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FINAL_DRAFT_ESSAY_3

FINAL_DRAFT_ESSAY_3 - Alexander Muhr WRIT-140 Jay Fisher...

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Alexander Muhr WRIT-140 Jay Fisher 10/24/05 ESSAY #3 The Predicament of American Business American businesses are faced with many different and complex decisions these days. With the competition of international companies increasing, there is a new sense of urgency to find more inexpensive means of production. There are strings that come attached with these new decisions, for instance, the possibility of decimating a domestic community or devastating international areas where the regulations are much more permissive. These are consequences very difficult to mend and therefore companies face the daunting task of actually having to choose. Corporations need to choose either to do massive revamps where they fire a huge chunk of their employees, or they decide to pull their operations overseas to a much cheaper alternative. One of the facilitations for international companies having much more success here in the United States is the fact that since 1960, the average tariff has decreased from 14 percent to 3 percent. (Kose 5) American companies are nowadays much less protected domestically and that makes them anxious to find new ways of staying profitable. Globalization is therefore a dilemma for American businesses because whichever decisions they make, there are ways to go against human rights, the environment and a global code of ethics. One of the effects of globalization is that businesses increasingly need to find ways to stay profitable by using more inexpensive means of production. American corporations do not account for the consequences that occur from their endless quest to drive the costs of doing business down. General Motors is one company that, due to the high cost of productions of automobiles domestically, had to find an alternative means of
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production, preferably outside of the United States. General Motors chose to use maquiladoras for their new production facilities. Maquiladoras are an interesting phenomenon created due to globalization. They are companies in Mexico, which are wholly owned by foreign corporations, under the NAFTA (North American Free Trade Agreement). General Motors decided to use these maquiladoras for production because the cost of production is much less than in America and they are also located near the American border. The effect that General Motors had on of their main production facilities in the United States was devastating. The documentary by Michael Moore, “Roger and Me,” depicts very graphically how Flint, Michigan went from a healthy middle class city, to a place with families dependent on welfare. Some consequences that
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