The Narrow View of Globophobia

I am a little surprised to see this piece in The Nation, because it is very pro-globalization. While it does address some negative issues that arise from globalization, it also attacks some of the fallacies that anti-globalists keep repeating.

Those who identify globalization as the major force behind the production of inequality frequently point to an alleged "race to the bottom," driven by multinational corporations (MNCs), which constantly ransack the globe searching for low costs and high returns. This case isn't easy to prove either.

If you look at the distribution of investment by US multinationals abroad, several things stand out. First, such investments are overwhelmingly located in rich countries. Over half is accounted for by Western Europe, Canada adds another 10 percent and the richer countries of Asia, 8 percent. So more than two-thirds of the total stock of US foreign direct investment is in countries with incomes roughly comparable to ours. Throw in the four classic Asian Tigers, and you've got more than three-quarters of the total. The poorer countries of Europe are home to less than 1 percent of US foreign investment, and China, even less. Mexico accounts for just 3 percent of the total stock, not much of an increase from 1980. That's not to say that Mexico isn't important in certain industries (like autos and electronics), or that it isn't an important club that employers use to scare workers–but the relocation of production to Mexico isn't quite the driving force of economic evolution that it's sometimes thought to be.

Interesting stuff. I like this part too, from the last paragraph.

In our normal work lives, we're all linked–often invisibly– with a vast network of people, from across the office or factory to the other side of the world. Standard globalization narratives, mainstream or critical, often efface this fact, seeing capital, rather than the billions who produce the goods and services that the world lives on, as the dominant creative force.

I don't agree that people alone are the dominant creative force, because I do think capital is required – to some extent – to put ideas into action. I continue to be amazed that globophobes exist on the left and the right. To me, it seems they might as well be arguing that the earth is flat.