Gaps between Nations of the World

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Two important gaps are growing in and between nations of the world. One is between rich and poor nations as well as people; the other, between old and young within nations. Both will have profound consequences.

The rich poor gap goes to the heart of the popular opposition to globalization. This is the tendency of multilateral corporations to seek the most favorable manufacturing conditions anywhere in the world: the fewest possible environmental regulations and the lowest possible labor costs. Poor countries see this as bringing them jobs; rich countries see it as taking jobs away.

Concern over labor and the environment was dismissed as modern version for the old arguments of protectionism. Now, it is seen as more complicated. Consider the issue in a multilateral relationship such as a Western Hemisphere wide Free Trade Area of the Americas, if one is negotiated. When there are many poor countries involved, such as all of Central America, they compete against each other to attract foreign business through lax, if any, environmental and labor regulation. The same situation prevailed among poor states in the United States before the federal government imposed nationwide uniform standards for the environment and labor. It would make sense to agree on worldwide standards, if agreement can be reached.

The second gap between young and old has to do with the surplus of labor in the poor world, where the young are more numerous, and the shortage of labor in the rich world, where the old are more numerous. The American computer industry has already imported, on a temporary basis, hundreds of thousands of workers from India to make up for a shortage of qualified American workers. In fact, the pressure of population growth in developing nations since World War II has generated a growing and irresistible flood of immigrants that is changing the American people from basically European to a heterogeneous mix of Europeans, Hispanics, Asians, and Africans with Europeans slipping into the minority.

Even more than the US, the rest of the rich world namely Europe and Japan needs immigrants. By 2050, only half of all Europeans and 58 percent of all Japanese will be under the age of 60. This will not sustain present economies. It is only immigration that is driving American population growth.

This combination of rich poor, old young trends is woven together in a complex relationship that has too many conflicting interests for neat solutions. Industrial economies will continue to seek export markets and advantageous investment opportunities.

There will continue to be enough people hurt by this growth in world trade to make themselves heard at the polls in democracies and in the streets of other countries. Enough people will continue to benefit to make them similarly heard. In most instances, the balance is probably on the side of the beneficiaries. But there are enough legitimate complaints that governments should curb the more greedy instincts of their corporations.

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