Globalization has without a doubt been a positive thing for many developing countries who now have access to bigger markets and can export their cheap goods to richer countries. It has also been beneficial for Multi-national corporations as well as Wall Street. However, on the other hand, globalization has not been working in the favor of working people and has deindustrialized America. Needless to say, globalization is no simple issue and both the pros and cons need to be examined.
People who support globalization believe that it can make the world a better place to live and solve problems such as poverty and unemployment. Free trade is intended to reduce restrictions such as tariffs, value added taxes, subsidies, as well as other barriers between nations. But there are still other barriers to free trade.
Supporters of globalization also argue that globalization is a representative of free trade, which is turn encourages global economic growth by creating jobs and making companies more competitive, as well as lowering prices for the consumers. Competition within countries is intended to push prices down. However, in many instances, this does not work since countries turn their currency in order to get a price advantage.
Globalization also allows poor countries the chance to develop economically through foreign capital and technology. This creates the proper conditions for a democracy as well as human rights to be able to exist, but this goal has yet to be completed in most countries. But, there is now a worldwide market for consumers and companies to have a lot more access to different products, which is the first step in democracy.
There is a sort of world power that is being created, rather than groups of power sectors. Decisions are being made with politics that help people all over in the world. There is no more information influx between countries who have nothing in common with one another, and countries are learning more about other cultures. And since everyone has the common interest of making money, corporations and governments are aiming to solve ecological problems for one another.
Socially, people have more open towards one another and people who live in foreign places are no longer considered aliens. Fast travel, mass communications and quick dissemination of information through the internet are inevitably benefits of globalization. Furthermore, labor can travel between countries in order to market their skills, but this can cause issues with the existing labor as it pushes wages down.
Another advantage of globalization is that sharing technology with developing nations can help them progress greatly. While this is true for small countries, many are stealing developed countries technologies and IP has become very problematic with competitors such as China.
Transnational companies invest in installing plants in various countries to offer employment for those in poverty. Globalization has further given countries given countries the ability to be a part of free trade agreements such as NAFTA, South Korea Korus, and The TPP. However, they cost the U.S many jobs as well as increase the trade deficit.
The main con of globalization is thought to be that it makes the rich richer while making the poor even poorer. The intention of globalization for free trade, where barriers are taken away, but there are still many barriers. For example, there are 161 countries with VATs on imports, while the U.S does not have VAT.
The biggest issue it causes to developed countries is the jobs that are lost due to the transfer to lower cost countries. Workers in developed countries, such as the U.S have to deal with pay-cut demands who threaten them to export jobs, which causes workers to have very little power in the situation.
Some large multi-national corporations are able to exploit tax havens in other countries and avoid paying taxes. They are accused of social injustice, unfair working conditions and a lack of concern for the environment. These corporations are more and more influencing political decisions and can be seen as a threat. Making products in overseas countries puts technologies at risk of being stolen or copied.
Furthermore, there are people who think that globalization also causes communicable diseases with HIV/AIDS being spread through traveling. Globalization is also the cause of labor exploitation and has seriously compromised on safety standards in the workforce, and has increased human trafficking. Social welfare schemes are experiencing a lot of pressure in developed countries due all the job losses and deficits.