Back in May, amid all the fuss and anxiety about the coming Brexit vote, Heathrow airport’s 70th anniversary celebrations went almost unnoticed. It’s a good old age for one of the world’s largest airports, but there was a time when I didn’t think it would make it much beyond 60. I abandoned that airport before it reached 60.
Three years after an event that changed international travel forever, I was in a queue in terminal 3. I had checked in in plenty of time, and effortlessly moved from the check-in queue to the security queue, which snaked around the terminal and was barely moving. Since 9/11, security had become a critical and accepted part of running an airport, which is why very few people expressed frustration.
Until we got around the final corner and saw that only three of the eight security lanes were operational. What was that about? One of the frazzled security team told me they hadn’t arranged for enough personnel.
The authorities at Heathrow must have knownhow many people would be using the terminal that day (most book weeks in advance). It wasn’t the first time this had happened at Heathrow (this was post-9/11 normal) but I decided it would be the last time for me.
Economic growth and globalisation have underpinned sustained growth in air travel, as Heathrow’s own figures show. In 2015 it recorded 75m arrivals and departures; up from 60,000 in 1946. Over this period the airport experience became all about queuing and kettling and management disdain.
And as you drift between security queues and passport queues, which will have been preceded by time-consuming and intrusive visa-application queues, you realise global travel highlights the stark difference between capital and labour.
Growth in the cross-border movement of people has been dwarfed by greater movement of capital across borders in recent decades. Deregulation, financial innovation and advances in technology and communications have boosted financial flows to unprecedented levels.
Through most of history these financial flows tracked the flow of goods and/or people, but that relationship has been delinked since the break-up of the Bretton Woods fixed exchange-rate system in the 1970s. The delinking process is most evident in the huge and growing values involved in cross-border trading in "derivative" financial products.
How ironic it was that as regulators across the globe were putting in place ever more intrusive ways of impeding the movement of people in response to the 9/11 horror, global capital flows were surging to unprecedented levels.
In 2007 these capital flows were equivalent to 23% of global GDP. Unlike labour, the capital market was a truly global one. A similar rate of cross-border movement would have involved the migration of 1.6bn people. At present 210m people live outside their country of origin.
The 2008 crisis was the financial equivalent of 9/11, but it wasn’t restricted to a few major US cities; this was a global terrorist event. Money that had been allowed to wash freely from one economy to another destroyed the lives of hundreds of thousands of people. Nine years later it continues to damage the prospect of millions of people in societies worldwide.
After 2008, fear and reduced economic activity, not tougher regulations, caused a sharp drop-off in financial flows, though things did become more difficult for the previously free-wheeling European and US banks, which then cut cross-border activity dramatically.
So next time you’re in a queue for a visa or to get through passport control or security at Heathrow, you may wonder: why are people not treated as lightly as capital? And would it have been possible for US$7.8trillion of illicit financial flows to leak out of emerging economies between 2004 and 2013 if financial capital had been subjected to the same controls as human capital?