Starbucks vs. Equal Exchange: Assessing the Human Costs of Economic Globalization

This paper discusses the impact of economic globalization on human populations and their natural environment. Trends leading to globalization, such as multilateral and bilateral trade agreements which reduce trading barriers between countries, are discussed. According to the economic principle of comparative advantage, all countries which specialize in what they can produce most efficiently should benefit equally from fair trade. Developing countries must increasingly rely on cheap labor and low environmental standards to compete for foreign investment and capital in the global economy. Observers argue that the market is not free enough to conect the long-term damage associated with export policies like this. Poverty, misery and social stratification are increasing in many developing countries as a result. A case study of the coffee industry in Latin America provides evidence of the consequences of globalization policies on the most vulnerable populations. NAFTA and the collapse of the Intemational Coffee Agreement contributed to environmental degradation and Joss of livelihoods in Chiapas, Mexico. The result was increased social unrest, which led directly to the Zapatisla uprising of 1994. Responses to the impacts of globalization are considered. International regulation of labor and the environment in trade agreements, voluntary codes of conduct for multinational corporations, and the alternative trade movement, in combination, provide the best mechanisims to address thehuman cost of economic globalization