Sunday, October 25, 2015
A topic that I found interesting was from this last weeks reading on Political Globalization. In Joseph E. Stiglitz article titled "Globalism's Discontents", he claimed that globalism itself doesn't have any problems, there are just problems with how it is being managed across the globe. He stated an example that included the IMF, or the International Monetary Fund, in which a third-world country borrowed 100 million dollars from the United States. In order to receive these funds however, the countries government must put aside the same amount in order to lend it to the U.S. On top of that, the money that is being borrowed must be paid back with interest. This is where globalism doesn't work. The United States is cashing in, but those who actually need the money in order to expand their infrastructure and education systems are put even farther in the hole. This also got me thinking about how the United States has often used less developed countries and their workers in order to fulfill their own needs, even though the other country may not benefit nearly as much. From a market standpoint, the U.S. is using Mexico as a means of selling their products for less than it takes to make them. In another reading about political globalization, Tina Rosenberg spoke of how American grown agricultural products are ruining the Mexican farming business. With enhanced technology and new methods to maximize production, Americans are able to produce goods on a grand scale without using many resources. Let's say the U.S. wanted to grow wheat. They could grow a massive ton of wheat in a short amount of time in a state-of-the-art megafarm in the U.S. Producing in large quantities would be cheap for the U.S., cheap enough to where they could undercut all of the local farmers in Mexico. The Mexican farmers are forced to sell for dirt cheap, or face the consequences. This lack of capital flowing through industries across the world just goes to show how holding developing countries to the globalized standard can be detrimental to their growth.
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