*A Retrospective*

It’s difficult to grasp the immensity of the globalization movement and thoroughly dissect the arguments for and against the phenomenon in a mere six weeks. Yet I feel as if this course has offered an interesting introduction into this complex topic. In reading a number of prominent authors on globalization, we have approached the concept from a variety of different perspectives. Globalization is not merely an economic issue, nor is it solely political. Rather it crosses into the territories of several disciplines – politics, economics, sociology, and ethics to name a few. It is truly an interdepartmental study, and therefore should be addressed as such.

Studying Stiglitz, Wolf, Singer, and various others has shown me that one cannot solve the problems of globalization by approaching the issues from solely one perspective. Our solutions must be as multi-faceted as the problems they are attempting to solve.

It is the recognition of this issue that I feel is notably absent in today’s global environment. Special interests abound – those for economic gain, those for environmental protection, those for political power. While the president argues for political concessions, corporate lobbyists assert their claims to financial resources. I believe that if we hope to reach greater consensus in the future on the issues related to globalization, we will quickly need to acknowledge the interests of multiple parties.

Thankfully, I also believe that we – as students attending a liberal arts college – are perhaps in the best position to tackle these issues. While a wave of specialization has engulfed our world’s workers for the past centuries, it is vital for the politicians and policy makers of tomorrow to be capable of seeing the “big picture”. A liberal arts curriculum stresses the interdependence and dynamism amongst a variety of seemingly dissimilar courses.

As my final year at W&L comes to a close, I continue to be impressed with the connections one can draw between different departments. History bears weight on current day politics, which in turn affect the business environment and regulation. Having the vision to recognize this trend is what one will need to quell the debates surrounding globalization.

Our international governance exercise will illustrate the need for level-headed mediators and talented coalition builders who can effectively listen to multiple viewpoints and create solutions for progress. I predict that it will be this group of individuals that will lead our globalized world into the future.

Here's a link to the cartoon.

*Stiglitz - International Development*

Well, I have to hand it to Stiglitz. Between his chapter in Making Globalization Work – “The Promise of Development” – and his article in the Frieden and Lake anthology – “International Development: Is It Possible?” – Stiglitz has caused me to reevaluate and clarify some of my opinions concerning the role of states and markets.

As it was pretty clearly established in class, I tend to be a proponent of market-guided policies. This isn’t because I don’t believe in the need for an effective government. Surely, as Stiglitz notes, “[the public sector] should focus its efforts on those areas where the private sector fails”, such as macroeconomic policy, legal systems, and environmental concerns (FL 388). Stiglitz seems relatively even-handed when assessing the positions of markets and governments; neither one is perfect and both require elements of the other to reach an equitable and sustainable balance.

No, it’s not that I categorically object to government intervention. Rather, I fear that oftentimes the developing countries that so desperately need well-run governments and efficient policies are the ones that rarely achieve these goals. Forgive my cynicism, but how can we ensure that developing countries are getting the leadership and fair governing that is necessary to relieve their economic and social hardships.

Clearly, installing politicians to lead a foreign country’s government isn’t effective (read: Iraq). The support of the people must be behind a government for it to be fully integrated and accepted. Yet even in the hands of the people, we are not guaranteed of a successful outcome. Granted I’m noting extreme cases here, yet fascism and communism both had their body of supporters. Moreover, corruption often runs rampant in developing countries where democracy and the free market are not well-established and the population is easily manipulated.

Perhaps what I feel is the most dangerous characteristic of government intervention and policy is that it is fundamentally grounded in the actions of human beings. While the market operates more as a soulless, unflinching machine, the government is led by flawed, self-interested parties. I do believe that people are essentially good and those who lead states care for their populations. Nonetheless, we are all victims of basic human nature. Sometimes we are truly our own worst enemy.

I do enjoy Stiglitz’s views and his unfettered idealism. His case is rational and convincing. Governments that focus on equity, investing in their human capital, and improving standards of living have a far greater rate of success than do corrupt regimes. Of course. And how does Stiglitz propose the West can help developing countries get there? 1) Don’t undermine democracy and 2) Reduce opportunities for corruption (Stiglitz 56). All well and good. I simply wonder if these steps are enough to help transform developing countries into thriving nations with fair and just governments.

A Report Card You'll Want to Post on the Fridge

Stiglitz's notion of an increased need for corporate social responsibility (CSR), is echoed by many authors within the IPE realm. The concept of CSR has existed for quite a while, yet not until recently has the topic received the attention it deserves. Stiglitz states that although some changes have been made, more regulation and higher standards should be adopted.

One of the recent undertakings of many companies has been what some call a "social report card", a "scorecard", or a "corporate responsibility report". Stiglitz refers to these innovations when he mentions "accounting frameworks...that track contributions to the community and environmental impact". As Stiglitz notes, these documents help companies, investors, and the public understand the true impacts of the corporation on a broader scale.

An example of this type of disclosure is found on GM's website. Within their CSR report, GM issues a scorecard which outlines a variety of environmental and social indicators and tracks their movement. In the GM report, indicators such as "waste" and "water use" are tracked along with "community donations" and "the percentage of hourly female employees". A similar scorecard from Exxon is also available. While this is not the ultimate solution to CSR, knowledge is an essential foundation and serves as an early step.

The Invisible Hand of the Market vs. The Heavy Hand of the Government

This article from the USA Today reminded me of that..ahem..disagreement we had a few classes ago about the power of the market versus the power of government. (Just to clarify, I'm not an anarchist, I promise).

The article focuses on the recent decline in illegal immigration numbers and the causes for this drop. Apparently, the main reason for the decrease in the number of illegal border crossings isn't the increase in National Guard troops, as Bush would so proudly proclaim. Rather, lower numbers in illegal immigrants are most likely due to the decreasing attractiveness of the US economy. While most sectors of the US economy are flourishing, or at least maintaining, the US housing market has been in a tail spin since the beginning of last year. Seeing as the construction industry is one of the largest employers of illegal aliens, it's not too far-fetched to link a dwindling housing market with a slowing of illegal immigration from Mexico.

Well, it seems like in this case the market trumps the government in its ability to most effectively changing the actions of others. Another case in point that the market just does it better.

Outsourcing Gets Personal

Having recently read Friedman's "The World is Flat", this article by David Silverman, entitled You Can't Stop a Tidal Wave with a Fork provides a solid contrast to the glorious tales of globalization touted by Friedman. The gist of Silverman is that while he himself has suffered from the drawbacks of the global era and outsourcing, he isn't about to sit by and pout (although the article itself does have its fair share of self-pity):

People ask me how I feel about my business being pushed out of existence by companies in India. They ask how I feel about greedy American companies sending the work overseas. They might as well ask me how I feel about deciding to stop a tidal wave with a fork. There's no way to regulate this global issue. It's beyond one person, or many. Dobbs can say anything he wants, but the hourly workers in India are just trying to feed their families and their bosses are using their price advantage to sell like any good businessperson would...According to Princeton professor Alan Blinder, as many as 40 million jobs may be outsourced over the coming decade or two. The only way to stop that work from flowing to cheaper labor markets would be to force companies to work within their borders and scan their e-mail for illicit projects being sent to people named Pratap. In other words, close down the country. But that's simply unworkable.

So what does Silverman suggest?

If the government wants to help small business and the American worker, it could do something to slow the pace of change. It is the speed of outsourcing, more than anything, that dislocates tens of thousands of workers a year and causes shock waves through the economy. The government could slow things down by granting subsidies to American firms to help compete with overseas companies. It could provide them incentives to buy locally. But, in the end, it can't stop the flow of work and money from traveling around the world...The U.S. would do well to stop wishing outsourcing would go away. It could do a lot more good by helping build the economic base of every country in the world.

I realize I'm a bit young to get too cynical, but "build the economic base of every country in the world"? I do strongly believe that Americans can help themselves by aiding those in other countries, but the issue of priorities is prickly. Who comes first when setting policies?

"Pizza for Pesos" Controversy

Lou Dobbs would love this one...

Apparently there's a pizza restaurant, Pizza Patron, that has begun accepting Mexican pesos at U.S. locations. The "Pizza for Pesos" initiative has resulted in an increase of 38.4% in the first quarter of this year. Interestingly, however, this franchise isn't setting a precedent. Rather, some companies have been accepting Canadian dollars and Wal-mart has bypassed that whole national currency thing by accepting Mexican pesos at stores along the U.S.-Mexican border.