Globalization and Poverty

On 9/9/11 I wrote a post entitled “Globalization and Advertising.” Each day it still generates a few hits and a week does not go by when someone writes directly to me to discuss it. A few months ago, a reader in Chicago started a lengthy thread about Globalization.

His main point is that Globalization is bad for the United States because developing countries have a comparative advantage over us when it comes to wages. So, evil multinational corporations simply move plants and factories overseas and dislocate American workers. His argument is that nobody wins with Globalization.

My take is that the topic is very complicated and certainly far more nuanced than my Windy City acquaintance makes it. Now, let me be clear. Managers who truly have no sense of social justice run some companies.  And, there is simply not enough time or money to identify all the greedy bastards out there who may cut legal or taxation corners to feather their own nests or prop up the corporate bottom line.

People who are critics of free trade often talk about those seeking a better life in America but forget about the billions overseas who seek the same kind of betterment. Not my Chicago friend, but others have written to me saying that, as a member of a Christian faith, free trade is unconscionable as some Americans inevitably lose their jobs if it is implemented. When I counter with don’t struggling Thais, or Vietnamese or Sri Lankans have the right to succeed, they tell me that is a different issue. When I ask if God looks at the passport of those being lifted out of poverty, people usually get angry, silent or both.

I am not naïve. There are some abusive practices out there where American workers are being asked to compete against child labor and sometimes prison labor. Clearly, that is not right. But is it social justice when Americans want to deny the poor abroad the chance to rise in life with their competitive advantage of lower wages?

For twenty-five years, I have wrestled with this issue. To me, the ONLY way for workers in developing countries to get out of abject poverty is if production can take place anywhere. The much-maligned multi-nationals are the key here. Only business, and usually big business will push for open markets. Politicians won’t do it, as they are afraid to offend even a few thousand constituents who may be temporarily out of work or have to move.

Each year millions of people in developing markets join the global middle class. And, in doing so, buy American brands of all sorts. The multi-nationals are not all laden with saints. But open markets are the only way the lowest in the world can claw their way out of terrible poverty. So, as unlikely as it may seem to many of us, the multi-nationals are the globes poorest unlikely and, at times, only real champions.

If you would like to contact Don Cole directly, you may reach him at doncolemedia@gmail.com