It Isn’t a Zero-Sum Game
Newsweek's Business Roundtable looks at the two faces of globalization, and whether the U.S. can stay ahead.
Robert Reich, former Secretary of Labor under Clinton, now teaches at the University of California at Berkeley.
If we define the world's economic leader as the country with the biggest gross domestic product, China is on the way to claiming that prize. China has over a billion people, and its middle class is growing quickly. But we shouldn't see this as a problem. The global economy isn't a zero-sum game where one country gains only if another other loses. As China grows, it will become an even larger market for our goods and services. It's also likely to be a continuing source of capital for us, buying our government bonds and holding reserves of our currency.
Although we've lost manufacturing jobs, this is partly a result of success. About half of those jobs have been lost to new technology, robots and computer-controlled machine tools, which have replaced old-fashioned assembly lines, dramatically reducing the need for workers. In 1900, more than a third of Americans worked on farms; now, fewer than 5 percent do. The manufacturing sector is following this historical pattern.
Meanwhile, we still lead in building intellectual property-products and services connected with the Internet, computer software, biotech, entertainment, marketing, and finance.
The increasing signs of anti-globalism sentiment are unsurprising given that the typical American got nothing out of the last economic expansion. Adjusted for inflation, the median wage is lower than it was in 2000, and jobs are less secure. Americans want to cast blame, and unfortunately, it's always easiest to blame foreigners-the people who trade with us, and migrate to this country. This could be a large problem in the future. When isolationism last flourished here in the 1930s, it hurt the economy, and if it comes to dominate our thinking, it will hurt us again.
M. Kathryn Eickoff, former chief economist of The Office of Management and Budget under President Reagan
Have you or someone you know closed a business, become unemployed or permanently lost a good job? Is your company downsizing, outsourcing, or moving your position overseas? Are you cutting back on your spending because of inflation and higher credit card charges?
You may have heard that globalization, greedy multinationals or illegal aliens are the cause of our problems. In fact, the opposite is true. Globalization means freer markets and more political freedom worldwide; multinationals are businesses, large or small, that have operations in more than one country; and illegal aliens are people who want a better life so much that they are willing literally to risk everything for a chance at the worst jobs our economy offers. All three are major contributors to our prosperity, productivity and standard of living.
With communism and socialism as examples of disastrous economic policies, the world is rushing to embrace capitalism, although not necessarily consistently; only the U.S. wants to run the other way. People in countries around the world know how much better off they are now than a decade ago. However, there are those among us-politicians, union leaders, and government-fed businesses and others, who whine about the good old days. As Washington's economic dictator says in Ayn Rand's far-sighted novel Atlas Shrugged, "We've got to stand still. We've got to make those bastards stand still!"
Well you can't make the brightest and the best, the most conscientious and most productive stand still without destroying the economy. To raise taxes and tariffs, close our borders, and return to isolationism means a return to the "beggar-your-neighbor" policies of 1930 and the Smoot-Hawley tariffs that led to the Great Depression and World War II.
Wilbur Ross, billionaire investor and past director of the Turnaround Management Institute
U.S. trade and currency policies stimulated world growth but caused huge trade deficits in the United States and inflation in commodity prices. Developing economies use more oil and metal per dollar of Gross Domestic Product than more mature ones, so as these economies grew, commodity prices soared. Meanwhile, their rising standards of living and population growth created extra demand for foods. The immediate way to slow emerging country growth is to increase our exports and minimize our imports by pushing the dollar lower..
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Member Comments
Posted By: Jmichaels59 @ 11/12/2008 12:24:51 PM
Comment: Eventually the biggest gap in the USA will occur between those who can change the way they think, and those that cannot. Start surviving today, there are options, if your plan A isn't working out, it may be time to start looking at something else. A different perspective is what you may need. You can thrive, right now. Look at a new plan, plan B maybe! Read/listen to this audio from Robert Kiyosaki, "The Perfect Business?". Get it FREE for a limited time NOW. http://www.freecdforyou.com
Posted By: izixyl @ 11/03/2008 6:44:01 PM
Comment: Response to VOTENOW: You posted the same comment twice to keep your off-topic copypasta political spam at the top of the comments list. The article that you are commenting on is about globalization and makes no mention of Sarah Palin. People reading this page might of actually come here in the hopes of reading about globalization. So why don't you take your sorry mess over to an article that is actually about the election?
But since we are on the topic....
On the whole, both Democrats and Republicans have failed this country enormously. Both promote globalization. Both are responsible for the deficit spending, the credit crisis, Fannie Mae, the bailout package, and on and on. I find the faith of Obama supporters to be very naive. To his followers he almost like some sort of magical black Jesus. During the heyday the Bush presidency, any criticism of the Bush administration was taken by Republicans was taken to be unpatriotic. Of course, everyone now knows that Bush was just a human being that both richly deserved and needed criticism. I thought it was wrong then with Bush, and I think it is wrong now with Obama. Is it racist to criticize Obama? Do we really need another president who cannot be criticized? Can we expect an honest assessment of the man when he is surrounded by an adoring media and throngs of messianic Obamaniacs, each one pressing to merely touch the hem of his garment and be healed of all their ills? Can the public expect on honest discussion on anything of even marginal importance ever again? Or instead will we deluged in slurry of opinion journalism designed to push towards one party or another?
Despite his campaign promises to "end tax breaks for companies that outsource", I have no doubt that Obama will prove to be a globalist par excellence.
Posted By: VOTENOW @ 11/03/2008 5:05:07 PM
Comment: Sarah palin when asked about becoming vp responded
"As for that VP talk all the time, I tell you, I still can't answer that question until somebody answers for me, 'what is it exactly that the VP does every day......"
Around a week ago she was asked again and this time said
They in charge of the U.S. Senate so if they want to they can really get in there with the senators and make a lot of good policy changes that will make life better for Brandon and his family and his classroom.
WRONG THE VP IS THERE TO STEP IN IF SOMTHING HAPPENS TO THE PRESIDENT ONLY THEY HAVE NOTHING TO DO WITH POLICY AND THEY DONT RUN THE SENATE!!
If she doenst understand the job why would we give her the job
Mccain has around a 40 percent chance because of his age in not being able to
As many as half the people between 72 and 76 are disabled or die
Hopefully mccain would be the exception but picking palin was about as smart as picking any other mrs Alaska contestant.
Thanks for making sure the rest of us are ok if something happens to you John
America cant take the chance of being run by someone that cant understand basic issues
NOT RIGHT NOW
Its not just that we disagree with her answers in alot of cases she doesnt understand basic questions
like what is the bush doctrine, or what do you read. She falls apart if you ask a follow question she hasnt memorized
These are not gotcha questions!!!
One of advisors recently said not only was she unqualified but said mccain picked her after 1 interview of about a hour
and that even at mcdonalds you get 3 interviews.
Members of her own campaign called her a diva and a whack job.
They would know better then anyone else right now.
So mccain gambled and he lost big. He ended up with a girl without a clue
But whats interesting is the top of the ticket could never disagree with what i am saying
because mccain could never read this blog he cant use a computer at all.
So hopefully fixing the economy would not require research or email
I mean his wife has 100 million dollars get him classes or something.
Am i crazy or do we want a computer literate president and a vp who can answer a least basic questions.
If you read the rest of the articles on this site you would think the world is about to end
So if thats the case these are the last 2 people you want running anything.
lets send them packing.
ELECT OBAMA BIDEN NOW