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Globalization — The Power of Human Engineering? [McMillan, Alexander]]

I drive a Volkswagen Jetta – it’s an automobile that I ordered straight from the factory as a graduation gift for myself during my last semester of my undergraduate education. It’s a German engineered car produced by the Volkswagen Group (VAG). But my car was assembled at a facility in Puebla, Mexico? What was wrong with Wolfsburg? The advantage is two-fold: VAG can produce automobiles at a lower price for delivery to more expensive locales like the United States, while providing a livelihood for those in the low-priced locale. In the case of Puebla plant, workers earn 20 thousand dollars a year [1], which is over double the national average within Mexico.

I do not make a distinction between the ways in which my immediate and extended family have been affected by globalization.I presume that at least my parents, the reality receive some of the same benefits of globalization in terms of commodity prices.

Overall, globalization has benefited the United States. By opening the United States markets to foreign goods, United States persons are able to obtain competitive prices on goods and services that would otherwise be more expensive if supplied by entities whose operations were strictly conducted within the United States. Furthermore, allowing foreign capital to flow into the United States from abroad enables firms receiving the capital to expand and generate new technology. The serious downside I see with globalization is the risk it can pose to National Security. If foreign parts or energy supplies are required to operate and maintain materiel, what happens if relations with foreign suppliers and/or their respective governments sour? A good example of this would be Russia cutting off supplies of gas to Europe in 2009 [2]. Another concern might be the cohort that benefits the most from globalization. For example, if a firm receives FDI and uses the investment to repatriate shares, the stockholders benefit from the increased share price, but the public at-large may not.

Like it or not, we once again live in an interconnected world where foreign and domestic brands of goods and services compete for our personal  share of wealth to be siphoned and circulated around the world for the benefit of ourselves and others — that’s the power of human ingenuity and engineering.

[1] 7 things we learned while visiting Volkswagen’s enormous factory in Mexico

[2] Russia Cuts Gas, and Europe Shivers

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