Globalization is defined as the flow of capital, goods, ideas, and people. As a consequence the world’s economies and populations are connected and interdependent. With globalization come numerous benefits including economic growth, increased standard of living, lower-cost products, cross-border talent sharing, and access to new cultures. However, there are many issues related to globalization that are impacting the health and safety of the world. These issues must be addressed to ensure political stability, economic and cultural vitality, and the environmental sustainability of our planet.
#1. Income Inequality
Globalization encourages the production of manufactured goods in developing countries such as China, Bangladesh, and Mexico, where laborers are often paid dismal wages and frequently work in unsafe conditions, while transnational corporations enjoy massive profit margins. In developed countries, many middle-class manufacturing jobs previously existent in the Western world are now outsourced to countries overseas. Western workers are then forced into low-paying service industry jobs, greatly increasing income inequality in these nations. On a global scale, the inequality between advanced nations and developing nations is growing exponentially.
#2. Overconsumption
Society consumes inexpensive products at an exorbitant rate. From fast fashion to electronics to excess food, overconsumption causes increased emissions, pollution, and unsustainable resource extraction. Many of these products end up in landfills, fueling the destruction of the Earth. The planet’s resources are being used at a faster rate than they can regenerate to supply consumer materialism and fuel economic growth. Buying fewer products, using less electricity, eating out less, and reducing travel can help alleviate this severe ecological issue.
#3. Deforestation
To raise cattle and grow land-intensive crops such as palm oil and soy, forests in Malaysia, Indonesia, and South America are being cut down at an alarming rate. Global markets for inexpensive products drive unsustainable farming practices in certain regions of the world. According to National Geographic, the world has lost a billion acres of forest since 1990, including 17% of the Amazon rainforest. The forests are home to 80% of Earth’s animals and plants, and old-growth trees are essential to help alleviate carbon emissions.
#4. Greenhouse Gas Emissions
The globalization of business markets has increased the transportation of goods overseas, increasing the impacts of climate change, ocean acidification, and the risks of oil spills. According to the International Transport Forum, the world will experience a 16% increase in CO2 emissions from transportation by 2050, as total transportation activity is anticipated to double compared to 2015. Manufacturing of goods also increases greenhouse gas emissions, as many factories in developing countries have poorly regulated environmental standards.
#5. Loss of Agricultural Diversity
The industrialization of food has led to a rapid decrease in the biodiversity essential for ensuring global food security, contributing to the genetic erosion of many species of crops and livestock. The rise of monoculture farming erodes soil health and contributes to land degradation. According to the UN Environment Programme, agriculture, land clearance, and the use of pesticides and fertilizers are an identifiable threat to 86% of the species at risk for extinction.
#6. Water Scarcity
Globalization contributes to an increase in industrialization and urbanization, increasing competition for scarce water resources. Rapid development, manufacturing industries, and agriculture frequently result in the overuse and pollution of available water sources. According to the United Nations, 2.2 billion people lack access to clean drinking water, while 70% of water usage is attributed to industrialized agriculture. The sustainable management of water and sanitation is goal 6 of the UN Sustainable Development Goals.
#7. Violent Conflict Over Resources
A dirty truth about our love for electronics is that many of the minerals found in these products are considered conflict minerals. Metals such as tungsten (used in cell phones) and cobalt (used in electric vehicle batteries) are largely located in the Democratic Republic of Congo, a country mired in armed conflict, corruption, poverty, and government chaos. While companies such as Apple, Microsoft, Intel, and Tesla have joined the Responsible Minerals Initiative, murky supply chains continue to fuel violent control of these mineral mines.
#8. Refugee Migration
According to the United Nations, 100 million people were forcibly displaced from their homes in 2022. Driven by violent conflict, political repression, ecological disasters, and poverty, these migrants often travel long distances in search of economic opportunity and safety. Improvements in immigration laws by receiving nations must be realized to effectively integrate migrants into workforces experiencing labor shortages and aging societies. The Institute for Economics and Peace estimates climate change could displace 1.2 billion people by 2050.
#9. Labor Exploitation
Globalization is cited as the cause of decades of stagnant wages in developed countries while driving labor exploitation in the developing world. Multinational companies are known to exploit loopholes in foreign labor laws, forcing workers to work long shifts (14-16 hours per day) for minimal pay, and frequently exposing them to toxic chemicals in unsafe working conditions. Forced labor, coerced and without pay, in regions such as Xinjiang, China manufactures cotton for some of the world’s leading apparel companies.
#10. Child Labor
According to UNICEF, 160 million children globally are victims of child labor, with half of that number including children aged 5-11. Child labor is prominent in the agriculture and fishing sectors, mineral harvesting, and the service industry, and many of these children are out of school. According to the U.S. Department of Labor, child laborers work in 78 countries in violation of international standards and social protection. Many children are victims of forced labor and slavery.
#11. Human Trafficking
Globalization has benefitted international crime rings by facilitating the involuntary movement of people through global trade routes, creating an illicit market for human trafficking. According to the International Labour Organization, 6.3 million children and adults have been trafficked into forced commercial sexual exploitation, while 49.6 million people live in modern slavery. Vulnerable migrants are frequently at risk of becoming victims of human trafficking.
#12. Deindustrialization of the Developed World
The loss of the manufacturing industry in the developed world can be seen in the closing of automobile plants throughout the United States in the 1980s and 1990s, destroying the economic heart of towns throughout the Rust Belt. Deindustrialization also causes over-reliance on international distributors for essential elements such as semiconductors and ingredients for prescription drugs. According to the US-China Business Council, 80% of active pharmaceutical ingredients are sourced from China. The lack of manufacturing in the U.S. is seen as a causative factor in the loss of well-paying middle-class jobs.
#13. Disinformation
Defined as the covert spreading of misinformation, disinformation is frequently used by authoritarian regimes to propagate false narratives. The globalization of social media allows nefarious actors to weaponize and spread disinformation easily throughout the world, influencing political events and fueling persecution of vulnerable minorities such as the Rohingya in Myanmar.
#14. Cybercrime
The ubiquitous nature of global cybercrime is propagated by the ease of anonymity in the virtual world and the use of cryptocurrency. The reality of a globalized, digitized world facilitates ransomware attacks, financial fraud, and theft of intellectual property. Cybercriminals frequently operate out of countries with lax law enforcement, yet can access organizations and companies located anywhere in the world. The Small Business Innovation Research institute estimates that the global economy loses $445 billion a year to cybercrime.
#15. Cultural Imperialism
The dissemination of Western products around the globe has fostered the loss of localized values and diverse cultural identities. American brands such as Disney, McDonald’s, Nike, and Walmart import Western ideals of fashion, food, entertainment, pop culture, and beauty into emerging markets, often to the detriment of small local businesses and indigenous cultural aesthetics. There are currently over 38,000 McDonald’s locations in over 100 countries.
#16. Loss of Small Local Businesses
Globalization has also led to the loss of small local businesses in the United States. The ubiquitousness of inexpensive, mass-produced products increases competition for locally crafted items. The influence of big box retailers that source their stores with imported manufactured items threatens local economies and creative small business development. Advancements in technology and automation further risk the economic health of small local businesses worldwide.
#17. Supply Chain Disruptions
During the COVID-19 pandemic, the world learned the essential nature of supply chains and the negative impacts that occur due to disruptions. Chinese manufacturers who supplied the world’s health supplies (such as masks and surgical gowns) were unable to produce to market due to the national shutdowns. Supply chains can be interrupted due to political and economic instability, transportation issues, cyberattacks, and natural disasters. Due to the unavailability of essential supplies, these disruptions contribute to a decrease in economic growth and a rise in global inflation. Items that continue to be in short supply are carbon dioxide (to make beer), computer chips, lumber, and some prescription medications.
#18. Currency Manipulation
To compete in the global market, some countries devalue their currency, reducing the cost of their exports and creating international trade surpluses. China and other Asian countries have long been labeled as currency manipulators, and this practice harms global businesses and consumers. China has been accused of developing excess capacity in industries such as aluminum, steel, glass, solar cells, and auto parts. The Economic Policy Institute states that currency manipulation increases the price of the US dollar, which makes American goods more expensive to purchase. This is contributing to a loss of manufacturing jobs in the U.S. as well as an increase in trade deficits.
#19. Exploitation of International Tax Havens
According to the National Bureau of Economic Research, multinational corporations using international tax havens have shifted 40% of their profits out of the country. As stated by the Institute on Taxation and Economic Policy, U.S. Fortune 500 companies have disclosed holding $2.6 trillion in profits offshore. As of 2017, Apple maintained $252.3 billion in overseas havens by shifting domestic profits and has avoided paying $78.5 billion in U.S. taxes.
#2-. Erosion of Democracy
The rise of authoritarianism, nationalism, and income inequality around the world has led to democracy being threatened. Countries such as Russia and China frequently disparage the global influence of neoliberalism and democracy, while far-right leaders demonize interconnected global institutions that seek to deliver justice and human rights. The social disruptions inevitable with the impending climate change refugee crisis will only exacerbate these tendencies.
How should we address these issues? The emergence of environmentally responsible companies that reduce emissions and pollution, promote ethical supply chains, and foster fair labor standards can serve as a model for corporate responsibility and ethical business practices. Reintroducing manufacturing in the developed world can build back middle-class jobs, facilitate economic growth, and alleviate over-dependence on China and other countries for essential supplies. Embracing clean energy technologies can help reduce CO2 in the atmosphere. By addressing these globalization issues, we can build a better world for our societies and the future of the planet.
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