The Trouble with Trade & the Negatives of Globalization
Trade, what is it good for? How about cheaper products, improved living standards, increased technological innovation, and increased capital flow between countries positively contribute to the pro-free trade narrative. The World Trade Organization even proposes that free-trade contributes to world peace. But, perhaps there is a dark side to free-trade.
Job Losses in the Developed World
The economies of developed countries are seen as being in a dominant position against the developing world. However, many low-skilled jobs are being lost to other countries with lower wages, such as India, Vietnam and China. The USA as well has lost around 851,700 jobs due to NAFTA signed with Canada and Mexico. This was a point of controversy that made President Donald Trump oppose the trade deal, leading to CUSMA. The global gig economy as well has made the exportation of jobs easier with, for example, tech support jobs being outsourced to South-East Asia.
Pollution
Pollution is often overlooked when determining the pros and cons of trade. Trade accounts for 7% of all global CO2 levels. This may not seem like a lot, but anything that contributes to global warming is not suitable for the planet’s future. Additionally, 700 thousand people die annually due to emissions related to trade. Unless trade goes green, more people will die.
Furthermore, it is worth noting the possibility of shipping accidents and oil spills that hurt ocean life. Oil spills damage the insulation of fur on otters and water repletion from boards, leading to hypothermia. Whales and Dolphins can inhale the oil, poisoning them. Additionally, oil can poison fish that humans use to eat. While oil spills have decreased since 1976, in the 2010s, “~164,000 tonnes of oil were lost from tanker spills of 7 tonnes and above” according to the International Tanker Owners Pollution Federation. While the polluters have to pay for the oil spills, delays can occur due to contention of asserting blame and legal consequences to force companies to clean their mess.
Growing Wealth Disparity
The rich are getting richer. While it is fair to concede that globalization has lifted many out of poverty, it must also be conceded that there is a disproportionate amount of wealth pooling in the hands of multinational corporations and their CEOs. Between 1978 and 2014, the salaries of executives in multinational corporations rose 997%. Meanwhile, the average worker’s salary only rose 10.9%. This matters as those with greater wealth have greater access to privileges in their lives, such as better education. As only a narrow group of people are benefiting from trade and globalization, perhaps it’s not an effective way to boost people’s standards of living. With the current level of globalization, lack of protectionism to safeguard the local industry, trade blocs like the EU or ASEAN and organizations like the WTO pushing greater free trade among nations, the wealth gap will only continue to grow.
Neo-Colonialism
Some academics have noted developed-world-exploitation of other countries for resources; this is called Neo-Colonialism. Neo-Colonialism can also extend to political, cultural and media domination within countries. This can occur if countries have corrupt leaders who take bribes from multinational corporations; thus, the leaders shape the laws to benefit the corporation. Another way Neo-Colonialism is established is by the free market system allowing more extensive cash reserves of foreign companies to undercut domestic business prices in the developing country. Either way, the country becomes subordinate to the whim of business interests and funnels profits out of the developing country towards their home countries. This was a particular issue Bolivian President Evo Morales spoke out against foreign lithium mining in the country.
Spread of Disease
Whether it be the trade port of Kaffa, Russia (now Feodosia) bringing the Bubonic plague to western Europe or contaminated mad cow beef being shipped internationally, disease has been at the centre of trade. Moreover, globalized commercial transportation has spread disease. Take Covid-19, for example. It infected people who came to Canada via airplanes. With millions of people travelling in cramped spaces, it is quite easy for a regional disease to grow into an international pandemic. Trade only exacerbates this through the potential shipping of diseased products and greater movements of peoples worldwide with shipped goods.
Worker Exploitation
Working conditions for labourers in foreign countries are usually brutal in comparison to the developed world’s standards. In China, Apple’s Foxconn factory is notorious for the suicides among workers with suicide nets put in place to prevent them. This is mainly due to inhumanely long work hours; some companies force workers to work 72-hour workweeks.
Moreover, India’s E-waste disposal contributes to the poisoning of workers who breathe in the toxic and carcinogenic chemicals in the burning disposal process. In fact, 76% of e-waste workers in India suffer from respiratory issues. Not to mention the additional environmental risks caused by burning e-waste, such as GHG emissions and lead water contamination.
In addition, poor wages in countries also contribute to fatigue and nihilism in countries like India and Vietnam, as with low wages, people cannot enjoy the fruits of their labour. This is especially true with Vietnamese Nike workers having to work ~191 hours even to afford the shoes they produce.
Overall, despair plagues those who work in these conditions. Trade and globalization are to blame as they facilitate companies’ profit incentive to treat their employees in this manner. The workers also do not have much bargaining power due to a large labour pool in developing countries where demand can easily be replaced. Finally, as workers need the money to support their families, risking their jobs is not worth it unless they go hungry.
Closing
The globalized world causes trouble, but every system has its kinks. Yet, these kinks are a lot more severe than many put their minds to. Job loss, pollution, wealth disparity, Neo-Colonialism, the spread of disease and pollution are harmful byproducts of globalization and trade. The current neoliberal idea that free is beneficial to all, originating from classical economists Adam Smith and David Ricardo, is not true. Countries, especially developing ones, must re-evaluate how they interact in the global market. That perhaps they are not genuinely benefitting as much from free trade as they may think.
Articles like this serve to drive awareness of modern world problems. To challenge a widely held consensus among the world’s nations is key to arising solutions to make our world better to live in. Whatever path the world takes, these troubles can not continue, unless humans choose the path of self-harm.
