How does free trade broaden the gap between the rich and poor?

This question has been boggling my mind for a little while.

I've been reading about it and it just seems like an overall good thing, yet I keep coming across "oh but it makes a bigger gap between the rich and poor" but I've not yet read anyone say why and how?

 

In the case of Western nations. low skill jobs can be done in low wage nations

so the demand for labor decreases in The West. The West is afforded cheaper consumer goods as a trade off. perhaps cheaper raw materials.

For the entrepunerial folks, globalization creates more opportunity by presenting markets in other nations. High skill, high value trades experience a higher demand as overseas markets open up to those products.

Labor value in The West is depressed by immigration which is a separate issue from globalization

Gobalization may open up opportunities for nimble labor as diferent industry sectors open up and close down with increasing frequency. Western workers have to surf the trends in industries.

Idealy Globalization should give prosperity to all as overseas nations grow richer and purchase more stuff. Proper management of tax codes for job creation and restraint on consumption by goverment help.

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Free trade allows high priced Amerikan labor to be replaced wth cheap slave labor. The cost of labor drops the price to produce an item. When sold the profit margin is higher.

Also the loss of jobs forced people to take lower paying jobs thus declining the middle class in to the upper-lower class.

Also when Dictator Bush touts how we are creating jobs that is whats happening, high paying jobs go to India or China and are replaced with low paying jobs.

 

Oh. Well that makes sense. Thanks.

 

Nobody is forcing anybody to take these jobs, and they are almost always better jobs with better pay than what is already available.

So if you live in a 3rd world nation, you have the option to either:

A) Pick coffee beans for 2 dollars a week.

B) Work in a textile mill for a dollar an hour (which may be a lot of money in many of these places)

Eventually, if the government isn't a corrupt African kleptocracy, conditions improve and the overall economy & living standards improve for everybody.

Asia is an excllent example of how globalization does good, as just 20 years ago both China & South Korea were sweatshop hellholes, but today are both booming economies.

 

There are cases in which free trade can raise the standard of living of a third world culture, this is true. However, it often has the opposite affect. Look at NAFTA for example. Indigenous people in South America have been sustaining themselves for thousands of years, living off the land by farming in their own way, and in their own right. Then these large agri-tech corporations move in, motivated by profit, with no concern for these folks. They bring their fancy machines, and their genetically engineered seeds and pesticides, with empty promises of improving the lives of the native people. On the surface and in the short term it seems attractive for the natives, but the GMOs they're forced to work with wreak havok on the eco system, and they become dependent on the corporations who supply their seeds and pesticides, and basically force them into indentured servitude. The damage is irreversable, and the natives ultimately become poorer, while the corporations reap the profits and become richer, thus the broadening the gap between rich and poor.

 

"3rd world nation" ... "third world culture"

we do have multiple worlds in this lil world, don't we! there is a broadenin gap between peoples and cultures ..nevermind the rest

 

You have no fucking idea what you're idea what you're talking about. I'll give you a hint about where you lost all your credibility:

NAFTA applies only to Canada, the US, and Mexico. You're thinking of the FTAA, which was never implemented.

 

Yes it does and it was sold to the US public as a way that would raise Mexico's poorest out of poverty, so that illegal immigration would no longer be a problem. But hell they are still swarming over the border instead of working in our Mexican plants....why is that? They would rather pay for a coyote, work here illegally than what their own country has to offer ten years after NAFTA was passed. It was sold to the US public as free trade, and opening up the global economy. How long to we have to wait to see a positive affect? The corporations involved saw profits increase immediately.

 

My bad, NAFTA might not be the culprit here, but free trade is, and that's the point. It usually amounts to imperialism, where outsider multi-national corporations go into a country and rape the people. If they could help the people prosper and become independent, it could be a good thing, provided the people welcome their help ("progress" isn't always the best thing after all).

Honestly, it's amazing I haven't been banned for my ignorance, I hope y'all can find it in your hearts to forgive me. Furthermore, I don't waste my time arguing with punks, the ignore button is soo much easier...

 

Head in the sand. Good logic.

 

It's a bummer I can't read spooner's response, I'm sure it's fuckin' brilliant...

...Another thing to consider is that imperialism is not necessarily a foreign entity. Now that corporations have become multi-national, not only are indigenous farmers in South America getting screwed, as are tribes in South Africa, etc., etc., but we're next folks...

It begins with privatization, you know, the p-word. The government hands over its infrastructure, resources like the electrical grid, sources of drinking water, etc. to big corporations, and that's great cuz now it's more efficient, right? Think again. Now everyone is dependent for all the vital shit, Maslov's heirarchy, you understand? We take it all for granted, but America could become a third world country. You, me, and the rest of the bitches could be working for "the man" and have no choices in the matter. But hey, I've got a post-graduate education (though I fucked up on the NAFTA thang, imagine that?), I work at a professional job, that shit doesn't apply to me, right? People in China and India can do what I do for half what they pay me, luckily I'm good at what I do, and somehow the powers that be think I'm worth keeping on.

Look, it's you guys future, I just hope you THINK about it. Waveowlsnotflags proposed a great question, even if I disagree with his political ideology.

And Spooner, I'm sure you're a well-read, intelligent dude, but you might think about not being a fucking dickhead on a public forum, y'know? Teach, don't insult, it's up to you...

BTW, I don't give a shit what y'all think, I care about the world, not me or you.

Take it easy,

 

Electric, Gas and Water distribution systems are private companies in New Jersey and are publicly regulated monopolies.
Public utility boards monitor these companies. They have public stock.

I dont want the goverment involved in these operations. The Goverment has enough to do already.

 

This is me nice.

 

The gap between rich and poor is a way of hiding that the poor are getting richer. By focusing on the gap, you can oppose something - like capitalism and globalisation - that is raising hundreds of millions of people out of poverty. Essentially its a trick question.

Anti globalisation requires total ignorance of the facts.

 

You write this as though these two things are mutually exclusive; however, I'm pretty sure that China has become a booming economy while remaining a sweatshop hell hole. Recently, there were about 356246543 news stories about how Chinese brick makers stole random children from public places and enslaved them; this was not an isolated incident but a widespread phenomenon in the region where it occurred.

Moreover, I attribute the Republic of Korea's successful industrialization to its strategic location during the Cold War. How else would a small state with minimal natural resources become so wealthy? Take the Democratic Peoples Republic of Korea as a counterpoint: it had a pretty high GDP and standard of living until the USSR collapsed and stopped subsidizing the DPRK's petroleum. Then some earth quakes and floods came along and there was a huge famine, but thousands of people didn't starve to death on the same peninsula possibly miles away from the ones who were. The dichotomy between the Koreas demonstrates that the global configuration of power does not always favor everyone.

Your whole argument is also flawed because the RK developed under a mercantilist industrial policy. They imposed policies that prevented foreign direct investment to get where they are! Meanwhile, the US gave them a bunch of money and put its military there!

The world isn't so simple that a bunch of peasants in some remote area are going to be saved by capitalism. Multinational corporations seek parts of the world with less labor, environmental, and other restrictions to increase their profit margins. The global North benefits from this because economic growth continues, by importing raw goods from the global South, once its natural resources are exhausted (See Wallerstein's Modern World Systems Theory). Sure, FDI gives some menial jobs to people that might be slightly better than their current menial jobs or unemployment and benefits a few overseers, but it doesn't allow the area of investment to actually accumulate any of its own capital. If everything is foreign owned, then the profits return to the core.

 

Yes, unfortunately it's the corporations and the wealthy elite in power in these foreign countries who benefit, while a majority of the people who live there are exploited. Globalization could be a good thing if it can be regulated. The benefits need to be distributed among everyone affected by it, not just the priviledged few...

 

Who's going to regulate it when the common consensus is that any regulation results in in less than free trade? That's just plain bull shit but it's what most of the American market has bought into and sold to developing nations. I feel so proud that this is what my country has spread around the world. NOT!

We're worried about democracy...shit the US doesn't care about democracy. Most only worry about their investments. Where do you stand?

 

You've beem fed the corporate marketing, like that woman that was burned by a MacDonald's coffee that was hotter than was recommended by safety advisors (and MacDonald's was aware the temp was too hot), she wasn't a corporate raider trying to place an unjust lawsuit, she was a consumer that was injured. Truth is they needed that laswsuit to bring their safety measures under reasonable measures. MacDonald's knew their coffee was too hot.

Death Tax, I hear the republicans bringing that up again, guess what, the common man will never be impacted by it, but the mega rich will, and that's why the media focusses on it. The middle class know what their tax rates are and they are willing to pay them. It's only the obscenely rich that fuss about paying their fair share.

Congress now passes bills that say will save us money, because they will prevent irresponsible lawsuits, guess what, the courts already prevent that. What congress wants us to do is prevent the little man from placing any lawsuits. They promise you lower insurance rates...Have you seen any of those (lower insurance rates)?

 

It's like California was sold deregulation, and watched Enron and this adminstration laugh over our plight. Wise up America!