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Dangerous Business: The Risks of Globalization for America

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Americans of a certain age know that something is wrong. Their nation is not what it used to be. But what exactly is the matter? Pat Choate provides a thoroughly researched and authoritative answer: the recent fashion for radical globalism has driven American society off a cliff. Of course, other writers have already taken shots at globalism but few if any have come to the subject with a greater depth of experience or a more acute intellect than Choate. Add in the fact that Choate is a born writer with powers of explication that other policy analysts can only dream of and the result is a remarkable tour de force that is must reading for any American concerned about his or her nation's future.

Again and again Choate, an economist and best selling author who was Ross Perot's vice presidential running mate in 1996, comes up with devastating facts that give the lie to the globalist chop logic that has driven American policy-making in recent years.

As he points out, a fundamental issue is the extent to which Washington has come to be run by lobbyists -- and particularly lobbyists acting in various guises for foreign governments and industries. The activities of the K Street lobbying system have not only greatly speeded up the acceptance of globalism by America's largely economically illiterate elite but, in a pernicious self-feeding process, have been facilitated by such acceptance.

His analysis ranges widely over such issues as the farcically counterproductive U.S. effort to create the World Trade Organization; America's vulnerability to illness spread via imports of contaminated food; the U.S. Defense Department's inability to keep track of its dependency on foreign suppliers for vital high-tech components; and perhaps most alarmingly the possibility that a foreign adversary could hide deadly Trojan Horse computer "viruses" in such components.

Choate is undoubtedly right in naming the American media as a key factor in the historic debacle radical globalism has wrought. America's most prestigious newspapers in particular have been colonized by a self-perpetuating oligarchy of smart aleck editors whose understanding of economics does not go beyond chanting that "the market is always right" -- a mantra that any first-year economics student knows is more honored in the breach than in the observance. Hailed as geniuses by the Davos crowd, such editors affect a "let them eat cake" attitude towards the millions of Americans who have had their livelihoods destroyed by unfair trade. No wonder Ben H. Bagdikian, a prominent Berkeley journalism professor quoted by Choate, observes that, "trying to be a first-rate reporter on the average American newspaper is like trying to play Bach's 'St. Matthew's Passion' on a ukulele."

That may be so but -- at least for a while longer -- books will continue to be published that hold nothing back. No book has done a better job of explaining the problems of radical globalism than Dangerous Business.

A good book, though most business people will disagree, but most working people will cheer. Over the last 30 plus years things have gotten so bad that our biggest exports, are jobs. And our leaders say this is good for America. You think? We have trade deficits with just about every trading partner, if they can be so described. But no one in power thinks we need to do anything to change things.

Trade, something of value, in exchange for something of equal value. What do we manufacturer in this nation anymore worth trading? This in turn has contributed to the credit crisis, over burdening credit card dept, (another story) our cities and states cannot meet their obligations in part because revenues are down.

Then there is that nasty word "Globalization," where this nation has become the dumping ground for it seems any and all goods other nations produce. Where we now look the other way because goods are cheap, because they are produced by prisoners, or worse children. No enviromental precautions, no minimum wage, cheap labor, better defined as "SLAVE" labor. Then there is that nasty thing we do called deficit spending, where we spend more than we take in. Living on credit so to speak.

The next President to take office had better have the balls to set this monster straight, or this economic quicksand America now faces will overshadow the great depression of the 1930s. We are pulling up every third world nation, at the expense of American jobs. The jobs an advisor of John McCain says we as Americans are not truly entitled to. Jobs that built this Nation after the depression, and aided in the winning of WW II.

Suggestions are made by the author as to how we can begin to dig ourselves out of this mess, but it will take a great deal of heart. Heart enough to renegoiate our one way trade deals. Pay our way out of dept, and not try to borrow our way out.

This is basic good economics, something like being left with a surplus, instead of dept. This is a major reason we can no longer properly supply our military, too much of what is now needed is produced by other Nations, and how bad is that? Well imangine if before World War 2 this were the case, think we would have won? The Pentagon has little choice but to look to overseas producers, because most of our heavy industry has been exported.

This all relates to our educational system where most high school grad cannot read a simple rule. Not nearly enough revenues to properly educate our children, and a Communist Nation holds a great deal of our dept, as well as Middle Eastern Nations. I thought we were anti Communist. Where do we go from here?

Well too many of us do not vote, and of those who do believe it when they the politicians say globalization is good for America. I hope we read this book, and start to pull our heads out of the sand.

Dangerous Business is an excellent resource for anyone with an interest in globalization, trade or economics. Mr. Choate succeeds where other notable academics have failed by presenting a readable, informative work that examines the often overlooked problems created by globalization. This is a great read.

Pat Choate, economist and former vice presidential running-mate of Ross Perot, masterfully exposes America's role in the global economy in his newest book, Dangerous Business: The Risks of Globalization for America. The ugly and deleterious side of globalization is documented through Choate's writing. Choate vividly details the nation's involvement in organizations such as NAFTA and the WTO and how involvement in these two organizations propelled the United States into globalism.

The participation in NAFTA and the WTO has changed the economic policies both domestically and abroad. Corporations now find it profitable to move their manufacturing and service sectors to other nations that offer lower wages and sub-par environmental standards. The negative consequences of outsourcing are destroying America's ability to remain sovereign and secure by accruing an insurmountable trade deficit and the general shrinking of the middle class.

Choate not only documents America's role in globalization with accuracy and precision, but he offers solutions to correct these errors and achieve a future of prosperity and independence. Dangerous Business will create awareness among the readers while offering an honest and insightful look into America's role in the global economy.

By way of full disclosure, the chances of my giving Pat Choate's new book, Dangerous Business a bad review are not very high.

We have been friends and business associates for more years than either of us care to count and our views on the competence of those in our government who masquerade as international trade negotiators are strikingly similar.

That said, Pat's ability to take a subject which is a non narcotic substitute for sleeping aids'like international trade'and make it interesting is rare and a gift which any college student who has a term paper due should appreciate.

In his last book, Hot Property, Pat explained how people in countries like China steal ideas.

This book concentrates on how they directly take our money.

And it is important to note that Pat is not a China-phobe.

In fact, the first thing he points out is that China, Inc. is not some backward, third world country.

Its industries are now owned mostly by the government but controlled by very smart, very efficient and very experienced people who would hold similar jobs in private industry were they here in the United States.

Worse, they are much better negotiators than anybody we have representing our country. Partially by intellect and partially by national trade doctrine.

In fact, in many cases, with a little help from our own stupidity, they can fake us out of our jockstraps--usually made in China these days and sold at Wal-Mart.

Pat points out that the situation we find ourselves in today is the result of the U.S. policy of free trade as opposed to fair trade which is being espoused by a non-partisan group of multi-national companies which look forward no further than their next quarter's earnings.

The resulting disruption of our economy is simply not accounted for in negotiating today's trade agreements because the results of globalization are instant profits for the multi-nationals at the expense of jobs and the U.S. economy.

Put bluntly to U.S. citizens who lose their jobs to outsourcing: you had a good run and if you live through the pain, maybe you'll do well in the future but you'll have to live through the pain as we pursue global profits.

China, on the other hand, follows a global policy of mercantilism.

Their currency is strong, they run a positive trade balance and they only let foreign investment into China when it suits their interests.

And even when they do allow foreign investment, it is allowed with an eye towards the future so that perhaps they won't need it after they absorb all the knowledge and expertise they can.

The results of both our policies and their policies have been a number of paradigm shifts in the United States.

One example is that many parts we use in our defense industries are now sourced overseas.

We are, even now, being treated, as an example, to the spectacle of an aircraft tanker competition between Boeing and the people who make the Airbus in Europe and Airbus won the initial round.

The future safety of such arrangements, Pat points out, is in doubt.

What can be done?

Well, that's the crux of the book and it can be summed up in two words.

Better deals.

It's a good read and makes you wonder what a Perot-Choate administration might have done to NAFTA and the WTO had they pulled off the miracle in 1996 and won the Presidency.

The American people need a wake-up call! That seems to be the message that Pat Choate is urgently attempting to convey in his important new book "Dangerous Business: The Risks of Globalization for America". For more than seven decades now both Republican and Democratic administrations have been pursuing economic policies that favor so called "free trade". And with the establishment of the World Trade Organization and the passage of NAFTA back in 1993 the Congress in conjunction with Presidents Clinton and Bush have seemingly colluded with multi-national corporations in accelerating the outflow of capital and good paying jobs from our country. Yes, it seems that people like Ross Perot, Pat Buchanan and Senator Byron Dorgan were right. Globalization has been a disaster for the American worker. But there is a lot more to this story than meets the eye. That is what "Dangerous Business" is all about.

Would it disturb you to learn that a number of state governments are in the process of leasing our freeways to foreign companies? I had never heard of this one before but in 2005 the State of Indiana awarded a 75 year lease on an extremely busy highway known as the Indiana Toll Road to a Australian/Spanish consortium. Under the terms of this agreement the State of Indiana would receive an up front payment of some $3.15 billion dollars. In return this consortium agrees to operate, maintain and collect tolls on the turnpike. Tolls are expected to increase dramatically in the years ahead and estimates are that this deal will produce more than $121 billion of revenue during the life of this agreement. This is definitely a short-sighted and ill-advised deal for the State of Indiana. Then there is another scheme known as the Trans-Texas Corridor. You might want to check one out at [...]. It is frightening to discover just how many questionable deals federal and state governments are entering into with virtually no involvement from the legislative branch and with an absolute minimum of publicity. It is instructive to note that both President Clinton and President George W. Bush have attempted to circumvent the normal legislative process by utilizing Executive Orders to accomplish their highly questionable objectives. Such actions makes one wonder just whose side our leaders are really on.

Those of you who are old enough might recall the classic scene in the 1976 motion picture "Network" where Arthur Jenson, Chairman of the Board of the UBS network (played by Ned Beatty) confronts anchorman Howard Beal in the Board Room. In that scene Mr. Jenson declares in no uncertain terms: "There is no America. There is no democracy. There is only IBM, and ITT, and AT&T, and DuPont, Dow, Union Carbide, and Exxon. Those are the nations of the world today." He goes on to say: "We no longer live in a world of nations and ideologies, Mr. Beale. The world is a college of corporations, inexorably determined by the immutable bylaws of business. The world is a business, Mr. Beale. It has been since man crawled out of the slime." How apropos to the subject matter at hand! Throughout the pages of "Dangerous Business" Pat Choate points to countless examples where the interests of our nation have been sold down the river by corporations, investors and the elite. One of the most disturbing things that I discovered was just how much of our nations defense work has been outsourced to other nations including China! It seems to me that the very security of this nation has been put at risk by actions like this. Then there is the whole subject of the WTO. Did you know that all 153 member nations of the World Trade Organization have an equal vote in the decisions that are made? Thus, as Choate points out, the vote of the tiny nation of Antigua (population 69,000) carries the same weight as that of the United States. There is clearly something wrong with this picture.

Time will simply not permit me to even scratch the surface of all of the substantive issues discussed in this book. Suffice to say that "Dangerous Business: The Risks of Globalization for America" is an extremely timely and important book that needs to be read and digested by as many Americans as possible. The American people need to understand what is happening around them and Pat Choate offers a number of thoughtful solutions to the problems he discusses. Extremely well written and exhaustively researched "Dangerous Business" is one book I simply could not put down. Very highly recommended!

"The globalization policies of presidents Bush (I and II) and Clinton constitute the worst economic mistake in American history" - says Chaote early in his "Dangerous Business." Readers then learn that the U.S. now imports more food than its exports; similarly more high-tech products.

In the six years since 9/11, food-born pathogens and toxins have killed 10X those killed in the terrorist attack. Our response - reduce the number of FDA inspectors. China, India, and Mexico are prime culprits, and cases have involved deliberate adulteration of food for animals and people with poisons that have killed thousands. U.S.D.A. inspectors analyze less than 1% of food imports; part of our reticence to reject Chinese food imports is their quick retaliation by banning ours.

Over 80% of the bulk active ingredients for U.S. prescription drugs are imported - mostly from China and India.

The Chinese low-cost advantage comes via low labor costs, few environmental/labor safeguards, piracy, export subsidies (tax exemptions, forgiven loans, free rent and land - estimated to contribute 16% of their advantage), industrial clustering (aka Ford's River Rouge Plant near Detroit; contributing another 16% of their advantage).

Foreign corporations may deduct from Chinese income tax an amount equal to 150% of their R&D in China - if this amount increased 10% over the prior year.

China's surplus funds and assets are expected to hit $3 trillion in 2010, vs. an entire value of $15.4 trillion for NYSE U.S. firms.

Finally, Chaote also points out that many key military components are either available in the U.S. now only through a single source, while others not at all. The Pentagon says it's not concerned because wars will be shorter in the future. Meanwhile, the wars in Iraq and Afghanistan continue on, years longer than WWI, WWII, and the Korean War.

This book is one of the most accurate explanations of how and why our economy is in shambles today! For Americans that want to get out of their comfort zones, and for those being forced out of their comfort zones because they have lost their jobs, this is a must read book about the American economy and the future of our country!

Candid, no-punches-pulled assessment of where we stand and what we are up against -- and this was written before the collapse. Pat Choate makes complex issues and concepts easy to grasp. An excellent resource for college instructors who appreciate non-academic language (no gobble-de-gook)that their students can understand. And, let's fact it, it's our young people who will really have to deal with and correct this mess. This will help them understand their inheritance.

Unless and until the thinking in this unassuming book becomes mainsteam in the US, the country will have a dire future, going down a path of rapid decline, led by its own elites' dogmatism and blinding stupidity as well as greed and total lack of morality.