̽��ֱ�� of Cambridge - Finbarr Livesey

Robots and carbon targets may signal the end of globalisation

fpjl2 — Wed, 17 May 2017 13:42:19 +0000

For decades we have been told that globalisation is an irresistible force. As Tony Blair said: “you might as well debate whether autumn follows summer.”

According to a new book by a Cambridge academic, however, factors ranging from automation and 3D printing to environmental regulations and customer expectations are now spelling the beginning of the end for globalised manufacturing.

Dr Finbarr Livesey, an expert in public policy, says that while digital globalisation continues apace, early signs can be seen of a sea change in the production and distribution of goods: with global supply chains shrinking as companies experiment with moving production closer to home.

In From Global to Local: the Making of Things and the End of Globalisation, published this week by Profile Books, he argues that many of the big assumptions we have about globalisation and outsourcing are now wrong, and that the global economy is subtly changing in ways yet to be picked up by blunt macroeconomic measurements.

“Robots are becoming cheaper than overseas labour, climate concern and volatile fossil fuel markets are restricting carbon footprints, and consumers increasingly expect tailored products with express delivery. Bouncing production around the planet is already making less and less economic sense,” says Livesey.

“Holding on to familiar stories about the global economy is not an option, as technological and political changes make a mockery of any past consensus.”

However, he warns against falsely claiming such shifts as a victory for protectionism: the technologies allowing the return of production to high-cost economies are unlikely to mean the promised return of jobs.

Livesey also argues that if ‘deglobalisation’ is indeed coming down the line then Brexit may be a particularly bad move for UK manufacturing:

“Trying to reach over our neighbours in the name of ‘global Britain’ at a time when many companies are on the cusp of reverting to regionalism means that marginal calls for European manufacturing bases may go to France or the Czech Republic, for example, rather than the UK,” he says.

Leaders in both west and east have hitched their wagons to the apparent inevitability of globalisation over the past thirty years. Yet, as Livesey points out, regionalism never went away. A significant percentage of exports continue to land in the same area they originate: around 50% in Asia and North America, and as much as 70% in Europe.

In the book he draws attention to examples of what he believes to be “weak signals of early change” as major companies tentatively start to U-turn on globalisation.

̽��ֱ��new Adidas ‘Speedfactory’ uses automation and 3D printing to produce high-end trainers – not in China or South Asia, but in Germany. “And we were told textiles were never coming back,” says Livesey.

̽��ֱ��mighty General Electric recently rejuvenated a vast manufacturing “ghost town” in Kentucky when they realised appliances could be made for the same or cheaper in the US than in China.

Foxconn, the company that makes iPhone innards, raised eyebrows when they suggested robots could replace one million Chinese workers – and that production could even move to the US as a result.

Global supply chains cost companies time in an age of next-day delivery, and add risks of disruption – from cultural differences to natural disasters – and even intellectual property theft. They also take a heavy environmental toll: shipping alone produces a billion tonnes of carbon, roughly equal to that of Germany.

“Take Zara, one of the daughters of ‘fast fashion’,” says Livesey. “They have a cycle from design through to production and shop floor delivery of just four weeks. In some cases it would take almost that long just to ship product from China. ̽��ֱ��new ‘Belt and Road’ initiative may only reduce that to two weeks.

“Many companies can’t afford the time, not to mention the added risk, of freighting goods around the world. Zara base much of their production in Spain, Portugal and Morocco to be on Europe’s doorstep – an example of ‘nearshoring’.”

Ultimately, the journey from production to customer may be measured in metres rather than continents. For example, Harvard Bookstore’s ‘Espresso Book Machine’ uses information from digital files to print and bind new books in store on demand.

Livesey highlights the patents for mobile 3D printing filed by Amazon in 2015 as indicative of a hyper-local rather than hyper-global direction for production. “While not currently feasible, there may come a time when your purchased product is printed en route to your house.”

While he admits that the data from the last few decades can make his position seem Canute-like at the moment, Livesey argues that the tide is turning, with signals of new localism amid the noise.

A recent survey of over 500 companies found well over half were moving production away from China. One in six companies surveyed by the Engineering Employees Federation had moved production from a low-cost economy to the UK. ̽��ֱ��Korean government passed a ‘U-Turn’ law encouraging companies to return from China.

“Companies are deciding to have their production either in their home country or nearby. Automation is attacking the costs of labour and shifting the calculus for managers. Political forces are constraining the space for manufacturing, for example restricting emissions from transport. ̽��ֱ��early signs are there.”

Finbarr Livesey will be discussing his book and the future of globalisation at this year's Hay Festival.

A new book suggests there is early evidence of a coming U-turn in the globalisation of manufacturing – and that the story we are told about the direction of the global economy is wrong.

Holding on to familiar stories about the global economy is not an option, as technological and political changes make a mockery of any past consensus

Finbarr Livesey

Container Port, Barcelona,

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Anyone for digital democracy?

fpjl2 — Mon, 02 Mar 2015 12:23:18 +0000

̽��ֱ��recent release of the report from the Speaker’s Commission on Digital Democracy attracted significant attention but really only for one of the 26 recommendations. ̽��ֱ��report contained much that was good, some that was pedestrian, but it has all been swept away because one recommendation was of a different stripe altogether – to have online secure voting as an option in the UK by 2020.

Before getting into the detail of the report we should get one thing out of the way. This is a report that was long overdue, whether it came from the Speaker, a Select Committee or another part of the mangle that is government. With the speed that online has come to dominate our personal and professional interactions, it was a glaring omission that the UK government and the Parliament in particular had not addressed the digital world, their role in it and how it can be used to improve democratic outcomes. Granted the Government Digital Service (GDS) is working hard to improve how government services are accessed, although it is best to not get into an argument about whether gov.uk is an improvement or not (as Chris Cook did with his Christmas wish for 2014). However, anything that starts a stronger debate on how the machinery of government interacts with the public and policymaking is a good thing.

Let’s get the obvious out of the way first. Many of the recommendations are not specifically about digital, they are about democracy. “By 2020, the House of Commons should ensure that everyone can understand what it does.” You would have hoped that this would at least have been as aspiration for some time now. Reducing the amount of jargon, making procedures clearer, having a communications strategy – it is frustrating that we are still at such an early point in the evolution of the House and its relationship to the outside world that these actions are pending.

Efforts to improve public participation in policy making depends on people wishing to be involved, as well as assuming we have a shared model of how representation works. On the first point, our recent survey highlighted an expressed desire to be involved, which we included as part of our submission to the Commission. According to the poll while 7% of the public feel engaged in decision making in Parliament, 53% want to be involved. Now that number may be soft, as it is easy to say you want to be involved but actually being involved is another thing. Assuming half of those who express the desire to be involved would actually get involved, that’s a 19 point difference between the current state of affairs and what people want. If new digital tools, clearer websites and better outreach help in that regard, fantastic.

̽��ֱ��concern here is raising expectations that cannot be met. This is the case with recommendation 18 to have a ‘cyber chamber’ for public debate on issues being discussed in Parliament. ̽��ֱ��desire to be involved has been translated by some as ‘getting my way’. To caricature, when I tell my MP what should be done I expect that to happen. If we promote engagement such as that involved in a ‘cyber chamber’ without clarifying the process of discussion, negotiation and compromise that happens in almost all policy areas, then we’ll be raising expectations that will be dashed, potentially worsening the situation further.

This leads to the second point on representation – how do we think representation works in the UK at the national level? Crudely the options have been characterised as having delegates (MPs who take our views on board as issues arise), trustees (MPs who can use their judgement on an issue), or party (where the party line is all). Is the approach in the report to tilt towards a delegate model of representation? It’s unclear reading the report. Without discussing how the link between the public and their representatives is construed, the report missed an opportunity to have a more fundamental conversation about the structure of the UK’s democratic system.

And then there is recommendation 26. Once the Commission’s report was released the news picked up on this to the exclusion of pretty much everything else in the report. From the BBC to the newspapers, the response was to acknowledge some of the good things in the report, but to be critical of the need for online voting. Is online voting necessary? Will having online voting improve turnout or improve the connectivity between the public and MPs? ̽��ֱ��answer to both questions is that we don’t know. ̽��ֱ��Commission says it is “… confident that there is a substantial appetite for online voting in the UK …” but does not present any evidence to back this statement up. ̽��ֱ��claim is that voting will become more accessible, but there is no evidence that even if it is more accessible that it will increase the rates of voting, or the subsequent engagement or satisfaction of the public with politics.

Overall the Commission should be regarded as successful in getting a conversation going on the modernisation of Parliament and its procedures. Letting in the sunlight should help increase trust and hopefully improve the speed and quality of policy making. However, this does seem to be an opportunity missed to have a deeper conversation on the nature of representation in the UK, and in a report with too many recommendations a mistake to allow one recommendation to overshadow all of the others.

Finbarr Livesey provided a submission to the Digital Democracy Commission on public engagement with policy making which can be accessed here.

This post was originally published on the blog site for the Cambridge Masters in Public Policy. Read more here.

Dr Finbarr Livesey – ̽��ֱ�� lecturer and Deputy Director of the MPhil in Public Policy – submitted research to Parliament’s recent report on digital democracy. Here, he discusses the report’s implications for the democratic process in the UK.

While 7% of the public feel engaged in decision making in Parliament, 53% want to be involved

Finbarr Livesey

Barney Brown

Online voting

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