Why is globalization inevitable?

[hetron]

I recently had a conversation with my uncle on what he thought of globalization. I told him that everything you read these days is about the marketplace becoming more global, and free trade is all but considered inevitable by major economists. His response was that globalization right now is a horrible thing for workers everywhere. The workers in the first world continue to lose jobs to workers in the third world, who get paid a pittance while the multinational corporations (the real benefactors of globalizations) are free to go into various 3rd world countries and find the one where the operating costs are cheapest (read: ones where they can totally run amok with regards to the environment) and pay the workers the least.

So if laissez faire global economics only really favors the big multinationals , how did we all get duped into thinking this was such a great idea?

[lehighguy]

It's great for workers in third world countries. They benefit enourmousely from globalization. You know that tech support guy from India you talked to. He's India's new middle class. He used to be a beggar on the street, now he has a place to live and food in his stomach.

What your uncle calls a pittance is usually ten times better then what is available in those countries. Multi-nationals attrach employees because they often pay above market wages.

If we looked back at Henry Ford's $5/day plan we would consider it a pittance by todays standard. However, in other countries it represents what is represented to American workers back in the day, an above market wage one could make ends meat on.

Of course the well educated in every nation benefit as well. All of those Chinese PhDs you see would have starved to death in the cultural revolution, now they are millionaires. Well educated highly skilled people in America benefit greatly as well. They can use the cheaper production costs to do all sorts of new things.

The real losers of globalization are lazy uneducated white westerners. People like my Dad who won't learn to use a computer. I bought him a computer with my poker winnings, I offered to teach him how to use it. He just doesn't want to put in the effort, even though are many things he really wants to do on it. He'd rather veg out in front of the TV. He loses in globalization, and I can't say I feel sorry for him.

[hetron]

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The real losers of globalization are lazy uneducated white westerners. People like my Dad who won't learn to use a computer. I bought him a computer with my poker winnings, I offered to teach him how to use it. He just doesn't want to put in the effort, even though are many things he really wants to do on it. He'd rather veg out in front of the TV. He loses in globalization, and I can't say I feel sorry for him.

[/ QUOTE ]

What about every other type of worker in western societies? How can they compete? It sounds like a losing situation- if the workers in a 3rd world country is paid less, and that country will let the company run it's businesses without giving a whit about environmental protection, how can they compete?

[lehighguy]

Well educated people in America are currently benefiting. By well educated I mean innovators. People who create, start thier own businesses. Not people that learn a "mental trade" (accounting, code monkey work) and act like mental assembly workers. I play warcraft which is made by Blizzard entertainment. Blizzard sells a number of units in the US, but a majority of thier sales are oversees. The programmers, managers, salespeople, and shareholders or blizzard entertainment all benefit from globalization. Thier ability to offer an innovative and unique product grants them all the ability to make a lot of money doing a job they love.

As for pay differences, they eventually disappear. It used to be that companies produced things in Japan because the labor was cheaper. Now Toyata outsources its production to the US because our labor is cheaper. The same thing will happen in China and India, though it may take several decades just as it did in Japan.

Enviormental concerns are valid, but the best safeguard for the enviorment is a strong economy. There will always exist a tradeoff between enviormentalism and GDP. When you have a high enough GDP that you can provide you citizens with basic fundamentals the balance starts to get tipped in favor of the enviorment. A similair thing occured in Japan where they caused a lot of polution while industrializing, but they are the leaders in enviormentalism now.

[adios]

Freer trade not free trade. Why shouldn't workers in the third world be entitled to new employment oppotunities? As far as raping the environment, yeah that happens and that is a bad thing. From what I've encountered most believe that if and when the standard of living is raised third world countries is raised, the countries involved will become more environmentally concious. Whether or not that is true remains to be seen. I think the global economies of most countries is far from laissez-faire. The obvious benefit is to the consummer. There are fields in the U.S. where workers are in demand as you well know. As far as your exploitation of third world workers claim goes I think you need to be a lot more specific as to your claims. I'm certain that this is not the case in all third world countries.

[hetron]

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Well educated people in America are currently benefiting. By well educated I mean innovators. People who create, start thier own businesses. Not people that learn a "mental trade" (accounting, code monkey work) and act like mental assembly workers. I play warcraft which is made by Blizzard entertainment. Blizzard sells a number of units in the US, but a majority of thier sales are oversees. The programmers, managers, salespeople, and shareholders or blizzard entertainment all benefit from globalization. Thier ability to offer an innovative and unique product grants them all the ability to make a lot of money doing a job they love.

As for pay differences, they eventually disappear. It used to be that companies produced things in Japan because the labor was cheaper. Now Toyata outsources its production to the US because our labor is cheaper. The same thing will happen in China and India, though it may take several decades just as it did in Japan.

Enviormental concerns are valid, but the best safeguard for the enviorment is a strong economy. There will always exist a tradeoff between enviormentalism and GDP. When you have a high enough GDP that you can provide you citizens with basic fundamentals the balance starts to get tipped in favor of the enviorment. A similair thing occured in Japan where they caused a lot of polution while industrializing, but they are the leaders in enviormentalism now.

[/ QUOTE ]

But in the meantime globalization hurts the american worker. There is no doubt that the rate of income growth in the US has leveled off for the lower and lower middle class. How can one argue that globalization is good for the people in that class?

[MMMMMM]

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But in the meantime globalization hurts the american worker.

[/ QUOTE ]

My impression from reading some months ago, is that this very well may not be true: rather, it hurts *some* American workers and *helps* some other American workers. I recall reading that the net amount of jobs we get outsourced to us, from other countries, exceeds the number of jobs we outsource to other countries. If that's the case then globalization is actually helping American workers overall--just not in certain niches.

Anyway you might want to do a little checking up on this before you jump on the bandwagon and presume that we are losing *net* jobs because of it.

Alternatively, if you are arguing primarily that it hurts only the rather unskilled workers, well, that is sort of like like saying: welcome to the 21st century. Times change, and some old skills are less needed or no longer needed. Change has always been a price of progress. Maybe it is time for some people to retrain, or to further their educations.

[BCPVP]

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But in the meantime globalization hurts the american worker.

[/ QUOTE ]
Who's the "american worker"? Is he just a guy in the manufacturing plant? Is he someone who runs a hardware store? The video rental store? Grocery store?

Globalization may hurt some in manufacturing jobs, but it doesn't necessarily hurt all American workers. People who refuse to adapt will most definitely suffer. But I don't have much sympathy for these people. There are plenty of other jobs for people, if they're willing to take them. Or invent them.

[ACPlayer]

As changes happen there are winners and losers. In the globalization process the big losers have been those workers who have been displaced out of their jobs -- and these are almost all American workers, some of whom have little prospects for decent jobs due to education, age, ability, or even the ability to get beyond their loss.

In globalization the big winners have been corporate stock holders and insiders and entrepreneurs around the world who have been able to understand the change and take advantage of it for themselves. The other winners has been the overseas middle class, specially in parts of Asia, which have benefited from, relatively, high paying jobs becoming available.

While over time, it *may* be that American has not lost net jobs. For those impacted the impact has been huge.

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I recall reading that the net amount of jobs we get outsourced to us, from other countries, exceeds the number of jobs we outsource to other countries.

[/ QUOTE ]


I cant imagine this to be true. But perhaps it so.

The net impact of globalization over time is to bing everyone in the world to a similar standard of living, IMO. Globally a good thing, locally it means that in a couple of decades, the Indian middle class witll have the same standard of living (as defined by material things) as the American standard of living. Lets hope they dont leave us in the dust though. My IFN investment has done extremely well, thank you India.

[MMMMMM]

I recall reading that the net amount of jobs we get outsourced to us, from other countries, exceeds the number of jobs we outsource to other countries.
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I cant imagine this to be true. But perhaps it so.

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It might be the net dollar amount rather than number of jobs. Anyway, I read it, and since I didn't do any follow-up research, I think it is certainly something to consider as a possibility. I wouldn't be at all surprised if it is true, anyway. My cautionary note is merely against *presuming* the opposite to be true.