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In an age of globalization, it is still a hot debate of whether globalization is an advantage or disadvantage to our society. Everyday you hear it on the news, you read it in the newspaper, and you overhear people talking about it and in every single instance the word globalization seem to have a different meaning. When I hear of globalization I think of the whole world coming close together in all phases. I tend to think that we as human beings are breaking down barriers that have been protected or guarded. For instance, I initially thought of the progress we are making in the communication aspect. So what its globalization and its effects on the United States?
WHAT IS GLOBALIZTION?
First off, we will search and explore some definitions of the term globalization. "Globalization is the process of denationalization of markets, politics, and legal systems, i.e., the rise of the so-called global economy" (Introduction to Globalization, 2004). Another article states, "Globalization is an inevitable phenomenon in human history that's been bringing the world closer through the exchange of goods and products, information, knowledge and culture. But over the last few decade, the pace of this global integration has become much faster and dramatic because of unprecedented advancements in technology, communications, science, transport and industry" (The Growing Integration of Economies and Societies Around the World, 2005). The third and final definition is from Thomas Friedman who wrote The Lexus and the Olive Tree. "Globalization is not a phenomenon. It is not just some passing trend. Today it is an overarching international system shaping the domestic politics and foreign relations of virtually every country, and we need to understand it as such" (Friedman, 2004). Now that we know what globalization is, we can know try to track it and better understand it and its effects.
HISTORY OF GLOBALIZATION
Now let's take a look at the history of globalization. When we look back at globalization we are going to look mainly from the area of the industrial revolution. "Globalization has been established by large developing countries who sought foreign investment by opening up to international trade" (A Quick Guide to the World History of Globalization, 2003). The first notion of globalization lasted from 1870 to the start of World War 1. It was stimulated by advances in transport and reductions in trade barriers. The level of exports to world income doubled to 8 percent as international trade boomedIt sparked massive migration as people sought better jobs. The end of World War 1 ushered in an era of protectionism. Trade barriers such as tariffs were erected. World economic growth stagnated and exports fell back down. (The History of Globalization, 2005). It seems as during this time, leaders became too conservative and very protective of our country's future economy.
"Following World War II, a second wave of globalization emerged, lasting from 1950 to 1980. It focused on integration between developed countries as Europe, North America, and Japan restored trade regulations through a series of multilateral trade liberalizations" (International Globalization, 2004). At this time, third world countries other poor countries were being pushed aside while these three countries refurbished trade regulations to restore adequate trading.
The most recent wave of globalization, which started in 1980, was spurred by a combination of advances in transportation and communication technologies. Can you imagine not having a cell phone or the Internet? From a student's perspective, this era of globalization, has greatly increased and transformed our education. The advancements in technology and communication allow individuals to seek opportunities once not available. We need to be able to adapt, and adjust quickly because times are changing.
Americans' views of international trade are complex and cannot be explained as a simple preference for free trade. A strong majority of Americans views trade as something positive and as having significant benefits for the U.S. economy. However, the majority also has major reservation about how trade has been put into practice: Americans show strong concern that, though trade has benefited business and the wealthy, it has not benefited American workers and has widened the gap between rich and poor. Americans also show concern that trade has been harmful to the environment, to international labor standards, and to poor countries. Thus, the net feeling about trade is lukewarm at best. However, if Americans' reservations are addressed, an overwhelming majority says it would then support free trade (Benefits of Globalization).
A majority of Americans supports having some trade barriers as a means of protecting workers from sudden job losses, even when it is weighed against the potential benefit of lower prices. Also, more popular than trade barriers are government programs that help American workers, through retraining and education, adapt to a globalizing economy.
ADVANTAGES OF GLOBALIZATION
Some Americans tend to see globalization as more positive than negative. These Americans are likely to view globalization as a process of the world becoming increasingly interconnected. It is seen not only as an economic process, but also as one in which values are becoming more oriented to a global context (Globalization in General, 2002).
At a business level, we talk of globalization when companies decided to take part in the emerging global economy and establish themselves in foreign markets. These companies adapt their products or services to the final user's cultural requirements. Then, they might take advantage of the Internet revolution and establish a virtual presence on the international marketplace with a multilingual corporate website or even as an e-business (Introduction to Globalization, 2004). These companies are wise, by taking advantage of the increased technology and globalization to tap into foreign markets.
The movement to lower trade barriers and open world trade has undoubtedly increased world growth in goods and services. It has consequently increased incomes and raised standards of living globally, which unfortunately, doesn't mean for each individual. It is an advantage for the world because third-world countries are able to begin to develop. When factory's open in these third world countries many of the natives are provided with jobs to help their community and country.
Next, countries that have entered thoroughly and positively into this freeing of trade have gained the most. The entire world has benefited from these countries gains. Corporations have greater flexibility to operate across borders.
Another advantage is that originally the globalization of trade has involved, principally, trade in goods; but now we have an explosion of trade in services, telecommunications, financial services, computer and information technologies, creating industries and frequently better paid jobs of a nature and on a scale undreamt of twenty years ago. Increased flow of communication allows vital information to be shared between individuals around the world. We have come along ways from when we used to barter for goods. If you look back in history we used to trade, for example, by exchanging one good for another good. Now we trade practically anything with almost everybody.
Lastly, capital markets also are truly globalized. Foreign investment is increasingly important in the creation of jobs and improvement of living standards in developing countries. More generally, it allows companies to position themselves in an increasingly competitive world through geographical diversification. There is also a reduction of cultural barriers that increases the global village effect (Advantages and Disadvantages of Globalization, 2003).
DISADVANTAGES OF GLOBALIZATION
A disadvantage of globalization is Americans are losing their jobs because corporations move jobs overseas. "With the pay of corporate CEO's at historical highs and American job creation at the lowest level since the Depression, corporations are laying off Americans blue-collar factory workers and white-collar professionals alike purely to cut costs. Thousands of quality jobs are lost every month, jobs that will be performed by people in China, India, Eastern Europe, and elsewhere at a fraction of what American workers earn" (Lou Dobbs, pg. 35). As I was reading Exporting America I found many examples of Americans losing their jobs due to globalization. Here are some examples from Exporting America:
Carrier, maker of air-conditioning and heating units, closes its Syracuse, New York, plants and most of its 1,200 jobs go to Singapore and Malaysia.
Maytag shits its factory in Galesburg, Illinois and moves 1,600 jobs to Reynosa, Mexico.
IBM announces growth and new jobs and then outsourced 90 percent of them, 15,000 in allwhile competitor Microsoft contributes $2 billion to India's economy with jobs.
Next, since capital is moving overseas it represents lost output, trade, and employment at home. Not only are Americans losing jobs but also America is losing out on producing those products here at home. The more jobs Corporate America outsources, the fewer workers there are to pay local, state, and federal taxes, which in the end further punished our struggling public education system. "But the outsourcing of American jobs is worsening our problems, not solving them. The law of supply and demand will always determine economic choices. As Corporate America recruits more labor from third world countries, it is encouraging our young people to make educational choices that may be ominous for our ability to produce and for our future prosperity" (Lou Dobbs, pg. 116)
Another disadvantage that I found to be interesting was "the spread of a materialistic lifestyle and attitude that sees consumption as the path to prosperity" (Advantages and Disadvantages of Globalization, 2003). I found that to be a different outlook focusing in on the society's reaction to globalization. So does making more money and having a lucrative bank account control our life and our lifestyle? For example, we have pro players who get attacked by the media for holding out for millions and millions of dollars when corporations dump workers to make extra money.