Is Globalization Slowing?

Alex Steffen of WorldChanging proposes that globalization could soon change direction as transportation costs increase.

"(T)ransportation costs are not the only reasons why globalization as we know it might be in for some rapid evolution. Consider:"

"-Some of the economic advantages of globalization have come from companies gaining the ability to skirt labor and environmental laws by doing business in countries with high levels of political corruption (corruption they have often helped create). But now, transparency activism has blown the cover of secrecy off these practices; now it is easier than ever to cause enormous brand damage simply by revealing an unsavory backstory.

-Much of the logic of globalization assumes a one-way flow of materials, mined and grown in the poorest countries, manufactured into consumer goods in China, Brazil or Mexico, sold on the shelves of megastores in Europe or North America, then shipped away to the landfill. But as we move into zero waste and closed-loop systems (where there is no "away"), reverse logistics start to become a real concern. Producers become responsible for their products, meaning that running their current supply chains in reverse doubles (at least) their already mounting transportation costs. This alone could drive more local manufacturing.

-Globalization suffers from some big disruptive vulnerabilities. An extreme act of terror, say a dirty bomb in a shipping container, could easily bring the whole system screeching to a halt. Ditto bird flu. Same with mass migrations triggered by environmental degradation and climate change in already desperately poor countries. Heck, even the right kind of invasive species scare could put a hiccup in the system, but some of these could stop trade altogether for quite some time."

Full Story: Could Globalization Be Going In Reverse?



What's globalization?

The article treats globalization as a pejorative term and no where is it referred to as international trade. International trade may decrease when transportation costs rise but that isn't anything to cheer about for the most part. A decline in international trade will lessen consumer choices and retard development in exporting nations. International trade also reduce the chances that international conflicts will lead to war. Economic interests are powerful to overcome some bad relations between countries.

I was looking for some statistics to back the author's premise but I doubt that international trade will drop considerably and he himself latches on to dirty bombs and bird flu as possibilities. 9/11 fears for the airlines were greater than the actual damage of the attacks but the number of passengers eventually rebounded. Any single incident will only be a blip but high costs for fuel will really hurt developing nations hard and developed nations can expect reduced exports as well as it did in the 1970s. Ultimately, when unemployment numbers rise from reduced economic activity, cheers about the demise of globalization (and international travel, too) will turn to jeers.

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