Countries intent on expanding their exports have come up with a new BUZZ-WORD called "globalization." Whether this emanates strictly from "Govt. "or is from companies pressurizing governments to act on their behalf may at first glance seem to be irrelevant. Not so. A company looking to expand it's markets would possibly investigate trade possibilities by either personal investigation , the use of trade introduction by other parties or organizations--or whatever. A successful order or orders creates no problem. We hope. Companies wishing to export their products, do so for selfish reasons. Nothing wrong with that. No harm in building up sales and profits. However, where it impacts on other Governments; it's companies and it's citizens is an entirely different matter. Another Ballgame. And it is here--at this point that one can start to see immense problems arising.

The imposition of tariffs and excise by countries has two major reasons attached to it. Both important. One is to protect fledgling Industries against competition, and the other as a revenue tax by Govt. What is most important to realize, is that this is of the utmost importance to small countries; impoverished countries or Small and Impoverished countries. As a matter-of-fact it is important to 90% of the countries who have not got the ECONOMIC CLOUT to stand up to the 10% who have! Herein lies the seeds of immense problems which are about to unfold. Just as a person has a right to live; so too do a "people" or a Country. The saying "to live and let live" applies to countries as well as to people. Before we press on regardless with so-called globalization; it is perhaps time to pull back--pause--and take a deep breath before we press on regardless. Where did this all start? Maybe in the dying days of the war in Europe when a political or a military decision was made to allow Russia to get to Berlin first. Or perhaps at Yalta where three politicians decided to carve up Europe into Communist and Non-Communist blocks and spheres of influence. From this emerged NATO and the Warsaw pact--resulting finally in the European Common Market. Nations banding together for political and ECONOMIC purpose. Maybe the INFANT was born here--open and free trade; no tariffs or economic borders. In fact, a common currency as well. Sounds fine! Yet from this was born the Canada / U.S.A. Free Trade Agreement; followed by the American / Mexico trade agreement--and finally the agreement combining all three countries in trade. Africa has it's trade bloc. South American countries want in to the NORTH AMERICAN FREE TRADE AGREEMENT. We now have the "Pacific Rim" countries and as well recent talk of the possible formation of "OCEANIA," A bloc comprising Far Eastern nations banding together for economic and trade purposes. "POLARIZATION"--Is this what we want?

Economic Warfare--is this to be our future? Perhaps this is inevitable--unless we pause and take a deep breath. GLOBALIZATION; a nasty word and perhaps a nasty thought. One thinks maybe it is time that we all give this a lot more thought. World trade has been around a long time; for centuries! Why now this clamor to drop trade barriers. Why now these threats of economic retaliation. Do we really need this confrontation? Where has the "live and let live " ideal disappeared to? Are we destined to all eat the same brand of chocolate--sip the same brand of coffee and drink the same brand of cool drink. Are we all destined to dress in denims and "runners." Are Kimono's and Sari's to disappear, and the Grenadier Guards to stand at Buckingham Palace in denims and "sneakers'? Must we all conform? Is this what Globalization has in store for us. GOD FORBID!! We live in a diverse society--and we should be thankful for that. There is only one Venice. You can copy it--sure. Yet you can never copy it's antiquity and it's atmosphere. That applies as well to the canals of Amsterdam, the Champs Elysees --the Via Venito and the Colosseum. The Acropolis and the Greek Islands. The wines of the world are made from the same varieties of grapes--yet they are all different. Thank goodness for that. Heritage, Language and Culture--these are precious things. Yet if you threaten a country economically--you threaten all of these.

Many years ago in England there was talk that "one day" the twelve most powerful companies would control the economic wealth of the country. The same thought was in the minds of the French, the Germans, the Italians and perhaps most of the major trading nations of the world. Be it the 12 biggest; the 20 or the 50. The thought was the same. But it would never happen! Or so they thought. It is happening NOW. As a matter of fact it is well on the way. Many years ago the United States of America recognized the trend. They called it "creating a monopoly." They forced the Rockefeller family to dismantle their oil company and thus was born Exxon and Mobil and others as well. Then came telecommunications--the breakup of Bell Telephone. There were other large groups under threat as well, including the recent threat to Microsoft. Mergers have become the polemic of Govt. scrutiny. Some mergers are allowed--others not. Who are these people of power who make these momentous decisions? Who shall live--and who shall die! Without fail, every merger in every country is followed by the announcement that "so many thousand jobs will be dispensed with" over whatever period of time. Fifteen years ago a merger whose value totaled $5 Billion made news. Ten years ago it was $10 Billion, and five years ago $20 Billion. Now a merger of $40 / $50 Billion are becoming commonplace. The latest trend is now "MEGA MERGERS" of $70 / $80 Billion and more are starting to take place. However these are between "MULTI-NATIONALS"; huge international conglomerates whose subsidiary companies span the world. And this phenomenon should concern us most. While the United States MAY be able to control the expansion and mergers of companies within it's own country, who is going to control the GLOBAL EXPANSION of MULTI-NATIONALS?

Let us retract for a moment in time. The following scenario has happened in most countries of the world. A manufacturer has dealings with a lot of small businesses. Small runs of production--credit problems with small business's or companies. So one goes for the "Chain Stores." Big production runs--one account. This may cost the producer a discount on price with a lower profit factor. No big deal. However, before long, the chain or chains have become a major factor in sales volume--then comes the "NUT CRACKER." We can get it cheaper elsewhere. THIS IS THE PRICE WE ARE PREPARED TO PAY!! Believe me, this is NOT a figment of our imagination. It has happened countless times before--and it is happening countless times at the moment. As a result the manufacturer has to accept the situation, rather than lose this big account--even be it at or near to their cost price. This not only happens with companies; it has happened to countries as well. About 30 / 35 yrs. ago Japan became a very important trading partner to Australia and South Africa. They were the single biggest importer of both countries WOOL CLIP; their output of Iron Ore and all the types of coal mined in Australia and South Africa. When the time was ripe "to put in the squeeze", Australia was told that unless they dropped their price for iron ore, all orders would go to South Africa. The price dropped. Next South Africa was told what price Australia had sold for--and "if you cannot BEAT that price, we are afraid that we will be buying elsewhere." The price dropped! Neither country could afford to lose those Japanese orders. The same tactics were used for all three commodities. At more-or-less the same period Japan was having problems with their Textile exports. Textile manufacturers in the United States complained that they could not compete with Japanese imports, and requested protection. Their Govt. slapped a strict quota system onto Japan. At the same time countries in Europe decided to do the same thing; having seen that it was working in the U.S. Japan now had a tremendous problem--especially as they were also told that they would be under scrutiny for "DUMPING PRICE" factors. What to do? The Govt. of Japan literally took Sledgehammers to hundreds of textile looms--and paid out the weavers for the value of the looms. Such was the power of the American textile manufacturers to influence Government! The identical tactic was employed by U.S. automobile manufacturers. Japanese cars came in under strict quota.

As of today--despite the talk of "Free Trade," hundreds of commodities come into the U.S. under strict quota. All Sugar imports are controlled. There is a list of countries who are allocated a portion of the quota--and if you are not on the list--you're out of luck. This happens in Europe as well in order to protect the SUGAR BEET farmers. Even though Canada is the United State's largest trading partner and a member of NAFTA., a large number of commodities pass between the two countries under quota arrangements. Such is the power of "vested interests" in dictating to Govt. The sheer power which can be wielded by MULTI-NATIONALS presently, questions what will happen in the future as these enter MEGA- MERGERS worldwide. Imagine the following scenario. A multi-national employing say 160,000 people tells a particular Govt. "Look, we are having a lot of problems with labor in your country. Unless you change the labor laws or put pressure on the unions, we're pulling out!" Or perhaps "amend you're tax laws." What then of price rigging between Multi-Nationals who control a major portion of production of a particular commodity. If the United States can be scared of JUST ONE MICROSOFT, what then if it had been part of a multi- national conglomerate controlling many more products beyond the reach of the United States Govt. While we acknowledge that Microsoft already does control 90% of the software programs already installed into computers as they leave the factory--specifically Windows.

A fairly recent example of the power of a multi-national ( within the past 4 / 5 years ) took place between a Japanese company and a coal mining company in British Columbia, Canada. A signed contract was entered into between the two to supply a particular type of metallurgical coal at a FIXED PRICE for a FIXED PERIOD OF YEARS. Because of the size and the fixed period of the order, the mining company expanded it's operation and this resulted in their commitment to large financial loans for this purpose. Perhaps two years into the contract, the world price of this type of coal dropped to perhaps HALF the contract price agreed upon. The mining company was told; " drop your price--or we cancel the contract." Without having to go into the long-drawn out specifics of what went on; a court case--arbitration and having eventually to drop the price drastically due to the financial MELT-DOWN which took place in Japan while this controversy was still in the process of being settled. However, as a result of the original threat--the mines operations had to be drastically curtailed, many jobs were lost, and the company was faced with huge loans which still had to be financed and repaid.

Other examples exist of the power and ramifications of huge Multi-Nationals or Conglomerates. Take for example the mighty TRADING HOUSES of Japan. Toyo Menka ; Marubeni ; C. Ito ; Kakiuchi. Between them they control the entire textile trade in Japan . Hundreds of commodities only move out of--and into Japan through these companies. Matzushita and Nippon Steel have control of most of the HEAVY INDUSTRY in the country. Thirty five years ago those trading houses controlled most of the textile industry in South Korea ; Taiwan ; Thailand ; Hong Kong ; and to a fairly large extent in Brazil. What percentage applies today is not known--but it would not surprise if it were still extensive. In Korea, the local "CHAIBOLS" possibly took over from Japanese owned conglomerates--although Japanese capital was up until very recently still heavily involved in all those countries. In Korea it was merely a local huge conglomerate taking over from a foreign owned one. Korea is an excellent example of what happened recently when a financial melt-down takes place. Millions of jobs lost! Billions of dollars lost. The country totally in financial distress. Besides all these examples one could name several hundred companies world-wide who straddle continents where they control either the output of, the sale of, or the import / export of pharmaceutical products, chemicals, petroleum or petro-chemical products, plastics, automobiles and automotive products. Radio and television products and tele-communications. Satellites in space. The list is endless.

In order to express in dramatic form the formation of what MULTI-MERGERS of HUGE CONGLOMERATES could mean if we do not " STEP BACK--PAUSE--AND TAKE A DEEP BREATH," we offer the following scenario for thought. Take as a base one thousand companies--and start a two merger factor. the second tier would thus consist of 500 companies; merge these and the 3rd. tier would consist of 125 companies controlling the original 1000. Before you get to the 12th. tier--the top of the pyramid--there will only be ONE COMPANY at the top of the pyramid controlling the original ONE THOUSAND. Thus one hundred thousand companies around the world would eventually result in ONE HUNDRED CONGLOMERATES perhaps controlling most of the worlds strategic materials and foods! FAR FETCHED! I THINK NOT!!

Let us examine a few facts. Before the collapse of communism in Russia, a fairly large amount of trade existed between them and a large number of western countries. Don't for one moment forget that it was in reality COMPANIES that were trading--not Governments or countries. The MOMENT communism collapsed--these companies were in "boots and all" clamoring to open either subsidiaries; or purchase companies or merge or take a substantial holding in all those countries who formed the communist bloc in Europe. What is an anomaly is America's treatment of Cuba. Perhaps not! While Russia was perceived to be a major threat to the western world--they happily traded. While COMMUNIST CHINA was perceived to be a threat to the world--we happily traded with them. So much so, that the United States gave China " a Favored Nation " status with a lower import tariff structure than that given to most of the friendly western trading nations! One wonders why? A valid reason has never been forthcoming. Why Cuba? It is a small island--a small impoverished nation. They present no major military or political or economic threat to the United States. There can be no nuclear threat--a massive base on the island, satellite surveillance around the clock--high flying aircraft surveillance and perhaps covert CIA. intrusion would surely put that worry to rest. No trade either way allowed. To the extent that any country trading with or investing in Cuba bears the threat of the wrath of the U.S.A. even to the extent of threatening economic sanctions against countries found to be ignoring America's wishes. A dramatic circumstance--is it not? One cannot stop asking why! The major economy of Cuba is Sugar and Cigars. Perhaps a little mineral mining, not of any economic consequence. However, perhaps the reason for all this can be found in the following. ALL the SUGAR PLANTATIONS and ALL the SUGAR REFINERIES and ALL the TOBACCO FARMS and ALL the CIGAR FACTORIES are COMMUNIST GOVERNMENT OWNED!! They belong to the people. Not to private companies or conglomerates. Perhaps herein lies the reason for all this. One cannot stop wondering whether one day--when foreign conglomerates were to be allowed to own or have a major share of all this--THAT SUDDENLY Cuba would be welcome into " the family of nations."

One should never forget that trade relations are conducted by companies--not governments or countries. Trade agreements may be negotiated by Govt. representatives--but they represent a request from one or more companies economic reasons. Or that of farmers or co-operatives. Never "government" reasons. At times it has been stated that a course of action was generated for "political" or " economic" or strategic" reasons. In every case the underlying factor is basically company or "people" driven. After all those "in govt." are placed there "by the people--for the people!" While on the subject of Government and people and "vested interests," one cannot stop wondering why the disparity in a government's treatment of Cigarette Manufacturers--and non action against the TOBACCO FARMERS. After all, there would be no cigarettes without the tobacco farmers! And less heart attacks--emphysema and cancer of the lungs without the tobacco farmers. Yet the manufacturers are pursued and economically browbeaten--yet no contribution is requested from the tobacco farmers. It does not make sense. Or must one presume something more sinister is behind it all? It would be laughable--were it not so tragic to note how futile all this is. In the end WE are going to be paying for all the legal costs, for all the cancer treatments and other medical costs. NOT THE CIGARETTE MANUFACTURERS or THE TOBACCO FARMERS. The punitive damages imposed on the manufacturers will be paid over 15 / 20 years--and recouped over and over and over again by manufacturers increasing the price of a pack of cigarettes. The SMOKERS will be paying! Find out how many packs are manufactured every day--add 50 cents to the price of each pack--then multiply the two and multiply the answer by 365 days for the year; then again for the 15 / 20 yrs. given to pay the punitive damages--you're going to be shocked to find out what vast additional profits are due to fill the pockets of the tobacco industry. Who is trying to fool who?

The WORLD TRADE ORGANIZATION may one day become a major problem to it's members. Or should one have said "for it's members." While it's members are essentially government representatives or officials, one must NEVER lose sight of the fact that they actually represent a country's companies or multi-national conglomerates. While everyone may possibly look upon this as it's strength--it may very well end to be it's primary weakness. Maybe it is TIME TO STEP BACK--PAUSE--AND TAKE A DEEP BREATH and examine where all this is taking us. Perhaps in our eagerness to expand world trade we are planting the seeds of dissent; distrust; and finally we may end up reaping economic upheaval and open economic warfare. The world is suddenly in love with China. The big companies of the world are clamoring to "get a slice of the cake--or is it the pie!" Forgotten is child labor, ( or maybe a reason to be there ). Forgotten is human rights. Forgotten perhaps also are the pirating of copyright and the infringement of patents. Forgotten also the possible stealing of nuclear secrets. Forgotten as well stolen technology. Remembered perhaps abysmally cheap labor and no problems from non-existent trade unions. Not forgotten perhaps the non requirement of "benefits" and medical coverage and pension contributions and unemployment payments. What has been forgotten is that China has FIVE TIMES THE POPULATION OF THE UNITED STATES!! One DAY--be it in 15 years time; or in 25 years time, China will remind the world of this fact!

Fairy Tale has it that once the Genie was let out of the bottle he granted THREE WISHES. However when the genie of China is let out of the bottle--the world may not be granted three wishes. We may however be faced with perhaps THREE SPECIFIC DEMANDS. They may very well be: China regards those areas of the world to be of STRATEGIC IMPORTANCE to us--stay "off limits!! China considers these countries to be of ECONOMIC IMPORTANCE TO US--stay away!! And the third possible demand may be. China regards it's POLITICAL INTEGRITY THREATENED--get out of our country!! Once you let THAT GENIE out of the bottle--there is no getting it back. Maybe it is time to "take a deep breath."

Before bringing this article to conclusion, we would like to offer the following comments. If we are to have "globalization" and "free trade," it may necessitate that some very important changes may have to be made. OF major importance is the ability of a country to pay for it's imports. Essentially the means with which payment can be made is by receiving payment for it's exports. So if a country has little--or nothing to export it is axiomatic that there are limitations to that country's ability to be of importance to participate in international trade. By advancing money (loans ) as a means to overcoming this disability is silly. Why burden a country with debt for this purpose. However this shameful practice does take place. Why? Because a company or companies benefit financially from the exports--and the citizens pay for this "privilege" by taxation. Thus if we are to assess the value of our export potential to a country, we have to ensure that the country concerned has the ability to pay. Thus, it is in everyone's interest to increase the export potential of each and every country. There are only two ways in which this can be done. Increase the price of the goods or increase the volume of the goods or services. There is in reality a very little limit to price, but there is a decided limit to volume. Consumption of anything is finite. For whatever reason--there is and has to be a limit. Be it temporary or not. For a moment in time, it will be finite. As the population of the world expands, the expectation is that demand for goods and services will expand at a similar rate. Additionally, as people and countries prosper--so too is the expectation that trade will increase to satisfy demand. But not for everyone. And not to the same degree as well. And it is because of these two factors that the following proposals are made.

During the last WORLD WAR most of the countries involved had to introduce PRICE CONTROL and the rationing of goods. This was essential, as the movement of goods and food across the oceans of the world was a hazardous occupation. Price control was necessary--and it worked well. Literally hundreds of thousands of items were priced--from butter to hairpins and bicycle parts. Thus price stability was created and maintained. The rationing of all goods resulted in the most essential things remaining available most of the time--although at times there were scarcities of certain commodities. Two very important things resulted. The price was the same--for the rich as well as the poor. The other was that rationing ensured that everyone was treated equally. Whether you were rich or poor--your allocation was the same. If INTERNATIONAL TRADE is to expand into a "GLOBALIZATION" and a "FREE TRADE" factor, then we have to ensure that everyone is treated equally and fairly. Which also means that everyone be given a share and an equal chance. Nobody likes cartels; they hate cartels. The reason is that cartels attempt to fix prices and attempt to control the market flow of goods. Yet it CAN WORK. It has worked. De Beers diamond company--through the operations of their CENTRAL SELLING ORGANIZATION has controlled the price and flow of uncut diamonds onto the world market for more than sixty years. Their success flows from an orderly supply and a slow and reasonable increase in price commensurate with inflation and mining costs. What is primary to this--is the absence of greed, most of the time!

Where is this taking us? Perhaps into a new concept. Let us for a moment in time examine, say Saudi Arabia. Their primary export--and to all intent and purposes their only and most valuable export--Oil. At say $20 a barrel, their percentage of estimated world supply as determined by OPEC. was worth say $40 Billion. So the whole world knew that this was the total value of imports that Saudi Arabia was capable of paying for. At the same time the Saudi's knew exactly what they could expect for their exports--and as a result could control their " balance of payments" for that year. However when prices dropped to say $10 a barrel--their income was halved. So not only did the Saudi's suffer--world trade with Saudi Arabia suffered equally as well. Now consider the following scenario. A world body--in consultation with all suppliers determines a reasonable world price for a commodity--be it say oil or copper or lead. Or whatever. Perhaps based on the average world price ruling for the past say five years. This price shall hold for five years--to be then revued for cost of manufacture and / or inflation. This would only apply to all those commodities that are principally exported items. Domestic prices are exempt. All nations would be able to determine what value they could expect for their exports--and all other countries would know how much each country could afford to purchase and pay for. The percentage market share is perhaps of no concern to the purchasers of these commodities. It is left to the "cartel" controlling total export estimates to say what each supplier's share shall be. As long as the price of the commodity is fixed for five years. However the price will be determined by a world body--not the cartel. In other words, say all copper producers would participate within the available market at the same price. What conceivably would happen, would be that the closest supplier of a commodity would supply their closest neighbors requiring the product--while leaving the larger producers to supply the bulk buyers. There are a lot of advantages with this system. Subsidies given to growers and manufacturers would have no effect what-so-ever on a fixed world export price. It would still be allowed domestically as an incentive or for whatever reason; and even if some of that food or commodity be exported within the fixed quota and price--there would be no disadvantage to competitors. Countries would still be able to do bi-lateral trade; in that one could say to the other: "We will take your potato crop--if you take up your copper requirements from us." Quota swaps could also possibly be accommodated. A country with an over-supply of say rice, could swap a percentage in exchange for another's wheat quota. this would be monitored by say THE WORLD TRADE ASSOCIATION when these requests are made. The underlying philosophy of all this, is to give stability to world trade. It gives the smaller nations and producers a fair share of the international market to buy and to sell at the same price as the more economically powerful nations. It obviates coercion, threat or economic bullying by the bigger of the smaller or weaker. and finally everyone will be playing on a level playing field.

We end off this article on GLOBALIZATION AND MEGA-MERGERS by offering the following. BE CAREFUL.--------When You Sow The Wind--You May Reap The Whirlwind! And finally. PULL BACK--PAUSE--AND TAKE A DEEP BREATH--AND THINK!