By SCOTT DEWING
A series of columns published: April, May, June 2004

Globalization Begins @ Home

Everything is in disarray: shirts and sweaters on the floor, shoe tongues sticking out and the waistbands on my pants all twisted inside-out. The tags on my bed mattress are sticking out too, but thank God they’re still attached or I’d be in real trouble. The clock radio is upside down and the cordless phone off the hook with its battery gutted and setting on the table. My work here is nearly complete, but I have to hastily finish and clean up this mess before my wife gets home and finally discovers, after 12 years of marriage, that I’m insane.

I’m ransacking my own home in search of something, anything, with the words “Made in U.S.A.” on it. So far, what I’ve discovered is that most everything I own was made in China by a 12-year-old named Wu Wei (pronounced “woo-way”). Okay, maybe that’s a bit of an exaggeration. It’s not like the tags in my T-shirts read, “This garment handcrafted by Wu Wei.” But for me, Wu Wei represents the billions of Chinese laborers as well as those from other countries such as Indonesia, India, Taiwan and Mexico who are, quite literally, responsible for having made the shirt on my back.

In the grips of irrational fears of having somehow violated the Patriot Act and being shipped off to Guantánamo Bay to be interrogated by men in black who think “Miranda” is either a porn star or a fancy liqueur, my frantic search continues:

My computer was made in Korea. The mouse in China. The light on my desk in Taiwan. The shoes on my feet, China. I begin rummaging through the closet again. Most of the shirts are “Made in China” with honorable mentions going to Indonesia, Bulgaria, Kenya, Mexico and Peru. Some of my shirts were “Made in Mauritius”. I don’t even know where the hell Mauritius is. If you’re like me and curious about just exactly where your Eddie Bauer shirts are made, the country of Mauritius (that’s pronounced “more-icious” like “delicious”) is an island in the Indian Ocean just east of Madagascar. Mauritius has a population of just over a million people. I’m not sure how many of them are involved in making my Eddie Bauer shirts for me, but thanks to The World Factbook, I now know that the GDP of Mauritius in 2002 was $12.5 billion, which ranks them at 122nd in the world.

According to the Factbook, the first place award for GDP went to the U.S. at $10.5 trillion with China running a distant second at $6 trillion. I’m not sure how we’re #1 when we don’t seem to make anything I own. Then I remember that my Korean-made computer runs on Microsoft Windows XP and Bill Gates’ net worth is currently $30 billion. Besides making him #1 on the Top 10 Filthy Rich list, that means he single-handedly beats the crap out of Mauritius. In fact, if you throw Bill Gates’ and his net worth into the global GDP competition, he ranks in the top 100. Way to go Bill! I suspect that this may have something to do with Microsoft making expensive software while the rest of the world makes the cheap clothing and assorted plastic crap you can purchase at any old Walmart.

Now, back in the darkness of my closet, it’s looking bleak. The only “Made in U.S.A.” garment I can find is a sweater. The sweater is old and tattered at the sleeves. I know the sweater is at least 15 years old because I remember wearing it in high school. That was in the late 80s, which means the sweater predates the onslaught of globalization, which is the driving force behind everything I own having been made everywhere else but where I live.

I move out into the living room and my search continues. Electronics? Don’t even bother. It’s all Japan. Picture frames? Taiwan. Guitar? Korea. In an act of desperation, I begin turning over candles. The “Vanilla Swirl” is Hecho en México. The “Luscious Lavender” in Indonesia. But finally, my salvation is found on the bottom of the “Mulberry Mûre” with its sticker reading those blessed patriotic words, “Made in U.S.A.” In an act of ecstatic celebration, I begin dancing The Hokey Pokey, candle in hand, because, well, “That’s what it’s all about!”

Actually, what it’s really all about is “globalization” and my quest to understand how it’s affecting and changing the world that you, Wu Wei and I all live in. According to globalization.com, “globalization is the process of denationalization of markets, politics and legal systems, i.e., the rise of the so-called global economy.” What it’s really all about is the shrinking of an already small world and the growing pains that have come and will continue to come along with it.

Globalization is nothing new. In his landmark book about globalization, The Lexus and the Olive Tree, veteran reporter and writer Thomas Friedman writes, “…from the mid-1800s to the late 1920s the world experienced a similar era of globalization.” According to Friedman, “If you compared the volumes of trade and capital flows across borders…and the flow of labor across borders, relative to populations, the period of globalization preceding World War I was quite similar to the one we are living through today.”

With the inventions of the railroad, steamships, the automobile, telegraphs and telephones, the world became a smaller place. “It would be safe to say,” writes Friedman, “that this first era of globalization before World War I shrank the world from a size ‘large’ to a size ‘medium’.”

We are now trying to squeeze into a size “small”, which will likely be accompanied by the same sort of discomfort I would feel if I actually tried to squeeze into some of the old jeans from my younger (and thinner) days that I found while rummaging through my closet.

Technology has been and will continue to be the driving force behind globalization, which is a big and complex topic. I’m a big but simple guy, which is why I can’t squeeze everything I need to write about globalization into the 1,000 words I’m allowed here every month. This then is the beginning of a series about globalization and technology: the problems, the challenges, the insanity and my underwear, which, by the way, were “Assembled in the Dominican Republic”.

A Passage to India

He says his name is Max, but I’m skeptical. His English is heavily accented and all smooshed together as though the words coming out his mouth and through the receiver to travel across an ocean of fiber-optics in mere milliseconds are being run through a blender set on puree. He says his name is Max but I’m thinking, Yeah, my gluteus maximus your name is Max!

I explain my problem—again—that the battery on my laptop isn’t holding its charge, that it runs out of juice before I can even gulp down a Venti-size latte at Starbucks where I often go to stare at my laptop screen in a ritualistic trance that could very easily be confused with spacing out but is really just my secret way of writing.

“Max” is perhaps more confused than amused by this and says something like, “Havibenuattempto drindebattareresharshering foolyto fool capassatea?”

I think he just asked me a question. Or maybe he just called me a fool. I’m not sure, but it’s a Saturday morning and I’m on my third cup of coffee and feeling a bit cocky. Alright, Max, Mad Max, Maximilian, Maxi Pad, whatever your name is, I can do this.

I explain my problem again, this time leaving out all the fluff and getting right down to the nitty-gritty: “My lap-top bat-ter-ee is dead,” I say, enunciating each word fully and slowly as though that would make a difference.

It doesn’t and Max continues his mangled monologue:

“Sir, dis maybenotbe beingdecase aseyem say-ingah befordis…”

I’m not even hearing the rest of what he says. Max and I are getting nowhere fast. Maybe it’s just the caffeine, but I’m feeling jittery and hostile with bad words beginning to run down from my brain to beat on the door of my mouth. My laptop is still under warranty, but hanging up and just buying a new damn battery is beginning to seem like a pretty good option.

Suddenly, I have a vision of Max: He’s squeezed into a 3’x3’ stall in a cube farm comprised of a thousand other Indian workers holed up somewhere deep in the bowels of a Bangalore building. How could I be angry at him? At the moment, he’s probably just as frustrated as I am. At the moment he and I are just a couple of precarious pawns being moved about on the world’s chessboard by the invisible but powerful hand of globalization. At the moment, neither one of us are fully comprehending what’s going on: Here I am in Oregon, calling India for technical support for a laptop that was made in China. Stop and think about that for a moment. If you are not totally overcome with awe by this, I have a lonely turnip for you to hang out with this weekend. This is what the world has come to. This is how small it’s become. Geography is dead and the world, with it’s known borders, countries and currencies, is turning into something that only our children will recognize as the foreign becomes familiar and what was familiar becomes utterly foreign for those of us who remember a different time and a much bigger and disconnected world.

India has quickly become the outsourced IT darling of this brave new world. Some $16 billion in services—from technical support call centers like the one Max works in to software development firms—have left the United States this past year. That number is expected to triple by 2007 with more than a million IT jobs moving overseas to places like India, China and Romania. While this loss of jobs may receive some lime-light and hype during a presidential election year, it’s really nothing new. Manufacturing jobs have been leaving this country for decades now. That’s what explains most everything I own—from T-shirts and toaster ovens to laptops and light bulbs—having been made everywhere else except where I live: China, Taiwan, Mexico and India just to name a few of globalization’s most popular places.

The Industrial Age and the manufacturing mayhem that came out of it was brought to fruition in the United States. Much of the day-to-day manufacturing of products has since moved overseas. Now we’ve been and continue to be the major innovative force behind the Information Age with its computers, software, fiber optics and the Internet. Why then should it come as a shock that the ongoing products of this next wave of change should come from overseas? Just as with manufacturing, the exodus of jobs is driven by profit and shareholder value. High tech labor in India costs less than a quarter of what it costs in the United States. And while that means that someone here is having problems bringing home the bacon, someone like Max in India is raking in the rupees.

At this year’s World Economic Forum in Davos, Switzerland, Nandan Nilekani, CEO of Bangalore-based Infosys Technologies said, “Everything you can send down a wire is up for grabs.” What he meant was that in this era of technology-powered globalization, the world has become a sufficiently small enough place that all countries can increasingly compete for a slice of the Information Age’s economic pie. However, while that is probably true, Max and I are epitomizing the problems and pain of this latest wave of globalization; and the only thing that seems to be up for grabs at the moment is what he’s saying as I politely say good-bye, hang up on the present and hope for a clearer future.

The Race to the Bottom

It’s an election year, and only June, and I’m already sick of it. Only six more months of mind-numbing, half-truth T.V. ads, scare-tactics and childish finger-pointing to go before we finally get to cast our precious vote in a climactic event that some will hail as an “exercise of democracy” while others will wallow in the anticlimactic depression of having—once again—chosen the lesser of two evils to preside over our country for the next 4 years.

Meanwhile, I have six more months of campaign ads to look forward to. Like the one I saw the other night for John Kerry in which he promises to create 10 million new jobs. The T.V. ad begins with the image of blue-collar workers, lunch pails in hand, walking toward a chain-link fence. “While jobs are leaving our country in record numbers,” says the announcer, “George Bush says sending jobs overseas ‘makes sense’ for America. His top economic advisors say ‘moving American jobs to low cost countries’ is a plus for the U.S. John Kerry’s proposed a different economic plan that encourages companies to keep jobs here. It’s part of a detailed economic agenda to create 10 million jobs. John Kerry. A new direction for America.” Then John Kerry himself cuts in and says, “I’m John Kerry and I approved this message.”

Well, I don’t approve this message. While Kerry’s promise to create 10 million new jobs in America may shine a brief ray of hope into the dark life of an unemployed steel-worker in Detroit, it’s important to understand that no president—Democrat or Republican, American or otherwise—has the power to determine whether jobs stay here or go overseas. The future of jobs in America is not controlled by the President, his advisors, the CIA or the almighty seer of America’s economic outlook, Alan Greenspan. Whether jobs stay within our borders or go elsewhere is driven by a much larger, more powerful and unseen global market in which jobs in the U.S. have been put in direct competition with other countries. As the world becomes more interconnected by technology, every job can potentially go somewhere else.

So, back to Mr. Kerry and the creation of 10 million new jobs in America and his economic plan that “encourages companies to keep jobs here.” Jobs aren’t “here” because “over there” is cheaper. I’m curious how Kerry plans to encourage companies to keep jobs in the U.S. Companies are driven by profit. The cheaper the labor, the higher the profit. In a global market place, U.S. labor is nothing but cheap. At the same time, however, a U.S. worker making the federal minimum wage bobs up and down somewhere around the poverty level in America’s economic sea.

According to Holly Sklar, co-author of Raise The Floor: Wages and Policies That Work For All Of Us, “The federal minimum wage, first enacted in 1938, was meant to put a firm floor under workers and their families, strengthen the depressed economy by increasing consumer purchasing power, create new jobs to meet rising demand and stop a ‘race to the bottom’ of employers moving to cheaper labor states.”

That legislative effort worked for a while with the real value of minimum wage (i.e., adjusted for inflation) peaking in 1968 at $7.92/hour. Since then, real wages for minimum wage workers have plummeted 35 percent. Meanwhile, domestic corporate profits have risen 64 percent. These two figures are intricately tied to the rise of globalization and an economy in which the “race to the bottom” is no longer a race between states within the union, but now includes every country in the world. Today, it’s a global race and the bottom is pretty deep.

And therein lies the rub for Mr. Kerry, or President Bush or anyone else with Kucinich-like tenacity who insists on running for President: How do you create jobs in a global market while maintaining a standard of living in the U.S. that is far higher than all other countries? This is a tough question and that along with the facts that I got a C- in economics, my family isn’t filthy rich and I’m a terrible public speaker, keeps me from running for President.

If I was, however, pushed, dragged or otherwise bribed to the podium, I would advocate the following: “To create jobs in a global economy, we need to constantly be creating a labor force that can be found nowhere else on earth, whose knowledge, skills, tenacity and humanity are always in high demand. In a fast-changing, technology-driven global economy, we need a labor force that is always at the forefront of change rather than clinging to the back of it and scrambling to protect jobs. In a global economy, we need to be pro-active rather that protective. We need to be the leaders, not the followers; the innovators not the manufacturers. To be the leaders and the innovators, we must have the best education system in the world so that we are building tomorrow’s leaders today. I’m Scott Dewing and I approved this message.”