Global Community -- a Difficult,

Global Community -- a difficult, but necessary compromise

According to its advocates, economic globalization is the reduction or elimination of barriers that limit trade, commerce, and the free flow of technology, capital, and new ideals across national borders. "In open markets, greater competition spurs the reallocation of labor and capital to more profitable sectors of the economy. The benefits of such free trade -- to both consumers and producers -- are significant." (Drenzer, 2004, p.1) in short, when markets are global and protectionism is minimized, nations can focus on producing what they can manufacture efficiently, rather than what they can only produce at great cost, because they lack the natural resources to do so. The wide plains of Argentina can produce the world's best beef, and consumers all over the world can enjoy this product at low prices, while the island nation of Tokyo can divert its resources into producing high-quality electronics for export. And the entire world can enjoy the environmental benefits of driving a hybrid car, like the low emissions, fuel-conserving Prius made by Toyota.

Advocates of globalization also suggest that by creating a state of positive interdependence, nations are less likely to go to war with one another, consumers of every nation have more selection of cheaper goods, and producers are able to produce a greater variety of such goods with less effort. When protectionism attempts to safeguard domestic industry, regardless of world market prices, safe from competition, Daniel Drenzer argues, waste ensues: For example "U.S. quotas on sugar imports have, in recent years, caused the domestic price of sugar to become 350% higher than world market prices. As candy makers have relocated production to countries where sugar is cheaper, between 7,500 and 10,000 workers in the Midwest have lost their jobs -- victims not of outsourcing but of the kind of protectionism called for by outsourcing's critics." (Drenzer, 2004, p.5) if American sugar is made too expensive, than candy producers will go elsewhere, where they can find cheaper, unprotected sources of sugar.

This is not simply true of the industrialized world but also in the non-industrialized world. In his book Why Globalization Works, Matt Wolf points to the growth of the Chinese and Indian economies during the 1980s and 1990s after they opened their economies to international trade and foreign investment. Not only did the GNP of these nations improved, so did the nations' standards of living. Also, China in particular grew more open to new ideas, on a grassroots level, even though it is far from liberalized in terms of its political structure. For the average Chinese consumer, China is by necessity still more open to new ideas in terms of the exposure of the populace than it was during the repressive years of the late 1980s. (Wolf, 2004)

India, as a major source of outsourced jobs from the U.S., has caused critics within the United States to cry foul at some of the alleged benefits of globalization. Technology has enabled white-collar jobs to be diverted abroad, because the wage scale is lower in India. Drezner agrees that some jobs have been lost in this manner, but minimizes the impact of outsourcing, and warns that protectionist policies will have a more dire effect than any immediate loss of it jobs within the United States. "The creation of new jobs overseas will eventually lead to more jobs and higher incomes in the United States...An open economy leads to concentrated costs (and diffuse benefits) in the short-term and significant benefits in the long-term. Protectionism generates pain in both the short-term and the long-term." (Drezner, 2004, p.1) in short, what is good for commerce abroad will, in a free market, eventually yield dividends for the American consumer at home.

The allegation that globalization costs workers their jobs is not a new one, however. Even before outsourcing, it was alleged that globalization allowed American businesses to profit off of the lower wages in developing nations, and exploit the labor in these low-wage countries, particularly of poorly paid industrial workers such as women and children. According to anti-globalization activist Robert Weissman, "the last 20 years of corporate globalization, even measured by the preferred indicators of the International Monetary Fund (IMF) and World Bank, have been a disaster for the world's poor." (Weissman, 2001) Weissman alleges that these international organizations are dominated by U.S. interests and assumptions about what constitutes economic health, and forced nations to privatize their national industries and deal with more powerful Western businesses, whether this was in the nation's interest or whether their populations desired this to be the case. "Over the last two decades, Latin America has experienced stagnant growth, and African countries have seen incomes plummet," due to the forced promotion of exports and reduction of trade barriers that penalize weaker nations still developing their infrastructures. (Weissman, 2001)