Market Globalization... The Winners and Losers

All of us who are not completely self reliant exchange goods and services in order to exist. Within most nations, and to a growing extent among most nations, barriers to trade and the transfer of goods and services is increasingly being left to the many influences of an openning global market. Exchanges of goods and services are becoming less impeded by governments, tribal gangs, feudalistic monopolies, and many other special interests. Over the years, economic experience has taught us that impediments to free trade are generally counter-productive with respect to our economic well being - at least for the short term. Thus, open markets or free trade has become the mantra of our so-called new world order of global economics.

But free trade has some negatives along with the positives. And like many other aspects of our existence, our success will eventually be determined by how well we think through the pitfalls. A major problem has been that the positives are of shorter range and seem to be much better understood than the negatives. Free trade is driven by people at one location benefitting from the cheaper materials or labor at another... while at the same time providing markets for those who have something to sell. The guiding hand of relative economic advantage enables some countries to access resources that they might possess in scarcity, and to control inflation by importing less expensive goods and services than they could produce at home. Meanwhile, their trading partners hopefully accelerate their development and economic progress with infusions of foreign capital and technology. So, at first glance it seems like a universal win/win.

However, if we look more deeply we see this is only part of the picture. We can rather easily understand the benefits of free trade on the small scale - between neighborhoods, communities, and states within a country. And the same is pretty obvious for trade between the "developed" countries. But we too often extrapolate this thinking to the "developing" world, without considering the potential cultural and ecological disruptions that may impact populations quite different from our own... and particulartly the long term quality of life and well being of indigenous peoples.

For example, say we send medical people and medicines to countries that lack these resources, with the goal of reducing infant mortality. On the surface this would seem like an obviously positive humanitarian gesture. But what if we do not give people the education and technology to correspondingly limit their birth rates? And let us assume, like often has been the case, that birth rates increase and the population grows rapidly because only one of nine babies born to the average woman die instead of the historical seven or so. And then, we watch, as rapid population growth exceeds what the economy can accomodate. And we see much of our infusions of resources squandered due to corruption and ignorance. And, due to the expanding needs of the rapidly growing human population, we see stresses on ecological resources destroying the essential nature that sustains the harmony and welfrare for all life. And tribal frictions explode into internecine warfare over diminishing resources with greed exacerbating the resource destruction and the spiraling descent into even greater poverty and cultural disintegration. Then maybe we should ask, what in the hell have we done? What did we fail to understand while we were offering what we thought was our good will?

If we really want to understand all of the potential impacts of free trade and truly want to make it a win/win, then we should focus on some issues that involve all societies, but mostly impact those that are the least developed. We must ask ourselves some important questions to minimize the negative effects of our behavior.

First, we should consider the natural balance of the cultures we are trading with. Will free trade or aid disseminate medical technology that will result in a rate of population growth that will likely outstrip economic growth? Will such growth produce stresses on the natural resources? Will it exacerbate, due to the pressure on resources, the frictions with neighboring cultures, or communities, or tribes, or nations?

Secondly, will it result in non-sustainable pressures on ecological resources by providing the technology and tools that will enable local populations to more rapidly exploit them? Suppose our medical technology causes the population to rapidly increase, will free trade also provide the tools that will enable an acceleration of the resource exploitation? Initially we offer steel to use as a machete, then we provide chainsaws, and then outboard motors and bulldozers, and on and on. And when there is nothing left to exploit, are we leaving them with the financial burden of debt while we move on to the next open market?

Thirdly, we should consider the social and political vulnerability of a society to the corrupting influences stemming from concentrations of wealth. A bit of common sense might tell us that impoverished peoples, with short histories of self-government, and who are often fractionalized on the basis of tribe or clan affiliation, are obviously more vulnerable to political and economic graft and corruption. We should make sure that the societies we are trading with have the type of governments, or organizational structures, that will assure contracts are honored and that will attempt to act in accordance with the best interests of the overall population. Will the profits generated by free trade be channeled into sustainable economic growth, or will they be skimmed off and squandered by warlords or tribal chiefs?

Then, we should look at cultural vulnerability. Will free trade accelerate the loss of indigenous cultures? How important are these cultures? Do they supply the energy and coherence that give the society the will and stamina to be successful? Is the culture the glue that holds the society in tact and enables it to function? And will its destruction cause the social fabric to unravel?

And lastly, we should make sure that we have put the whole question of free trade in a holistic perspective that considers the ecological harmony of the people and their natural world. Will our free trade cause imbalances that put pressure on the natural resources and biological diversity that sustains them, while giving them the technological means to more effectively destroy their environment? Are there unintended synergisms that result from free trade that link cultural disintegration with monopolistic exploitation of resources, coupled with technological amplification of individual impacts, making the overall result even more devastating than we could have intuitively imagined?

The negative economic results that the world has witnessed in many of the developing countries over the last century speak for themselves. The bottom line would seem to be the number of people living in the hopeless swill of a seemingly never ending spiral of poverty. These numbers seem to be increasing in many areas. But our concerns should focus not only on human poverty and abuse, but also on the increased impoverishment of all forms of life. Biodiversity is crashing in practically all of the ecological hot zones that have had the "good fortune" to be exposed to western technology, and the free trade pot of gold at the end of the rainbow. Our thoughtless transfer of goods, services, and technology to many societies has had the overall impact of reducing not only their quality of life, but also the quality of the natural life that sustains them.

So, where do we go from here? Many of these people have increased their numbers and depleted their resources to the extent that they are deeply dependent on western goods and services to sustain even their current levels of meager existence. Curtailing this trade would be callous. We bated them into the trap of irresponsibility and we owe them our assistance in finding a way out. We must educate. And we must do this by pointing out the greater ramifications of certain behavior patterns, and making sure that all future rewards in the form of trade and aid are contingent on demonstrated progress in meeting sustainable goals. Medical technology prolonging life should be offered only after the behavioral changes necessary to stabilize the population have been effectively employed with demonstrated results. Chainsaws and bulldozers should not be provided without assurances that they will not be used to further the destruction of pristine natural habitats and the reduction of biodiversity. And we should make our contracts with only those people or organizations that we believe will honor them and act in the best interests of all of the people. Thus, the only reasonable approach is to begin to try to create win-win/ non-zero sum interactions by basing future aid and trade on how well each society addresses these concerns.

And we need to educate our own. We should be thinking about how to live sustainably on our own resources or, at least, minimizing the exploitation of resources that contributes to the exploitation of people. The first item on our checklist should be energy independence. We have the technology to begin the move away from a fossil fuel based economy and beginning this journey would offer innumerable benefits over the current mess. Our collective refusal to re-engineer our economy to accomplish this has certainly fueled the fires of corruption and resentment in the Middle East, in addition to leading us into subservience as an oil whore with a foreign policy riddled with hypocritical posturing. And we spend billions to perpetuate this because of the vested interests of the few who reap the huge profits from the status quo.

Basically, we should demonstrate that we are good people by behaving as such. At a time when we have the technology to make big changes on the planet, it is more urgent than ever that we understand what we are doing. The guiding principles should be based on the greatest good for the greatest number relating to all life. What is at risk is too great to be left to the often shortsighted interests revolving around the opportunistic greed of a few, and the corrupted governments and leaders that they manipulate.