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Yes....the Red Chinese are coming, the Indians have taken over world’s steel, and London real estate is now Russian and Arab occupied territory! Putting the wagons in a circle ought to fix the problem. Why not add pseudo-protectionism, brew a more confused cocktail, and satisfy the residual hype of the cold warriors? Does it make sense to go beyond the odd simplification that skews globalisation, capitalism and development in the same breath?
The question skews the interests of (for-profit) companies in the private sector. Alas, their complaint has a whiff of a desire for an easy, free rescue by the U.S. government as the industry hopes to surf the recent tides of “resource nationalism”. Surely the government can rescue Silicon Valley from its follies, since the Fed rescued Wall Street from its foolish deals. After all, both made fortunes from hype: one from irresponsible lending hype and the other from the Y2K bug. Never mind that the market value of Microsoft is now twice the value of Citigroup, the American banking giant!
The essential fact remains that such materials and the so-called intellectual property rights are privately owned, produced and sold with a fundamental “design flaw” of easy duplication that easily crosses national borders and is effortlessly duplicated on Main Street USA, in a Bangkok backstreet, or swapped over the Internet with one side being 12 time zones away from the other. These inventions have superseded the mindset of laws and international conventions enacted a long time ago, before Microsoft, Google and iPods gained currency. The IT sector has created a modern “give it away” business model, unheard of a few decades ago. These private companies operate on a worldwide basis and they, not their home governments, are best placed to challenge illegal practices in local (foreign) courts. If such jurisdictions are lucrative for their sales and marketing operations, they cannot run back to the U.S. government for cover and enforcement muscle, where those unresponsive “foreign” legal systems happen to be the source of other advantages gained by the U.S. economy. It can all be negotiated into a new legal structure, but chances are that other “shocking” findings (such as cheap or unsafe labor practices) will come up in any global rounds of fair trade negotiations. And what will be the impact on the price of goods that eventually end up at Wal-Mart, and the resulting inflation? Surely the U.S. Trade Representative knows the answer to that one.
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