Globalization that Works for Working Americans

Publication Date: January 2007

Publisher: Economic Policy Institute

Author(s): Jeff Faux

Research Area: Economics; Labor

Type: Brief

Abstract:

Competently managed, America's integration into the global economy can contribute to increasing living standards for workers in America and in the rest of the world. Unfortunately, the process is being tragically mismanaged, carried out not with a carefully considered plan but with a chaotic patchwork of international trade and investment agreements and policies increasingly unaccountable to any country's citizens.

In America, as elsewhere, the benefits of the current form of globalization have been concentrated among those at the top of the income and wealth ladder, while the costs have been paid by working families at the middle and the bottom. Real wages and benefits for the majority of workers are stagnant, jobs have been destroyed, and family and community life has been stressed and, at times, broken apart.

In the United States, the mismanaged policies of the last two decades have severely damaged the nation's competitiveness and plunged it into a spiral of trade deficits. To some extent the economic harm has been obscured by massive borrowing from the rest of the world, borrowing that is clearly unsustainable. America urgently needs to reverse its course with a comprehensive strategy that matches the scope and depth of globalization's challenges.