Economic Freedom

After seeing the video on The Travels of a T-shirt in a Global Economy, I realized how long of a process it is for products to be made and distributed to their destinations. Now that I think about it, it is not surprising that one particular t-shirt was all over the world. It is incredible to think that our products and consumer goods start out on one side of the world and wind up in our house. But with this idea, comes the concept of outsourcing which can be good for our economy and bad at the same time. With t-shirts it might be a little different because the book talks about how the United States had one of the biggest exports of cotton. But with other things for example, people in China are making our consumer goods which takes away from jobs that citizens in the United States could have.

On the other hand, trade is very much essential for globalization to occur. Globalization interconnects our countries together politically, socially, and economically. Trade allows us to purchase goods and services that we wouldn't normally be exposed to, or be able to trade our goods that we no longer have any use or need for. Free trade is essentially the meaning of economic freedom. We are allowed to buy and sell the goods and services almost anything between states, countries, and continents. There is no limit to whom we can trade with. In the article, (http://online.wsj.com/article_email/SB123008314776232087-lMyQjAxMDI5MzEwNjAxODYzWj.html), it talks about how globalization and trade help countries liberalize markets, which was something they talked about in video. The article also explains that because of the expansion of global trade, wages have seem to done a little bit better than they previously had. And wages are particularly an important topic of concern, because like we heard in the video, most people are underpaid and don't get the amount they work for, in addition to horrible working conditions (sweatshops).

Although we have economic freedom as of right now, things could be changing in the near future. But recently, the newly approved economic stimulus package might be limiting our economic freedom, and this would mostly affect other countries that the United States normally purchases from. An article from CNN.com, (http://money.cnn.com/2009/02/13/news/economy/buy_american/index.htm), talks about House of Representatives and the Senate are soon to vote on provisions that limit materials used in public works projects, paid for by the stimulus package, to only products made in U.S. factories. This doesn't sound like a huge problem, but it is. The "Buy American" provisions, however, won't break any existing trade agreements which means that these projects can still purchase equipment from Canada and the European Union; this could possibly start a trade war because now any country not included in the trade agreements is now allowed to trade with the U.S. for such projects. This is taking away the economic freedom of companies in the U.S. who wish to still trade with other countries, and the other countries being limited from trade. This could drastically affect the exports of other countries who usually sell steel and pipes to the United States.