Submitted by Charles Hugh-Smith of OfTwoMinds blog,
Globalization continually creates imbalances that fuel a perpetual instability that gradually impoverishes every sector other than global capital.
Globalization has two guaranteed consequences: permanent instability and endless boom-and-bust cycles. As noted in Forget "Free Trade"--Focus on Capital Flows, the key engine of globalization is mobile capital: capital that can borrow money for next to nothing in one nation and then move that capital to other nations where yields are higher and opportunities for exploitation riper.
This mobility of capital is an enormous benefit to the owners of the capital, but it creates extraordinary instability for those who are not as mobile. When mobile capital encounters anything that reduces profits--higher taxes and rising labor costs, competition or restrictive regulations--it closes factories and fires its workers in that locale and shifts to another locale with greater opportunities for high returns.
The workers left behind have limited means to replace the lost wages, and the local government often has few resources to repair any damage left by the exploitation of resources. The advantage of mobility is reserved for capital, and to the relatively limited cohort of workers who can immigrate to other nations to find work.
This illustrates two key ontological characteristics of financialized globalization: perpetual instability and a never-ending cycle of boom and bust as capital sparks rapid development in one locale and then moves elsewhere once profits decline.
The scale of global capital is difficult to grasp; trillions of central bank-issued dollars, euros, yen and renminbi are sloshing around the global economy, seeking low-risk profits.
Capital has no loyalty to anything but its own expansion, and the damage it leaves in its wake is of no concern to the owners of capital.
There are even less visible consequences to the globalization of markets, capital and labor. Once goods and services are priced globally, local supply and demand no longer set the local price. As my colleague Mark G. has observed, consumer prices can rise even if there are deflationary surpluses in the local economy because price is set by global supply and demand. As a result, measuring inflation and deflation locally is meaningless in a globalized economy.
This financialized globalization of goods, services, credit and currencies continually creates imbalances that fuel a perpetual instability that gradually impoverishes every sector other than global capital, which being mobile, can exploit the imbalances for its own profit.
"In a 'globalized' world, no country, not even the US, can protect itself from the consequences of imbalances elsewhere. The global economy is a system in which certain types of imbalances are impossible. I especially focus on the requirement that global savings and global investment always balance, but there are others. Because an imbalance at the global level is impossible. if there are imbalances in one country or region, there necessarily must be the opposite imbalances in another, and the more open an economy, the more likely it is to respond to imbalances elsewhere.
It is impossible, in other words, to understand any non-autarchic economy in the world except in the context of global imbalances.
Here is Mark's commentary:
The logically following converse of Pettis' point is that only economies enjoying autarchy in any category of economic activity can ever hope to reach reasonable price stability in those activities, and then only if these activities are also made non-tradable by local practice. Restated, "free trade" between large central states is a prescription for perpetual instability at all levels.
Ricardo's theory of comparative advantage is only advantageous if you enjoy an advantage in a particular field. Otherwise it is merely a road map to rapid impoverishment. The only localized response--even at continental level--is to embark on a series of successive financial bubbles. This is pretty much what we've seen everywhere in the world for the last three decades.
Thank you, Mark, for summarizing the consequence of central bank-funded mobile capital and the imbalances and boom-bust cycles this free money for financiers generates globally.
Of related interest: A Thought Experiment in American Autarky (January 17, 2014)
Oh it's so simple if You think about it. One world , one wage
Yes for some that $2.00 per day wage would be a raise.
And one exchange rate for USD
China & Mexico = parity with the USD, GBP, EUR.
Other than "Where did all the people go?", presented without comment:
http://ncrenegade.com/editorial/so-where-did-the-people-go/#comments
Sigh. You think a globalised world is unstable, CHS? See what happens when you have - say - a drought-induced famine in one country and you can't trade with other countries because it contradicts your anti-globalisation ideology; and watch the people starve.
Globalisation minimises (or, at least, ameliorates) supply shocks. Don't believe me? Stop trading with your neighbours and see how well you do. After all, globalisation is just localism writ large.
the key engine of globalization is mobile capital: capital that can borrow money for next to nothing in one nation and then move that capital to other nations where yields are higher and opportunities for exploitation riper.
No, we had greater globalisation in the period prior to WWI; free movemnt of capital, no currency risk, stable international currency... and very definitely positive interest rates.
I like CHS, on the whole, but sometimes he's so off-base I wonder if his retarded twin has hacked his blog .
I'm sorry but I think the fittest and perhaps the ones with the most resources will survive. The ballooning world population will lead to more human misery and we will not be able to prevent the calamity.
This is dead on.
Under a gold standard, real bills, and multi-lateral trade, freer regulations, no central banking and no socialist nations, pre-WW1 saw an amazing level of trade, without the imbalances we suffer today.
The main error was made when Nixon listened to Friedman and his theories on fiat currencies all floating against each other all backed by debt that would no longer be extinguished by final payment in gold. None of those theories became true in the real world. But no economist worth his $200k university chair has the balls to expose that emperor, because it would mean questioning the entire financial system.
All fine in theory, in reality one massive imbalance between China and US will ultimately destroy current model of the globalised trade. Result will be quite similar as the one prior to WW1 except this time it will be truly global in scope.
"Free" trade and the financialization of the economy are the hidden traps in what is otherwise called globalization. What has happened over the past two decades can not be unwound. There is no path to return to a real economy except collapse.
Globalization means everything becomes shit, anytime, anywhere, anyway.
"Financialized globalization" means everything becomes shit, anytime, anywhere, anyway. There are other models for "globalization" that would benefit people, not capital.
But we're living under the "golden rule", and those with the gold have written the rules :(
We will all be happy when we are all poor and living in one room shacks. No need to work hard because we will never get ahead. If we accumulate too much it will be confiscated and sent to Nigeria or somewhere. This is only fair! sarc
I am all for a reversal of globalization, but I don't tbink many ZHers are going to cherish the "simpler" lifestyle. I assume, maybe incorrectly, that most ZHers are neither the SNAPitariat nor the fast food workers of this country.
If my lifestyle gets any "simpler" i'll be beating my clothes on rocks down at the stream.
and now kids hold your hands together and jump....
It's what I've been saying for years, Ricardo is dead and "Lucy you're in big trouble now!"
I can't wait until we start trading with aliens (from outer space).
"trading with aliens"?
The kind that "serve mankind"?
That is because globalization is a corporate and financial takeover of the world.
I once thought that protectionism and import duties were wrong but I now want to seal the border shut. I can do without the China shit.
Trace back the origin of your thinking about protectionism, and you might be surprised.
Yep. Back to the Founders of the country, who in their wisdom put heavy tariffs on all imports.
=slavery.
Globalization = Global Manipulation
Yeah. They can't say they didn't know. Think Hacienda Patrons, the wealthy Land Owners who lorded over serfs or Peons.
The plan was to generate bigger profits, lower labor costs, increase debt, create debt slaves or welfare citizens... while picking the losers in the Western Economies.
US/EU Banking System is well developed. And our Government Systems are well Developed. Even the Catholic Church & Roman Empire had well developed systems for finance, money, revenues, book keeping, accounting, inventories.
I would bet there is another plan out there to:
- Use Privatization & Contracting out of Banking & Government Functions to Indians, Filipinos, Chinese, Jamacians,... or just to low wage US Workers
- Contracting out and Outsourcing can effectively turn the USA into a 3rd world country
- They already have Beta Tested it
- Beta Tested Iraqi War Narrative
- Beta Tested TARP Bailout Written By TBTF Bankers
- Beta Tested Subprime & NINJA Subprime Loans
- Beta Tested DOJ & FBI Failure to Prosecute TBTF
- Beta Tested Billions in Lost Money in Iraq War
- Beta Tested QE $4 Trillion Inflation
- Beta Tested Off-shoring, Outsourcing, Decapitalization of US Manufacturing
- Beta Tested open Borders while Building DHS $60 Billion Dollar Budget
Must be a new word for this...
- Anarchy by the Elite
- Creative Destruction of 1st World Nations
- Return to the Dark Ages
- Duopolistic Abdication of Governance for the People
- Abdication for Anarchy
- Roman Corruption
- Rule by Elites
- Sucker's Rule (PT Barnum)
- You get the Government you ask for
- Government will take as much as you let them
- Bankers will take as much as you let them
- You get the government you pay for, and you didn't pay them anything they didn't take from you
- You pay Bankers & Politicians to Run your Government, and you surrender both security & freedom
WE HAD SYSTEMS to prevent this. Auditing Systems. Accounting Systems. Inspection Systems.
Good post.
Thanks. Also Beta Tested War Outsourcing, Mercenaries, Contractors sucking up hundreds of Billions in War Revenues, and gave birth to probably 3 more generations of weapons systems.
Excellent post. The goal is to create a global neo-feudal system.
Thanks. And of course they have Beta Tested Market fixing
- ZIRP for 2014 - 2008 = 6 Years
- Gold & Silver Fixing for 2014 - 1971 = 43 Years
- HFT or high speed trading
- Algo Trading
- Naked Short Selling
- ISB Fix
- LIBOR Fix
not enough room for whole list...
Global neo-feudalism sounds about right. Blood lines, Royal Lines, Stratification between royals, Rulers (Presidents, Prime Ministers, MP, Congressmen), Vatican, Managers, Professional Engineers, clerics, book keepers & account managers, and Labor (unskilled Labor).
http://m.youtube.com/watch?v=-A0eem5ON6Q
It's a trick on played on patriot's.by banksters.
Barnhardt talks about this in her latest post. She pulled some of her notes from Denniger over at Market Ticker:
http://www.barnhardt.biz/2014/10/29/notes-for-apres-la-guerre-part-2-ban...
Globalization is good if you can compete. It's a biological equivalent of bringing a foreign specie into a new environment. It may become a new food source or a fierce predator.
Does the US benefit from globalization? It depends on who you are. If you are an export of fiat and credit (ie. the bank), you benefit substantially, as US holds a monetary monopoly through its reserve currency. Sure, the benefits will end, but the wealth sucked from the rest of the world via this mechanism over the last 40 years cannot be denied.
"Smart" contries such as Spain keep borrowing and defaulting strategically all throughout history. They figured how to game the system, and so did we.
Oil trade is a side beneficiary through the petrodollar arrangement. Because of the petrodollar reach, our oil corporations manage to post profit while the US remains a net importer of energy. That's some financial magic right there! Army, being a part of the pertrodollar enforcement brigade also has no reason to complain. They earn their pay by defending the dollar, the banks and the oil wells, regardless of whether they're located on home soil or in foreign lands.
Who loses out? The energy-dependent manufacturers and producers of intellectual content succeptible to piracy.
Every country has vitrually the same stance on intellectual propety: "Don't steal from your own people, but if you steal from someone else - it's alright." Companies such as Samsung were able to outpace Apple. How? Because they didn't have to pour funds into initial research and development. They didn't have to test new grounds. All they had to do was pick the winning formula, tweak it just enough to avoid major lawsuits, and run with it. Being a component manufacturer for Apple products, Samsung was able to use leverage to get away with many violations
Still, even with the net outflow of jobs to foreign countries, I believe we were a net beneficiary. If we did not put fiat export into hyperdrive, jobs would've dried up a lot sooner. The Fed funny money had allowed us to remain pseudo competitive in areas in which bankers themselves were interested. We were able to sustain the service sector bubble. We were able to spend beyond our means while receiving rewards for free.
Cheap Chinese crap? Sure - everyone complains about it. Meanwhile what do we send back to them? What US product floods their shelves in return? Nothing! We may receive crap, but we send out even less than that. We send out paper.
Jobs? Well, what would you expect! Cut globalization off completely. Raise mile high walls all around the continent. Drill for your own oil and gas and see if your life gets any easier. Comparing life today to life before globalization, don't forget to also put energy use and energy production into context... and when worrying about loss of jobs, don't forget about automation that knows no borders and isn't a foreign phenomenon.
You can and will eventually be automated out of existence and the height of border fences has nothing to do with it.
But we are the most competitive nation on earth. Or so I am told. The most productive nation.
But really In Washington DC, NYC, Wall Street... once you get around power & money... they don't want to play fair. They want an unfair advantage... and they use lawyers & Lobbyist as one strategy to do this. They will sue you. They will drive your business to dust.
They want Monopolistic Advantages.
Winning. Getting the highest Compensation. Running the biggest Corporation or Empire.
Not everyone shares the old American Values & Ideals, Integrity, Fair Play, ... as costs of Education & Health Care rise... as other American costs Inflate... people are willing to keep their mouth shut.
A return to American Ideals?? Is it possible??
Only if we can get Money out of Politics, End Gift Giving to Politicians, End Foreign Wars, Stop using governments, banks & CIA to intimidate foreigners & foreign Governments.
Sure, we can keep our Nukes & We can patrol the Seas for free trade routes. We need the primary Law of the Land to be Prime over Corporate Rights, and we need limited to accounting & financial Tricks. Free Trade is where US Workers know that imported products are safe and are not made by children, slaves, or people without any worker rights... which means free trade must be auditable.
I'm not sure what American values are. They seem to change every so often. The modern version of the American dream seems to involve doing little or no work and having money do all the heavy lifting. Putting one amount into a black box and getting a different amout out. Pension funds, insurances, investments.
I don't like any of it. All I want is to do work and engage in commerce. I want to use the least amount of currency possible, knowing it is not my, but banker's money that enriches him instead of me, or at best lets him piggyback into fortunes he had nothing to do with. Governments - likewise.
I want to be able to barter goods and services and neighbors. I want to have the option of opting out of the system entirely - buying land and growing food to feed my own family and no one else. Trade excesses? Whether I want to or not, should be up to me.
None of such oportunities exist. I live on land I don't own. I work for someone else. A portion of my wage is subtracted without my concern many times over - as I earn it, as I spend it and even as I save it. Inflation takes care of that.
What American dream can exist under such conditions? Worshiping financial parasites. aspiring to join their ranks? The only ther option is to be their victim, or what they consider a criminal.
Either facilitate fractional reserve banking by earning and spending fiat. Provice free service by borrowing to your neck and spending every working hour trying to pay off interest, or manufacture locally, trade locally and barter without producing a fiat denominated equivalent of the transaction tax for the IRS?
What are the options that exist in modern America ourside from the 3 I outlined? I don't see any, so I believe the dream to be dead - non applicable under certain conditions. Either you're a parasite, a victim or a criminal.
I want this system to end and to start fresh. I have plans, I have skills, but I don't want to do a god damn thing for the sake of non-productive parasites. I don't want to be money-rich in this system, in which wealth is rarely created and mostly transferred from pocket to pocket. I want to live and work with people like myself for mutual benefit and do it voluntarily - not because some law says I have to.
I have met people that have set up new lives in foreign countries. I can see how the health system is set up much better and see a more natural way to live... freer like you say. The rent, houses, land are affordable. But it takes time to figure out your taste and if it is for you.
I met a guy from Texas who designed Alcohol Stills and traveled to Germany, Asia, and Brazil. He says companies can get a Loan for an Energy Start up like Biofuel or Alcohol for fuel and not have to pay anything for 5 years. A development type contract business loan. This means they can take time to work out the methods and make sure they are profitable before paying the bank back. Probably the government is involved. Sounds like he made a great Still Design, stacks.
Anyway, seems like you need that in the USA for any small business. No interest or payments for 5 years. Say $2 Million dollars minimum with no taxes till you are profitable.
Most of us can't move to a foreign country because we have no nest egg or pension. It is not for everyone especially if you have kids and grand kids you have to be with. But I could see where you could get a place to live and some land if you want it. It does not seem like you can make money in a third world country or even Latin America since produces are cheap and wages are low. Some people volunteer or just work a business just to be involved in something.
Personally I have a hard time understanding US Inflation in Education & Health Care. Maybe that is my biggest issue. I don't want to lose my savings. But the wars and the taxes that must come from the wars... and the danger from financialization... and the loss of the US Constitution... and the loss of all but a handful of congress members who represent Main Street. Wall Street Coup in DC. After all the unchecked spending and war mongering... it is just not America. Fear is the new value for America. And Financial Conflict of Interest seems to be present every where.
Thanks for the reply. I will still think about living outside of the USA.
I am a dual citizen actually and I speak multiple languages. I have the option of migrating to Europe, but it is, unfortunately, in no better shape than the US at the moment. The EU is just as likely to collapse as the US. Countries that seem to have good business conditions (Greece and Spain) offer citizenship in exchange for very modest investments into the economy, but I believe that to be temporary. All they want is to lure the money in, before kicking the investors out, or letting the locals roam free with pitchforks. Foreigners always get the blame in the finger-pointing game.
Taking savings out of the country - that would be a real problem for me. Safeguards are in place to prevent exactly that. Most countries are eager to let people live, if they leave every possession behind. Because of that, I've got reasons to stick around at least a while longer. Family - that's another burden. I take care of 4 people in the family and I can't bring all of them along. They're holding me back also.
I'd rather work on fixing the system right here. If we go down - the whole world will go down together and start rebuilding from scratch. I think this land has plenty of pent up opportunity. It is currently denied to the average person, but maybe it'll change. I hope it will.
I am afraid of uncertainty. I know something bad is coming and don't know how to position myself. Latin America? I don't speak the language, unfortunately, but I've got friends there that offered to help me get settled if I ever consider it, though I've never actually been South of the border, so I have no idea what it'd be like.
Once again - I'd rather work towards restoring freedom and justice in America that run away from problems while hoping to find a better place elsewhere. When the world passes through the financial singularity there'll be no safe havens.
Thanks. Agree that China has same debt, Russia probably, Brazil, India, Malaysia, Mexico, ...
Commonly for world countries we see countries:
- drug gangs/government drug gangs
- large sovereign debt & liabilities
- WB/IMF/US/UK/EU suppression of sovereignty
- Cultures are in question, favor banks, favor elites
- Questions about justice & individual rights
- Higher fees for businesses, foreign residents, tourists, Bank services for anyone from the US due to FACTA, but ATM fees seem okay
I should look at Amnesty International... as they can compare USA with other countries.
I Agree:
- There are plans to scapegoat foreigners and US citizens ... and there is reason to have blowback against US people through out The Americas due to the Monroe Doctrine
- VISA Deals only draw US/UK/EU/Asian Investment like in Malaysia in housing that is expensive
- Spanish would be easy for you if you are multilingual...but is harder from non-European nations
- US has Potential & the whole world would feel any US Economic Collapse
You are well informed.
- Uruguay?
- Chile'?
- Argentina (seems expensive still like Europe & Brazil)
- Peru, seems unsafe so far
- Ecuador, many changes, many immigrants, petty crimes, now has modern highways
- Columbia, Property Title problems in farm areas
- Panama, Belize, Nicaragua, Costa Rica, El Salvador, Honduras... drug trade routes... lots of poverty... and Costa Rica has tourist prices and high property prices
- Lots of plugs for Panama, Lots of retiree benefits, more modern than Belize... still has the bureaucracy like France
Sounds like Latin America has dangerous men, but if you stay away from drug gangs, cities when it is dark, and bad parts of the big cities... maybe the sexism is not a problem. Typically I get yelled at by drunk men and I am just an average man. But that is in the central or old part of town. sometimes I don't like the guys standing at a bus stop on the outskirts of town, but I can afford a taxi in the cheap countries... $2 dollars. Walking is nice, but dogs bark and can get aggressive if you don't have rocks or a stick.
I see dangerous men in the US are now joined by dangerous women gangs... go figure. We knew there were gangs in the US cities...
Faith in Humanity, seems very visible in 3rd world, they don't like criminals, they don't like killers, they will witness about criminals and watch for them.
- Oh just remembered, Ecuador will take 3% of your saving account if you leave, for me this would be little money, I might buy a house & so transfer a monthly utility payment and enough for groceries each month... it would be only $2,500 or less at the most far fetched, that is like $75 dollar loss
- And if you like Europe & US, then maybe the loss in living standards is a deal breaker, US stores & business practices are built on convenience, this is lost in restaurants overseas, in utility offices, and government offices, the ugly American has two sides to the story: efficiency versus.... low pay, low skills, low potential, low expectations, and low sympathy
Lenin has seldom looked smarter--at least as an academic.
This article could have been cribbed from Lenin's chapter on "Finance Capital" from his 1916 pamphlet, written while in exile, Imperialism: The Highest Stage of Capitalism.
The only adjustment you need to make to Lenin's nearly century-old work is that his data are all drawn from a hard currency world economy, hence finance capital sought current account surpluses. In our contemporary soft-currency environment, empires seek to maximize their current account deficits and stick weaker people with their ever-devaluating paper.
Precisely.
Friedman too had it wrong. Either lied about or didn't realize how nations would act under trade exchange by free-floating fiat debt receipts that can only grow in number and size..
There is no boom and bust, Central banks and central planning took care ot that.
Good article that leaves one thing out. It is not the free flow of capital that is causing the problem, but the free flow of enormous quantities of debt fraudulently masquerading as capital. That and you can't have "free trade" with unfree people. Any country with honest money can and should erect barriers to protect its populace from the fraud that is fiat. http://www.amazon.com/Localism-Philosophy-Government-Mark-Moore/dp/06922...
Capital mobility is a closed looped system and by definition will degrade
over time leading to an end point of zero mobility of capital and a worthless
currency like the Americans are waking up to realize today. Capital mobility is essentially a mythology for millions upon millions of Americans today, but not the 1% that can borrow at zero per cent interest. Moreover, repo-105 did not work out to well for Lehman Bros. CEO Fuld as I recall. Capital was not mobile September 16th 2008 IMHO. The metrics of capital mobility are not entirely clear either. I object to willy nilly terms in economics, wtf.
Its really simple...there are about 7.3 billion people on this poor planet...thats alot of variables...there cannot be stability.
mother nature really f'd up when she brought us to fruition but rest assured one day she will right her wrong.
Charles writes very well about the bad things that have been put upon us by "Globalism". Isn't it way past the time when reasonably intelligent men stop avoiding the conclusion that, net-net, globalism IS the problem.
Great societies and great nations have been built upon the simple principle of "self-interest"... that is, "National Self-Interest".
But Adam Smith and David Riccardo have turned parlor room queries about the wealth of nations and comparative trade advantages into a pseudo science that we call "Economics". For them "enlightened self interest" existed without concern nor any sense of obligation or responsibility for "others", whose material well-being could be adversely affected by the "successes" of these "enlightened" persons.
But when it comes to nations, enlightened self interest should mean concern for -and a sense of obligation to- its citizenry. Governments should not play favorites among its own citizens; and should not set rules and regulations which enables -even encourages- a few of us to pursue schemes that enrich the few of us at the expense of the rest of us.
"Trickle Down Theory" works only if the capitalists invest primarily within their native country; and hire, train, and promote citizens of their country. For this, capitalists should expect that their fellow citizens would purchase the goods and services produced within their country.
In the post WW II era, "International Business" flourished; and the American Multi-National Corporation was paramount. The aim of the MNC was to maximize the market potential in a specific foreign country/region for the kinds of products that it was best known for in their home country. Alterations to products were developed to increase demand and acceptance for their products. AND -through an organizational structure, called a "Joint Venture"- production was localized, and the citizens of the "host country" were employed, and promoted to eventually run the operations. "Trickle Down Theory" was working on an "International" scale.
Adam Smith did not consider the possibility that Englishmen would close down their mills and fire their employees to replace them with labor and mills in another country. Neither could he have envisioned that his country would allow such goods to be imported and allowed to replace what had been domestic production. To him that would have been unconscionable.
For many centuries, mankind traded goods made in one country for goods made in another. But this trade was seen as an augmentation to domestic production and to meet domestic demand, as well as a way to offload excess production onto lands where the demand for such production was greater than their capacity to produce. That was healthy. That was not globalization, which is not healthy.
Globalism is a manmade creation, fashioned into treaties hammered out in the 1990s. Mankind can unmake it. And the sooner, the better.
CHS writes about globalization, here. It's a different concept from "globalism"
the primary aspect of globalization is the free flow of finance, goods and services, and in theory, the free flow of people
the word "globalism", instead, is not properly defined, but it denotes primarily policies and institutions that affect the whole world
"Adam Smith did not consider the possibility..."
I'm not that sure about that. But yes, I could imagine Adam Smith would be horrified about today's globalization
after all, he wrote books like "The Wealth of Nations", which leads me to think that he would propose today policies that put National issues fore and front
but his writings pushed Britons to ask for "Free Trade" as a panacea to everything. more conservative instead of (classical) liberal politicians followed a policy of having tariffs on wheat and corn, for example, on the grounds that "Britain Ought To Feed Itself"
when the Corn Laws were repealed, Britain became the Champion of Globalization (it's first version, at least)
and I think this is the real litmus test of "how much" globalization you might want or not: food. The very moment you can't feed yourself (from a National point of view) without trade... well, then you must trade, as freely as possible, and embrace all consequences
trade does not equal trade. If you are trading non-critical goods for your economy, you are not engaging in the same relationship as if you are trading utterly critical goods
like... oil
+1, worth repeating: "In the post WW II era, "International Business" flourished; and the American Multi-National Corporation was paramount. The aim of the MNC was to maximize the market potential in a specific foreign country/region for the kinds of products that it was best known for in their home country. Alterations to products were developed to increase demand and acceptance for their products. AND -through an organizational structure, called a "Joint Venture"- production was localized, and the citizens of the "host country" were employed, and promoted to eventually run the operations. "Trickle Down Theory" was working on an "International" scale."
this is - in my humble opinion - the biggest cultural shock I witness when Americans travel: the realization that the US promoted in massive scale what I simply call Big Biz
and this is gone into the very bones of the "American Mind": that all business is, at least potentially, Big Business, or ought to be so, and so needing as much market quotas as possible, nationally and internationally, and exploiting the great strenghts of financialization and return on scale
as a reminder, Communist economic theories also emphazise the strenghts of return on scale, and so "Big Is Beautiful". So the excesses of this kind of capitalism and communism are the same: huge, concentrated production. And this fosters... oligopolies, and their drivers... oligarchs
if you define business as Big Business, you eventually start to screw small and medium business. note how seldom the American political discourse makes a difference between Big Biz and Small Biz. you are either "pro-biz" or "anti-biz", particularly if you are a small, foreign country
Countries with no financialized economies have benefited from globalization. For them, trade flows of physicals are of equalt importance to investment flows of papers. Eg: China has benefitted enormously from globalization that propels it from an underdeveloped economy to a mfg gloabl powerhouse until recently.
It is just that the Western Predators is continuing to extract rents through their enforcement of their model of globalization. This is now a tough fight. Non-financialized economies are pushing their agendas to define globalization and they have increasing physical resources vs indebted once developed economies.
The article smacks of arrogance and ignorance looking at globalization thru the prism of skewed investment flows of papers and that the global economy is a financialized one with disdain for economies that deal with real goods and services who today are not irrelevancies.
Keep dreaming/spinning that there are retards in BRICS who are not exposing their economies to captures by financial banksters as well as not adopting econ models that are based on the second and more degree of derivatives trading in paper assets. Needless to say, these assumed retards are not about to ensure that the once developed economies can trade out of their debt traps.
Decentralization should be the motto of this and the following generations.
Globalized wars: Anyone can fight against anyone
http://failedevolution.blogspot.gr/2014/09/globalized-wars-anyone-can-fi...