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DaimlerChrysler Chairman Jürgen Schrempp Defends Globalization as an Opportunity (July 2, 1999)

Countering the strident criticism of the left, DaimlerChrysler chairman Jürgen Schrempp defends globalization as an opportunity to increase worldwide prosperity through trade and competition.

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DaimlerChrysler Chairman Jürgen Schrempp on Globalization at the 7th Annual Colloquium of the Alfred Herrhausen Society in Berlin

1. Globalization is a competition not only for markets but also for values.

You all saw the pictures from the G8 summit: demonstrations by activists against globalization and global corporations. Their perspective reduces globalization to a new form of profit maximization. The market has become “an idol,” as was recently stated in the weekly newspaper Die Woche. The book The Economic Horror was a bestseller. But all of this overlooks the fact that globalization not only exposes our economy to international competition but our liberal democratic values and economic ethics as well. Economic and political freedom are interdependent.

So what does capitalism mean today? Capitalism per se has a moral quality, since it creates prosperity for broad segments of the population. The justification of capitalism and of the market economy can only be found in what they do for the people and nowhere else. The key elements of capitalism – competition and the pursuit of profit – do not imply a dog-eat-dog world. They are the necessary incentives for ultimately advancing the common good. In this respect, serving society is also always one function of capitalism.

That is why the concept of the market economy, together with the rule of law, is one of the basic pillars of a democratic constitutional state. Competition prevents the concentration of economic and also political power; it guarantees equal opportunity, performance equity, and social security; and it is the driving force behind social change. If there are still many people around the world who don’t share in this prosperity, then the market economy needs to be really set in motion. Improvement does not come from restraining market forces, but rather from liberating them.

2. Globalization does not create new conflicts; rather, it is a key to peace.

The elimination of divisive borders and the opening of national markets are the keys to stability and prosperity on our continent. The European Alliance for Peace, the European Union, and the integration of markets in Western Europe were the prerequisites for preserving freedom. Today, the economy accelerates political change in places where there used to be a lack of freedom.

The economy creates networks. The economy creates common interests, also for people from different countries. After years of being sealed off, the young democracies of Central and Eastern Europe have good reasons for wanting to become part of the European Union. Security and stability in today’s world community can no longer be guaranteed through military means alone. These things are increasingly dependent on global economic growth. Global corporations create a common basis for this – a basis for prosperity, jobs, and worldwide participation in forward-looking technologies.

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