America & Globalization Essay

Abstract The purpose of this paper is to explore the idea that American corporations are working with international companies to help boost the economy. The paper focuses on the use of globalization as a primary tool towards accomplishing that goal. The paper also provides the reader with views from both supporters of globalization and opponents as well. The articles used for this paper give very interesting facts as well as views on both sides of the socio-economic table. In U.S Liberal Politics author Deborah White’s article â€Å"Pros and Cons of Free Trade† she discuses globalization in relation to free trade agreements and provides both pros and cons as well as a generalized definition of free trade. Meanwhile, Gary Hufbauer provides a more supporting article on Globalization supplied with studies and debates. As for Chris Isidore’s article, it focuses generally on the recessions from past to present and what trends are different and remain the same when it deals with the progression of the economy. Lastly, Wikipedia’s definition of †Globalization† lays out in detail the history, timeline, business applications, and etc. about the economic reference. In like manner, this paper examines the overall analysis of globalization and how it relates to boosting the economy. America & Globalization One of the biggest topics today in America’s current events is the U.S. economy and the need for an economical boost. The U.S. declared the latest recession the biggest since the Great Depression. According to Chris Isidore (2010, p.1), â€Å"The Great Recession started in December 2007 and ended June 2009†. However, this information does nothing for the many Americans out of work, over-debt in their mortgage, and uncertain about their financial future. Nevertheless, seemingly, the American corporations have worked hard to try to find ways to help fellow Americans and boost the economy back to its median. One of the ways big corporations think will help is the use of Globalization. According to Wikipedia (2012, p.1) by definition, â€Å"Globalization refers to the increasingly global relationships of culture, people, and economic activity. It is generally used to refer to economic globalization: the global distribution of the production of goods and services, through reduction of barriers to international trade such as tariffs, export fees, and import quotas†. Comparatively, the United Nations Economic and Social Commission have also written that globalization â€Å"is a widely-used term that can be defined in a number of different ways. When used in an economic context, it refers to the reduction and removal of barriers between national borders in order to facilitate the flow of goods, capital, and services and labor†¦Ã¢â‚¬  In contrast, there are just as many people opposed to this idea as those whom support it. Deborah White writes (p.1), â€Å"One angry complaint is that more than three million U.S. jobs with middle-class wages have been outsourced to foreign countries since 1994.† It seems that the biggest obstacle is convincing the middle class that globalization is in fact, a good idea for the economy. Those same opponents believe that free trade has caused more U.S. jobs losses than gains, especially for higher-wage jobs. They also feel that many free trade agreements are bad deals for the U.S. Nevertheless, American corporations in conjunction with government officials are both working with other international companies to help boost our economy. To begin with, American corporations like the idea of boosting the economy through the use of globalization. Henceforth, with treaties like NAFTA (North American Free Trade Agreement) and organizations like NATO (North Atlantic Treaty Organization) America has been at the forefront of the campaign for the removal of barriers between national borders in order to facilitate the flow of goods, capital, services and labor. Moreover, as White writes (2012, p.2), â€Å"The purpose of free trade agreements is to allow faster and more business between the two countries/areas, which should benefit both.† Statistics show that globalization does help boost the economy. Gary Clyde Hufbauer writes in his article, â€Å"The Peterson Institute calculates that the US economy is approximately $1 trillion richer each year owing to past globalization—the payoff both from technological innovation and from policy liberalization—and could gain another $500 billion annually from futur e liberalization†. These are the numbers that motivate American Corporations. In addition, globalization helps increase sales and profits for U.S. businesses, which ultimately boost the economy. What the middle class does not understand is that globalizations tactics such free trade help create more jobs within the middle class sector for the long term. White also adds (2012, p.2), â€Å"Removal of costly and delaying trade barriers, such as tariffs, quotas and conditions, inherently leads to easier and swifter trade of consumer goods. The result is an increased volume of U.S. sales.† Globalization also helps to develop and strengthen the economy of the poorest countries as well. Some of the biggest benefits of poor countries through tactics like free trade are creating more industrialized nations and increasing the purchase of their natural resources and/or labor services. Condescendingly, there are just as many opponents to globalization and free trade as there are supporters. Many of those that oppose consists of middle class Americans and the congressman they elect. The biggest problem is a fear of the unknown. Middle class Americans don’t want to wait for the â€Å"long-term†. They want to continue to have the same security of employment as they’ve always had, which is understandable. Nevertheless, they also feel free trade agreements cause a loss in higher paying jobs. This is the basis or platform for the argument of the â€Å"War on the Middle Class†. The argument of free trade and globalization, although provides a soaring boost in corporate profits, individual wages stagnate. This leaves no room for the middle-class to advance. As White explains (2012, p.2), â€Å"While corporate profits soar, individual wages stagnate, held at least partly in check by the brave new fact of offshoring — that millions of Americans’ jobs can be performed at a fraction of the cost in developing nations near and far.† All things considered, the determination of whether globalization is good for the economy will continue to be a debatable issue amongst those of different socio-economic groups. Nevertheless, there is no doubt that globalization has its pros and cons. The ultimate goal and mindset of American Corporations behind implementing globalization is to work with international companies in an effort to boost the economy. Famous investor Warren Buffet once said, â€Å"Someone’s sitting in the shade today because someone planted a tree a long time ago.’ Whether that shade tree is globalization, who knows? The ultimate goal is creating jobs and getting the economy back on course. References Deborah White. (2012) US Liberal Politics Pros and Cons of Free Trade Agreement. Retrieved from http://usliberals.about.com/od/theeconomyjobs/i/FreeTradeAgmts.htm Chris Isidore. (September 2010) Economy Recession officially ended in June 2009. Retrieved from http://money.cnn.com/2010/09/20/news/economy/recession_over/index.htm Gary Hufbauer. (May 2008) Answering the Critics: Why Large American Gains from Globalization Are Plausible. Retrieved from http://www.iie.com/publications/papers/paper.cfm?ResearchID=929 Wikipedia. (March 2012) Globalization Retrieved from http://en.wikipedia.org/wiki/Globalization