Global Economics: Fair or Foul?

        Agricultural subisidies are not only bad news for US taxpayers, they are also crippling to the economies of third world countries who don't need the foot of the global money lending establishment forcing their heads under water. The policies of the International Monetary Fund and the World Bank have not only crippled the economies of struggling companies, they have put money in the hands of dangerous regimes who use a poorly designed system to advance their own agendas.

        Because of American agricultural subsidies, the products of farmers here in the United States are sold in foreign markets for less than they cost to produce. Though agricultural subsidies have existed in the United States for decades, during the Reagan administration the efforts of the IMF and World Bank combined with domestic policies to push local farmers in third world countries out of their own markets. In order for these countries to generate income they needed to pay back loans, it was necessary to export more products than they imported. Since import tariffs were discouraged by the policies enforced by international lending institutions, the only way third world countries were able to discourage the purchase of foreign goods was to lower the incomes of consumers. This was accomplished by severely depreciating local currencies.

        As if the system of subsidies and tariff restrictions wasn't hurtful enough, international policy is full of double standards. Policies adopted in the US are disallowed in other countries and subsidized products specifically target foreign competitors to insure our hegemony in the global economy. American participation in the global economy has not only been hurtful to third world competitors, it has undermined the quality of life of domestic employees. By its design, the United States' entrance in the world market shipped millions of well-paid positions over seas. This action was aimed at the disollution of labor unions here in America, which it has largely accomplished. A predictable side-effect, however, has been that the gap between American upper-class earners and the lower and middle-class continues to grow. This system perpetuates itself because those who are in charge of it profit from it the most and have no motivation to change the way the world functions.

        Economists concern themselves mainly with efficiency. In an economic mindset, moral dilemmas carry substantially less weight than the creation of an international system that relies on relative gains. Because one country can produce X amount of product "A" cheaper than another country, argue economists, it should concentrate on producing only product "A". This system works, to an extent, but is obviously undermined by government subsidies that allow products of one country to compete artificially with those of another. Probably a country cannot expect to produce all of the consumer goods it needs, but in minimizing reliance on foreign goods, it increases the quality of life of its own workers and insures the solvency of its economic structure long into the future.