The problem with lowering taxes is that either tax needs to be increased in another area, such as income tax, or state services, such as schools and hospitals will be decreased in quality. This will lessen the chance of corporations moving their capital into another nation, while also allow businesses to sell their produce for cheaper prices and more effectively compete with the cheap products of the developing world.
Another possibility to increase employment is to decrease taxes on capital and lowering the standards of wages policies.
On contrary, free market supporters such as liberals and conservatives do not agree to protectionism, partly because it limits free trade, and also trade is not as fair when governments support their own production, because the production of nations who do not have subsidies cannot compete with the sponsored products of the west, also, the regulation of the economy limits one’s freedom to a certain extent. Protectionism also needs higher taxes in order to function properly, and is therefore disliked by many people. The problem with protectionism is that most nations are part of trade agreements which seek to decrease tariffs and abolish subsidies in order to promote free and fair trade, which is supposed to create economic growth, so therefore protectionism is not possible in all the countries.
Secondly, subsidies which sponsor businesses will sponsor some of the businesses in order for them to sell their produce for lower prices than the foreign products so that their produce also competes better in the market. All of the mentioned concepts are to attract national business and production in order to create jobs once foreign products have higher costs, national produced merchandise compete better in the market and therefore the industry grows to create and protect jobs.
The amount of imports should be reduced in order to prosper national production, and therefore create more working opportunities. The growing amount of imports from the developing world is causing the diminution of domestic demands on various products, and therefore lowering the industry which produces these merchandise. One way to stop the increasing unemployment is through protectionism meaning higher tariffs on foreign produce, higher subsidies on domestic production. The consequence of this corporate action of greed is unemployment, unemployment of the innocent workers of the west who lost their jobs to the cheap labor of the third world. The possible solutions to stop unemployment are through protectionism, or the decreased taxes on capital, and, a possible solution would be to certify goods which are produced within the European standards, to stop the exploitation of the developing world’s workers.ĭue to globalization, industrialists have been given the potential to invest their capital where labor is cheap, and environmental standards are low, a perfect combination for high profits. Some problems, such as unemployment cannot be solved in a fair way unless globalization is abolished, while other problems, such as the exploitation of workers can be solved without interfering with social security or globalization. Secondly, due to the growing transfer of capital from the west to the third world, more job opportunities are being given to the poorer nations, however because of low standards on policies, corporations often exploit the cheap labor through extremely low wages “workers of foreign corporations can earn as little as 3 dollars a day” (Pearson). As we know now, during the recent recession, unemployment rate in the west is gradually growing the reason for this is the growing imports from developing nations and the low environmental and wage policy standards which attracts corporations to invest in the third world. It is now clear that globalization is causing issues which need to be solved these are unemployment, exploitation of workers, and poverty.