Question

Read and Comment. What advantage might a poor country have? Discuss the plight of the children. (Keep in mind that the author is a very liberal New York Times columnist.)

HEARTS AND HEADS

By Paul Krugman

SYNOPSIS: Anti-globalization protestors want to turn the world into a nasty place. There is an old European saying: anyone who is not a socialist before he is 30 has no heart; anyone who is still a socialist after he is 30 has no head. Suitably updated, this applies perfectly to the movement against globalization — the movement that made its big splash in Seattle back in 1999 and is doing its best to disrupt the Summit of the Americas in Quebec City this weekend.

The facts of globalization are not always pretty. If you buy a product made in a third-world country, it was produced by workers who are paid incredibly little by Western standards and probably work under awful conditions. Anyone who is not bothered by those facts, at least some of the time, has no heart.

But that doesn't mean the demonstrators are right. On the contrary: anyone who thinks that the answer to world poverty is simple outrage against global trade has no head — or chooses not to use it. The anti-globalization movement already has a remarkable track record of hurting the very people and causes it claims to champion.

The most spectacular example was last year's election. You might say that because people with no heads indulged their idealism by voting for Ralph Nader, people with no hearts are running the world's most powerful nation.

Even when political action doesn't backfire, when the movement gets what it wants, the effects are often startlingly malign. For example, could anything be worse than having children work in sweatshops? Alas, yes. In 1993, child workers in Bangladesh were found to be producing clothing for Wal-Mart, and Senator Tom Harkin proposed legislation banning imports from countries employing underage workers. The direct result was that Bangladeshi textile factories stopped employing children. But did the children go back to school? Did they return to happy homes? Not according to Oxfam, which found that the displaced child workers ended up in even worse jobs, or on the streets — and that a significant number were forced into prostitution.

The point is that third-world countries aren't poor because their export workers earn low wages; it's the other way around. Because the countries are poor, even what look to us like bad jobs at bad wages are almost always much better than the alternatives: millions of Mexicans are migrating to the north of the country to take the low-wage export jobs that outrage opponents of Nafta. And those jobs wouldn't exist if the wages were much higher: the same factors that make poor countries poor — low productivity, bad infrastructure, general social disorganization — mean that such countries can compete on world markets only if they pay wages much lower than those paid in the West.

Of course, opponents of globalization have heard this argument, and they have answers. At a conference last week I heard paeans to the superiority of traditional rural lifestyles over modern, urban life — a claim that not only flies in the face of the clear fact that many peasants flee to urban jobs as soon as they can, but that (it seems to me) has a disagreeable element of cultural condescension, especially given the overwhelming preponderance of white faces in the crowds of demonstrators. (Would you want to live in a pre-industrial village?) I also heard claims that rural poverty in the third world is mainly the fault of multinational corporations — which is just plain wrong, but is a convenient belief if you want to think of globalization as an unmitigated evil.

The most sophisticated answer was that the movement doesn't want to stop exports — it just wants better working conditions and higher wages.

But it's not a serious position. Third-world countries desperately need their export industries — they cannot retreat to an imaginary rural Arcadia. They can't have those export industries unless they are allowed to sell goods produced under conditions that Westerners find appalling, by workers who receive very low wages. And that's a fact the anti- globalization activists refuse to accept. So who are the bad guys? The activists are getting the images they wanted from Quebec City: leaders sitting inside their fortified enclosure, with thousands of police protecting them from the outraged masses outside. But images can deceive. Many of the people inside that chain-link fence are sincerely trying to help the world's poor. And the people outside the fence, whatever their intentions, are doing their best to make the poor even poorer.

Originally published in The New York Times, 4.22.01

Answer 1

Ans) Globalisation is a key macroeconomic concept.Globalisation is a term that determines boundryless trade and aims at promotion of exports and imports as well as a supporter of free trade.It also aims to overcome trade tariff and qouta and dumping activities.The article above is related to antiglobalisation propaganda which states an important saying of if someone is not supporting socialism under 30 than he has no heart and if someone follows socialism after 30 than he has no head.In a nut shell socialism is the kind of the political and economic structure that states the equitable distribution of resources and reduction of the gap between rich and poor.And is against the concentration of wealth in few hands.Hence as per tha saying initially the nation should fullfill the social aspect of the people inorder to fullfill the economic needs, but afterward the nation has to concentrate on the corporate policies favouring the rich.This is not justified .The advocates of antiglobalisation states that the third world workers are exploited in terms of lower wages and poor conditions in which the workers do work.And the MNC take the advantages of it as they have to pay the lower wages for the productions.It is a fact that the problems of the poor countries workers are lack of adequate political will , and infrastructures and economic policies as in the case of bangladesh workers , working for walmart products and when due to the pressure the production is stopped , the workers were working in a greater inhuman conditions.The poor countries are poor because of such political , soci-economic conditions and because of that they are compelled to work for lower wages as that can be seen from the mexican migratory workers , migrating for slightly higer wages than their countries.Also the exports industries in poor countries can develop their exports through the skills that they can achieve while working for MNC , and than only can produce the quality of products that the weatern countries want.Hene it is not lower wages that , is the big problem it is poverty that compels them to work for lower wages and below the class working environment.Hence globalisation , is a key to have a decent improving tool than antiglibalisation which cannot do good to the poor countries.