Assignment
You are the chair of an IMF task force. Your job is to reevaluate the policy of bailing out national governments that suffer major losses in the private sector in the name of protecting the value of the currency. Taxpayers in industrial countries typically foot the bill for IMF activities, with loans typically running into the many billions of dollars. Some critics call this system a kind of "remnant socialism" that rescues financial institutions and investors from their own mistakes with taxpayer money. Financial crises often originate as private-sector affairs, but then central banks step in and pledge foreign exchange reserves to shore up the currency.
A. Do you agree with the belief that the current system privatizes profits and then socializes losses if the government steps in with a bailout?
B. What sort of alternative can you envision to replace the current system, which often involves an IMF bailout?
Case Study Global Trade Deficit in Food Safety
Read through and discuss the case at the end of Chapter 8 and answer the following questions.
A. How do you think countries with a high volume of exports to the United States, such as Mexico, would respond to stricter food-safety rules?
B. Do you think such measures are a good way to stem the tide of food-related illnesses?
C. Some people believe that free trade agreements force consumers to trade the health and safety of their families for free trade. What are the benefits and drawbacks of putting food-safety regulations into regional trade pacts?
D. The lack of harmonized food-safety practices and standards is just one of the challenges faced by the food industry as it becomes more global.
E. What other challenges face the food industry in an era of economic integration and open markets?