Unformatted text preview: 4.2.5 U.S. HIST. SEM. 2
- - In 2010, the People's Republic of China (PRC) was America's third largest trading partner, behind
only America's neighbors, Canada and Mexico. However, just 40 years ago, China had no official
ties to the United States, let alone a trade partnership.
Two major events in 2001 changed the relationship between the United States and China. The
9/11 attacks on the World Trade Center refocused much of U.S. foreign policy toward stopping
terrorism in the Middle East. China gave direct support to the resulting U.S. effort in Afghanistan
and the War on Terror. THE WTO
- - - - Secondly, China joined the World Trade Organization (WTO), agreeing to help ensure open trade
among member nations. These agreements forced China to make their economic policies known
to the WTO. The WTO prevents members from creating trade policies or barriers for another
member that do not apply equally to all other members.
The WTO is a global organization that governs the rules of trade between countries. Its members
join voluntarily, and their governments approve the regulations. The WTO wants to help trade
flow as freely as possible — to keep governments from interfering with trade — and to reduce any
negative economic impact from the actions of the member countries.
- Terrorism: The use of violence or the threat of violence against people for political gain.
- WTO: World Trade Organization, an institution that supervises international trade and
promotes free markets.
The WTO creates standards for international trade laws, so that suppliers and buyers around the
world can be sure they will be treated the same. Starting in the 1970s, shipping companies began
using standardized containers so that their shipping partners could predict how goods would
arrive, and plan for their handling.
Almost every item imported to the United States spends some time in a steel container like the
ones you see above. Over 17 million such containers travel around the world on ships, trains, and
even trucks. Over a quarter of them come from China. Free Trade
- International trade has been going on for centuries. Nations have competed with one another and
sometimes gone to war over trade issues. In the 21st century there is growing support for "free
trade," which means goods can move more easily between nations. This means lower or no
import taxes or any other system that would slow down the importation of goods. In America we
are used to driving cars from Sweden and Japan. Our clothes mostly come from Asia and a lot of
our wood comes from Canada. With free trade more countries can sell to more people. NAFTA
- - The North American Free Trade Agreement, or NAFTA, puts free-trade principles in place in a
smaller area. Established in 1994, the agreement creates free trade among the United States,
Canada, and Mexico. The agreement ended most direct tariffs and created a schedule for
However, there are critics of NAFTA. Canadians fear they will lose control of their vast natural
resources; Mexican farmers are threatened by unrestricted imports of cheap U.S. harvests, and
many Americans resent the emergence of Mexican factories and reduced restrictions on
immigrant workers. - NAFTA: North American Free Trade Agreement, an agreement signed by the United
States, Mexico, and Canada in 1994. It called for fewer tariffs, or taxes, on goods being
sold between the three countries. It also made it easier for workers to pass between
- In poor countries, workers perform even highly skilled or labor-intensive work for far less than the
minimum wage in the United States. Some maquiladoras are also sweatshops. These factories
are often called sweatshops, a term used to describe the brutal workplaces that existed in
American cities at the turn of the last century. Many Americans criticize companies that use unfair
and abusive sweatshop labor, but these companies argue that without sweatshops, the people of
these countries would not be employed at all. Maquiladoras
- Maquiladoras are special kinds of factories that exist in Mexico as a result of NAFTA free-trade
policies. Because of the tariff reductions, U.S. companies can send raw materials across the
border to be processed or manufactured by low-paid workers, and then bring the finished goods
back. Maquiladoras employ thousands of Mexicans and account for nearly half of Mexican
exports. However, like other factories, profits remain with the U.S. companies that own them. - If companies have to ship products from overseas, why doesn't the shipping make them more
- Standardized containers mean big savings on the labor to load or unload goods at every
How do labor costs play a role in the move toward free trade?
- Labor costs in the United States make companies want to hire cheaper workers in other
countries, and free trade helps them do that.
How do you think American workers feel about outsourcing?
- Many don't like having to compete with sweatshop workers who accept low pay and
terrible conditions. But free trade helps Americans who make products for export.
Does outsourcing help or hurt workers in developing countries?
- People disagree. Sweatshop work is hard and dangerous. But some people say those
workers would earn even less without those jobs. - - - - A reaction against outsourcing and decreased labor standards has increased support of fair
trade. The fair trade movement is an effort to improve living standards in developing countries.
That means that workers in other countries are treated fairly and not abused. By supporting fair
trade, consumers agree to pay more for their goods, but in return they know that their purchases
are not supporting unfair labor practices.
- Outsourcing: When a company purchases products or services from an outside supplier,
rather than performing the same work within its own facilities, in order to cut costs.
- fair trade: Buying products internationally at a price that helps the seller to reach a higher
standard of living. This is often used in trade with developing countries. How Long Can the United States Keep Buying Goods
- - In the United States, one of the most serious effects of globalization has been on factory workers
and their communities.
Many large American industrial cities, such as Detroit and Flint, Michigan, where cars are made,
face rising unemployment and shrinking populations. Causes include:
● The move of jobs and businesses to the South.
● Competition from Japanese and German auto companies.
● Foreign-owned auto companies setting up plants in other parts of the United States.
Globalization: A term that describes the increasing interdependence the nations of the world have
on one another. The word is used to discuss economic interdependence, but it also refers to
political, cultural, and technical interdependence. Trade Deficit
- - - Manufacturing products overseas in developing countries increased profits for U.S. corporations,
especially retailers. But as more jobs went overseas and more finished goods came in, the
market for U.S.-made exports could not keep up with goods being imported. Beginning in the
mid-1980s, more money left the country to buy foreign goods than came in for goods sold. This
created a trade deficit. Throughout the 1990s, this deficit grew despite America's booming
Because Americans do not bring in enough dollars to pay for the goods that they buy, countries
like China invest their trade surplus in American bonds. In effect, China is lending the United
States the money to continue buying Chinese exports.
Joining the WTO forced china to be more open w. It eco. Acts.
NAFTA is a trade agreement
What is a part of globalization ?
- Increasing international dependence
Sweatshops provide abusive and unfair working conditions
Which is a cause of America’s trade deficit?
- Increased trade with china
Why would US comps. Outsource jobs?
- To decrease labor costs
Why shipp. Comps. Start. Use of standardized contains.?
- To make shipp. More efficient
3rd indust. Revolt. Describes how comps. Have changed the eco. ...
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- Fall '17
- US History