American capitalism in the not too distant past had been a remarkably successful, finely balanced, complex system in which the desire of businesses for limitless profits was juxtaposed with regulatory social controls and safety nets, imposed by government agencies, religious institutions and the legal system to minimize the damage that might be inflicted on workers.
Our world has changed. American capitalism has metamorphosed into global capitalism. The desire to maximize profits remains unabated but the regulatory social controls have splintered and threaten to vanish. National standards are meaningless when "Free Trade" around the world means that businesses can pick and choose whose standards, or lack there of, they prefer.
The most immediate case in point is the recent revelation that Chinese companies that ship pet food and animal feed in general to the U.S. have been routinely adding an inexpensive protein substitute filler without nutritional value and in some concentrations, poisonous to the feed. In China there is no rule or law against doing so. For those producers, the more they use of the cheap filler the more profitable for their business. The consequence for the U.S. we can only guess. This has been going on for years. It is not too far fetched to guess that if the tainted feed has been given to our food stock it will or has been passed on to us.
This case is only the tip of the iceberg. Look and you shall find a multitude of other examples.
These are wondrous times in which we live. We certainly can and should take advantage of all the advantages afforded by Tom Friedmans "Flat World". Can we trust our leaders to anticipate and plan to offset the disadvantages?
5 comments on "Globalization" Neuters Regulation of Greed
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Indeed, you have captured the dynamic behind events. Your emphasis is different. The inference is that lack of regulation among many of our trading partners will serve to unravel the protections of our own workers. Is that a good thing since it will improve our competitive advantage? Or as Alan Blinder has come to see it does free trade (despite the advantages) in the current era, necessitate major adaptations to retrain and insulate workers and consumers from the unraveling of our own regulatory systems?
We'll weather it just as we'll weather global warming. We've been here for a long time, and have lived through all kinds of s--t. Besides, the point of this article comes down to money, and it's only money. I'll spend my worry time on the islamofascists getting nukes.
John Porter commented Apr 30, 2007
It's a relatively recent state of regulations that have made our workers among the safest in the world. It's no coincidence that during that same time our competitve advantages have eroded, with foreign companies rising to win the markets. They are doing nothing more than following the pre-regulatory model of American capitalism - the one that was so highly successful.
comment by centurion on April 30, 2007 1:04 PM (EST) [ reply ]
centurion
Indeed, you have captured the dynamic behind events. Your emphasis is different. The inference is that lack of regulation among many of our trading partners will serve to unravel the protections of our own workers. Is that a good thing since it will improve our competitive advantage? Or as Alan Blinder has come to see it does free trade (despite the advantages) in the current era, necessitate major adaptations to retrain and insulate workers and consumers from the unraveling of our own regulatory systems?
reply by fixed845inc on April 30, 2007 4:52 PM (E
John M. commented Apr 30, 2007 |delete
John Porter
You're right, it is inevitable and furthermore it is irreversible. What I dislike is that it is seemingly happening to us outside our control. I don't believe it has to be that way. I believe it can be mitigated, redirected, anticipated and, as you point out, adapted to. Forethought is called for.
John M. commented Apr 30, 2007 |delete
The whole system has always been the people's responsibility this whole time. We are the ones who started eating canned, then frozen, then foods full of chemicals and preservatives, and now genetically modified organisms and stuff grown from who knows where that contains who knows what.
When are people going to realize no one is going to take care of them. The idea that a nice clean bright and colorful label with a smile on it doesn't mean anything. We have to wise us and start taking responsbility for our own lives, and that means we should be acting much more locally, and imposing local regulations.
Europe will not none of our Frankenfood and I do not blame them, and so that we do not do the same our government hides it from us.
Face is for years we have done the same thing to the workers in other parts of the world that our own companies use to do to us in the early 1900's - exploit them.
It is time to have global standards, and global regulations for pollution, purity, chemicals, recycling, energy ,etc ... our American capitalists just want one side of globalism, they get to go screw people all over the world while they screw us to with the highest prices in the world while they have substantially lowered costs and risks.
Time to wake up and hit back hard!
bruce k commented May 1, 2007
bruce k
There have been efforts to address these issues but they have been piecemeal and incoherent. Boycotting products can be effective if the public is informed and the efforts coordinated.
John M. commented May 1, 2007 |delete
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"With the onset of the Internet and other technologies, globalization was inevitable. Those who try to adapt will make it and do well; those that don't will go the way of the dinosaurs."
I disagree entirely. I'm not sure of your political affiliation, but I have listened as conservative pundits have repeatedly deflected criticism of globalism using the same argument... that it is somehow inevitable and we just need to submit to it.
This posiition is entirely wrong. (I've also heard conservatives argue that we shouldn't bother about pollution, either, because a) if we don't do it someone like China will be doing it anyway and b) its not realistic to believe we can live in a pristine world).
The truth is, we choose the world we wish to live in, and choose how we act in that world.
There is nothing simpler than opposing globalism:
1) Buy American (why is it that conservatives are so unpatriotic on this issue, supporting the outsourcing of American jobs and the destruction of the American working and middle classes, yet so patriotic on other issues?)
2) Support politicians and political movements that oppose globalism.
Once you do both, eventually, change will happen. I'd rather vote for a Conservative who is antiglobalist than a Democrat who is actively globalist!
There is nothing wrong with acting internationally (the UN, UN agencies, international organizations like NATO...) but there is nothing right about allowing capitalism to flee to dictatorships supporting slave labor just because it means our VCR's cost less...
Geoffrey B. commented May 1, 2007
Geoffrey, I really think you are wrong about Globalization, it is inevitiable and it is a good thing. What would you think if you could not get Florida oranges in the winter, or Idaho potatoes, or Silicon Valley computers ... this is industrial evolution.
The problem is that it is being done like the wild west, with no regulation. Europe is less hurt by this because they have a completely different way of viewing their countries and treating their people .... also their people are not so stupid and lazy as American and they demand their rights.
I agree with you in buy American when possible, and support political action, but to regulate globalism and help Americans compete. Even without globalism we have out of control capitalism inside the US ... that is the root of the whole problem, I think globalism is getting a bad rap to cover for corrupt rich people who are powermad and have to billionaires instead of just multi-millionaires.
bruce k commented May 1, 2007
bruce, I fully support trade in a balanced environment - with countries that enforce minimum wage laws, allow trade unions, enforce safe workplaces, allow freedom of speech and expression, and respect US intellectual property.
But most of what you see available in Walmart comes from countries that do not tolerate dissent, disallow unions, fail to enforce what pathetic labor laws they have on the statutes, and engage in wholesale piracy of American patent- and copyright- protected products.
If like most countries, we limited the amount of money capitalists take out of this country, we could go a long way to balancing it... it is the fact that US corporations are at the forefront of this process, outsourcing their mid-level work and building factories overseas, just to enrich the CEO and the board - that is driiving globalism...
Geoffrey B. commented May 1, 2007
1st paragraph I agree with. The fact that it has not worked out that way I think is due to the the people's ignorance and not paying attention, or not understanding, or being locked out of globalization policy, and on the other side lots of people who are international capitalists who see that they can be virtual tyrants if they play their global carpetbagger roles right - globalization unregulated is an invitation for tyranny if the people are not careful or do not demand their rights .. which they are not.
Products would be counterfeited in some of these countries whether WalMart was there or not ... the driving force for a lot of this chaos is that so many companies are afraid they will be locked out of markets if theydo not give in to the likes of China ... it happens to the best ... it is not us, our fault, but the fact that China is a bad actor that we have no control over.
Also your last comment about enriching just a elite of people, CEO, board, and do not forget capitalists, the investors is the whole problem - I agree.
In order to raise people, they have to have some route to gain and save capital so they can function as citizen investors, vote their money, take their risks and support what they believe in ... how do they do that when their incomes go down, but not the prices they pay? Globalization as it is occuring now is undercutting democracy and economic progress of Americans. Europeans would simply not put up with this.
bruce k commented May 1, 2007
One way to think about this matter is to extrapolate to the extreme.
What would happen if people from any where in the world were free to migrate to the U.S. without permission and given amnesty and the promise of citizenship?
If you find that absurd then what kinds of limits to immigration would you impose?
What if produce from anywhere were free to be imported to the US without limit and without inspection? Sounds ridiculous. Then what limits should be imposed and what types of inspections would be necessary?
A world without borders is a world bent on it's own destruction.
John M. commented May 1, 2007 |delete