25 January 2008

Riding the Wave of Globalization

I recently found this globalization gone wrong joke in my email:

I was depressed last night so I called Lifeline.
I got a call center in Pakistan. I told them I was suicidal.
They got all excited and asked if I could drive a truck.
Monday, on my flight up from Dallas to Indianapolis, I rode by a woman who worked for Delphi, the auto parts manufacturer. She’s managing a project to move a factory from a rural area of Indiana to Mexico. “I can’t stay in the town,” she said. “The locals are pretty angry about losing their jobs.” This factory is one of the main sources of employment, and now it is gone. I’m not sure what’ll happen to the town, but I’m sure about why it is happening. “Machine operators here in the US cost $40 an hour. In Chihuahua,” she said, “they cost $70 a week.”

That night in the hotel, I get an email from my buddy Jeff. He’s getting laid off from his job in database design, along with 40 coworkers. The positions are being outsourced to a contractor in the Philippines.

Every color collar jobs – from blue to white – are being exported.

Globalization is not going to be stopped by legislation. It is not going to slow. It is not going to reverse. It is a reality for which politicians have given two very unsatisfactory solutions: either they tell constituents suck it up and deal with it; or they promise to stop it through legislation, a plan about as likely to work as outlawing lust.

It took us decades to adapt our school system to the creation of knowledge workers who could thrive in corporations and succeed in the information economy. Now, policy makers need to begin finding ways to prepare the next generation of workers to compete and thrive in a period of globalization.

It seems to me that a strategy for successful globalization would rest on at least three things:

1. Changing our attitude towards all things foreign. There is this odd tendency to think that foreigners have to learn English to talk to us. They do. And then they sell to us. We, by contrast, refuse to learn their languages, their cultures, etc. And we can't sell to them. The result? Huge trade deficits even when the dollar falls.

2. Dedicating our education more towards entrepreneurship. Low cost labor represents a threat to someone who is working and a great opportunity to an entrepreneur.

3. Give employees who own stock more say in company policy. Pension funds are the biggest owners of stock. It’s not obvious that they would chose to up their returns to capital by 5% if it meant that they would see their salaries fall by 50%. Employees own these companies. Let them have a say in how work is allocated and contracted.

Bucky Fuller said, “Use forces, don’t fight them.” Globalization is too big to fight, but it can be harnessed. I've ridden waves and been ridden by waves. I know for a fact that it is much better to ride them.


Anonymous said...

Maybe I'm reading this wrong, but in point #2 you seem to be saying, "The working class has to eat any shit sandwich you feed them, so exploit them for your own benefit!"

I think reform has to start from the other end. There's plenty of wealth in this country, it's just not sticking to the people who create it. Labor has to band together to get their fair share of the pie.

Dave said...

As I finished the post, I said in my head "I want to hear what Thomas has to say." And there you were.

I think we or two of us have had this exhange before. Good or bad, Ron is right about where things are going. Maybe the solution Thomas is to think globally rather than locally in terms of political approaches to economic inequities. "This country" is soon to be a political and economic appendix as are other countries. Until we all think about the entire table upon which we "play," we are missing important parts of the "game."

Lifehiker said...

I'd add a 2.a. regarding education.
It's an incredible American resource that we squander because too many Americans aren't motivated to take advantage of it.

I guess I believe that our overall standard of living, even for "poorer" people, is high enough to create apathy about getting skills that are useful. No such problem elsewhere...

Maybe our situation is similar to that of other great nations that have just petered out due to "globalization" of one kind or another. We can try to stand on our laurels of the 19th and 20th centuries, but I'm not sure they will support us. We need to get smarter.

Ron Davison said...

actually, when we began to train and prepare knowledge workers for an information economy, our manufacturing workers did much better. The same will happen when we encourage entrepreneurship.

I think the important thing is to move the whole forward and to take care of the poor - around the world. And as much as possible, I think that people want to be autonomous and not dependent - a thriving global economy could provide that potential.

I'm sure what you say is true - but I also think that lots of people simply don't fit into a traditional education model. Solution (said the guy who plays one note?) - a form of entrepreneurship in education, creating ways of learning that work for different people.

Lifehiker said...

Entrepreneurship in education?

Ron, there are few expressions that can get a person "disappered" in the middle of the night, and you have written one of them. It's been nice knowing you...

Good Witch and I have just ordered
The Neurological Origins of Originality" from The Teaching Company", our first science course.

When I compare The Teaching Company's professors to many "live" professors I've had over the years, those live ones oome out a distant second.

In this electronic age, perhaps many bright but apathetic kids would benefit much more from seeing and hearing the very best teachers than the worn out ones that they often are forced to suffer. Why hasn't this approach been tried? Vested interests are awfully powerful.

Ron Davison said...

Here's a thought experiment that might become reality.
One of the ways that productivity will go up is to have a higher ratio of teachers to students. The best, brightest, and most entertaining will teach huge swaths of students in the same way that entertainers do today. The big difference is that the teachers who previously did that will now have time and energy to focus on the customization of these generic messages to individual children. This might result in fewer teachers, but it will certainly result in more learning.

David said...

I'm so with you on entrepreneurship being the answer to competing globally, This is where Obama strikes me as at least having a clue about change. His focus seems to be on providing a vision, leadership, encouragement and even know how. A government (bureaucracy) that has proven it cannot change is not going to be an adeauate agent for change. A leader could be though if he or she stops short of trying to administer it.

Alstroz said...

I also have a comment about the education part. I actually think it is very accurate to say that jobs that are being outsourced leave gaps here for higher education-seeking individuals. Hopefully, though, more and more Americans will persue higher education, but we'll have to wait and see how that pans out.
You should visit my blog, I have some posts that share some of your topic ideas.