It's Good to Go Global

Posted: Sep 12, 2008 10:45 AM
It's Good to Go Global

            In the second season of HBO’s acclaimed series “The Wire,” viewers learned about life on the Baltimore docks. Things are difficult for longshoremen these days, and we can blame globalization.

            It wasn’t long ago that freighters had to be loaded and unloaded mostly by hand. It took hundreds of men several days to load a ship’s hold. “While the work was often hard, dangerous and dirty, it also required ingenuity, experience, brawn and teamwork,” explains an exhibit at the Smithsonian Museum of American History.

But these days almost everything moves in containers. Goods are loaded in and they’re stacked on ships, making it simple to unload. A handful of longshoremen can do the work it once required scores of men to do, and they can do it in hours, not days.

The containers are then loaded on trucks or trains and delivered to stores. That cuts down on labor costs, and it cuts down on transportation costs. It’s a success of globalization, and it’s a big reason why the price of just about everything is lower these days.

Lower prices are good news for anyone who wants to buy food, electronics, or clothing. In other words, almost all of us. But, of course, the good news of cheaper imported goods comes with bad news for longshoremen, who are mostly out of work.

And that, in a nutshell, is globalization. Good for the vast majority, harmful to a handful.

In a recent Newsweek article, columnist Daniel Gross noted that “Americans are now more inclined to see themselves as victims of globalization -- rather than as beneficiaries of it.” He cited a Los Angeles Times/Bloomberg poll that showed half the respondents think free trade hurts the economy, while only a quarter say it helps.

Why is that? Human nature.

People “enjoy pursuing goals, like a higher income, a promotion or a new house,” according to the publication “Life, Liberty and the Pursuit of Happiness” from the Acton Foundation. “Inevitably though, once you obtain something, you rapidly will become accustomed to the new reality, and it will cease to provide much pleasure.”

            It’s the same with globalization. Sure, it’s brought prices down. We should be celebrating that we can buy $15 sneakers or a $400 personal computer -- and we should be thanking globalization.

Yet it’s natural to assume prices were going to come down, anyway. Instead of rejoicing in free trade we focus on the negative -- on the handful of longshoremen who’ve lost their jobs instead of the millions of Americans who’ve benefited.

Still, the facts are on globalization’s side.

Even with free trade, American jobs are actually safer than they were 30 years ago. Yes, political candidates will spend the fall telling Americans we’re all about to lose our jobs. But, “the typical worker had a 10 percent chance of losing his or her job between 1975 and 1976,” writes labor policy analyst James Sherk in a recent paper from The Heritage Foundation. “Today, only 5 percent of workers lose their jobs over the course of a year. Job security has increased markedly over the past generation.”

In his Newsweek piece, Gross compared globalization to the recent Olympic Games, where China finished a close second to the U.S. in total medals, and actually won more gold medals.

But that doesn’t necessarily show that the United States is slipping; it just proves the rest of the world is playing the globalization game, too, and gaining ground. The reality is that American athletes had a better Olympics this year than in 2004, when we won 36 gold and 102 medals overall. In 2008 we won the same number of golds, but 110 medals overall. It’s just that China improved its performance to close the gap.

“Americans returning from jaunts abroad can’t help but notice that the distinguishing features of modern capitalism, many of them developed in the United States, are being put to greater effect overseas,” Gross writes. And while that’s true, it just means we’re facing a challenge, to improve everything from our cell-phone networks to our roadways. And competition improves performance.

The Chinese purportedly use the same word for “crisis” as they do for “opportunity.” That’s fitting. Globalization, and the free trade that it brings, has been and still remains a great opportunity for Americans -- if we’re able to stop seeing it as a crisis.