The Trouble with Globalization

By Andalusia Knoll Soloff
Globalization enthusiasts say it creates opportunity for all, but as communities around the world have discovered, it has significant costs. The elimination of trade barriers keeps the price of sneakers low, but how does it affect the factory-workers on the other side of the globe who make those sneakers?
A view of a busy city at nighttime from above. Several brightly lit, modern skyscrapers are surrounded by crowds of people down below.

On New Year’s Day of 1994, a group of indigenous Mayan guerrillas, known as the Zapatista Army of National Liberation (EZLN) launched a coordinated attack across the southern state of Chiapas, Mexico. Hundreds of humble farmers were armed with machetes and outdated rifles, and they were disguised with ski masks and red paisley bandanas. They took over government buildings and read a statement in Spanish that emphasized the phrase: Ya basta, meaning, “Enough is enough.”

The timing was no coincidence. The North American Free Trade Agreement (NAFTA) was to take effect that same day. The landmark agreement was supposed to decrease trade barriers and increase business investment between Canada, the U.S., and Mexico. On signing NAFTA, U.S. President Bill Clinton said, “We have to create a new world economy.” He celebrated that the trade agreement would be “our opportunity to provide an impetus to freedom and democracy in Latin America and create new jobs for America as well.”

But the Zapatistas and other subsistence farmers believed NAFTA would be their economic death, because it would flood Mexico with imported corn, seriously devaluing the crop that paid for their livelihood. Corn growers in the United States received government subsidies (financial aid) to the tune of $20,000 a year each, but in Mexico the farmers only got about $100. That meant U.S. corn sold in Mexico was ultimately much cheaper than what Mexican farmers could grow locally. They simply could not compete, having started the race already $19,900 behind.

As a result, millions of Mexican farmers migrated to the United States over the next decade. NAFTA, instead of bolstering the Mexican economy, effectively lowered wages there and drove the Mexican consumer’s purchasing power down by an average of 24 percent. At the same time, Clinton had promoted NAFTA saying it would create hundreds of thousands of jobs in the U.S. to produce the goods that would be exported to Mexico. But that’s not what happened. It is estimated that within the first 15 years of NAFTA’s implementation, close to 700,000 jobs were lost in the U.S. as well.

Several people set a table under a wooden shelter. Most are wearing handkerchiefs around their noses and mouths  and are filling the table with a large feast. Behind them is a view of a lush, mountainous area.

Zaptista women preparing a communal meal. Notice the care they take to protect their identities by wearing bandanas and ski masks. Courtesy of Andalusia Knoll Soloff.

Instead, hundreds of electronics factories opened in Mexico’s Ciudad Juarez, right by the U.S. border. Mexicans migrated there from across their vast country to work long hours for miserably low wages. At the same time, workers in the U.S. complained about the loss of jobs as factories moved south to another country. Usually when workers need more protection, the best option is to form a union. However, any factory workers in the U.S. who talked about unionizing were met with threats by company bosses who said that they would sooner shut the factory down.

In the late 1990’s Ciudad Juarez was a dangerous place. Many young women disappeared on their way to and from the maquiladoras—that’s the word for factories in Mexico that are run by foreign companies to make exports to that company’s country. The city was a killing field, as women’s bodies were later found in the desert, abandoned near the same factories that had lured them with abundant work. To this day, most of these murders remain unsolved and the factories continue to operate.

The Zapatistas meanwhile, declared themselves autonomous (independent) from the Mexican government. They started their own farming cooperatives, built their own schools and even operated their own government centers. These resistance strategies have protected the Zapatistas from many of NAFTA’s negative effects. Today their numbers are estimated at 250,000 people, and across the world they are seen as a powerful symbol of anti- globalization.

The rise of the anti-globalization movement

A screenshot of an early website, featuring simple linked pages, a couple of small photographs, and boxes of text.

This screen shot from 1999—when the Internet was only about five years old—shows the first Independent Media Center site’s splash page, courtesy of Indymedia.

In 1999, the World Trade Organization (WTO) was set to meet in the city of Seattle. The plan was to discuss how to reduce tariffs and lift barriers to global trade among its 134 member states. At the break of dawn on November 30th, 1999, as the WTO delegates made their way across Seattle, tens of thousands of protestors blocked the streets so the delegates could not reach the convention hall. The protestors were using a tactic called direct action, where they physically put their bodies on the line to protest what they saw as injustice.

These protests became known as “The Battle of Seattle”. Riot police responded with heavy-handed tactics, including pepper spray, tear gas, and mass arrests, but ultimately the Seattle Police were not prepared for a protest this big. The WTO delegates could not get past the protesters, and were unable to attend. The negotiations were called off.

The delegates of the World Trade Organization argued that global trade rules between nations allow for a more prosperous, peaceful, world—economically speaking. Critics say these trade rules provoke a “race to the bottom,” with corporate profits taking priority over regulations meant to protect laborers and the environment.

These effective protests gave birth to an independent media movement. When the traditional media characterized the protestors as violent vandals, the activists were able to do their own reporting and flip the script. Protestors told their side of their story to the world—quite an achievement since this was before we had blogs, Facebook, and Twitter. They called themselves Indymedia and their call to action was: “Don’t criticize the media, be the media.”

Within a few years, Indymedia expanded to 35 countries with 200 local Indymedia sites in over 15 languages. The sites connected a network of those resisting globalization, and Indymedia would be a key resource in protests of other institutions that promoted globalization and world trade. These included the International Monetary Fund (IMF), the World Bank and the G20.

As numbers of protestors swelled outside the gatherings of this financial organization, the stakes grew higher. In 2001 Carlo Giuliani was shot and killed by riot police while protesting the G8 meetings that took place in Genoa, Italy. In 2003, at the WTO protests in Cancun, Mexico, Lee Kyung Hae, a South Korean farmer stabbed himself to death while a sign hung around his neck stating “The WTO kills farmers.”

In the following years, the global political and corporate elite met in isolated, exclusive locations where they could not be shut down by protests.

A complex artwork shows several people, wearing masks of different animals, sitting at a table digging into a cake topped with a “500” candle. Beneath the table, animals are being led on a conveyer belt underneath the tablecloth.

Detail of an artwork by The Beehive Collective depicting corporate greed at a global level. Illustration courtesy of The Beehive Collective, CC BY-SA 3.0.

Does globalization create global prosperity?

Not everyone hates globalization. Its advocates believe that trading on a global level can be a powerful force for social good in the world and encourage prosperity in developing nations. They argue that opening markets and eliminating trade barriers helps transnational corporations open factories in countries that need them. The idea is that this creates jobs and reduces poverty.

Your clothes are evidence that globalization created jobs in the global south. Read the tags on your shoes, shirt, and pants. Were they made in China, Honduras, Bangladesh or some other distant part of the globe? But then think: If your shoes cost $100, how much do you think the person who glued their soles on got paid for each pair of shoes? How many hours do you think they would need to work to be able to purchase a pair? What kind of conditions do you think they work in?

Nike is the world’s largest athletic apparel maker in the world and arguably the most popular sneaker with a highly recognizable logo. In recent years Nike has hailed itself as a “social justice” company with a new campaign featuring social justice advocate Colin Kaepernick.1 They also ran a campaign encouraging women to break free of the limits society puts on them.

But wait for the other sneaker to drop. Nike’s factories around the world also have a long history of abuses. In 1997, an accounting firm documented how workers at a factory making Nike products in Vietnam were exposed to toxic chemicals, forced to work 65 hours a week, and earned only $10 dollars. Nike tried to dodge responsibility saying that the factory was really run by subcontractors.2 The company was eventually pressured by international watchdogs to set labor standards, but investigations have shown that they still do not comply with these standards. In 2011, workers at Nike’s Converse shoe factory in Indonesia protested that their “supervisors throw shoes at them, slap them in the face and call them dogs and pigs.”

Nike is just one example of a transnational corporation that benefits from increased global trade and low tariffs. While it has created hundreds of thousands of jobs across the world, that has not necessarily created prosperity. In fact, global inequality has risen exponentially over the past 30 years. In the United States alone, the top .001 percent earned 636% more in 2014 than what they earned in 1980 while there was no increase in income for the bottom half of earners.

Austerity and the down-side of globalization

The International Monetary Fund (IMF) was formed after World War II and is one of the pillars of neoliberal globalization. Its goal is to allow countries to borrow from countries as a way to promote “financial stability, foster global cooperation, facilitate trade and growth, as well as reduce poverty.”

The IMF encourages governments to cut spending on social services and implement “austerity” (very strict and limiting) measures. This often means cutting government subsidies for gas and public transit. For students and working-class people who primarily use public transit to go to and from school and work, losing those subsidies can be devastating.

In 2010 Greece faced an economic depression and was bailed out by the European Union and the IMF. This forced the country to implement austerity measures such as increased taxes, an overhaul of the pension and health system, as well as a reduction in salaries for workers already receiving low wages. People protested in the streets for months.

In 2018 Haiti sought financial aid from the IMF. The institution said it would help as long as Haiti put an end to energy subsidies. This raised fuel prices, and in July of that year there were massive protests against the government that turned violent, resulting in 17 deaths and hundreds of injuries.

Conclusion

Is it possible for globalization to benefit all parts of the world? Is there a way to promote global trade without harming those doing the physical work while only benefiting consumers? Is it better to provide difficult, poorly paid factory work to regions where there otherwise aren’t any jobs? Advocates of austerity measures and global trade believe that their policies will help promote global prosperity. But Greece, Haiti and other examples have shown us that this is not the case and that inequality keeps rising. If these policies stay in place, what will the future look like?


1 Kaepernick, a professional football player, famously chose to kneel—while everyone else stood—during the National Anthem. It was his way of calling attention to police brutality and systemic racism in the U.S.

2 Subcontractor: If my neighbor says he’ll pay me $5 for a fresh glass of lemonade, and then I pay you $2 to go pick some lemons, squeeze them into glass, add sugar and water, that means I subcontracted the work to you. Subcontracting can be done fairly, like if I had paid you the $4.50 you deserve. But I knew you needed the money so badly I could get you to do it for $2, so this was exploitative subcontracting.

Sources

World Trade Organization. 1999 Annual Report. 1999. https://www.wto.org/english/res_e/booksp_e/anrep_e/anre99_e.pdf

Alvaredo, F., L. Chancel, T. Piketty, E. Saez, and G. Zucman. 2017. World Inequality Report 2018. Belknap Press.

Felter, C. 2019. “What’s Driving the Protests in Haiti?” September 3, 2019. https://www.cfr.org/in-brief/whats-driving- protests-haiti.

Greenhouse, S. 1997. “Nike Shoe Plant in Vietnam Is Called Unsafe for Workers.” New York Times. https://www.nytimes.com/1997/11/08/business/nike-shoe-plant-in-vietnam-is-called-unsafe-for-workers.html

Hessler, Uwe. 2018. “IMF Bailouts — Roads to Stability or Recipes for Disaster?” DW.com (Deutsche Welle) September 4, 2018. https://www.dw.com/en/imf-bailouts-roads-to-stability-or-recipes-for-disaster/a-45338114

Liacas, T. 2014. “A Tribute to Indymedia, the Scrappy Forerunner of Social Media Activism.” October 14, 2014. https://medium.com/@TomLiacas/a-tribute-to-indymedia-the-scrappy-forerunner-of-social-media-activism-cb5b3ae6d4e5

Tinti, P. 2019. “In 2003, a Farmer Killed Himself to Protest Globalization. Little Has Changed.” September 13, 2019. https://www.vice.com/en/article/j5ygx8/in-2003-a-farmer-killed-himself-to-protest-globalization-little-has-changed

Wright, S. 2011. “Nike Faces New Worker Abuse Claims In Indonesia.” June 3, 2011. https://www.huffpost.com/entry/nike-faces-new-worker-abuse-indonesia_n_896816

Andalusia Knoll Soloff

Andalusia Knoll Soloff is a multimedia journalist based in Mexico City whose work has been published by Al Jazeera, Teen Vogue, Democracy Now!, VICE News, BBC, NBC, The Intercept, and Latino USA, among other outlets. Her reporting focuses on human resilience and dignity in the face of disappearances, state violence, land struggles and gender-based murders in Latin America. Knoll Soloff is the author of the graphic novel Alive You Took Them, about the 43 missing Ayotzinapa students.

Image credits

Creative Commons This work is licensed under CC BY 4.0 except for the following:

Cover: Hong Kongers Protest Ahead Of The G20 Summit: Protesters take part at a rally against the extradition bill ahead of 2019 G20 Osaka summit at Edinburgh Place in Central district on June 26, 2019 in Hong Kong, China. © Getty Images / Anthony Kwan / Stringer.

Zaptista women preparing a communal meal. Notice the care they take to protect their identities by wearing bandanas and ski masks. Courtesy of Andalusia Knoll Soloff. https://subversiones.org/archivos/11669

Indymedia - This screen shot from 1999—when the Internet was only about five years old—shows the first Independent Media Center site’s splash page, courtesy of Indymedia.

Detail of an artwork by The Beehive Collective depicting corporate greed at a global level. Illustration courtesy of The Beehive Collective, CC BY-SA 3.0. http://beehivecollective.org/graphics-projects/mesoamerica-resiste/


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