Sunday, November 24, 2013

The Pitfalls of Globalization

Although the failings of Obamacare and its website are a life and death issue for many Americans, the state of the economy is still our number one domestic problem.   Many articles about our growing and appalling disparity of wealth and incomes have been appearing lately, usually written by liberals.  I have conservative views, but facts are facts.  The average real wage has steadily declined since 1976, and the upper 20% of Americans now own more than 87% of all the wealth.  The bottom 40% own only .3 of 1% of the nation’s wealth, and these data are only a few of many devastating indicators.  The result has been a lowering of living standards and rising levels of stress and anger.  This disparity has, indeed, become our nation’s greatest domestic problem.

I’ve written several articles about this, and pointed out the several reasons for these trends.  Advances in technology, including robots and email, have eliminated millions of factory and middle management jobs.  Other factors include: an explosion in energy costs, the collapse of private-sector unions, our welfare system, and globalization.  In my opinion, the main reason for the increasing disparity and our present stagnation is globalization or so-called, “free-trade”, which has decimated manufacturing industries and jobs, and shifted them overseas.   The result has been that Americans who live on investment income become richer, while most of America becomes poorer.  What has happened is that the average American has traded a good-paying job for the opportunity to buy cheap goods at Walmart.  This has had the most devastating effects on black families living in inner cities where factories have completely disappeared.

Both political parties are to blame, as both have succumbed to the ephemeral lure of the benefits of “free-trade”, while both seem paralyzed by references to Smoot-Hawley tariffs and its role in the Great Depression.  It clearly was a mistake not to protect our manufacturing base, and we have to start working out of this mess.  Right now, the average American cannot find a good job, and their children cannot find any job.  It is especially dismaying to hear President Obama talking about a free trade agreement with Vietnam, which will just increase the flood of cheap goods and further exacerbate the problem.

What we need to do is 1, stop any further “free-trade” agreements; 2, require our military to purchase only items 100% made in the USA; 3, subsidize and protect the startup of manufacturing businesses located in inner cities; 4, begin negotiations to abrogate current agreements such as NAFTA; 5, begin to impose limited tariff protections for existing industries that need help; 6, encourage the growth of private-industry labor unions by amending Taft-Hartley to allow “right-to-work” laws only to apply to public-sector unions; and 7, review all federal regulations relating to manufacturing with the object to eliminate those that are unreasonable or do not survive an unbiased cost-benefit analysis.

I used to view with shock and disgust the violence that occurred in cities where globalization conferences took place.  Now that I am aware of the destruction that globalization has brought, I have a little more understanding of that anger.


AddThis Social Bookmark Button


At 9:15 AM, Anonymous Anonymous said...

That's a remarkably liberal point of view, Mr. Wilcox, but it might also include such remedies as a high tax rate on astronomical bonuses and changes to the rules governing taxes on hedge funds.


Post a Comment

<< Home