Economists, academicians and financial consultants for years have been preaching that globalism is the wave of the future and that anyone who wants to survive in business must ride it or drown.
All of a sudden, Business Week is having second thoughts.
This voice of business now says that Americans are no longer the captains of their own fates because "globalization has overwhelmed Washington's ability to control the economy." As recently as 10 years ago, the United States could set its course for economic growth by tax and spending decisions made by our elected representatives.
But no more. Whether you are a Republican supply-side tax-cutter, a Wall Street deficit hawk of either party, a Silicon Valley techie, or Speaker for the House Nancy Pelosi, D-Calif., pandering to those who want to boost the minimum wage, you must face the fact that you are marginal in comparison with the elephant in the room, which is globalization.
By many traditional measures, the U.S. economy is doing great. Unemployment, inflation and interest rates are low, the stock market and household wealth are high, and goods are cheaper than ever.
But real wages for many U.S. workers are down over the past five years and have stagnated for others. Business Week now admits that our weak wage growth is driven by competition from cheap labor in Asia and that Congress is virtually powerless to make any significant difference.
The effects of globalization are not equal. Janet Yellen, president of San Francisco's Federal Reserve Bank, warned in a recent speech: "Globalization and skill-based technological change may have been working in combination to particularly depress the wage gains of those in the middle of the U.S. wage distribution."
Gone are the days when the man once acclaimed as the most powerful in the world, Federal Reserve Chairman Alan Greenspan, could manipulate our economy by tweaking our interest rates. Even though President George W. Bush's tax cuts poured billions into the economy and cut the federal deficit by 40 percent, high taxes on business and high-income individuals acted to hinder job growth.
What about the area we brag about, research and development? Business Week admits that it's no longer a given that U.S. workers benefit directly from U.S.-funded research because India and China are increasingly attractive places for U.S. companies to do R&D, and education is no answer because globalization depresses wages for the better educated as well as the poorly educated.
Phyllis Schlafly is a national leader of the pro-family movement, a nationally syndicated columnist and author of Feminist Fantasies.
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