GLOBALIZATION-World Politics






Globalization (or globalisation) is a term used to describe the changes in societies and the world economy that are the result of dramatically increased trade and cultural exchange. In specifically economic contexts, it refers almost exclusively to the effects of trade, particularly trade liberalization or "free trade" Between 1910 and 1950, a series of political and economic upheavals dramatically reduced the volume and importance of international trade flows. In the post-World War II environment, fostered by international economic institutions and rebuilding programs, international trade dramatically expanded. In the 1970s, the effects of this trade became increasingly visible, both in terms of the benefits and the disruptive effects.


Meanings of Globalization

"Globalization" can mean:


The formation of a global village — closer contact between different parts of the world, with increasing possibilities of personal exchange, mutual understanding and friendship between "world citizens", and creation of a global civilization. The World Bank defines globalization as the “Freedom and ability of individuals and firms to initiate voluntary economic transactions with residents of other countries”.

Economic globalization — 'free trade' and increasing relations among members of an industry in different parts of the world (globalization of an industry), with a corresponding erosion of National Sovereignty in the economic sphere. The IMF defines globalisation as “the growing economic interdependence of countries worldwide through increasing volume and variety of cross-border transactions in goods and services, freer international capital flows, and more rapid and widespread diffusion of technology” (IMF, World Economic Outlook, May, 1997).

The negative effects of for-profit multinational corporations — the use of substantial and sophisticated legal and financial means to circumvent the bounds of local laws and standards, in order to leverage the labor and services of unequally-developed regions against each other.

The spread of capitalism from developed to developing nations.

"The concept of Globalisation refers both to the compression of the world and the intensification of conciousness of the world as a whole" - Roland Robertson

It shares a number of characteristics with internationalization and is used interchangeably, although some prefer to use globalization to emphasize the erosion of the nation-state or national boundaries.


Globalism, if the concept is reduced to its economic aspects, can be said to contrast with economic nationalism and protectionism. It is related to laissez-faire capitalism and neoliberalism.


History of globalization

Since the word has both technical and political meanings, different groups will have differing histories of "globalization". In general use within the field of economics and political economy, is, however, a history of increasing trade between nations based on stable institutions that allow individuals such as Masa and Kellie and firms in different nations to exchange goods with minimal friction.


The term "liberalization" came to mean the combination of laissez-faire economic theory with the removal of barriers to the movement of goods. This led to the increasing specialization of nations in exports, and the pressure to end protective tariffs and other barriers to trade. The period of the gold standard and liberalization of the 19th century is often called "The First Era of Globalization". Based on the Pax Britannicaand the exchange of goods in currencies pegged to specie, this era grew along with industrialization. The theoretical basis was Ricardo's work on Comparative advantage and Say's Law of General equilibrium. In essence, it was argued that nations would trade effectively, and that any temporary disruptions in supply or demand would correct themselves automatically. The institution of the gold standard came in steps in major industrialized nations between approximately 1850 and 1880, though exactly when various nations were truly on the gold standard is a matter of a great deal of contentious debate.


The "First Era of Globalization" is said to have broken down in stages beginning with the first World War, and then collapsing with the crisis of the gold standard in the late 1920's and early 1930's.


Globalization in the era since World War II has been driven by Trade Negotiation Rounds, originally under the auspices of GATT which led to a series of agreements to remove restrictions on "free trade". The Uruguay round led to a treaty to create the World Trade Organization or WTO, to mediate trade disputes. Other bilateral trade agreements, including sections of Europe's Maastricht Treaty and the North American Free Trade Agreement have also been signed in pursuit of the goal of reducing tariffs and barriers to trade.


Signs of globalization

Globalization has become identified with a number of trends, most of which may have developed since World War II. These include greater international movement of commodities, money, information, and people; and the development of technology, organizations, legal systems, and infrastructures to allow this movement. The actual existence of some of these trends are debated.


Increase in international trade at a faster rate than the growth in the world economy

Increase in international flow of capital including foreign direct investment

Greater transborder data flow, using such technologies such as the Internet, communication satellites and telep hones

The push by many advocates for an international criminal court and international justice movements (see the ICC and ICJ respectively).

Greater international cultural exchange, for example through the export of Hollywood and Bollywood movies.

Some argue that even terrorism has undergone globalization. Terrorists now have attacked places all over the world.

Spreading of multiculturalism and better individual access to cultural diversity, with on the other hand, some reduction in diversity through assimilation, hybridization, Westernization, Americanization or Sinosization of cultures.

Erosion of national sovereignty and national borders through international agreements leading to organizations like the WTO and OPEC

Greater international travel and tourism

Greater immigration, including illegal immigration

Development of global telecommunications infrastructure

Development of a global financial systems

Increase in the share of the world economy controlled by multinational corporations

Increased role of international organizations such as WTO, WIPO, IMF that deal with international transactions

Increase in the number of standards applied globally; e.g. copyright laws

Barriers to international trade have been considerably lowered since World War II through international agreements such as the General Agreement on Tariffs and Trade (GATT). Particular initiatives carried out as a result of GATT and the WTO, for which GATT is the foundation, have included:


Promotion of free trade

Of goods: reduction or elimination of tariffs; construction of free trade zones with small or no tariffs

Of capital: reduction or elimination of capital controls

Reduction, elimination, or harmonization of subsidies for local businesses

Intellectual Property Restrictions

Harmonization of intellectual property laws across nations (generally speaking, with more restrictions)

Supranational recognition of intellectual property restrictions (e.g. patents granted by China would be recognized in the US)

As defined through lecture series given by Dr. Cullenberg, Professor of Economics at the University of California, Riverside, globalization can be basically understood from an economic perspective through the following seven aspects:


International Trade: Exports and imports of goods and services. Creation of increased interdependency and the creation of a balance of trade.

International Portfolio Investment: Assets, cash, international currency, stocks, bonds, real estate, etc.

Migration: Movement of people.

Foreign Direct Investment: Movement of whole companies.

International Environment: Global warming, O-zone layer, water resources etc.

Global Culture: Creation of understanding and meaning, and international communication.

International Governments: Control and power nationally and internationally.


Anti-globalization


Various aspects of globalization are seen as harmful by public-interest activists as well as strong state nationalists This movement has no unified name. "Anti-globalization" is the media's preferred term. Activists themselves, for example Noam Chomsky, have said that this name is meaningless as the aim of the movement is to globalize justice. Indeed, "the global justice movement" is a common name. Many activists also unite under the slogan "another world is possible", which has given rise to names such as altermondisme in French.


There is a wide variety of different kinds of "anti-globalization". In general, critics claim that the results of globalization have not been what was predicted when the attempt to increase free trade began, and that many institutions involved in the system of globalization have not taken the interests of poorer nations and the working class into account.


Economic arguments by fair trade theorists claim that unrestricted free trade benefits those with more financial leverage (i.e. the rich) at the expense of the poor.


Many "anti-globalization" activists see globalization as the promotion of a corporatist agenda, which is intent on constricting the freedoms of individuals in the name of profit. They also claim that increasing autonomy and strength of corporate entities increasingly shape the political policy of nation-states.


Some "anti-globalization" groups argue that globalization is necessarily imperialistic, is one of the driving reasons behind the Iraq war and that it has forced savings to flow into the United States rather than developing nations.


Some argue that globalization imposes credit-based economics, resulting in unsustainable growth of debt and debt crises.


Another more conservative camp in opposition to globalization are state-centric nationalists that fear globalization is displacing the role of nations in global politics and point to NGOs as impeding upon the power of individual nations. Some advocates of this warrant for anti-globalization are Pat Buchanan and Jean-Marie Le Pen.


The main opposition is to unfettered globalization (neoliberal; laissez-faire capitalism), guided by governments and what are claimed to be quasi-governments (such as the International Monetary Fund and the World Bank) that are supposedly not held responsible to the populations that they govern and instead respond mostly to the interests of corporations. Many conferences between trade and finance ministers of the core globalizing nations have been met with large, and occasionally violent, protests from opponents of "corporate globalism".


The movement is very broad, including church groups, national liberation factions, left-wing parties, environmentalists, peasant unionists, anti-racism groups, libertarian socialists and others. Most are reformist (arguing for a more humane form of capitalism) and a strong minority is revolutionary (arguing for a more humane system than capitalism). Many have decried the lack of unity and direction in the movement, but some such as Noam Chomsky have claimed that this lack of centralization may in fact be a strength.


Protests by the global justice movement have now forced high-level international meetings away from the major cities where they used to be held, and off into remote locations where protest is impractical.


Some "anti-globalization" activists object to the fact that the current "globalization" globalizes money and corporations and at the same time refuses to globalize people and unions. This can be seen in the strict immigration controls that exist in nearly all countries and the lack of labour rights in many countries in the developing world.


Effects of Globalization


Scholars, policymakers, and activists have debated the effects of globalization, and continue to do so. And similar to many questions in international relations, the effects of globalization depend on who you are asking; individuals, depending on their theoretical viewpoints, as well as beliefs about international relations, may have varying position about the true effects of globalization. Scholars have categorized the positions regarding the “effects of globalization” into three groups: “The hyperglobalizers and transformalists”, “the skeptics”, and the “weak globalizers” (Payne, 2013: 18; McGrew, 2008, in Baylis, Smith, and Owens: 2008) (a more recent version of the book The Globalization of World Politics: An Introduction to International Relations can be found here).


Hyperglobalizers and Transformalists: Hyperglobalizers and Transformalists argue that globalization is essentially changing everything around us, which includes the amount of political power that states have had. To Hyperglobalizers, the state’s power is being altered by non-state actors (McGrew, 2008). Supporters of this view might point to the increase in technology, and related to this, personal cell phones and recording devices, as well as social media platforms such as Facebook and Twitter as evidence of the decline of the state. By having access to cameras that can text, store pictures, and record information have left states with less power over the individual. In addition, there are many examples of how social media has challenged state power. One of the more recent examples is the 2010-2011 Arab Uprisings or the “Arab Spring.” Here, citizens in the Middle East and North Africa took to the streets to protest the authoritarian regimes in power of their respective states. And while many of the leaders such as Zine el-Abedine of Tunisia and Hosni Mubarak of Egypt attempted to crackdown on citizens, as well as disrupted political protests, internet and technologically savvy protesters were often able to stay a step ahead of the governments by organizing the revolution with technology, and more specifically publicizing rights abuses through social media sites. It is no wonder that those within the hyperglobalizer and tranformalist camp would point to such events to show the weakening of the state in the context of globalization.


Skeptics, on the other hand, skeptics argue that despite the idea that globalization is increasing, the power of the state in its domestic and foreign affairs has not diminished. As Payne (2013) explains, there are those in this camp say “that globalization is largely a myth that disguises the reality of the existence of powerful sovereign states and major economic divisions in the world. National governments remain in control of their domestic economies as well as the regulation of international economic activities.” This position says that regardless of how it seems that the state is weakening, they continue to have great holds on domestic power, as well as in terms of their interactions with other powerful states. However, they argue that much of the financial power is with the economically developed states, whereas economically developing states are not as interconnected as some might think (Hirst and Thompson, 1999, 2003; Hay 2000; Hoogvelt, 2001; Gilpin, 2002, in McGrew, 2008). Furthermore, while some hyperglobalizers suggest that cultures are becoming more interconnected, skeptics argue that cultures continue to actually be distant and people are more “suspicious of each other” (Spiro, 2000, in Payne, 2013:20).


The weak globalizers, or the transformalists, take a middle position in the globalization debate. They recognize that while the state is not going anywhere anytime soon, politics are indeed becoming more “global” (McGrew, 2008). Thus, there clearly is change and globalization is happening, but historical political power structures such as the state continue to be dominant actors in the international system. In addition, while we are becoming more interconnected, there is still the desire for continued individual identity, and this can show itself in a variety of forms.