The Real Impact of Globalization

NAPA, Calif. — Stuart Varney, an economist and contributor to Fox News, is bullish on the U.S. economy. He warns, however, that government will have trouble supporting long-term pension and health-care commitments to retirees in coming years.

Varney, speaking here at the Ziff Davis CIO Summit on Monday, said there is also a potential political "crunch" in China that could spill over to that country's economy. That crunch may occur because China's Communist party is being "bumped up against" by capitalists on issues such as property rights. "Twenty years from now, I cannot see the Communist party maintaining its grip," he said.

Varney discussed the new realities of the global marketplace, addressing an audience of about 130 technology executives at Ziff Davis Media's CIO Summit at the Silverado Resort in Napa, Calif.

Why is he optimistic about the U.S.? "Americans apply technology in the workplace, as do other successful economies," he said, citing Singapore, South Korea, Ireland and Australia as other countries that embrace technology and change.

"Americans love what is new," he said. Other countries, for example, look to preserve old buildings. "In America, you knock the damn thing down. You build something vibrant, viable."

Varney cited one example of rapid change propelled by technology: booking airline tickets online, a feat that marked its 10th anniversary on Jan. 16. "Think of how the travel industry has been transformed," he said, referring to Alaska Airlines' first online ticket sale.

To illustrate his point about the power of globalization, Varney ticked off the gross national product of four countries: the U.S., estimated at $13 trillion this year; Japan, at $4.3 trillion; Germany, "which is mightily struggling along," at $2.2 trillion; followed by China.

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