Speaking More Truths About Globalization
You can't hardly turn on the boob tube or read a newspaper or look at a mainstream website without hearing the clamor about the benefits of "globalization" and "increased trade" blah, blah, blah...if you try to contest that nonsense, you're just a dumb protectionist (trust me, I have the scars to show it...oh, sorry, that's a certain New York senator's line). Anyway, my friends at the Center For Economic and Policy Research, Dean Baker and Mark Weisbrot, have an excellent piece out about globalization responding to a piece in Foreign Affairs. It's short and sweet--a little too wonky for my taste but it makes some very important points.
One of the things I and others keep pointing out is the fallacy that globalization and so-called "free trade" has been of great benefit to anyone but the very wealthy and privileged. The two CPER dudes write:
That's right. The economy did better, as a whole, when it was...oh, my god, hold your hats on this...CLOSED than when it was subjected to the whims of free market globalization.
As I've pointed out many times, most recently the other day, the rhetoric of "free trade" versus "protectionism" doesn't really tell us the real story. The CEPR dudes conclude with this nice point:
One of the things I and others keep pointing out is the fallacy that globalization and so-called "free trade" has been of great benefit to anyone but the very wealthy and privileged. The two CPER dudes write:
In other words, even ignoring the re-distribution of income in the last few decades, the U.S. economy during a period in which it was mostly a closed economy (1946-1973) vastly outperformed the increasingly open economy that we have had over the last 33 years, in terms of raising living standards.
That's right. The economy did better, as a whole, when it was...oh, my god, hold your hats on this...CLOSED than when it was subjected to the whims of free market globalization.
In the United States, it is quite likely that the vast majority of the labor force has actually lost more from the redistribution of income and lowering of their real wages due to trade and investment liberalization, than they have gained from access to cheaper consumer goods.
As I've pointed out many times, most recently the other day, the rhetoric of "free trade" versus "protectionism" doesn't really tell us the real story. The CEPR dudes conclude with this nice point:
This drives home the nature of what we are dealing with: it is not a question of "saving globalization" from "special-interest protectionists" as the authors argue. The "special interest protectionists" - highly paid professions, CEO's, pharmaceutical companies and other monopolists - have been reaping the gains from misnamed "free-trade" agreements for many years, while subjecting the majority of Americans to international competition that has lowered their living standards. The "dangerous path" ahead is not so much the "creeping protectionism" feared by the authors as it is the continued use of global commercial agreements to increase income disparities in the United States.
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Hello?
That's right. The economy did better, as a whole, when it was...oh, my god, hold your hats on this...CLOSED than when it was subjected to the whims of free market globalization.
Please permit me to point out that during that time frame(1946-73), we also had much lower IMMIGRATION than we now have. The time during which the US's middle class actually came into being was after (1) the closing of the last great migration (1924) and after (2) the Great Depression and (3) WWII, both of which further depressed immigration, and the opening of the floodgates on legal immigration (1965 - THANK YOU, TEDDY. NOT!) and the more recent illegal inundation (80's on). Globalization is migration as well as trade and outsourcing. In fact, outsourcing jobs that can be accomplished abroad and importing massive amounts of cheap foreign labor into the US to take care of those jobs that can't be sent abroad are flip sides of the same coin. They both depress middle/working class wages.
global
i agree to a large extent with deena. americans, and we liberals are guilty of this as well, suffer
from a having your cake and eating it too syndrome. we want millions of immigrants to pour into
this country without controls, at the same time we are dumbfounded when we see our way of life
heading down the drain. immigration is only part of the problem. globalization promises more
than it delivers. having lived in the third-world, i can tell you that though many have been lifted
out of poverty, those were mostly people who already were upper middle class and had
significant economic and political connections to those in power. to the middle and working
class on this side of the ocean, we are definitely much poorer than our parents were.
true, they lived through depressions and wars, but at least they could dig themselves out of it
and buy that bungalow in the suburbs. that's getting much harder for average people to do
these days. protectionism could help us. though we can't help but think globally, local
economies are still the fulcrum of our nation. we can't compete on a global level when most
of middle america is crumbling and our communities are in shambles. what benefit is it to us
if a community in rural china profits from factory growth when flint michigan and youngstown
ohio look like beirut? what good is the dow jones at over 14 thousand when real wages have
remained flat since 1966? what good is the economy when only doctors, pharmacologists and
a few other professions with powerful protectionist lobbies are entitled to make all the money
while the rest of us are told to tighten our belts and eat crow? sorry, but though we can
express concern for the rest of the world and wish them well, we need to clean up our own
own messes first. the chinese have an expression: 'don't sweep the dust off your neighbor's
sidewalk until you've swept your own.' yes, selfish, perhaps, but practical, nevertheless, and
one of many reasons why the chinese economy is kicking our butts. not all of us can or should
be scientists, engineers, commodity brokers, wall street gurus and global economic players.
someone has to hold down the regional forts, drive the trucks, melt the steel, bake the bread
and shuffle papers. globalism is necessary and inevitable: coffee, tea, wines, foodstuffs,
computer components, etc, are a result of the global economy, which is nothing new or
revolutionary. but that does not give license to our laying waste of an entire economic system
and way of life for millions at the expense of profitability for those 10% lucky enough to avail
themselves of the global banquet. much of america is looking and feeling more and more like
asia these days, and the question is, is this the type of society americans want future
generations to inherit? i certainly hope not, though regretfully, i'm losing my confidence in
american wisdom and common sense more and more each day!