Globalization

globe.jpgThere are a lot of ways to look at the topic of Globalization. And which way you choose to look at it depends on which aspect of it you focus on.

One way to see Globalization is as a leveling process wherein the world’s resources are redistributing themselves. Poorer nations can do the work for richer nations cheaper than the richer nations could have it done at home, so the rich nations send the work offshore and money flows into the poorer nations while increased profits flow into the stockholder’s pockets in the richer nations. People in the rich nations pay less for the products, people in the poor nations have higher incomes and the corporations in the richer nations deliver better returns to their stock holders. So what’s not to like?

poor_home.jpgFor one thing, the well paying jobs in the richer nations are being sent offshore to be done for less and this reduces the income of the folks who previously worked in the rich nations. This in turn increases the gap between the wealthy folks in the rich nations who own the stocks and are getting richer and the folks in the rich nations who used to do the work (which is now outsourced) who are now getting poorer.

Some folks imagine the rich nation is better off for all of this but I don’t think so. The money sent overseas to pay the workers doing the outsourced work is money that has left the country. The increased profits made by the stockholders in the rich country is money that remains in the rich country. So, if the folks overseas have more money and the stockholders have more money, then who has less? Yes, the folks who used to work in the well paying jobs in the rich country.

So, one way to look at globalization is to say that the stockholders in the rich country, in order to increase their wealth, have sold the workers in their own country down the river.

People say that globalization is better because is it distributing wealth more equitably between the richer and poorer countries but that’s not really the point. If the stockholders in the rich countries were not getting richer in the process (which is the point), there would be no redistribution of wealth. But, these stockholders are quite willing to give away the wealth of the workers in their own country if it will increase their own personal wealth.

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