MONEY 125 - GLOBALISM

THIS IS MY 125^TH BLOG ON UNDERSTANDING MONEY TOOLS

October 3, 2017

In this blog we are going to discuss the pros and cons of globalism/globalization. 

Many people lump the two terms together.  I differentiate between the two.  Globalism to me is the theory or ideology of bringing together countries for a commonality/ideology on an international scope of trade and mutual understanding including product, pricing, tariffs, taxes, currencies, politics, transportation including importation/exportation of goods and much more.  Globalization is the quantitative measurement of globalism.

There are so many terms bantered around on this subject including globalist versus nationalist.  I am afraid globalism will destroy our heritages and allegiances to the country we were born; this is the nationalist within me.  Personally I like uniqueness and not for world homogeneity. True nationalism and being self-sufficient in today’s world is long gone.  A big start in the direction of globalism happened with the passing of NAFTA, North American Free Trade Agreement.  It was drafted under President George H. W. Bush and passed through the Senate under President Clinton in 1993.

I was not an advocate of NAFTA, nor am I a proponent of globalism.  As much propaganda as you hear on how wonderful it is let’s take a look at the benefits and deterrents. The hard cold truth of the matter is that globalism mainly helps the big corporations, wealthy and Wall Street.  There is no such thing as “trickle down” and helping the poor and lower class citizens in any country.

Pros of globalism:

-       Free trade, reduced barriers of trade.

-       Agreed upon taxation, although may differ country to country.

-       Cheaper goods.

-       Opening up new markets for product.

-       The thinking that it creates jobs.

-       Great for multi-national companies.

-       Larger profits for companies favoring stockholders.

-       Increased competition, although we all price set and subsidize products.

-       Infused capital to emerging countries.

-       Possibly more democracy.

-       More understanding of the varied cultures.

-       Countries more quickly connected on information, including the internet and manufacturing of products.

Cons of globalism:

-       Even though the media states that globalism is good for emerging      countries and the lower classes, this is false; it benefits the wealthy and large corporations.

-       Large corporations use emerging countries to skirt environmental protection laws like we have in this country and many of the G20 countries.  As an example, Monsanto uses chemicals to control weeds in these countries and in South America that are recognized to be cancer producing.

-       Large companies create agreements with these emerging countries so that they have complete control, and produce goods in very poor worker conditions that would normally be banned in the G20 countries.  These include sub-human working environments and child labor.  OSHA type laws do not exit that would protect and improve workplace safety.  There are essentially no worker rights, few lawsuits representing workers, no insurance, no disability compensation if injured in the workplace, no set hours, no overtime pay and no set vacations.

-       Taxes including “value added taxes” as in the European Union have not been diminished but increased.

-       Currency wars have only increased to make a country’s products seem less expensive.

-       No question about it, it has robbed American workers of their jobs.  We have become a service economy, and other than technology and pharmaceuticals we produce little.

-       Countries like China welcome our technology and companies, then steal proprietary patent rights and copy product.

-       Globalism doesn’t work for most of the world.  Inequality and discrimination have only increased over the past 30 years.

-       Countries that have borrowed from the International Monetary Fund and World Bank owe heavily.  If these countries can’t make payment, settlement is normally having to sell off their country’s best assets to the wealthy and big corporations. We have seen this with Goldman Sachs Investment Banking firm being sent to countries for restructure of debt.  Prime examples are Greece and most recently Puerto Rico.  With the recent financial disaster caused by hurricanes in Puerto Rico I have no idea how they will ever make themselves whole.

-       Perhaps the spread of diseases which were not common in many of these countries prior to globalism, with international travel made easier. 

-       An excuse for large companies to set up off-shore trusts so that earnings and profits do not filter back to the USA, nor do they pay taxes on these monies providing they set up the trusts legally with good law firms.

Since 1993-1994 when NAFTA took a foothold in agreement between Mexico, the USA and Canada, you witnessed inexpensive, subsidized American corn go to Mexico displacing thousands of Mexican agricultural workers.  No wonder Mexicans have flooded into the US! Our dairy farmers see inexpensive milk come in from other countries like New Zealand.  Plentiful lumber comes across our northern border from Canada.

I hope this gives some insight as to why I am against the euphoric thinking that many have on this subject.