Tuesday, December 26, 2006

Some American views on globalization

Greg Mankiw
links to this article by senators Byron Dorgan and Sherrod Brown. Excerpt:
We must insist that all trade agreements have labor, environmental and other protections so that American workers can compete on a level playing field. Trade agreements must also be reciprocal. The American market is the most desirable in the world. Every country wants access to it. That gives us a great deal of leverage, if only we'd use it. Barriers to U.S. products overseas should not be tolerated.

Free-trade agreements have protected drug companies, international investors and Hollywood films, yet failed to protect our communities, our workers and our environment.

Mark Thoma links to this post . Excerpt:
Or consider trade-opening agreements. They give Americans access to more low-cost products and services from abroad. This makes Americans’ dollars go further. But the agreements especially benefit the rich, who spend more than the middle class and the poor because they have more income to spend. The agreements also typically impose a burden on working-class Americans who thereby lose their jobs to foreigners. These job losers get new jobs, but studies show the new jobs pay 10 to 15 percent less than the old ones. Even if you assume that access to cheaper goods from abroad adds about 10 to 15 percent to their purchasing power, these working-class wage earners come out about even, at best. That means the overall result of most trade agreements is to widen inequality. Do the efficiency benefits of trade outweigh this result? Maybe a decade ago when inequality was less pronounced. Probably not, now.

From a project (Executive summary here ) sponsored by Democratic Leadership Council:

While public attitudes are complex and sometimes can appear contradictory, this report finds that the challenge for America’s leaders is clear: In the global era, American voters are waiting for a leader and party that can explain how globalization can be made to work for everyone. We began this work with few preconceptions. We knew from other studies that everyday Americans are feeling new pressures on themselves and their families. We found that these everyday pressures have created stark divisions among voters. Some voters look forward to seizing the opportunities offered by globalization, others are most concerned by the loss of economic security and the rapid pace of change. Many Americans hold seemingly conflicting feelings about globalization. They may simultaneously have concerns about lost income and lost job security, but still express a positive overall sense about globalization reflecting our national optimism and competitive spirit. Successful national leadership will address both the concerns about rising insecurity and the hopes felt by most voters.

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