Race to the BottomRace to the Bottom The adverse effects of globalization on The adverse effects of globalization on

the environmentthe environment

Global Change 2 – Section 007

Michael Ashby

Zach Goldstein

Carly Van Dort

The global economyThe global economy Technology means a Technology means a

connected global connected global economyeconomy

Corporations are Corporations are turning to developing turning to developing nations due to cheap nations due to cheap labor and lenient labor and lenient environmental environmental standardsstandards

This creates a “race to This creates a “race to the bottom” as the bottom” as countries compete for countries compete for big businessbig business

What is Globalization?What is Globalization? ““the increase in the the increase in the

exchange of goods and exchange of goods and services worldwide which services worldwide which has been especially has been especially prevalent in the last prevalent in the last decade”decade”

National boarders become National boarders become meaninglessmeaningless

Companies build factories Companies build factories and invest in capital in and invest in capital in developing nationsdeveloping nations

Globalization affects Globalization affects everyone…everyone…

Yes, even you!Yes, even you!

Globalization now Globalization now affects nearly affects nearly every part of every part of civilization:civilization:• CultureCulture• PoliticsPolitics• Human rightsHuman rights• EconomicsEconomics• CommunicationCommunication• The environmentThe environment

““Race to the Bottom”Race to the Bottom”

Contributing Factors:Contributing Factors:• Developing countries Developing countries

need jobsneed jobs• In order to attract the In order to attract the

jobs, the developing jobs, the developing countries lower their countries lower their environmental and environmental and working standardsworking standards

• Developing countries Developing countries compete against one compete against one another to provide the another to provide the lowest standards lowest standards

http://www.nclnet.org/welcome.html

Environmental Policy-MakingEnvironmental Policy-Making

Government is Government is influenced by influenced by multinational multinational corporations as wellcorporations as well

““Policy paralysis”: Policy paralysis”: (Zarsky, 1997) If policy-(Zarsky, 1997) If policy-makers attempt to raise makers attempt to raise environmental environmental standards, they are met standards, they are met with threats by the with threats by the corporations to leave corporations to leave the countrythe country

http://socrepsoc.com/nikeposter2.html

Case StudiesCase StudiesThe effects of The effects of Multinational Multinational

Corporations (MNCs)Corporations (MNCs)Example: Rio Tinto in Madagascar has lifted mining restrictions.

Results:

•Rio Tinto’s short-term profits maximized

•Marked loss of biodiversity

•Decrease in environmental protection of mining areas

Case StudiesCase StudiesThe effects of Multinational The effects of Multinational

Corporations (MNCs)Corporations (MNCs)Example: Coca Cola allows lax human rights and environmental regulation in its international bottling factories.

Results:

•Coca Cola is distanced from its effects

•Deaths due to poor water supply; water privatized by the company

•Low control over environmental impacts

A look to the futureA look to the future

There is hope:There is hope:• People are becoming People are becoming

more involved globally more involved globally (activism)(activism)

• Companies are being Companies are being pressured to be more pressured to be more environmentally environmentally responsibleresponsible

• Race to the top?Race to the top?

Thumb’s up!Thumb’s up!