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The 10 Globalization Lies

Neoliberal lies like "our welfare state is not affordable any more" cannot be refuted with slogan sentences. We must go back and envision alternatives.
The 10 Globalization Lies

[This summary of the 1997 book "The 10 Globalization Lies" by Gerald Boxberger and Herald Klimenta is translated from the German on the World Wide Web, www.physik.uni-regensburg.de. Gerald Boxberger is an economist and free lecturer and journalist on economic and social policy in Regensburg. Herald Klimenta is a physicist who studied economics and globalization.]

Spurred by numerous seminars and lectures, the 1997 book "The 10 Globalization Lies" made clear in a simple way the complex economic connections. In the course of the work, it became clearer that neoliberal lies like "our welfare state is not affordable any more" cannot be refuted with slogan sentences. We must go back and envisage alternatives. This is always lacking in comparable books.

Lie 1: "Globalization is not controllable"

Politicians resolve tariff reductions, common currencies and allow the transfer of great sums of money. Globalization is deliberate and controlled and did not break over us fatefully. In international organizations like the "World Trade Organization" (WTO, successor of GATT) or the OECD, the way is prepared that gradually robs states of their sovereignty (as for example with the Multilateral Agreement on Investments, MAI) and hands sovereignty over to multinational corporations obliged only to profit. If the political will exists, sovereignty could be different than only for the advantage of businesses.

Lie 2: "The welfare state is too expensive"

For 23 years the share of social expenditures in the gross national product has been a nearly constant 33%. Only the burden of earned incomes by social taxes increases. Reason: High unemployment (therefore fewer payees), overloading of social insurance with non-insured 620 DM jobs, very low business taxes and very low increased wages of those liable for insurance.

Lie 3: "Globalization is a chance for overcoming unemployment"

The pressure to produce ever more cheaply arises through intensified international competition. Therefore productivity must be improved through the use of robotics and modern information technology. Consequence: rationalization and dismissals. In 1997, productivity growth was 3.7%. Unemployment can never be combated by promising an economic growth propelled by globalization. That would be utopian. Growth rates would be necessary that would be ecologically fatal.

Lie 4: "Wages in Germany are too high"

Then Germany may not be productive any more. The wage level is justified because productivity in Germany is so high. The export surpluses show that Germany is competitive. Wages could even be higher.

Lie 5: "The state meddles too much in the economy"

The state share for 23 years was a constant 50% although expenditures of the state rose sharply (for example, unemployment benefits). Compared with other industrial states, Germany is in midfield. The "anorexia" of the state shows its unsocial face in the privatization of the postal service and railroads. By the year 2000, 200,000 jobs will be lost here.

Lie 6: "The foreign investments of German industry demonstrate Germany's unattractive position"

German industry invests abroad to open up new markets, to avoid risks in rates of exchange, to be present locally and annex foreign firms. One often hears of firms that went abroad for cost reasons and returned again... The reason lies in the quality of products, the education level of workers and the higher reliability in Germany.

Lie 7: "The Euro benefits everyone"

The Euro will lower costs for businesses in European trade. The competitive pressure will increase. Consequences: rationalization, dismissals and another rise of unemployment. The pressure on wages will increase more - on account of improved Europe-wide comparability.

Lie 8: "Great Britain and the US are models in the creation of jobs and prosperity"

In the US, 2% of the male population of working age do time in prison. The hidden unemployment in both countries is much higher than in Germany. In England, the statistical rule for ascertaining the unemployment rate was changed 32 times. Without the changes, the rate would be 14%. American workers work on the average 430 more hours each year than German workers.

Lie 9: "Developing countries profit from globalization"

80% of humanity is poor. 1.3 billion people have less than $1 per day at their disposal. In 1962, the 46 poorest countries of the world (500 million people) had a share of 1.4% in world trade. In 1995, the share only amounted to a negligible 0.4%. To entice capital, developing countries prostitute themselves for corporations. Unions are prohibited and industrial safety is non-existent.

Lie 10: "Globalization brings diversity everywhere in the world"

Whether the number of apple varieties declines or almost every movie film is of American origin or the only political alternative is neoliberalism - in the age of globalization, profit counts and only big business and great output can keep pace. Genuine diversity is uneconomical. What is sold to us is not real diversity (20 different toothpastes).

Realistic Alternatives

The mobility of capital can be limited with a Tobin tax (currency turnover tax). Through a social-ecological tax reform, transportation costs could be gradually raised to realize a more regional and more ecological economic structure. An increase of demand through increased net wages would noticeably lower unemployment with reducing working hours. European Union law does not contradict that, only the will of industry. Industry will not emigrate when it is most advantageous to produce locally than to transport a crate of wine for example from California to Baden-Wurttenberg.

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