mainstream economic expectations, middle-income countries have

struggled economically in the last two decades, and those that have opened

their markets more have fared even worse. Yet a return to protectionism is

unlikely to do any good. The pace and pervasiveness of technological change

make it difficult, if not impossible, to put the globalization genie back in

its bottle. But the formula of \"more free-trade agreements\"-bilaterally,

regionally, and multilaterally-is unlikely to work, either.

The challenge for the middle-income world is to find ways to \"tech up\" and

enter the global knowledge economy, so as to escape the trap of having to

dumb down to compete in standardized manufacturing and, increasingly,

standardized services. This will require educational reforms geared toward

producing a large pool of skilled and creative labor, as well as good

government, secure property rights, and strong financial systems to fight

corruption and inefficiency. Such reforms would give entrepreneurs

incentives to take advantage of newly minted knowledge workers, fostering

innovation. But such a transformation will be expensive and difficult to

execute, and the countries of Latin America and eastern Europe are not

likely to be able to achieve it on their own. The transition to democracy

has not itself proved the necessary catalyst. Instead, it has raised popular

expectations that politicians find increasingly difficult to satisfy.

What can the West do to help? For much of eastern Europe, entry into the

European Union, long and drawn out as the process of accession has been, may

well be the answer. Poland, Hungary, and the other formerly communist

countries that were admitted this year hope that membership will bring to

them what it has brought to Greece, Portugal, and Spain over the past 20

years: access to western European markets, capital, and development

assistance, as well as other, less tangible, but equally important

advantages. New members must adopt the acquis communautaire of the EU: the

full range of its laws, regulations, and institutions. Although it has often

been derided as overly bureaucratic and sclerotic, over time, the acquis has

aligned the domestic institutions of these nations with common European

practice, bringing the EU's poorest members stability, predictability, and

credibility-and an environment conducive to the emergence of the knowledge

economy-far more quickly than they could otherwise have expected.

Although the EU's latest members from the east are starting from even

further behind than were Greece, Portugal, and Spain, they can expect

accession to help them build relatively quickly the foundations for

successful competition in the knowledge economy. It goes without saying,

however, that the helping hand of EU membership is not being held out to all

postcommunist countries. Most conspicuously, Russia will likely remain on

the outside looking in, even though it needs the shape-up that membership

would bring more acutely than most of the countries that acceded this year.

Latin American nations have aggressively pursued closer economic relations

with the EU, but membership is obviously not an option for them, and they

have no analogous organization on the continent. NAFTA is more than a mere

free trade agreement, but its rules and regulations are rudimentary compared

with the EU's. The United States, moreover, has been reluctant to extend the

treaty's reach, choosing not to integrate more deeply with its NAFTA

partners or to extend the NAFTA model. Meanwhile, Latin American countries

have been pushing in all directions for more free trade agreements:

bilaterally, regionally, and with other parts of the world. Yet in rushing

to do so on almost any terms, they risk reinforcing the damaging dynamic

that trade liberalization has wrought on them and the rest of the

middle-income world.

If unalloyed free-trade agreements alone cannot do the job and an EU-like

organization is a pipe dream, what can be done for Latin America? The World

Bank has been promoting smart development assistance, focusing on the

creation of knowledge economies. So far, however, it has remained largely

ineffective as an agent of change in the middle-income world. The United

States recently launched the Middle East Partnership Initiative to foster

educational, financial, and judicial reform in the middle-income countries

of that region. Such efforts should be replicated in Latin America and all

middle-income countries to counteract the economic stagnation and rising

popular frustration that threaten these nations' openness and stability.

The problem today is that U.S. policymakers have more pressing things on

their mind than Latin America's economic woes. In the early Cold War era,

the Marshall Plan advanced U.S. foreign policy by creating democratic and

capitalist bulwarks against communism in Europe. Bailing out Russia and

Mexico also made sense in the years following the Cold War, when traditional

security issues receded into the background. But since the September 11,

2001, attacks, achieving political goals through economic means has been

given a much lower priority than the war on terrorism. And if a new Marshall

Plan is created, it will focus on the Middle East.

The ultimate irony facing globalization's missing middle may be that the

more the free trade project founders in Latin America, the greater will be

the pressure on people in the region to migrate to the United States.

Migration will, in turn, squeeze employment and wages for the American

manufacturing middle class even more and force the U.S. government to think

creatively about growing economic problems south of its border. After all,

the flow of former East Germans into western Germany motivated Chancellor

Helmut Kohl to invest massively in the formerly communist part of the newly

unified country. Rapid increases in the number of eastern Europeans looking

to live and work in western Europe also strengthened the case for the EU's

eastern expansion. Much like East Germans did, eastern Europeans will

benefit because western European investment will speed their transition to

the knowledge economy. Perhaps, then, migration into the United States from

Mexico and the rest of Latin America will ultimately help the continent move

into the knowledge economy.

Before September 11, the disagreement over globalization was the principal

fault line in world politics. Even today, ensuring that globalization's

benefits reach all parts of the world would provide a bedrock upon which

peace and prosperity in the twenty-first century can be built.

Unfortunately, so far the middle-income nations have been left out. The

United States and the EU must help Latin America and eastern Europe develop

competitive knowledge economies. This project may seem banal compared with

the war on terrorism, but over time, ignoring those pushed aside by

globalization will have immense implications-economically and politically.

Geoffrey Garrett is Vice Provost of the International Institute and Director

of the Ronald W. Burkle Center for International Relations at the University

of California, Los Angeles.