Essay About Larger Companies And Lower Wages

Globalization
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Globalization is a concept with many differing definitions. Globalization is
a process which entails the free movement of capital, goods, services and labor
around the world. Globalization is the massive control of the worlds economy by
big business, this control transcends the boundaries of state and country. This
transcendence across countries makes the subunits of the economy decompose
and depend on the larger companies with a controlling interest in most of the
capital within a given economy. These companies then form global constituents,
they then have a control of a large volume of capital within many countries. This
global control of capital comes through the deindustrialization of larger economic
superpowers to third world countries for economic gains of these companies.
Seeking lower wages and a large unskilled labor force, companies find it in third
world countries. These are concrete examples of global companies seeking
wage reductions on an international scale. This migration causes a
deindustrialization for the larger countries and a industrialization in these
developing countries. In a curious fashion they tend to confirm the Marxist view,
long thought out of fashion, that the working classes would be kept at subsistence
level. Reebok Shoes, and other footwear giants, are forever shifting their
manufacturing base to lands of lower wage scales. (This is more easily done in
that industry than would be possible in steel or automobile manufacturing.) From
New England to the American South and on to the American colony of Puerto
Rico, thence the Philippines, Taiwan, Korea and Thailand — until the annual
wages of the factory are less than the remuneration paid to the basketball star
paid to advertise the final product. No, globalization does not mean “workers of
the world unite”. Joan E. Spero, Under Secretary of State for Economic,
Business and Agricultural Affairs stated the issue at hand was one of a
formidable size, “Capital now moves with startling speed around the world.
Each day over $1 trillion is traded in a global foreign exchange market that never
closes. Technological advances in computers and telecommunications are
paving the way for a new information-based economy.” The capital within this
globalized economy is not situated as one might have first assumed. The capital
is concentrated within the upper management and within the boundaries of the
company itself. The growth of the American economy in particular is in no way a
direct reflection on the wages and standard of living for most American workers.
Large companies set up manufacture of products in developing countries,
exploiting the economic need that is present there. Then these companies take
this product from this country and bring it back to places like the United States to
be marketed. The economic benefits are then reaped by the company. The
product was manufactured in this third world country where they were paid small
wages and in horrible working conditions. Then the product is taken to the
United States where is sold to the American public who played no role in the
manufacture of the product thus their purchase in no way supports the circulation
of capital within the United States economy and is given specifically to the
company. The company then takes the capital and reinvests the money into the
company and in foreign industry and the money is not recirculated within the
economy that created it. This theory of capital flight is what produces the
economic growth of the economy as a whole but the workers and middle class of
that economy do not see that growth. The middle class is becoming less and
less necessary within the globalized economy. The skilled worker is not
necessary due to technological advancements and the movement of industry
from the United States to developing countries. The developing countries are
used for their large and willing unskilled worker population. The need for specific
talent and training is becoming more and more necessary within countries such
as the United States. This creates an international division of labor within the
global economic market system.
The labor market has changed dramatically in the past three or four
decades. The unskilled labor work force has shrunk over the last few decades,
this