Considerations

Steven E. Landsburg is correct when he writes that free-trade and globalization are helping, not hurting, the United States:

All economists know that when American jobs are outsourced, Americans as a group are net winners. What we lose through lower wages is more than offset by what we gain through lower prices.

It's all about the competition. If three people want to sell me a product, I will purchase it from the one who offers the lowest price. If the pool of available sellers increases to three hundred, then the odds are greater that someone in that group will be able to offer a price that is even lower. Globalization has increased the size of the group to nearly six billion. Globalization is keeping prices low.

However, it is also evident that many workers in specific industries are losing (their jobs) while the consumers, in general, are winning (lower prices). But, Lansburg wonders, do the winners in globalization owe the losers anything? His response is "no":

Even if you’ve just lost your job, there’s something fundamentally churlish about blaming the very phenomenon that’s elevated you above the subsistence level since the day you were born. If the world owes you compensation for enduring the downside of trade, what do you owe the world for enjoying the upside?

I doubt there’s a human being on earth who hasn’t benefited from the opportunity to trade freely with his neighbors. Imagine what your life would be like if you had to grow your own food, make your own clothes and rely on your grandmother’s home remedies for health care. Access to a trained physician might reduce the demand for grandma’s home remedies, but — especially at her age — she’s still got plenty of reason to be thankful for having a doctor...

Suppose, after years of buying shampoo at your local pharmacy, you discover you can order the same shampoo for less money on the Web. Do you have an obligation to compensate your pharmacist? If you move to a cheaper apartment, should you compensate your landlord? When you eat at McDonald’s, should you compensate the owners of the diner next door? Public policy should not be designed to advance moral instincts that we all reject every day of our lives.

Globalization is an amoral phenomenon. It is neither morally good or bad. It merely is. And it is something that no country can ignore. Protectionists who want factory jobs to remain in the United States sound like a typewriter manufacturer who uselessly rails against the computer. Rather than learning to manufacture computers, he tries to stop others from creating them. We need to respond logically to a rational process that is transforming the world.

Globalization is not only amoral; it is also a neutral phenomenon. Whether it helps or hurts a country depends on how that country responds. It is impossible to ignore the reality: Manufacturing is dead. The United States needs to revamp its educational system, retrain large segments of the workforce, and focus on jobs that can only be performed locally. There is no moral imperative to do so -- it just makes good economic sense.

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