Globalization: Blessing or a Curse?

Posted on September 9, 2010 by raesmiley

Globalization is defined as a way to extend to other or all parts of the globe; make worldwide. As
I start the second half of my college career, the reality that someday Ill need to find a job to
support myself is sinking in. For generations people have been preparing themselves with the
same tools to enter the workforce: education, social skills, specified knowledge, etc. but as
Globalization sets in, the need for these things, and others, is amplified. Furthermore, this trend
of Globalization not only makes for a more complex skill set, but also, a more competitive
landscape all across the board Outside of the professional world, Globalization is also bound to
have an effect on my personal interactions. With a broadened communication network and the
ability to communicate with almost anyone from almost anywhere at almost any time, it is likely
that my acquaintances and friends will change dramatically.
I anticipate that as the efforts to globalize our world continue, a few things will become a lot
more difficult and a lot of things will become quite a bit more simple. Rather than entering a
local jobMARKET within my city, I will be entering an international job market where it is
quite possible my skill set will be easily outsourced for a lot less money than I will be asking for.
So what can I do to make myself more desirable to these future employers? Well, when thinking
globally the first thing that comes to my mind is multiple languages, thus, learning a language
other than my own seems like a good place to start. Furthermore, providing a level of
confidence and communication ability that is unique to myself seems like an important task.
The word unique brings to mind a crucial aspect of what I think will be important in a globalized
world. How can you make yourself unique in a world where everyone is attempting to assimilate
to each other. As Thomas Friedman notes in The World is FlatIndian people who are being hired
by outsourcing American companies, are taught to disguise their pronounced Indian accents
when speaking English and replace them with American. This removes the truly unique
experience that Americans are having when they deal with an outsourced person, there is an
attempt to hide the outsourcing and to make it appear that all things are staying in America. So I
wonder how this can be applied to my attempts to become more adept to working in a globalized
world.
Well firstly, I can assure any American company that I am going to sounds like an American.
That however, does not remove the fact that I am still more expensive then my foreign
competitors. I am however different in some crucial ways. I am receiving an education that not
many people are able to experience, I already have my foot in the door in certain career paths
through internships and acquaintances, and I am a viable candidate for face-to-face
communication as I look like many expect an American to look. Those things, while considered
important now by many are not necessarily going to be so in another 5 years when Globalization
continues to increase. Therefore I return to my attempts to learn a second language and become
more globally aware.
It seems to me that becoming globally aware is key to being part of a world that relies upon
communicating and understanding many different parts of the world. Immersing myself in the
local, political and recreational news of other nations seems a good place to start. Also traveling,
either by actually visiting other countries or by using the vast variety of technologies at my hands
to communicate with other nations, is bound to be helpful and become the first step to

globalizing my social network. It is possible that someday I may have a friend that I see and talk
to everyday who lives on the other side fo the world.
As I think more about Globalization I attempt to conjure up some images in my mind about what
the future of the world will look like. As I do this, a classic image that I remember from far
before video chat and outsourcing were at the top of the global spectrum comes to mind:

Although a simple, childish image, I feel like this really does represent my future. With all of the
potential difficulties that come with becoming a globalized world, the perpetually important idea
of everyone being connected and everyone getting along shines as a light in the distance of this
movement that is Globalization. I for one cannot wait to become part of an international
community and am looking forward to the day that the Indians who are outsourced into
American jobs do not have to hide their accen
Globalization A Curse or Blessing to Africans?
By
Sani Bala Shehu
sanibalashehukano@yahoo.com
INTRODUCTION

Globalization, comprehensive term for the emergence of a global society in which economic,
political, environmental, and cultural events in one part of the world quickly come to have
significance for people in other parts of the world. Globalization is the result of advances in
communication, transportation, and information technologies. It describes the growing
economic, political, technological, and cultural linkages that connect individuals,
communities, businesses, and governments around the world. Globalization also involves
the growth ofmultinational corporations (businesses that have operations or INVESTMENTS
in many countries) and transnational corporations(businesses that see themselves
functioning in a global marketplace). The international institutions that oversee worldTRADE
and finance play an increasingly important role in this era of globalization.
Although most people continue to live as citizens of a single nation, they are culturally,
materially, and psychologically engaged with the lives of people in other countries as never
before. Distant events often have an immediate and significant impact, blurring the
boundaries of our personal worlds. Items common to our everyday livessuch as the
clothes we wear, the food we eat, and the cars we driveare the products of globalization.
Globalization has both negative and positive aspects. Among the negative aspects are the
rapid spread of diseases, illicit drugs, crime, terrorism, and uncontrolled migration. Among
globalizations benefits are a sharing of basic knowledge, technology, INVESTMENTS ,
resources, and ethical values.
The most dramatic evidence of globalization is the increase in trade and the movement
of capital (stocks, bonds, currencies, and other investments). From 1950 to 2001 the
volume of world exports rose by 20 times. By 2001 world trade amounted to a quarter of all
the goods and services produced in the world. As for capital, in the early 1970s only $10
billion to $20 billion in national currencies were exchanged daily. By the early part of the
21st century more than $1.5 trillion worth of yen, euros, dollars, and other currencies
wereTRADED daily to support the expanded levels of trade and investment. Large volumes
ofCURRENCY TRADES were also made as investors speculated on whether the value of
particular currencies might go up or down.
REASONS FOR GLOBALIZATION
Most experts attribute globalization to improvements in communication, transportation, and
information technologies. For example, not only currencies, but also stocks, bonds, and
other financial assets can be traded around the clock and around the world due to
innovations in communication and information processing. A three-minute telephone call
from New York City to London in 1930 cost more than $300 (in year 2000 prices), making
instant communication very expensive. Today the cost is insignificant.
Advances in communication and information technologies have helped slash the cost of
processing business orders by well over 90 percent. Using a computer to do banking on the
Internet, for example, costs the banking industry pennies per transaction instead of dollars
by traditional methods. Over the last third of the 20th century the real cost of computer
processing power fell by 35 percent on average each year. Vast amounts of information can
be processed, shared, and stored on a disk or a computer chip, and the cost is continually
declining. People can be almost anywhere and remain in instant communication with their
employers, customers, or families 24 hours a day, 7 days a week, or 24/7 as it has come to
be known. When people in the United States call a helpline or make an airline reservation,
they may be connected to someone in Mumbai (Bombay), India, who has been trained to
speak English with an American accent. Other English speakers around the world prepare

tax returns for U.S. companies, evaluate insurance claims, and attempt to collect overdue
bills by telephone from thousands of kilometers and a number of time zones away.
Advances in communications instantly unite people around the globe. For example,
communications satellites allow global television broadcasts to bring news of faraway
events, such as wars and national disasters as well as sports and other forms of
entertainment. The Internet, the cell phone, and the fax machine permit instantaneous
communication. The World Wide Web and computers that store vast amounts of data allow
instant access to information exceeding that of any library.
Improvements in transportation are also part of globalization. The world becomes smaller
due to next-day delivery by jet airplane. Even slow, oceangoing vessels have streamlined
transportation and lowered costs due to innovations such as containerized shipping.
Advances in transportation have allowed U.S. corporations to subcontract manufacturing to
foreign factories. For example, in the early 2000s the Guadalajara, Mexico, factory of
Flextronic International made pocket computers, Web-connected TVs, computer printers,
and even high-tech blood-glucose monitors, for a variety of U.S. firms. Low transportation
costs enabled Flextronic to ship these products around the world, and the North American
FreeTRADE Agreement (NAFTA) made the Mexico location more attractive to Flextronic.
Advances in information technologies have also lowered business costs. The global
corporation Cisco Systems, for example, is one of the worlds largest companies as
measured by itsSTOCK MARKET value. Yet Cisco owns only three factories to make the
equipment used to help maintain the Internet. Cisco subcontracts the rest of its work to
other companies around the world. Information platforms, such as the World Wide Web,
enable Ciscos subcontractors to bid for business on Ciscos Web site where auctions take
place and where suppliers and customers stay in constant contact.
The lowering of costs that has enabled U.S. companies to locate abroad has also made it
easier for foreign producers to locate in the United States. Two-thirds of the automobiles
sold in North America by Japans Toyota Motor Company are built in North America, many
inKentucky and in seven other states. Michelin, the French corporate giant, produces tires
in South Carolina where the German car company BMW also manufactures cars for the
North American market.
Not only do goods,MONEY , and information move great distances quickly, but also more
people are moving great distances as well. Migration, both legal and illegal, is a major
feature of this era of globalization. Remittances (money sent home by workers to their
home countries) have become an important source of income for many countries. In the
case of El Salvador, for example, remittances are equal to 13 percent of the countrys total
national incomea more significant source of income than foreign aid, investment, or
tourism.
THE INSTITUTIONS OF GLOBALIZATION
Three key institutions helped shape the current era of globalization: the International
MonetaryFUND (IMF), the World Bank, and the WorldTRADE Organization (WTO). All
three institutions trace their origins to the end of World War II (1939-1945) when the United
States and the United Kingdom decided to set up new institutions and rules for the global
economy. At the Bretton Woods Conference in New Hampshire in 1944, they and other

countries created the IMF to help stabilizeCURRENCY MARKETS . They also established
what was then called the International Bank for Reconstruction and Development (IBRD) to
help finance the rebuilding of Europe after the war.
World Bank
Following Europes postwar recovery the IBRD became known as the World Bank. Its
mission was redirected to help developing countries grow faster and provide a higher living
standard for their people. The World Bank made loans to developing countries for dams and
other electrical-generating plants, harbor facilities, and other large projects. These projects
were intended to lower costs for private businesses and to attract investors. Beginning in
1968 the World Bank focused on low-cost loans for health, education, and other basic needs
of the worlds poor.
International Monetary Fund
The IMF makes loans so that countries can maintain the value of their currencies and repay
foreign debt. Countries accumulate foreign debt when they buy more from the rest of the
world than they sell abroad. They then need to borrow money to pay the difference, which
is known as balancing their payments. After banks and other institutions will no longer lend
them money, they turn to the IMF to help them balance their payments position with the
rest of the world. The IMF initially focused on Europe, but by the 1970s it changed its focus
to the less-developed economies. By the early 1980s a large number of developing
countries were having trouble financing their foreign debts. In 1982 the IMF had to offer
more loans to Mexico, which was then still a developing country, and other Latin American
nations just so they could pay off their original debts.
The IMF and the World Bank usually impose certain conditions for loans and require what
are called structural adjustment programs from borrowers. These programs amount to
detailed instructions on what countries have to do to bring their economies under control.
The programs are based on a strategy called neoliberalism, also known as the Washington
Consensus because both the IMF and the World Bank are headquartered
in Washington, D.C. The
strategy
is
geared
toward
promoting
free
markets,
including privatization (the selling off of government enterprises); deregulation (removing
rules that restrict companies); and trade liberalization (opening local markets to foreign
goods by removing barriers to exports and imports). Finally, the strategy also calls for
shrinking the role of government, reducing taxes, and cutting back on publicly provided
services.
World Trade Organization
Another key institution shaping globalization is the World Trade Organization (WTO), which
traces its origins to a 1948 United Nations (UN) conference in Havana, Cuba. The
conference called for the creation of an International Trade Organization to
lower tariffs (taxes on imported goods) and to encourage trade. Although the administration
of President Harry S. Truman was instrumental in negotiating this agreement, the U.S.
Congress considered it a violation of American sovereignty and refused to ratify it. In its
absence another agreement, known as the General Agreement on Tariffs and Trade (GATT),
emerged as the forum for a series of negotiations on lowering tariffs. The last of these
negotiating sessions, known as the Uruguay Round, established the WTO, which began
operating in 1995. Since its creation, the WTO has increased the scope of trading

agreements. Such agreements no longer involve only the trade of manufactured products.
Today agreements involve services, investments, and the protection of intellectual property
rights, such as patents and copyrights. The United States receives over half of its
international income from patents and royalties for use of copyrighted material.
CRITICISMS DIRECTED AT THE IMF AND WTO
Many economists believed that lifting trade barriers and increasing the free movement of
capital across borders would narrow the sharp income differences between rich and poor
countries. This has generally not happened. Poverty rates have decreased in the two most
heavily populated countries in the world, India and China. However, excluding these two
countries, poverty and inequality have increased in less-developed and so-called transitional
(formerly Communist) countries. For low- and middle-income countries the rate of growth in
the decades of globalization from 1980 to 2000 amounted to less than half what it was
during the previous two decades from 1960 to 1980. Although this association of slow
economic development and the global implementation of neoliberal economic policies is not
necessarily strict evidence of cause and effect, it contributes to the dissatisfaction of those
who had hoped globalization would deliver more growth. A slowdown in progress on
indicators of social well-being, such as life expectancy, infant and child mortality, and
literacy, also has lowered expectations about the benefits of globalization.
IMF Terms and Conditions
The IMF, in particular, has been criticized for the loan conditions it has imposed on
developing countries. Economist Joseph Stiglitz, a Nobel Prize winner and former chief
economist at the World Bank, has attacked the IMF for policies that he says often make the
funds clients worse, not better, off. So-called IMF riots have followed the imposition of
conditions such as raising the fare on public transportation and ending subsidies for basic
food items. Some countries have also objected to the privatization of electricity and water
supplies because the private companies taking over these functions often charge higher
prices even though they may provide better service than government monopolies. The IMF
says there is no alternative to such harsh medicine.
The WTO has faced much criticism as well. This criticism is often directed at the rich
countries in the WTO, which possess the greatest bargaining power. Critics say the rich
countries have negotiated trade agreements at the expense of the poor countries.
The Final Act of the Uruguay Round that established the WTO proclaimed the principle of
special and different treatment. Behind this principle was the idea that developing
countries should be held to more lenient standards when it came to making difficult
economic changes so that they could move to free trade more slowly and thereby minimize
the costs involved. In practice, however, the developing countries have not enjoyed special
and different treatment. In fact, in the areas of agriculture and the textile and clothing
industries where the poorer countries often had a comparative advantage, the developing
countries were subjected to higher rather than lower tariffs to protect domestic industries in
the developed countries. For example, the 48 least-developed countries in the world faced
tariffs on their agricultural exports that were on average 20 percent higher than those faced
by the rest of the world on their agricultural exports to industrialized countries. This
discrepancy increased to 30 percent higher on manufacturing exports from developing
countries.

Agricultural Subsidies
The agricultural subsidies granted by wealthy countries to their own farmers have earned
the strongest and most sustained criticisms, especially from developing countries. Japan, for
example, imposes a 490 percent tariff on foreign rice imports to protect its own rice
farmers. The average cow in Switzerland earns the annual equivalent of more than $1,500
in subsidies each year as the Swiss government seeks to protect its dairy industry from
foreign competition.
The United States enjoys some of the greatest advantages. Because of government
payments, U.S. farmers can sell their products at 20 percent below their cost of production
in overseas markets. United States corn exports represent more than 70 percent of the total
world exports of corn. The United States ships half of the worlds total exports of soybeans
and a quarter of all wheat exports. Farmers in theUnited States can sell these grains at half
of what it costs to produce them. The resulting artificially low world prices hurt producers in
poorer countries where there are no government subsidies.
For example, in 2002 the president of the United States authorized $4 billion in subsidies
to Americas 25,000 cotton farmers. This action lowered world cotton prices by one-fourth.
As a result West African countries lost hundreds of millions of dollars, and the regions 11
million cotton-producing households suffered increased poverty.
The European Union (EU) gives its farmers even higher subsidies. The EU is the worlds
largest exporter of skimmed-milk powder, which it sells at about half the cost of production.
The EU is the worlds largest exporter of refined sugar, which it sells at a quarter of the cost
of producing it. Governments in the developed world pay more than $300 billion a year in
farm subsidies, seven times what they give in development aid. Such subsidies have a
devastating impact on farmers in poorer countries. Mexican farmers are priced out of local
markets for corn by subsidized U.S. exports. Sugar growers in Swaziland and cotton
producers in West Africa must compete with products that rich countries dump onto the
world market at prices well below the cost of their production due to these subsidies.
Foreign Aid
Foreign aid from rich countries does little to offset the impact of these subsidized farm
exports. Foreign-aid spending by wealthy nations amounts to only a tiny percentage of their
incomes and total government spending. The United States gives just 0.1 percent of its
gross domestic product (GDP), or about $35 a year per American, in foreign aid. Of this,
about one-third goes to just three countriesIsrael,Egypt, and Pakistanwhich together
receive more than twice as much aid from the United States as the poorest billion people in
the world do. Europe gives 0.33 percent of its collective GDP and has promised to increase
giving to 0.39 percent. Although the United States andJapan, the worlds two largest
economies, give the most aid in absolute terms, they are at the bottom of the list of
countries based on aid as a share of national income. The most generous are the smaller
countries of Northern Europe, including Denmark, Norway, The Netherlands,Luxembourg,
and Sweden.
Trade Disputes, Rules, and Agreements
Given the importance of foreign trade, one of the most important international agencies is
the WTOs Dispute Settlement Board, which is empowered to settle trade disputes under

WTO rules. Winners of such settlement decisions by the board are allowed to retaliate
against countries found guilty of unfair trade practices. Smaller, developing countries,
however, fear cross-retaliation if they confront larger, more powerful nations.
Critics of the WTO in developing countries charge that the rules do not help them and that
they have been forced to bear the harsh adjustment costs to free trade while developed
countries have not lived up to their liberalization commitments. According to these critics,
the terms of trade have gone against the developing countries. The value of developing
countries exports has declined relative to the value of their imports. Not only have the
prices of such commodities as coffee, copper, sugar, and cotton fallen substantially for
decades but also earnings from labor-intensive manufacturing, such as textiles and clothing,
have declined as an ever greater number of developing countries compete for the limited
amount they can export to the rich countries. At the same time the developing countries
have faced increased prices on goods they import, ranging from computer software to
airplanes to medicine.
A WTO meeting in November 2001 in Doha, the capital of Qatar, set in motion a multiyear
negotiating process aimed at further liberalizing world trade but with a focus on the needs of
the developing countries. However, disputes over agricultural subsidies, the definition of
intellectual property rights, and whether poor countries were to be entitled to special and
different treatment were not easy to resolve. The rich countries had the greater bargaining
power, and their trade negotiators were under pressure not to make concessions that would
hurt people back home.
In 2003 these issues came to a head as WTO talks in Cancn, Mexico, foundered.
Representatives of a group of 21 developing countries withdrew from the talks after the EU
and the United States failed to meet their demands for lowering agricultural subsidies. The
same countries also resented EU and U.S. proposals that they accept new rules for foreign
investment without first agreeing on the issue of subsidies. Some observers believed that
the failure of the talks in Cancn made it unlikely that global trade rules could be negotiated
by a self-imposed deadline of January 2005.
Critics of the WTO have also charged that the developed countries have obtained a set of
trade agreements benefiting their large corporations. The Agreement on Basic
Telecommunications, for example, opened world markets to large telecommunications
companies based in the developed nations. These companies were previously excluded from
these markets by government-owned monopolies. The Financial Services Agreement
likewise opened opportunities for banks, insurance companies, and stockbrokers in the
developed countries as they sought to expand into new markets.
Instead of increasing economic stability, financial liberalization caused financial crises in
most of the worlds economies. An IMF study found that 133 of the funds 181 member
countries suffered at least one significant banking crisis from 1980 to 1995. The World Bank
identified more than 100 major bank collapses in 90 developing or formerly Communist
nations from the late 1970s to 1994. Many economists believe that these crises were caused
by the IMF-imposed financial liberalization on countries that either lacked regulatory
agencies or the experience necessary to oversee the financial sector.
THE DEBATE OVER GLOBALIZATION
Very few people, groups, or governments oppose globalization in its entirety. Instead, critics
of globalization believe aspects of the way globalization operates should be changed. The

debate over globalization is about what the best rules are for governing the global economy
so that its advantages can grow while its problems can be solved.
On one side of this debate are those who stress the benefits of removing barriers to
international trade and investment, allowing capital to be allocated more efficiently and
giving consumers greater freedom of choice. With free-market globalization, investment
funds can move unimpeded from where they are plentiful (the rich countries) to where they
are most needed (the developing countries). Consumers can benefit from cheaper products
because reduced tariffs make goods produced at low cost from faraway places cheaper to
buy. Producers of goods gain by selling to a wider market. More competition keeps sellers
on their toes and allows ideas and new technology to spread and benefit others.
On the other side of the debate are critics who see neoliberal policies as producing greater
poverty, inequality, social conflict, cultural destruction, and environmental damage. They say
that the most developed nationsthe United States, Germany, and Japansucceeded not
because of free trade but because of protectionism and subsidies. They argue that the more
recently successful economies of South Korea,Taiwan, and China all had strong state-led
development strategies that did not follow neoliberalism. These critics think that
government encouragement of infant industriesthat is, industries that are just beginning
to developenables a country to become internationally competitive.
Furthermore, those who criticize the Washington Consensus suggest that the inflow and
outflow of money from speculative investors must be limited to prevent bubbles. These
bubbles are characterized by the rapid inflow of foreign funds that bid up domestic stock
markets and property values. When the economy cannot sustain such expectations, the
bubbles burst as investors panic and pull their money out of the country. These bubbles
have happened repeatedly as liberalization has allowed speculation of this sort to get out of
hand,
such
as
inIndonesia, Malaysia,
and Thailand in
1997
and
since
then
in Argentina, Russia, and Turkey. According to critics, a strong active government is needed
to assure stability and economic development.
Protests by what is called the antiglobalization movement are seldom directed against
globalization itself but rather against abuses that harm the rights of workers and the
environment. The question raised by nongovernmental organizations and protesters at WTO
and IMF gatherings is whether globalization will result in a rise of living standards or a race
to the bottom as competition takes the form of lowering living standards and undermining
environmental regulation. One of the key problems of the 21st century will be determining
to what extent markets should be regulated to promote fair competition, honest dealings,
and fair distribution of public goods on a global scale. See alsoDevelopment Economics.
REGULATING GLOBALIZATION
The debate over globalization focuses in particular on how it can be regulated to address
growing income and wealth inequalities, labor rights, health and environmental problems,
and issues regarding cultural diversity and national sovereignty.
Inequality
By the late 1990s the 20 percent of the worlds people living in the highest-income countries
had 86 percent of the worlds income; the bottom 20 percent had only 1 percent of the
worlds income. An estimated 1.3 billion people, or about one-sixth of the worlds

population, have incomes of less than a dollar a day. Inequality is growing worse, rather
than better. More than 80 countries had lower per capita income (income per person) at the
end of the 1990s than they had at the end of the 1980s. In 1960 the top 20 percent had 30
times the income of the poorest 20 percent. This grew to 32 times in 1970, 45 times in
1980, and 60 times in 1990. By the end of the 20th century the top 20 percent received 75
times the income of the bottom 20 percent. The income gap is even apparent in cyberspace.
The top fifth in income make up 93 percent of the worlds Internet users and the poorest
fifth only 0.2 percent.
These inequalities in living standards and participation in the global economy are a serious
political problem in an era of globalization. Some countries have been unable to function at
even a minimum standard of basic competence in the globalized economy. The only
profitable economic activity in some of these countries is linked to criminal behavior, such as
the trade in illegal drugs, smuggling, and extortion of various kinds. Governments that are
helpless to stop such activity or to collect taxes to meet basic public service needs are
characterized as failed states. Sometimes failed states can become havens for terrorists and
foreign criminals who use them as bases for activities harmful to other governments and
their people. These states may also provide safe haven for mercenary forces that conduct
raids into neighboring countries. In parts of Africa, for example, where diamonds and other
valuable resources attract criminal despots, mercenary armies have been engaged in mass
killing to terrorize local populations into giving them what they want. The international arms
trade and easy importation of weapons, which allows such behavior, is a serious problem.
Labor Rights
To stimulate economic development many developing countries have established free-trade
zones where investors are given special benefits, such as low or no taxes, and labor unions
are discouraged or not allowed. These benefits have led to violations of human rights. For
example, the Workers Rights Consortium, supported by many colleges and universities in
the United States, has sent inspection teams to developing countries to investigate the
conditions under which caps and sweatshirts are made for university sports teams. The
consortium found violations of child labor laws, intimidation of workers seeking to have their
grievances addressed, and sexual harassment. Because only 1 percent of the projected
growth in the worlds labor force is expected to be in the high-income countries in coming
decades, what happens to the worlds lower-income workers in the developing countries
takes on added importance. It may well determine whether there will be an overall rise in
living standards as productivity gains are widely shared or an overall decline if developing
countries compete for jobs by holding down wages and allowing harsher working conditions
to attract investment and job creation.
The UNs International Labor Organization (ILO) has tried to level the playing field by
endorsing five widely accepted core labor standards. These are elaborated in the ILOs 1998
Declaration of Fundamental Principles and Rights at Work. The first promises freedom of
association and states that workers should be able to join together and form organizations
of their own choosing. The second is the right of workers organizations, including trade
unions, to bargain collectively with employers and governments. Third is the elimination of
all forms of coerced or compulsory labor. Fourth is the effective abolition of child labor. The
ILOs Minimum Age Convention sets a basic minimum age of 15, but if a country is less
developed or if only light work is involved the minimum age can be lower. If hazardous work
is involved, the minimum age is 18. The fifth provision is the elimination of discrimination in
employment based on race, sex, religion, political opinion, or national or social origin.

Because the ILO has no enforcement powers, it has proven difficult to achieve these goals.
In some countries governments pledge to observe the ILOs standards but then ignore
them. Where child labor laws are enforced, government factory inspectors often simply
demand that child workers be fired. Many observers believe that to successfully attack the
evils of child labor, child workers should not merely be fired but should be placed in schools
and families should be compensated for the loss of income that occurs when children are
removed from factories.
Health Issues
Life-threatening diseases represent another facet of globalization. Improvements in
transportation that helped usher in globalization also made it possible for infectious diseases
to spread rapidly around the globe. In 2003, for example, a deadly form of pneumonia
known as severe acute respiratory syndrome (SARS) originated in China and quickly posed
a worldwide health threat as airline passengers infected with the virus spread the illness.
The best way to address these health issues often conflicts with the WTOs stand on
intellectual property rights, in particular the patent laws that protect medicines made by
pharmaceutical companies. This issue is particularly prominent in relation to acquired
immunodeficiency syndrome (AIDS). Of the 20 million people who have died of AIDS most
lived in poorer countries. In some developing countries the infection rate is above 30 or
even 40 percent of the adult population. Today the worst affected countries are in Africa.
The disease is also spreading rapidly in countries such as India, China, and Indonesia.
There are other killer diseases found mostly in poorer countries. Although tuberculosis (TB)
affects a small percentage of the population in rich countries, more than one-third of the
worlds population was infected with tuberculosis in 2000. There are 8 million new cases of
TB and 2 million deaths a year from this disease, and these numbers are climbing. More
than 1.5 million people die each year from malaria, another disease that mainly impacts
developing countries. Diseases spread by unclean drinking water and tainted food kill nearly
2 million people a year, mostly infants and small children and mostly among the 1.5 billion
people in the world who do not have access to clean water.
In the case of diseases that primarily affect poor people, little or no research is being done
to provide new medicines because the people affected are too poor to buy them. A major
struggle has emerged regarding AIDS treatment over whether patent laws will continue to
require that people pay high prices for life-saving drugs or whether lower-cost generic
medicines can be provided. This issue has been intensively discussed as part of the debate
over the WTOs Agreement on Trade Related Aspects of Intellectual Property Rights (TRIPs).
Western pharmaceutical companies that do the research and development wish to protect
their investments and argue that without such protection less will be spent to develop new
life-saving drugs. The developing countries argue that scientific breakthroughs should be
shared as widely and as inexpensively as possible. They have resisted the extension of
property rights.
Environmental Issues
At least since the discovery of the ozone hole above Antarctica in the early 1980s, there has
been growing awareness that air pollutants can cross borders and affect everyone living on
the planet. The UNs Intergovernmental Panel on Climate Change, made up of the worlds
leading climate scientists, for example, predicts that by the year 2100 the temperature of
the planet could rise by as much as 1.4 to 5.8 Celsius degrees (2.5 to 10.4 Fahrenheit

degrees). This global warming is due to the burning of fossil fuels, which occurs mainly in
the developed, industrialized world, and the destruction of rain forests, which occurs mainly
in the developing world. Already Greenlands ice sheet has thinned and Argentinas South
Patagonia ice fields have retreated substantially. Glaciers are melting, and weather patterns
may already be changing.
If global warming continues, experts expect deserts to advance, particularly across West
Africa, and sea level to rise, flooding coastal areas and submerging a number of Pacific
Ocean island states. One-third of the worlds most populous countries would be flooded by
even a small rise in sea level. While developed countries such as The Netherlands can cope,
developing countries such as Bangladesh cannot afford to pay for the kind of dike system
that currently protects The Netherlands. Because of such dire forecasts, 160 nations in 1997
agreed to the first-ever binding pact to limit the emissions of carbon dioxide and other socalled greenhouse gases that contribute to global warming. Known as the Kyto Protocol,
the pact represented a modest step in limiting and rolling back harmful greenhouse gas
emissions.
Environmentalists argue broadly in favor of sustainable development. By this they mean a
pattern of living that favors the preservation of habitat, the conservation of nonrenewable
resources, and the increased use ofRENEWABLE ENERGY sources so that Earths
ecosystems are not harmed beyond repair. Environmentalists favor the principle that
polluters should pay for the right to pollute. Concerning genetic engineering, most
environmentalists argue for a precautionary principle that emphasizes careful study before
new genetically engineered plants or animals are introduced into ecosystems. Genetically
modified plants, according to this principle, should not be introduced unless it is clear that
no damage will be done. Some politicians and agribusiness corporations believe such a
conservative approach would slow growth unnecessarily, lower living standards, and result
in greater costs for businesses and consumers. They favor rules based on proven danger
and far quicker introduction of genetically engineered products and processes.
CULTURE
There is widespread disagreement over what, if any, regulation is appropriate in the realm
of culture. Some people fear a loss of cultural diversity as U.S. media companies become
dominant. Such companies tend to bundle their products so that a blockbuster movie is
promoted by selling soundtracks, books, video games, and other products. These cultural
wares are distributed worldwide, and along with reruns of U.S. television shows, tend to
replace local alternatives. The question is whether responses by other nations, such as
prohibitions against the English language and government subsidies of national cultural
productions, are legitimate restraints ofTRADE or represent an unfair trade practice.
National Sovereignty
In a world that seems to grow increasingly smaller many issues must be considered at a
global level and not only at a local or national level. However, at what point does this
threaten national sovereigntythat is, the ability of a country to be self-governing? Some
environmentalists, for example, have argued that environmental laws in the United States
can be undermined if the laws are found to violate NAFTA. In effect, they say, the United
States has lost the right to make and enforce its own environmental policies.
GLOBALIZATION IN THE COMING DECADES

Globalization raises other questions that will be central to the 21st century. What is the
proper role for the IMF, WTO, and UN, and how should they be governed? What is the best
way to FINANCE development? How much autonomy should countries have when the
economic, political, and environmental decisions they make can have global repercussions?
To what extent should global institutions be able to constrain what countries can and cannot
do in an increasingly globalized world? What is the right way to balance social and cultural
values with the need for economic efficiency? As the 21st century progresses, more and
more decisions regarding these and other issues will need to be debated.
This is fact and reality, there is nothing concocted fabricated invented originated, devised or
improvised. Sani Bala shehu wrote in from civil liberties organization (C.L.O).And can be
reach at:
Sanibalashehukano@yahoo.com

GLOBALIZATION: A BLESSING AND A CURSE

Crossing Borders Global Studies 2009
Reflection on Globalization
GLOBALIZATION: A BLESSING AND A CURSE
Roberto:
Globalization is as huge as its term. The enormity of its measure is limitless. The
effect is both predictable and unpredictable. It is a blessing and a curse. It smacks
right in our faces shaping our mode of responding the necessity of everyday life. We
cannot ignore and undo the smashing wave of technology affecting our economic,
political and cultural life, even our sex life so to speak. Indeed we all enjoy its
accessibility from agriculture to food production, family desires to the wider
community needs; and the whole global village running like machines absorbing
anything that globalization emits.
The ideal premise is that globalization should work in service of the people. In
practice it maybe an assumption. It involves politics, economics, self-interest and
power. And who are in power? The rich nations who have all the resources at the
same time using the resources of the deprived and under privilege nations through
land and labor use. It may appear in sheeps skin of development and progress.
Who wouldnt want it anyway? These are realities as real as how globalization
gradually devours the weak, the vulnerable sectors of the society.

Where are we heading to? Where will it lead us? Simple questions we wont bother
thinking about. Or maybe we leave it to the experts and the knowledgeable. That is
what they are made for anyway. These are the attitudes that will deliver us into hell.
The advanced price we have to pay is the future of the coming generation.
On the other hand there are efforts to install preventive measures in various forms.
Individual advocates, concerned citizens, organizations and institutions fight it out
in various playing fields. Education and information in all forms are venues for
awareness and action. Creative and active approaches are explored to respond the
hazards of globalization transforming its own technology to a positive and functional
use. Individually, being part of humanity playing a key role on this issue must
develop a sense of critical attitude in taking action to the influx of what
globalization has to offer. Unless we choose to sit and wait until the kingdom comes.
Eva Vtkov:
Why do we get so attached to our stuff? Or, to be more precise, to some of our
stuff? We develop relationships to different objects that we own, let it be an iPod,
favourite book or a bike. And in case of lost (when this item is stolen/broken/lost),
we exprerience a terrible feeling for a while, it feels like loosing the best friend. In
order to overcome this feeling, we run to the shop to get a replacement for the
previous object and we start a brand new relationship. But as I have implied
before, that doesnt count for all of our stuff.
Or at least not all the time. Do you remember how easy it is to forget about the old
object when you are on the way to the shop to buy a new one? Because the old one
is out of date, doesnt function any more or you just got tired of it? I think that
people tend to buy new things instead of repairing or improving the old ones
nowadays. It just requires less effort. In order to have your old shoes repaired, you
have toINVEST

time and energy into finding a place where they repair shoes,

bringing them there and after some days bringing them back home. Does it cost 10
times less than a new pair of shoes? But buying new ones is soooo much easier! It is

an easy solution. A relatively easy and fast way how to solve my problem.
The first step we all have to do in order to improve the environement we live in, is
start looking for solutions with a long-term perspective on mind.

Reut:
The movie (20 min. on the process of "things") presented in a very clear way the
greedy side of human beings. This greediness is a part of a process of detaching
ourselves from what we really need and connecting to what we want or what we are
told we want/ need by others.
Globalization has a big affect on the matter because it enables exposure to those
unnecessary things. That exposure has no limits; it reaches young and adults, poor
and rich, everywhere in the world. Censoring that exposure is almost impossible.
The way to make a change, as it seems to me, is to raise awareness to the way we
consume things, even though we don't need them, and to educate about the
process of making things and their consequences.

Aneka Kervitcerov:
The term globalization is recently being used more and more often. It seems to be a
new trend in our society and you might be criticized if you would not mention this
subject during your speech. However where did this reflex appeared and what does
it means for common people?
In my opinion globalization came through the development of economy and
technology. Thanks to theCURRENCY

convertibility we can have translational

corporations that offer the same products and services to people all over the world.
Thanks to the media we can communicate and share information with everybody on
the other end of our planet. And thanks to the modern transport and infrastructure
we can visit places of our dreams.

Finally a question comes up: should we be afraid of this phenomenon? I believe

globalization just reflects reality that all of us are identical human beings with the
same needs and shortcomings. And as every event in peoples lives, it only depends
how we utilize it.

Samba:
Globalization is a term that describes a process of a world connected in all aspects
of life. In fact, media and economics are the corners of this phenomenon. Moreover,
capitalism is a fundament element of globalization. It facilitates the movement of
goods and people through exchange andTRADE . Which sums up the world into a
small village were all nations are connected somehow.
However, globalization contains several disadvantages that many people suffer or
even die because of it. In fact, globalization has divided the world into two blocks:
the rich and poor, the have and have not etc. So wherever you go in the world rich
people live together play together; meanwhile, poor people suffer together, live
together etc. In other words interests are globalized rather than humans.
Consequently, materialism rises in all around the world. The image of a small village
where all things are connected turns to be a small city where no one knows the
name of his neighbor.
Anyway, we have to admit that globalization contains as everything else advantage
and disadvantage. Ignoring it is a suicidal choice. So we simply have to be aware of
it so that we can swim in it and not sink into it.
Fruzsina:
The Globalization is a process of interaction and integration among the people,
companies, and governments of different nations, a process driven by
internationalTRADE

andINVESTMENT

and aided by information technology.

There is some maintain word when we hear them we are thinking about the
globalization, for example environment which is very important to keep safe. There
are some methods which might help like recycling, more trees, dont waste the
energy.
The other example is communication. This is one of the most important things. This
is that it helps people keep contact with each other. You need it to be able to work.
Technology has been the principal driver of globalization. Advances in information
technology, in particular, have dramatically transformed the economic life.
Globalization is everywhere that it would be very hard to prevent.
Zsuzsanna:
Globalisation.
This word express me to making the world open and to come at table.
And Im also associating a lot of expressions related to the Globalisation: uniformity,
one world, people, united, same, big, north, south, equality, liberalism, free trade,
fair trade, institutions, and government.
The world is open to you. But who opened it? And you can find the institutions,
governments, the media, and the companies.
Is it really open, open for everyone? Thats the question.
Lets see an example:
When you go to the shop, you can find a banana from Ecuador on the display, and
you pay the same price than you would pay for a loaf of bread. Its a good business
for you, you think.
But how is it possible to get the banana in a very reasonable price if it comes from
so far away, how many miles it was need to take until you get it? What is the impact
of the environment? It should be cost a lot. And how much could be remain from
this relatively cheap price at the producer? What is the system behind it? Is it really
a good business for you?Globalisation generates a lot of question to me. But I think

we always need to ask about...This small example points out that Globalisation has
an effect on you and you can have an effect on it as well. Be aware!
Posted by Fraekhedunderansvarat 3:23 PM
GLOBALIZATION: A BLESSING AND A CURSE
Crossing Borders Global Studies 2009
Reflection on Globalization
GLOBALIZATION: A BLESSING AND A CURSE
Roberto:
Globalization is as huge as its term. The enormity of its measure is limitless. The
effect is both predictable and unpredictable. It is a blessing and a curse. It smacks
right in our faces shaping our mode of responding the necessity of everyday life. We
cannot ignore and undo the smashing wave of technology affecting our economic,
political and cultural life, even our sex life so to speak. Indeed we all enjoy its
accessibility from agriculture to food production, family desires to the wider
community needs; and the whole global village running like machines absorbing
anything that globalization emits.
The ideal premise is that globalization should work in service of the people. In
practice it maybe an assumption. It involves politics, economics, self-interest and
power. And who are in power? The rich nations who have all the resources at the
same time using the resources of the deprived and under privilege nations through
land and labor use. It may appear in sheeps skin of development and progress.
Who wouldnt want it anyway? These are realities as real as how globalization
gradually devours the weak, the vulnerable sectors of the society.
Where are we heading to? Where will it lead us? Simple questions we wont bother
thinking about. Or maybe we leave it to the experts and the knowledgeable. That is
what they are made for anyway. These are the attitudes that will deliver us into hell.
The advanced price we have to pay is the future of the coming generation.

On the other hand there are efforts to install preventive measures in various forms.
Individual advocates, concerned citizens, organizations and institutions fight it out
in various playing fields. Education and information in all forms are venues for
awareness and action. Creative and active approaches are explored to respond the
hazards of globalization transforming its own technology to a positive and functional
use. Individually, being part of humanity playing a key role on this issue must
develop a sense of critical attitude in taking action to the influx of what
globalization has to offer. Unless we choose to sit and wait until the kingdom comes.
Eva Vtkov:
Why do we get so attached to our stuff? Or, to be more precise, to some of our
stuff? We develop relationships to different objects that we own, let it be an iPod,
favourite book or a bike. And in case of lost (when this item is stolen/broken/lost),
we exprerience a terrible feeling for a while, it feels like loosing the best friend. In
order to overcome this feeling, we run to the shop to get a replacement for the
previous object and we start a brand new relationship. But as I have implied
before, that doesnt count for all of our stuff.
Or at least not all the time. Do you remember how easy it is to forget about the old
object when you are on the way to the shop to buy a new one? Because the old one
is out of date, doesnt function any more or you just got tired of it? I think that
people tend to buy new things instead of repairing or improving the old ones
nowadays. It just requires less effort. In order to have your old shoes repaired, you
have toINVEST

time and energy into finding a place where they repair shoes,

bringing them there and after some days bringing them back home. Does it cost 10
times less than a new pair of shoes? But buying new ones is soooo much easier! It is
an easy solution. A relatively easy and fast way how to solve my problem.
The first step we all have to do in order to improve the environement we live in, is
start looking for solutions with a long-term perspective on mind.

Reut:
The movie (20 min. on the process of "things") presented in a very clear way the
greedy side of human beings. This greediness is a part of a process of detaching
ourselves from what we really need and connecting to what we want or what we are
told we want/ need by others.
Globalization has a big affect on the matter because it enables exposure to those
unnecessary things. That exposure has no limits; it reaches young and adults, poor
and rich, everywhere in the world. Censoring that exposure is almost impossible.
The way to make a change, as it seems to me, is to raise awareness to the way we
consume things, even though we don't need them, and to educate about the
process of making things and their consequences.

Aneka Kervitcerov:
The term globalization is recently being used more and more often. It seems to be a
new trend in our society and you might be criticized if you would not mention this
subject during your speech. However where did this reflex appeared and what does
it means for common people?
In my opinion globalization came through the development of economy and
technology. Thanks to theCURRENCY

convertibility we can have translational

corporations that offer the same products and services to people all over the world.
Thanks to the media we can communicate and share information with everybody on
the other end of our planet. And thanks to the modern transport and infrastructure
we can visit places of our dreams.
Finally a question comes up: should we be afraid of this phenomenon? I believe
globalization just reflects reality that all of us are identical human beings with the
same needs and shortcomings. And as every event in peoples lives, it only depends
how we utilize it.

Samba:
Globalization is a term that describes a process of a world connected in all aspects
of life. In fact, media and economics are the corners of this phenomenon. Moreover,
capitalism is a fundament element of globalization. It facilitates the movement of
goods and people through exchange andTRADE . Which sums up the world into a
small village were all nations are connected somehow.
However, globalization contains several disadvantages that many people suffer or
even die because of it. In fact, globalization has divided the world into two blocks:
the rich and poor, the have and have not etc. So wherever you go in the world rich
people live together play together; meanwhile, poor people suffer together, live
together etc. In other words interests are globalized rather than humans.
Consequently, materialism rises in all around the world. The image of a small village
where all things are connected turns to be a small city where no one knows the
name of his neighbor.
Anyway, we have to admit that globalization contains as everything else advantage
and disadvantage. Ignoring it is a suicidal choice. So we simply have to be aware of
it so that we can swim in it and not sink into it.
Fruzsina:
The Globalization is a process of interaction and integration among the people,
companies, and governments of different nations, a process driven by
internationalTRADE

andINVESTMENT

and aided by information technology.

There is some maintain word when we hear them we are thinking about the
globalization, for example environment which is very important to keep safe. There
are some methods which might help like recycling, more trees, dont waste the
energy.
The other example is communication. This is one of the most important things. This

is that it helps people keep contact with each other. You need it to be able to work.
Technology has been the principal driver of globalization. Advances in information
technology, in particular, have dramatically transformed the economic life.
Globalization is everywhere that it would be very hard to prevent.
Zsuzsanna:
Globalisation.
This word express me to making the world open and to come at table.
And Im also associating a lot of expressions related to the Globalisation: uniformity,
one world, people, united, same, big, north, south, equality, liberalism, free trade,
fair trade, institutions, and government.
The world is open to you. But who opened it? And you can find the institutions,
governments, the media, and the companies.
Is it really open, open for everyone? Thats the question.
Lets see an example:
When you go to the shop, you can find a banana from Ecuador on the display, and
you pay the same price than you would pay for a loaf of bread. Its a good business
for you, you think.
But how is it possible to get the banana in a very reasonable price if it comes from
so far away, how many miles it was need to take until you get it? What is the impact
of the environment? It should be cost a lot. And how much could be remain from
this relatively cheap price at the producer? What is the system behind it? Is it really
a good business for you?Globalisation generates a lot of question to me. But I think
we always need to ask about...This small example points out that Globalisation has
an effect on you and you can have an effect on it as well. Be aware!
Posted by Fraekhedunderansvarat 3:23 PM
Even though globalization affects the worlds economies in a positive way, its negative side
should not be forgotten. Discuss.
In the present age, globalization is playing an increasingly important role in our lives. But in the
meantime whether it is a blessing or a curse has sparked a heated debate. Some people argue that

globalization has a fundamentally beneficial influence on our lives, while many others contend that it
has a detrimental effect as well.
A convincing argument can be made about globalization not only playing a pivotal role in the
development of technology and economy, but also promoting the cultural exchange between different
countries. To start with, it is the globalization that impelled many corporate to become international
groups, thereby making a contribution to the local technology and employment. Specifically, when a
multinational group establish a factory in a developing country, the new equipment, the new
management skills and the job vacancies are all in the best interest of the local society. Moreover,
people worldwide can get to know each other better through globalization. It is easy to see that more
and more Hollywood blockbusters show cultures different from American, some recent examples are
Kungfu Panda and The Mummy.
Admittedly, the profit driven side of globalization has severely affected young people. Today, in the
metropolises in different countries, it is very common to see teenagers wearing NIKE T-shirts and
Adidas footwear, playing Hip-Hop music on Apple iPods and eating at KFC. The culture that took a
thousand years to form just seems similar in these cities; it seems as though you can only distinguish
them by their language. Meanwhile, in some developing countries, sweat workshops are always a
concerning issue. For instance, reports show that some teenagers employed by NIKEs contractors
work in smelly factories over 14 hours a day, but are only paid fifty cents per hour.
To sum up, I would concede that globalization does come with some adverse effects. Despite that fact,
benefits created by it far outweigh the disadvantages. Overall, I am convinced that we should further
promote globalization and meanwhile the local government should take measures to combat culture
assimilation and sweat workshop

TheBlessingsand
Challengesof
Globalization
By Daniel Griswold
This article appeared on Cato.org on September 1, 2000.

The evidence of globalization can be seen everywhere: in the home, in the workplace, in
the discount stores, in the newspapers and business journals, in the flow of monthly
government statistics, and in academic literature. The backlash was on display in Seattle
in November 1999, when thousands of protesters took to the streets to demonstrate
against the ministerial meeting of the WorldTRADE Organization (WTO).

A short definition of globalization is the growing liberalization of internationalTRADE

and investment, and the resulting increase in the integration of national economies.
Economist David Henderson of the Melbourne Business School expands the definition
into five related but distinct parts:
* the increasing tendency for firms to think, plan, operate, and invest for the future with
reference toMARKETS and opportunities across the world as a whole;
* the growing ease and cheapness of international communications, with the Internet
the leading aspect;
* the trend toward closer international economic integration, resulting in the
diminished importance of political boundaries. This trend is fueled partly by the first
two trends, but even more powerfully by official policies aimed atTRADE and
investment liberalization;
* the apparently growing significance of issues and problems extending beyond national
boundaries and the resulting impetus to deal with them through some form of
internationally concerted action; and
* the tendency toward uniformity (or harmonization), by which norms, standards,
rules, and practices are defined and enforced with respect to regions, or the world as a
whole, rather than within the bounds of nation-states.1
Globalization can be seen most clearly in the quickening pace and scope of international
commerce. Global exports as a share of global domestic product have increased from 14
percent in 1970 to 24 percent today,2 and the growth ofTRADE has consistently
outpaced growth in global output. In the United States, the ratio of two-way trade and
investment income flows as a share of GDP has roughly tripled since the 1960s. Annual
global flows of foreign direct investment surged to a record $ 400 billion in 1997, with
37 percent directed to less developed countries (LDCs), up from 7 percent in 1990.3 In
the 1970s, dailyFOREIGN EXCHANGE transactions averaged $ 10 billion to $ 20
billion; today, the average daily activity has reached more than $ 1.5 trillion.4

The expansion of international trade and foreign investment has not been the result of
some grand design imposed on the global economy. It has been an ad hoc,
decentralized, bottom-up process resulting from two developments of the 1980s: the
collapse of global communism and the demise of the Third Worlds romance with
import substitution. The fall of the Berlin Wall and the final disintegration of the Soviet
empire two years later released 400 million people from the grip of centrally
commanded and essentially closed economic systems. Meanwhile, the debt crisis of
1982 and the resulting Lost Decade of the 1980s imposed a painful hangover on many
Third World nations that had tried and failed to reach prosperity by shunning foreign
capital and by protecting and subsidizing domestic infant industries. Beginning with
Chile in the mid-1970s and China later that decade, LDCs from Mexico and Argentina to
India more recently have been opening theirMARKETS and welcoming foreign
investment. The globalization of the last decade has not been the result of a blind faith
in markets imposed from above but of the utter exhaustion of any alternative vision.
In contrast to those failed policies, certain countries have managed to dramatically
improve their living standards by deregulating their domestic economies and opening
up to globalMARKETS . The Four Tigers of East AsiaHong Kong, Singapore, Taiwan,
and South Koreaare the most prominent examples. From typical Third World poverty
in the 1950s, each has achieved a standard of living today equivalent to that of
industrialized nations, with per-capita incomes in Hong Kong and Singapore rivaling
those of the wealthiest Western nations.
The relative success of openness as a policy, compared with protectionism, has spurred
a global movement toward unilateralTRADE liberalization. Since the mid-1980s, sixty
LDCs have unilaterally lowered their barriers to trade. LDCs have flocked to join the
WTO. Today more than three-quarters of its members are LDCs, with another twenty
waiting in line to join.5 The move to trade liberalization has been accompanied by
investment liberalization, with more than 90 percent of national policy changes in the
last decade being in the direction of more openness toward foreign investment.6
THE BLESSINGS OF GLOBALIZATION

Beyond all the impressive numbers about the extent of globalization, what kind of
impact is it having on national economies? There are at least three fundamental
blessings of globalization on nations that embrace it: faster economic growth, reductions
in poverty, and more fertile soil for democracy.
The greatest beneficiaries of globalization are the long-suffering consumers in those
nations that had been protected from global competition. Globalization expands the
range of choice, improves product quality, and exerts downward pressure on prices. It
delivers an immediate gain to workers by raising the real value of their wages. It
transfers wealth from formerly protected producers to newly liberated consumers, with
the gains to consumers exceeding the loss to producers because the deadweight losses to
the economy are recaptured through efficiency gains.
Under autarky, consumers are often cursed with poor service and overpriced and lowquality goods because there is no real competition to spur domestic producers to meet
the demands of their consumers. This explains the poor quality of cars sold by protected
domestic producers in such places as India, where the standard Ambassador car is based
on the Morris Oxford, a make of car that went out of style in Britain four decades ago.
LDCs have the most to gain from engaging in the global economy. First, they gain access
to much larger markets, both for imports and exports. On the import side, consumers
gain access to a dramatically larger range of goods and services, raising their real
standard of living. Domestic producers gain access to a wider range and better quality of
intermediate inputs at lower prices. On the export side, domestic industries can enjoy a
quantum leap in economies of scale by serving global markets rather than only a
confined and underdeveloped domesticMARKET .
Second, LDCs that open themselves up to internationalTRADE andINVESTMENT
gain access to a much higher level of technology. This confers on LDCs a latecomers
advantage: rather than bearing the cost of expensive, up-front research and
development, poor countries can import the technology off the shelf. They can
incorporate new technology by importing capital equipment that embodies the latest

advances and computers with the latest software. Subsidiaries of multinational

companies also bring with them new production techniques and employee training that
bolster the host nations stock of human capital.
Third, engagement in the global economy provides capital to fuel future growth. Most
LDCs are people-rich and capital-poor. In a few countries in Asia, the level of domestic
savings has been high enough toFINANCE domestic investment, but typically the
domestic pool of savings in an LDC is inadequate. Global capital markets can fill the
gap, allowing poor nations to accelerate their pace of growth. In 1998, $ 166 billion in
foreign direct investment flowed from the advanced economies to the less developed. A
poor country that closes its door or fails to maintain sound domestic policies will forfeit
the immense benefits this capital can bring.
Fourth, openness to the global economy can provide the infrastructure a developing
economy needs for growth. Foreign capital canFINANCE more traditional types of
infrastructure, such as port facilities, power generation, and an internal transportation
network, just as British capital helped to finance Americas network of canals and
railroads in the nineteenth century. But just as importantly, multinational companies
can provide an infrastructure of what could be called enabling services, such as
telecommunications, insurance, accounting, and banking. As China and India have
realized, a protected and inefficient service sector weighs down an entire economy,
retarding the development of manufacturing and other industries. LDCs need to shed
the mistaken idea that opening their economies up to international service competition
is a concession to be made to gain access to farm and manufacturingMARKETS in
the advanced economies. In reality, liberalizing their service sectors by opening them to
foreign competition is a favor LDCs can do for themselves.
Fifth, engagement in the global economy encourages governments to follow more
sensible economic policies. Sovereign nations remain free to follow whatever economic
policies their governments choose, but globalization has raised the cost that must be
paid for bad policies. With capital more mobile than ever, countries that insist on
following antimarket policies will find themselves being dealt out of the global

competition forINVESTMENT . As a consequence, nations have a greater incentive to

choose policies that encourage foreign investment and domestic, market-led growth.
New York Times columnist Thomas Freidman, in The Lexus and the Olive, his 1999
book on globalization, describes these progrowth policies as the Golden Straitjacket.
The increasingly manifest rewards of engagement encourage nations to unilaterally
restrict the scope of government action. As Friedman explains:
To fit into the Golden Straitjacket a country must either adopt, or be seen as moving
toward, the following golden rules: making the private sector the primary engine of its
economic growth, maintaining a low rate of inflation and price stability, shrinking the
size of its state bureaucracy, maintaining as close to a balanced budget as possible, if not
a surplus; eliminating and lowering tariffs on imported goods, removing restrictions on
foreign investment, getting rid of quotas and domestic monopolies, increasing exports,
privatizing state-owned industries and utilities, deregulating capital markets, making its
currency convertible, opening its industries, stock, and bond markets to direct foreign
ownership and investment, deregulating its economy to promote as much domestic
competition as possible, eliminating government corruption, subsidies and kickbacks as
much as possible, opening its banking and telecommunications systems to private
ownership and competition, and allowing its citizens to choose from an array of
competing pension options and foreign-run pension and mutual funds.7 While
globalization may confront government officials with more difficult choices, the result
for their citizens is greater individual freedom. In this sense, globalization acts as a
check on governmental power, making it more difficult for governments to abuse the
freedom and property of their citizens.
Any casual survey of the world today will confirm that nations relatively open toTRADE
tend to be more prosperous than nations that are relatively closed. The wealthiest
nations and regions of the world- -western Europe, the United States, Canada, Japan,
Hong Kong, Taiwan, South Korea, Singaporeare all trade-orientated. Their producers,
with a few notable exceptions, must compete against other multinational producers in
the global marketplace. In contrast, the poorest regions of the worldthe Indian

subcontinent and sub-Saharan Africaremain (despite recent, halting reforms) the least
friendly to foreign trade. And those countries that have moved decisively toward
opennessChile, China, and Poland, among othershave reaped real (and, in the case
of China, spectacular) gains in living standards.
Systematic studies confirm a strong link between openness and economic growth.8 A
study of 117 countries by Jeffrey Sachs and Andrew Warner found that open economies
grew much faster than closed economies. Specifically, the authors found that the
developing countries that maintained open economies throughout the 1970s and 80s
grew at an average annual rate of 4.5 percent,COMPARED with an average growth rate
of 0.7 percent for closed economies. As a result, the open developing economies tended
to converge toward the slower-growing rich economies, while relatively closed
economies did not converge.9
A more recent study, by Jeffrey Frankel and David Romer, produced similar results. The
authors found thatTRADE exerts a qualitatively large and robust E positive effect on
income. In their study of 150 countries, they concluded that increasing the ratio
ofTRADE to gross domestic product by 1 percentage point raises income per person by
between 0.5 and 2 percent.10 The Organization for Economic Cooperation and
Development (OECD) concluded that nations relatively open to trade grew on average
twice as fast as those relatively closed to trade.11
HOPE FOR THE WORLDS POOREST
Globalization offers hope to the worlds poorest. Just as more open trade tends to
promote economic growth, growth in turn leads to poverty reduction. A World Bank
study found that periods of sustained economic growth are almost always accompanied
by reductions in poverty. Specifically, the study found that poverty fell in 77 of the 88
decade- long periods of growth covered by the survey.12
The greatest reductions in poverty in the last twenty years have occurred in nations that
have moved decisively toward openness and domestic liberalization. The most
spectacular gains have been realized in East Asia. Between 1993 and 96, the number of

people living in absolute povertywhat the World Bank defines as less than $ 1 per day
declined in the region from 432 million to 267 million. In China alone, the number of
poor people so defined fell by 150 million between 1990 and 97.13 The 1997
98FINANCIAL crisis that began in East Asia brought a temporary halt to this progress,
but poverty rates in the hardest-hit countriesKorea, Thailand, and Indonesiahave
begun to decline back toward their precrisis levels. Globally, the number of people living
in absolute poverty has declined in the 1990s to an estimated 1.2 billion in 1998.14
Globalization facilitates the spread of modern medicine, which has helped to extend life
expectancy and reduce infant mortality in rich and poor countries alike. On average, life
expectancy in developing countries rose from 55 years in 1970 to 65 years in 1997. This
good news is tempered by the fact that life expectancy has actually fallen in thirty-three
LDCs since 1990, in large part because of AIDS epidemics, and remains far behind the
OECD average of 78 years. Infant mortality rates in Asia and sub-Saharan Africa have
fallen by about 10 percent since 1990.15
Opponents of globalization try to blame poverty in the world on the spread ofTRADE
and investment liberalization. But those regions where poverty and inequality have been
the most visible and intransigent for decadesLatin America, sub-Saharan Africa, and
the Indian subcontinentfor most of that time self-consciously followed policies of
economic centralization and isolation.
FERTILE SOIL FOR POLITICAL FREEDOM
By raising the general standard of living, freeTRADE helps people achieve higher levels
of education and to gain access to alternative sources of information. It helps to create a
larger and more independently minded middle class that can form the backbone of more
representative forms of government. The wealth created from expanded trade can help
to nurture and sustain civil institutions that can offer ideas and influence outside
government. Engagement in the global economy exposes citizens to new ideas and new
social and business arrangements. In his book Business as a Calling, Michael Novak
explains the linkage with what he calls the wedge theory:

Capitalist practices, runs the theory, bring contact with the ideas and practices of the
free societies, generate the economic growth that gives political confidence to a rising
middle class, and raise up successful business leaders who come to represent a political
alternative to military or party leaders. In short, capitalist firms wedge a democratic
camels nose under the authoritarian tent.16
The wedge theory seems to be working in practice: As a general rule, the citizens of
nations that are more open economically tend to enjoy other liberties as well. The
relationship can be confirmed byCOMPARING cross-country data measuring
economic openness and political/civil liberties. For the political and civil data, I have
used recent ratings from Freedom House, which classifies the nations of the world as
free, partly free, or not free.17 Then I compared the Freedom House scores with
international economic freedom as measured in the study Economic Freedom of the
World: 1998/1999 Interim Report, written by James Gwartney and Robert Lawson. The
authors rated nations according to their level of taxation on trade, the size of the trade
sector,EXCHANGE RATE controls, and restraints on capital mobility, with a rating of
10 representing maximum openness.18
Comparing these two sets of data confirms that nations that respect human rights tend
to be relatively open to commerce with the rest of the world. Nations that are classified
by Freedom House as being free scored an average of 7.9 on the scale of economic
openness. Those that are partly free scored a less open 6.7, and those that are not free
scored the lowest, 5.4 (see fig. 1). If we start at the other axis we find that, of those
countries in the top third of the Gwartney-Lawson scale of economic openness, 84
percent earned a political/civil ranking of free. Of those in the middle third according
to economic openness, 57 percent were free, but in the bottom third, only 22 percent
were free. In other words, citizens who enjoy the freedom to engage in international
commerce are about four times more likely to be free from political and civil oppression
than those who do not enjoy such freedom.
Globalization and the growth it spurs have contributed to expanded political and civil
freedom in a number of countries. Taiwan and South Korea were essentially

dictatorships two decades ago, but they are now governed by elected legislatures and
presidents. Political debate in those countries is robust, and civil liberties are more
secure than ever. A share of the credit for political reform must be given to economic
liberalization and the educated middle class it helped to create and nurture. In Latin
America, the movement toward economic liberalization has been intertwined with a
flowering of representative government. Chile, a leader in economic reform, now enjoys
one of the regions most stable democracies. A decade of dramatic economic reform in
Mexico has helped lay the foundation for a more open political system, including
Mexicos first competitive presidential primary within the Institutional Revolutionary
Party.
Skeptics of the link between economic and political reform routinely point to India and
Singapore to refute the thesis. These countries are clearly outliers in the scatterplot:
Singapore is one of the worlds most open economies but its government remains
authoritarian, while India remains relatively closed economically yet is ruled by
democracy. Exceptions, however, do not negate a clear trend. And even these two
notable exceptions seem to be migrating toward the trend line, with India opening up to
trade and foreign investment since its balance of payments crisis in 1991, and the
Singapore government gradually loosening its controls on civil society.
THE CHALLENGES OF GLOBALIZATION
The advance of globalization has not been a smooth or a pain-free process. The changes
it has caused, or is perceived to have caused, have spurred a political backlash
dramatically evident in the street protests that plagued the WTO ministerial in Seattle.
Two of the most common complaints against globalization are that it has undermined
labor and environmental standards, and that it has exacerbated the gap between rich
and poor, both among and within countries.
Critics of globalization warn of a destructive race to the bottom, as advanced nations
are forced to weaken labor and environmental standards to compete with less-regulated
producers in developing nations. This theory rests on the assumption that lower

standards give LDCs a significant advantage in attracting global capital and gaining
export markets at the expense of more developed countries. The OECD has found that,
in practice, a lack of core labor standards plays no significant role in attracting foreign
investment or in enhancing export performance. The OECD did find strong evidence
that there is a positive association over time between sustained trade reforms and
improvements in core standards.19
In other words, trade liberalization encourages higher standards, not lower standards. If
anything, the real race may be toward the top. For reasons of internal efficiency as well
as public perceptions, multinational companies tend to impose higher standards on
their overseas production plants than those prevailing in local markets, thus raising
average standards in the host country. Free trade and domestic liberalizationand the
faster growth they createare the best ways to encourage higher standards. As per
capita incomes rise in less developed countries, so does the domestic political demand
for higher standards, and the ability of the productive sector to pay for them. Punishing
LDCs with trade sanctions would only cripple their long-term ability to raise domestic
labor and environmental standards.
Some environmental activists complain that the global trading system, as embodied in
the WTO, favors free trade at the expense of environmental protection. But WTO rules
place no restraints on the ability of a member government to impose any environmental
regulations determined to be necessary to protect its own environment from
domestically produced or imported products. Article XX of the General Agreement on
Tariffs and Trade 1994, the basic charter of the WTO, plainly states that members may
impose trade restrictions necessary to protect human, animal, or plant health. The
Sanitary and Phytosanitary Agreement of the Uruguay Round does require that such
restrictions be based on sound scientific evidencea commonsense requirement
necessary to discourage the use of health and safety issues as a cover for protectionism.
If WTO members are found to be in violation of their commitments, they remain free as
sovereign nations to simply ignore any adverse WTO rulings against domestic
regulations that impact trade. A prominent example is the European Unions ban on the

sale of beef from cattle treated with growth hormones. The EU has repeatedly lost in the
WTO, but it has no plans to lift its ban, even though it has produced no scientifically
sound evidence that the banned beef poses any hazard to public health. The United
States retaliated against the EU in May 1999 by imposing sanctions on $ 117 million
worth of imports from Europe, but retaliation as a weapon of trade disputes existed long
before the WTO.
Antitrade environmental activists complain that several decisions by the WTO have
undercut U.S. environmental regulations. In the so-called Shrimp-Turtle case, the WTO
ruled against a U.S. ban on shrimp from countries the United States judged were not
adequately protecting sea turtles from being caught and killed in shrimp nets. In an
earlier, similar case, the WTO had ruled against a U.S. ban on tuna from Mexico that the
United States claims was caught through a process that endangers dolphins.
Environmental critics of the WTO point to these two cases as proof of their claim.
In both these cases, however, the United States remains free to simply ignore the WTO
ruling and continue enforcing the law as is. The affected nations could in theory retaliate
with trade restrictions of their own if the United States refuses to comply, but that
option would always exist even if the WTO did not. And in the case of the Shrimp- Turtle
decision, it was not the law itself that ran afoul of WTO rules but the discriminatory way
the United States went about implementing it, for example giving Latin American
suppliers more time than Asian suppliers to comply with the law.
Expanding trade is not merely compatible with high standards of environmental quality
but can lead directly to their improvement. As a country sees its standard of living rise
through economic liberalization and trade expansion, its industry can more readily
afford to control emissions and its citizens have more to spend on the luxury good of
improved environmental quality, above what they need for subsistence. And as
economic growth creates a growing, better- educated middle class, the political demand
for pollution abatement rises. Today the most restrictive environmental laws are
maintained in developed countries that are relatively open to trade.

This helps explain the so-called Environmental Kuznets Curve, where environmental
quality in a developing nation initially deteriorates as the economy begins to
industrialize but then improves after its citizens reach a certain standard of living.
Research by Alan Krueger and Gene Grossman indicates that the turning point occurs at
about $ 5,000 per capita: We find no evidence that environmental quality deteriorates
steadily with economic growth. Rather, for most indicators, economic growth brings an
initial phase of deterioration followed by a subsequent phase of improvement. By $
8,000 per-capita income, the authors found, almost all the pollutant categories had
begun to improve.20
The United States itself is a classic example of the benign effect of trade and growth on
the environment. It has simultaneously one of the most open economies and one of the
cleanest environments in the world. In the past decade, the United States has continued
to open its economy further, signing the North American Free Trade Agreement and
shepherding the creation of the World Trade Organization. Meanwhile, two-way trade
and foreign investment continue to climb as a percentage of GDP. This liberalization of
international trade and investment has been accompanied by ever-rising environmental
standards. According to the Presidents Council on Environmental Quality, mean
ambient concentrations of both sulfur dioxide and carbon monoxide in the atmosphere
of the United States have dropped by nearly 40 percent since 1988. During that same
period, the annual number of bad air days in major U.S. cities has dropped by twothirds. The direct discharge of toxic water pollutants is down dramatically as well. Since
the early 1970s, during a time of growing globalization of the U.S. economy, real
spending by government and business on the environment and natural resource
protection has doubled.21
Despite the rhetoric heard on the streets in Seattle, expanding global trade has not
spurred a race to the bottom on environmental regulation or quality. In fact, the
evidence points in the opposite direction.
THE GAP BETWEEN RICH AND POOR

Another challenge of globalization is the perception that economic liberalization has

exacerbated the gap between rich and poor countries, and between the rich and poor
within countries that have liberalized. The perception that the gap has been growing,
both among and within nations, is broadly true. The connection with globalization is
much less clear.
While some previously poor countries have managed to close the gap with the more
advanced economies, a disturbingly large number of countries have fallen further
behind. According to the World Bank, the ratio of income per capita in the richest
countries compared with that in the poorest rose from 11 in 1870 to 38 in 1960 to 52 in
1985.22 Concern about the marginalization of poor countries in the global economic
system has rightly focused on sub-Saharan Africa. Since 1976, the regions share in
world trade has fallen from 3 percent to slightly more than 1 percent in the 1990s.23
While the flow of foreign direct investment to LDCs has risen dramatically in the 1990s,
sub-Saharan Africa has been almost entirely overlooked. But the phenomenon of
marginalization has not been a random event.
Poor nations that have fallen further behind the rich nations are almost uniformly those
that have clung to state-directed and inward- oriented economic policies. Sub-Saharan
Africa has lagged behind the rest of the world in economic growth in significant part
because its markets remain among the most closed in the world. Its governments have
neglected domestic infrastructure such as roads and have distorted their domestic
economies with subsidies, high taxes, and regulations. Granted, many African nations
must also bear the burden of civil and tribal strife, poor soil, and inaccessible geography.
But domestic economic policy must be considered a key variable in explaining the
regions failure to develop. Those African nations that have implemented more open,
stable, and market-friendly policies in the last decadesuch as Uganda, Botswana, and
Mauritiushave achieved growth rates exceeding those of the advanced nations.
The most obvious variable that separates countries that are closing the gap from those
falling further behind is their own domestic policy choices. Simply put, nations that
adopt the Golden Straitjacket begin to catch up with the advanced economies, while

those that reject it become increasingly marginalized. In their Economic Freedom of the
World: 1997 Annual Report, Gwartney and Lawson found strong empirical evidence
linking growth rates to economic freedom. The authors measured seventeen categories
of economic policy for each of 115 countries covering monetary policy, property rights,
government spending and regulation, and restraints on foreign trade. They found a
strong correlation between economic freedom and both economic growth and percapita GDP. The authors found that each quintile of greater economic freedom
corresponded with faster growth and higher per-capita GDP. Nations in the top quintile
in 1995 grew almost three times faster (2.9 percent annually) on average than those in
the middle quintile (1.1 percent). Those in the bottom quintile saw their economies
shrink an average of 1.9 percent.24
There is nothing inherent in the process of globalization that would cause the gulf
between rich and poor nations to expand. In fact, the access to capital, new technology,
and larger markets that comes with global integration should be expected to accelerate
the convergence of less developed regions of the world and to make global trade and
wealth less concentrated across countries. This dynamic has been at work inside the
United States, which has itself been a continent-sized free- trade area for more than two
centuries. At the turn of the last century, in 1900, per-capita income varied widely
across the four major regions of the United States. While incomes in the Midwest were
close to the national average, at 103 percent, incomes in the Northeast were 139 percent
above the national average and those in the West were 153 percent above. In contrast,
income levels in the South were only 54 percent of the national average. One century
laterthanks in large measure to the free flow of goods, capital, and people within U.S.
bordersregional disparities have shrunk dramatically. Today, income levels in the
Northeast are only 117 percent above the national average, incomes in the Midwest and
West are within 2 percentage points of the national average, and incomes in the South
as a share of the national average have risen to 90 percent.25
Evidence of a similar trend exists among countries that have chosen to join the global
economy. A 1998 study sponsored by the WTO found that global trade and investment

flows have actually become less concentrated in the last two decades when adjusted for
the growth in world trade. Moreover, the authors found that the concentration of trade
and financial flows has fallen among countries that have more rapidly liberalized,
whereas it has increased among those that have integrated more slowly. We argue this
shows that marginalization of individual countries from world markets can be mostly
explained by inward-looking domestic policies, they concluded, and therefore that
marginalization is not inherent to the globalization process.26
Of course, the advanced economies have not always been helpful. Despite progress in
the post-war era, advanced-economy trade barriers remain stubbornly high against
clothing, textiles, and agricultural goods, the very products in which LDCs have a
natural comparative advantage. A recent study by Thomas Hertel of Purdue University
and Will Martin of the World Bank found that the average tariff that rich countries
impose on manufacturing goods from poor countries is four times higher than the
average tariff rich countries impose on each others goods.27 One of the many
disappointments left in the wake of the failed WTO talks in Seattle has been the
indefinite postponement of negotiations to lower barriers to poor-country exports. It
would be wrong, however, to blame advanced-country trade barriers for the lack of
economic progress in so many LDCs. After all, the Four Tigers of East Asia managed to
hop on the income-convergence conveyor belt in the face of advanced-country trade
barriers that were even higher than they are today.
For poorer nations, the global economy has become like one of those giant conveyor
belts that speed passengers through airport terminals. Globalization can accelerate a
countrys development, but only if its policymakers allow its citizens to hop onboard by
opening the economy to international trade and investment. This conveyor belt of
growth provides new technology, investment capital, domestic competition, expanding
export markets, and powerful incentives for further domestic policy reform. The result is
faster growth and dramatic improvements in living standards within a generation or two
as we have seen most strikingly in the Far East. The fact that some nations insist on

walking their own, uphill, isolated, and often dead-end path is not the fault of
globalization but of their own policymakers.
The story of income inequality within nations is more complicated. The trend within the
United States and other developed nations has been toward a wider earnings gap
between the lowest- and the highest-paid workers. The gap has been driven primarily by
a difference in worker skills rather than by international trade. An information-based
economy will naturally produce jobs that require more specialized and technical skills
than a less developed economy, which is more weighted toward agriculture and
industry. As a result, in the United States in the last twenty-five years, the gap in income
has been increasing between workers with college degrees and those with only high
school diplomas.
International trade has probably contributed something to this trend in the United
States, because trade should in theory accelerate the transition toward industries that
rely more intensively on high-skilled labor. But the primary engine of change in the U.S.
economy during that time has been technological innovation.
The relatively larger importance of technological change compared with trade can be
seen in recent trends of job displacement. U.S. Labor Department surveys show that
three-quarters of Americans displaced from their jobs in 199597 were working in
sectors of the economy that are relatively insulated from trade.28 Even in the more
trade-intensive manufacturing sector, technological change rivals trade as the principal
engine of labor-market change. International trade is often blamed for job displacement
in manufacturing when in fact the cause is rising productivity. This explains why the
number of workers employed in manufacturing in the United States has remained stable
in the 1990s at slightly more than eighteen million, at a time when manufacturing
output has been rising an average of 3.8 percent a year in the decade (and 5.5 percent a
year since 1994).
As with employment, technology is also the chief explanatory variable of changes in
income inequality. William Cline, in a study on the impact of trade on wages, concluded

that international trade and immigration are unlikely to have been the dominant forces
in rising wage inequality.29 After surveying the literature and employing his own Trade
and Income Distribution Equilibrium model, Cline concludes that skills-based
technological change is by far the largest identifiable contributor to the growth in
income inequality. International trade and immigration together contribute only about
one-tenth of the gross (total) unequalizing forces at work over this period.30
If curbing inequality is the aim,TRADE policy is a poorly suited instrument for
achieving it. The right response to this growing demand for higher skills is not to stifle
change through trade barriers but to raise the general skill level of the workforce.
Instead of a futile effort to save the jobs of yesterday, the focus should be on preparing
workers to meet the rising demands of the labor market for specialized skills.
EXPANDING ECONOMIC LIBERTY
Globalization is really just shorthand for expanding economic liberty across
international borders. The debate it has spawned is the repackaging, on a global scale, of
the long-running argument over whether the way to prosperity is through
freeMARKETS or centralized government planning, or some third way between the
two. If you believe freeMARKETS unleash forces that are destructive to human
happiness and must be controlled by active government intervention, you will tend to
see globalization as a threat. If you believe that free markets, operating within a rule of
law, are essentially self- regulating and lead, in the words of Adam Smith, as if by an
invisible hand to a greater general prosperity, then you will tend to see globalization as
a blessing.
The argument that globalization is much more the latter than the former is supported
not only by economic theory but by decades of hard-earned experience. A growing
majority of nations have made their peace with globalization based not on whim or blind
ideology but on the manifest failure of any alternative. They have come to realize that
the spread of free markets and the institutions that support them offer the best hope
that the fruits of prosperity can be shared by a wider circle of mankind.


Notes 1.David Henderson, The Changing International Economic Order: Rival Visions
for the Coming Millennium, Melbourne Business School, 9 Sept. 1999.
2.Figures quoted by Alan Greenspan, chairman, Federal Reserve Board of Governors,
Technology andTRADE , Speech before the Dallas Ambassadors forum, 16 Apr. 1999,
http://www.federalreserve.gov/boarddocs/speeches/1999/19990416.htm
3.United Nations, WorldINVESTMENT Report: 1998 (hereafter WIR:1998), 9.
4.United Nations, Human Development Report: 1999, 25.
5.Organization for Economic Cooperation and Development, Policy Coherence Matters,
(Paris: OECD, 1999), 45.
6.United Nations, WIR:1998, 57.
7.Thomas Friedman, The Lexus and the Olive Tree (New York: Farrar, Straus and
Giroux, 1999), 8687.
8.One problem with these cross-country studies of growth andTRADE is that trade
liberalization is seldom an isolated event. LDCs liberalize in the context of broader
economic reforms, which often include selling state-owned industries; reducing
government taxation, spending, and borrowing; and deregulating domestic prices and
production. This poses the challenge of determining the source of faster growth.
Another methodological challenge is in measuring openness. There is no standard
statistical measure of a nations openness. What is clear is a general correlation between
openness, under various definitions, and economic performance.
9.Jeffrey Sachs and Andrew Warner, Economic Reform and the Process of Global
Integration, Brookings Papers on Economic Activity 1 (1995).
10.Jeffrey Frankel and David Romer, DoesTRADE Cause Growth? American
Economic Review, June 1999, 37999.

11.Organization for Economic Cooperation and Development, Open Markets Matter:

The Benefits ofTRADE and Investment Liberalization, 1998, 10.

Globalization Blessing or Curse

By Aimon Tanvir Malghani -

Nov 7, 2013

575

SHARE

Facebook

Twitter

Globalization is a highly contested domain, and there are no absolute lines for
demarcating it (Mittelman).
Globalization has several features, namely, economic, political, social, cultural, and
environmental. Its concept started emerging in 1500s and the development of the idea
was gradual but slow.
Humans have interacted over long distances for thousands of years. The overland Silk
Road that connected Asia, Africa, and Europe is a good example of the transformative
power of trans-local exchange that existed in the Old World. Philosophy, religion,
language, the arts, and other aspects of culture spread and mixed as nations
exchanged products and ideas. In the 15th and 16th centuries, Europeans made
significant discoveries in their exploration of the oceans, comprising the start of
intercontinental travel to the New World of the Americas. Global movement of people,
goods, and ideas expanded considerably in the following centuries.
Today, everyone is well aware of the term and some analysts criticize while others
support this idea. The fact is that like a coin, every idea too has two aspects; light and
the dark one. There are certain benefits of globalization, one of the most important of
which is the globalTRADE . These business transactions involve economic resources
such as capital, natural and human resources used for international production of
physical goods and services such as finance, banking, insurance, construction and other
productive activities (Joshi, Rakesh Mohan, (2009) International Business).
In the modern world scenario of today, however, globalization has severe
consequences, most notorious of which is the terrorism and so called war against terror.
9/11 attack is the best example. This attack enabled America to gain sympathies from
the Muslim World too. Soon after the 9/11 attack, American Army invaded first in
Afghanistan and then in Iraq claiming that Taliban forces of Afghanistan were
responsible for this. This started a war which is to this date continued and has cost tens
of thousands of lives. This was just because of globalization and open boundaries of the
countries.
Today, drone attacks in Pakistani territory are also because of the fact that we live in a
globalized world. Many innocent children and people die of these everyday but we do
nothing except to condemn. But avoiding globalization and being cut-off from other

nations is not an option for the solution of the problems being caused. The need of hour
is the intervention of United Nations to combat problems and maintain the honor of a
country by formulating some laws.
Globalization might be a curse and can be a blessing. It depends on the nations which
side of the coin they choose for themselves. Living with peace and harmony costs
nothing but brings happiness and prosperity.