Globalization the Current Economic Crisis

¶ … Globalization The current economic crisis has showed us a different side of globalization than the rampant growth -- at least for first world and already developing nations -- that it promised and in large part delivered during the first few decades of its rise.

Not only are we seeing the negative effects of tying the world's economies together as a massive failure originating lrgely in one country has a domino effect on all the others, but we are also seeing an increase -- however slight -- in levels of global economic cooperation. This increased cooperation does not, unfortunately, come as part of a smooth and altruistic meeting of minds, but rather through large and complex gatherings if international leaders and advisors, each with their own agenda and their own methods of achieving it.

International business is quickly learning the responsibilities attendant upon globalization, in addition to the prosperity it promises. In an article appearing in the Wall Street Journal on April 3, the various decisions -- and indecisions -- of the leaders of the Group of 20 Nations made during their recent London meeting. The meeting itself is a prime example of the macro-globalization aspects of the current world economy; this meeting did not focus on specific companies or industries so much as it did the global economy as a whole (Fidler et al., 2009).

Though of course the overall economic outlook is tied to individual companies and their performance, both domestically among the many nations of the world and internationally across them all, the issues at stake during the Group of 20 meeting involved the economies of the governments and nations themselves. Specifically at issue during the meeting were various international agreements between the sovereign nations regarding regulation of business and currency, as well as the cooperation of the nations through previously established international agencies (Fidler et al., 2009).

One of the main points that the article makes is the imbalance that exists between many of the various countries that make up the Group of 20 nations and the rest of the connected world.

This is especially apparent in the International Monetary Fund, which has been accused of being more subservient to the larger nations that make it up (read: the United States, among others), and the current situation might "require the fund to shoe more spine in dealing with its largest members than it has managed in the past" (Fidler et al., 2009).

The independence and free reign that many international businesses have enjoyed during the past prosperity is being extremely curbed, and the availability of money through the International Monetary Fund has decreased significantly, while the role the fund plays is hoped to increase (Fidler et al., 2009). Much of the prosperity that has come to international businesses during the era of globalization came because of various loopholes or purposefully constructed laws that allowed businesses to get around tax laws and other regulations.

The meeting of the Group of 20 also decided to tighten these regulations and tax havens, recognizing that businesses must accept their share of the responsibility for the current crisis not just with lip service but also with the money they've earned from the system the way it used to work (Fidler et al., 2009).

This has also affected international investment in large publicly held companies, and some of the regulations discussed in last week's meetings include the use of an international currency and international investment regulations, including the way taxes are charged and allocated (Fidler et al., 2009). In the past, the construction of global economic regulations and tax laws -- or the lack thereof, in many cases -- was a major part of many international businesses' plans -- it had to be, to ensure maximum growth and success.

The changes that the Group of 20 are proposing and hoping to enact will have a huge effect on such things, forcing international businesses to further change their future projections and plans even more than they already have (Fidler et al., 2009). Businesses have already had to deal with a decline in investor confidence, and now there will be tighter regulations on how they are able to spend their money and move it around, even while the pool of money both from investors and from company profits is growing shallower.

In addition to increased regulation and the closing of tax havens and.