Has Globalization Failed Us?

After 26 years of the creation of the World Trade Organization and the massive expansion of globalization through free-trade agreements around the world, what are the results? Do we live in a better society than before? There is no doubt that tremendous wealth has been created, but has it been distributed fairly amongst all the participants in the creation of that wealth? I will make the case that it has not, most of the new created wealth has been massively concentrated in a few hands and a few multinational corporations. We now have massive concentration of capital in a few companies that have become too big to fail, who through their massive new size have the upper hand in capturing market share, negotiating with suppliers and governments (unfairly), and buying out the competition becoming even bigger. The problem is that while this multinational corporations and the private banking that finance them, grew year after year breaking record profits, the workers that made that possible didn’t got their fair share of the benefits. Society in general didn’t benefit as it should through building better infrastructure and higher quality services, because in this globalized world, companies move assets around to tax havens to trick the system and avoid paying their fair share of taxes. In today’s world we call taking advance of tax loops smart instead of immoral and unethical, what is wrong with paying more to society If society is helping your company make more money? If workers pay their fair share of taxes, why corporations can’t do the same? Why does making more and more money has become the goal? What about the goal of creating better conditions for the employees? What about the goal of taking care of the communities that contribute to the company’s profits by consuming its products and services? What about the goal of taking care of the environment without whom we cannot survive as a human species? We need to start asking us this tough questions.

How is it possible that a product can be cheaper to produce on the other side of the planet, when that product has to be transported through air, land and sea, temporary stored, and finally, distributed to the final consumer? I’m not even counting all the middlemen fees and import duties that must be paid, and it is still cheaper than producing locally? It makes no sense if we think about it. In my opinion the reason for this nonsense is that we are not accounting for the cost of contamination that those companies contribute, nor we are accounting the cost of the miserable wages that they pay to their workers to produce that cheap. It has become a spiral of value destruction, first by shipping overseas the production facilities affecting local workers and local economy, then by contributing to the below-poverty line wages that those companies are allowed to pay their employees, some of whom even after an 8-to-12-hour shifts don’t earn enough to cover the basic needs of living by themselves. Those companies don’t care about the environment because their goal is to cut cost to make more money, not to create wealth for the communities where the do business or a healthy workplace for their employees. Finally, they contribute to contamination even further by transporting those goods to the world. So, are those products really cheap after accounting for all those factors? Maybe they are cheap in terms of money, but what about in terms of all the value destruction described above? I believe that buying cheap products from overseas is wrong. I believe that every company that wants to do business overseas should put a factory in that country to support the communities that are consuming their products, pay their fair share of taxes to that country, and avoid unnecessary contamination to the environment through transportation. Now, I want to clarify that I’m not against globalization, it has been a blessing to be able to buy products from around the world, but it should be for products that cannot be produce locally or that makes no sense to produce locally.

Thanks, to globalization the world has experience unprecedented growth and wealth creation, but only for the owner of capital, because at the same time we have experienced unprecedented growth of income inequality. Wages have remained stagnated while workers production has constantly increased, and companies break record profits. Thanks to globalization we now have a world supply chain that ships parts and pieces around the world creating unnecessary contamination due to the transportation and refrigeration needs. If a company contaminates the air or sea, no matter where that company is located, we all share the same atmosphere and oceans, and one day it will affect us, sooner than later, so why do we continue to support those companies and that system? We the consumers have all the power, we can decide how to spend our money, we can decide to buy locally instead of cheap products from overseas, we can decide to buy from companies that pay fair wages and take care of the environment, we can decide to buy from companies that give back to the communities that consume their products and pay their fair share of taxes to support wealth distribution. We can’t wait for the government to react or for the companies to change, we have to help them change by taking the first step and become conscious responsible consumers.

What can we start doing today?

1.       Buy your food from local farmers. Buy directly from the source so that they can have higher profit margins to produce higher quality food. They take care of the land because is their land, they intend to pass that land to their children, and they eat from what they are producing. Most big companies see food production as a commodity while for farmers is their way of life, who do you think will take better care of the land?

2.       Consume locally produce products. By doing this you are helping your local community keep the wealth and the environment by avoiding transportation pollution.

3.       Buy quality over quantity. Let’s start buying less products but of higher quality that will last longer.

4.       Buy used or refurbished over new. Google marketplace, ebay, yard sales and thrift stores are a great source of high-quality used products. Before we buy something new, lets shop around for product that we can recycle and in doing so save money and help the environment.

5.       Buy from companies that pay fair wages and protect the environment. Let’s research who we are buying from and let’s start rewarding the companies that have a real commitment to something more than just profit.

In summary, the globalization of cheap and low-quality products has proven to be a value destructive practice. Trying to be the cheaper product manufacturer means that you must pay cheap wages (sometimes below-poverty line wages), don’t protect the environment, avoid taxes, and don’t give back to the communities you serve. We as a society should be better than that, we have options, it depends on us to change this system, are we willing to make the change?