Ethic: Principles of Ethical Behavior in Modern Society

Globalization

Globalization is said to have begun after World War II but accelerated since the mid 1980’s, driven by
two factors.

a.) Technological Advances have reduced the cost of transportation, communication, and
computation to the degree that it has become economically viable for a firm to place different
phases of production in various countries.
b.) second factor has to do with the Business Escalating Factor Liberation of Trade and Capital
Market. More and more governments are declining to protect their economies from foreign
competition or influence through import tariffs and non tariff obstacles like import quotas, legal
prohibition, and export restraints. Many international institutions founded after World War II
such as the World Bank International Monetary Fund (IMF) and General Agreements Tariffs and
Trade (GATT) have played a crucial role in endorsing free trade in place of protectionism .

2.1: Some Problems with Globalization:

Globalization has unfortunately has a dark side. According to the online summarized version of Author
Gail Tverberg’s “Twelve Reasons Why Globalization is a Huge Problem”( Tverberg, 2013):

a.) Globalization uses up finite resources more quickly.

As an example, China’s coal use begun rising rapidly after they joined the World Trade
Organization in December 2001.In fact there is a huge increase in world coal consumption.
b.) Globalization increases world carbon dioxide emissions .
if the world burns coal more quickly and does not cut back on other fossil use then carbon
dioxide emissions increase.
c.) Globalization makes it virtually is impossible for regulators in one country to forsee the
worldwide implications of their actions.
An individual country may indirectly encourage world trade to ramp up manufacturing in coal
producing areas, and increase emission overall.
d.) Increases world oil prices.
Part of our problem now is that with globalization, world oil demand is rising rapidly.Rapidly
rising world demand, together with oil supply which is barely rising, pushes world prices
upward.

e.) Globalization transfers consumption of limited oil supply from developed countries to
developing countries. The way this transfer takes place is through the mechanism of high oil
prices which is particularly a problem for major oil importing countries.
 A rise in oil price tends to lead to a cutback in discretionary spending, recession, and
lower oil use in these countries.
 Developing countries are able to use higher priced oil than of the developed countries.
In some cases subsidies play a role. Job loss plays a role in the loss of oil consumption
from developed countries.
Ethic: Principles of Ethical Behavior in Modern Society

f.) Globalization transfers jobs from developed countries TO LESS DEVELOPED COUNTRIES.
It nakes it hard for developed countries to compete. A country with a lower cost structure is
able to out compete a typical OECD ( Organization of Economic Cooperation and Development)
Country.
g.) Globalization transfers investment spending from developed countries to developing
countries.
If an investor has a chance to choose between a country with a competitive advantage and a
country with a competitive disadvantage which will an investor choose? A shift in investment
shouldn’t to surprising. In recent years the US domestic investment has dropped of close to the
consumption of assets. The assets include all capital assets, business owned assets, and
individual homes.
h.) With the dollar as the worlds reserve currency, globalization leads to huge US balance of trade
deficits and other imbalances. The US trade deficits have soared because US dollar is the worlds
reserve currency.
 High oil prices together with globalization have led to huge US deficit Spending since
2008.The result is a mismatch between government income and spending.
i.) Globalization tends to move taxation away from corporations and onto individual citizens.
Corporations can move to locations where the tax rate is the lowest. Individual citizens have
much less ability to do this. Also, with today’s lack of jobs, each community competes with
other communities.

Globalization as a new challenge to ethics.

 It requires incorporating ethics such as (business, and environmental ethics) as part of

companies strategic business program and alliances.
 It mandates top management to establish clear policies that establish ethical behavior.
 Management training seminars and orientation meetings that involve discussion of
actual situations can alert employees to potential ethical conflicts.

With the involvement of business ethics, companies are expected to gain a competitive
advantage, goodwill and recognition in the global business world. This will then lead to good
profits and a healthy competition in the international globalize business world.

3.) Search for Universal Values

Indeed, a set off shared ethical values and standards is central for the cohesion of society and global
justice and peace. This moral values and principles will make for peace and harmony at the global level.
However it is still much impossible that basic and fundamental values hold for every society.

 Developing universally expected principles for administering transnational interactions

is possible through the process of intercultural dialogue.
Ethic: Principles of Ethical Behavior in Modern Society

In globalizing world, it is prudent to advocate universal cultural values such as truth, justice,
and love. Situations today ideally call working in favor of a universal spirit of fraternity, a
solidarity altruistic spirit, a decided and generous will, and the universal will to live in peace.

 In disharmony, the reawakening of the human spirit of love and compassion may save
us from our worst extremes.
 Material ought to go hand in hand with moral and spiritual wealth.

4.) Lose Sovereignty. Organizations such as the International Monetary Fund (IMF), World Bank, and
World Trade Organizations (WTO) virtually take over their traditional functions. This scenario is seen as
morally condemnable intrusiveness of international economic organizations, characterized by the lack
of accountability to people openly affected by their policies and the tendency to impose agonizing
conditions on indebted governments.

5.) Ecological Collapse. The involved anthropogenic greenhouse effect is generating Global climate
change or global warming that depletes the ozone layer. The global Biosphere is also encountering a
speedy reduction in the diversity of ecosystems, and the number of species of life.

Explosive population growth threatens to surpass the earth’s carrying capacity and burst the
biosphere. Industrial capitalism is responsible for the damage of the ozone layer and the escalation of
global warming.