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Disadvantages of Modern Globalization

Updated on June 5, 2018

A debate involving the world as a whole is underway. The debate is on the subject of globalization. Today the topic of globalization is discussed within levels of government, politics, and the world’s working class. While there are some benefits to globalization, the negative effects of the process has many around the globe concerned.

The numerous disadvantages of globalizing the world’s national governments, economy, and sovereignty or the loss thereof are devastating notions. Such notions are indeed a reality if and when globalization is set into full effect. Therefore, globalization will be a global disaster.

Defining Globalization

Nonetheless, the topic of globalizing is not a new one. Upon viewing the term globalization what first comes to mind is the obvious word global. Globalization has a broad definition.

However, globalization tends to generally be defined as “a process of interaction and integration among the people, companies, and governments of different nations, a process driven by international trade and investment and aided by information technology” (Globalization 101).

The practice of trade across national boundaries has been in effect down through history. Only in the 21st century has the practice of globalization taken on an all inclusive approach.


The History of Globalization

The history of the process of globalization is a long one. Some researchers and authors on the subject only attest to the year 1492 as the first appearance of the globalism process.

Trade between countries such as Europe and the new world caused relations and a period of empires founded upon the sea along Europe. However, globalization can be seen in operation as far back as 325 B.C when the Chandragupta Maurya combined a world religion, trade economy, and imperial armies for the first time” (A Quick Guide).

Maurya then came together with Alexander the Great and in 325. The two made a link along routes between the “Mediterranean, Persia, India, and Central Asia” signifying an international trade (A Quick Guide).

The Silk Road that stretched across the center of Asia is another examine of globalization in history. There are even some researchers who believe that globalization was first set into motion when mankind spread across the globe.


Free-Market Economic Systems

As time went on and World War II ended, many national governments took up “free-market economic systems, vastly increasing their own productive potential” (Globalization 101).

Countries also began to open barriers and freely move capital internationally. Then when new technologies came along, the free-market economic systems gained even greater momentum. With new technology available like information technology, countries were able to take part in new economic activities.

Such activities include trading and investing internationally through the use of the internet. Thus, today many corporations are mimicking the global trade processes of the past but with a new high tech twist.

Free Trade

Trade agreements in time past are not the same as the globalization processes discussed in the current 21st century. The current globalization process is often referred to as modern globalization. With modern globalization there are some modern advantages.

Some of the advantages are centered on free trade. In the fall 2002 Cato’s Letter entitled Globalization is Grrrreat!, out of the five benefits of globalization listed in the letter, four of the five were about free trade. According to the author of Tom G. Palmer “trade is at the very foundation of human civilization” (Palmer).


Modern Disadvantages

Trade among international means gives the trading country the opportunity to acquire capital at a lower price. Globalization also creates “economic growth, reduces poverty, and expands export markets” while also dynamically changing economic competitiveness among nations (Thompson).

Those who are opposed to modern globalization are not necessarily opposed to the advantages aforementioned. The negative effects of globalization are the reason why some nations are in opposition. The disadvantages of globalization are costly for national governments, economies, and their people.

Although proponents of globalization speak highly of the forthcoming process, those opposed however are expressing increasing concern. Their concern is for the “consequences of global change for the well-being of various groups, the sovereignty and identity of countries, the disparities among peoples, and the health of the environment” (Lechner, Loftin, and Boli).

Monopoly of Power

There are possible negative effects of globalization and definite negative effects of globalization. A possible negative effect is the control globalization will have over national governments. Globalization requires the decline in power of national governments.

Therefore, it is possible for “the danger of a concentration of power under globalization” as Sajay Samuel stated (Grossman). Institutions such as the World Trade Organization could be viewed as tyrannies. Or politicians and political movements could become tyrannies.


Where's Regulation?

The regulation of globalization is yet another troubling issue for the world. When national governments no longer have the same powers in local governing but have to answer to a global governing organization, problems of control can arise. Technological innovation could get out of hand since such mediums are inherently unpredictable.

Dominant influences among political and economic parties could be lost. Not to mention that all countries do not have the same laws. The world does not have only one set of rules that all governments regulate by. Therefore, the attempt to control the world’s governing processes by a select few organizations may in fact get out of control.

Eroding A Nation’s Sovereignty

It is concerning for nations to think that just a few or certain institutions would make the laws and govern the policies of the world. There are inhabitants in countries around the world that feel as though globalization will have international organizations beyond their democratic control that will make the rules.

Rules will be decided by these international organizations without the input from the people who will be affected by them the most. The globalization of law negatively affects the sovereignty of nations as well. When the laws of a nation are globalized the sovereignty of that nation are eroded to a certain extent.

The globalization of law erodes a nation’s sovereignty by “reducing the power of the nation-states to control the development of the law” (UICIFD). The economy is also vulnerable to such a decline in the power of national governments.


Losing the Comparative Advantage

In the United States, outsourced labor has taken a toll on the national economy. Many Americans have lost their jobs to production shifts abroad. Imports overseas are another reason for an increase in job loss in the U.S.

Then those Americans who find new jobs tend to receive lower wages. In addition, white-collar jobs are becoming increasingly negatively affected by offshore operations. The most startling of all for any country but especially the United States is that fact that employees in the nation can lose their comparative advantage.

When companies in other countries decide to build factories with advanced operations and produce products or services at lower wages as good as those produced in the U.S., the United States then looses its comparative advantage.

Labor Strength Reduction

The globalized economy functions on a delicate balance. When the economy of a certain country suffers such as the economy of the United States, the rest of the world suffers to a degree as well. In the case of labor and inequality in modern globalization, the outsourcing of labor causes a country’s labor strength to be reduced.

Afterward, when a nation’s labor strength is reduced, the nation’s purchasing power gets reduced as well. Therefore, some nations under globalism will have greater internal labor strength while other will not. Small businesses in any country can be put out of business by larger organizations.

The competitive nature of the business industry becomes reduced along with the use of agriculture in a globalized world. The inequality in the economy under globalization causes the quality of life in countries to become lower.


Global Inequality Among the Poor

Inequality in globalism lies within several advantages that certain countries and groups of people will have opposed to others. Inequality in globalization involves women, poorer nations and environments.

The richer nations and citizens will have control over the poorer nations and citizens. The “richest one percent of the world’s population controls as much wealth as much as the poorest fifty-seven percent” (Dunklin). Within the last two decades, the living standards of many poorer nations declined as the global market expanded.

“Per capita private consumption within the United States increased by 1.9 percent per year from 1980 to 1998, while during the same period, sub-Saharan Africa experienced a 1.2 percent annual decline” (Dunklin). Thus, the poorer nations experience inequality as a part of globalized economies and marketplaces.

Discrimination of Women in a Global Economy

In a United Nation 2001 press release, the Third Committee concluded that “the negative effects of globalization, manifested most visibly in widespread poverty throughout the developing world” (Poverty, Negative Effects of Globalization Highlighted).

In addition, women can experience inequality in globalization through the world’s economy. Inequality or discrimination of women in a globalized economy can involve women being exploited in sweatshops receiving low wages. Also, in politics women can be pressured globally and be excluded from political processes.

However, the inequality and discrimination of women in society is a real factor around the world now. The implementation of modern globalization in its entirety will exacerbate the unequal treatment of women in a globally ruled economic and political society.


Environmental Hazards

Globalization can also work against and or not properly support human values. Protecting the environment and climate on a global scale is challenging. The environments in one section of the world may suffer and climates may become hazardous on a global scale even more so than nations experience now.

In regards to cultural diversity, globalization could positively affect cultures or undermine them. Globalism’s “multinational corporations promote a certain kind of consumerist culture, in which standard commodities, promoted by global marketing campaigns exploiting basic material desires, create similar lifestyles” (Lechner, Loftin, and Boli).

The adequate protection of the environment, climate, economy, labor, culture, and human rights should be at the top priority of the globalization process; however, they are not. Without the proper support of human values globalization will be a global disaster.


The Debate for Globalization

On the other side of the debate for globalization, the proponents of globalization feel as though the positives of the globalism process outweigh the negatives. Those who support globalization primarily claim that free trade is the reason why the world must move forward to globalism.

They see “globalization as the beneficial spread of liberty and capitalism” (Sachs). Free trade is the current driving force of the globalism process. Free trade brings higher standards of living to some countries, benefiting and helping developing countries to grow.

However, this claim is only true in a general sense. Not all countries or all peoples will benefit equally. Although inequality is experienced today, it is not experienced on the magnitude of a completely globalized scale.

Two Conflicting Movements Today

There are primarily two movements in effect today. One is the pro-globalization or pro-globalism and the other is the alter-globalization or the anti-globalization movement or such members go by other names.

Pro-globalization proponents stick to the positives effects of globalization. Supporters of the pro-globalism movement also claim that the negative effects of globalization are being blown out of proportion by the naysayers. Moreover, the issues can be tackled in time.

On the other hand, the opponents to globalization, those in the alter-globalization movement support the cooperation and interaction on a global scale but are opposed to the negative effects of economic globalization. Both movements are influential in the future of globalization. The cooperation and interaction between the two movements can help to eliminate the negative effects of modern globalization.


The Future

The future of globalization is a bright one to some but ominous to others. By the year 2020, the world economy “is projected to be about 80 percent larger… than it was in 2000 and average per capita income to be roughly 50 percent higher” (Sachs).

Global technologies are expected to benefit those countries that accept and utilize them and hold back those countries that do not. Within globalization countries such as “China, India, and other developing countries” are thought to further integrate into the global economy (Sachs).

According to the National Intelligence Council’s article on The Contradictions of Globalization “hundreds of millions of working-age adults will join… a more interrelated world labor market” (Sachs). Thus, it is evident that globalization will more than likely be a powerful force in the future.

A Global Disaster?

There are and will be very few, if any, countries remaining unaffected by globalization. As aforementioned, the idea of globalization is not a new one. The process and ideology of globalism has been around from the time of ancient civilizations.

Modern globalization takes a new approach to bringing the economies and nations of the world under a technologically free-trade driven tenant. When globalization comes to fruition, its negative effects on economic and sociological facets will be felt worldwide.

While some countries will gain greater wealth from the global process, other countries will become poorer. Globalization appears to be primarily concerned with the benefits of free trade. However, without the proper support of human values and human rights, globalization will in fact be a global disaster.

Would you be in favor of modern globalization?

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References and Further Reading

  • “A Very Long-Term View.” A Quick Guide to the World History of Globalization. University of Pennsylvania School of Arts & Sciences, n.d. Web. 9 Dec. 2009.
  • Dunklin, Arthur L.Globalization: A Portrait of Exploitation, Inequality, and Limits.” Globalization. N.p., 2005. Web. 10 Dec. 2009.
  • Grossman, Hallie. “Teach-in examines negatives of globalization and the WTO.” The Daily Collegian. Penn State University, 21 Apr. 2004. Web. 8 Dec. 2009.
  • “Law & Globalization.” UICIFD. University of Iowa Center for International Finance and Development, n.d. Web. 10 Dec. 2009.
  • Lechner, Frank, Teresa Loftin, and John Boli. The Globalization Website. Emory University, n.d. Web. 9 Dec. 2009.
  • Palmer, Tom G. “Globalization is Grrrreat!” Cato’s Letters. Cato’s Letters, Fall 2002. Web. 9 Dec. 2009.
  • “Poverty, Negative Effects of Globalization Highlighted.” United Nations. N.p. 10 Nov. 2001. Web. 9 Dec. 2009.
  • Sachs, Jeffrey. “The End of Poverty.” New York, New York: The Penguin Press, 2005. Print.
  • Thompson, Robert L. “Globalization: Benefits and Costs.” Illinois Ag Policy Briefs. University of Illinois, 9 Dec. 2009. Web. 9 Dec. 2009.
  • “What Is Globalization?” Globalization 101. Carnegie Endowment for International Peace, n.d. Web. 8 Dec. 2009.


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