Globalization Oui et Non?

First, Let’s Define It “[I]t is the inexorable integration of markets, nation-states and technologies to a degree never witnessed before – in a way that is enabling individuals, corporations and nation- states to reach around the world farther, faster, deeper and cheaper than ever before, and in a way that is enabling the world to reach INTO individuals, corporations and nation-states farther, faster, deeper and cheaper than ever before. This process of globalization is also producing a powerful backlash from those brutalized or left behind by the new system.” Thomas L. Friedman, The Lexis and the Olive Tree, 1999

A Little Background  World has grown small, flatter, interdependent  Romans  Explorers  Colonialism

20 th Century  Political alliances and wars – WW I & WW II WW I & WW II  Post WW II – Rebuilding Japan and Europe – Marshall Plan Europe – Marshall Plan  Cold War – We Won! – Now What?  EU expansion, other trade agreements  Improved technology

Necessary Elements  Reduction of trade barriers, tariffs, comparative advantage : )  Transparency – Rule of law, corruption controls  Free press/media  Capital markets – stocks & bonds  Democratization – China?  Infrastructure

Fall Out - Positive  Capitalism’s inevitable cycle of innovation and creation  Micro benefits – entrepreneurship, markets, products and specialization increase  Macro benefits – increased trade, opportunities, living standards, national income, GDP  Foreign direct investment: outside corporate investment  India, South Korea  Peace?

“[T]wo nations who traffic with each other become reciprocally dependent; for if one has an interest in buying, the other has an interest in selling; thus their union is founded on their mutual necessities.” “[T]wo nations who traffic with each other become reciprocally dependent; for if one has an interest in buying, the other has an interest in selling; thus their union is founded on their mutual necessities.” Montesquieu, Spirit of the Laws, 1748

According to Friedman, countries the trade together don’t make war on each other. Or, countries that have McDonald’s don’t make war on each other. The Golden Arches Theory of Conflict Prevention

Fall Out - Negative  Capitalism’s inevitable cycle of innovation, creation and destruction  Environmental – China, hello?  Jobs/wages – lower living standards  Rich vs. poor: multinational corporations and wealth concentration  Race to the bottom  Trade agreements that hurt more than help  World-wide recession – not just local anymore

The Big Question  Are international organizations like the UN, WTO, IMF, the World Court, NAFTA, non-governmental organizations equipped to police globalization’s discontents?  Sovereignty infringement, neo- colonialism (Shell in Nigeria)

Backlash # 1 Jihad vs. McWorld  Benjamin Barber argues that globalization has not encouraged cooperation  Lebanonization of the world  Threatens democracy – Middle East, China  Disintegration: internal conflict/violence resulting from economic upheaval  Decentralization along ethnic, religious or linguistic lines

Backlash # 2 Cultural Homogenizing  Joseph Nye argues not a serious problem  Japan – it’s not happening  They hate us, but not our blue jeans  Not all trends adopted – capital punishment  Cultural diversity actually encouraged

Backlash # 3 Individuals  Nye claims locals benefit, not just big corporations  Persian Gulf – local governments  Across the pond – Wales and Ireland  This is “Bob.” How can I help you?  250,000 Indians are now answering the phone

Office space in central Bangalore, India is dominated by multinational corporations… Photo and map courtesy of bbc.com

The World Is Flat Or so says Thomas Friedman in Ten events have sped up globalization:  Fall of Berlin Wall - 11/9/89  Netscape goes public – 8/9/95  Better software for work  Open-sourcing – free software movement  China joins WTO – 12/11/2001  Russia joins WTO – 8/10/2012  Better supply chains – Walmart  Better supply chains – UPS  Search engines take off  Digital, mobile, virtual

What About Your Country?  What positive impacts is globalization creating in your country?  What negative impacts is globalization creating in your country?  What is your country doing about globalization and its discontents?  Make a generalized list of globalization’s costs and benefits.

Globalization’s costs   Erosion of state sovereignty   Pressure to conform to global norms   Increased autonomy, succession movements   Increased vulnerability to other state actors   Need to be more aware of what’s going on outside your borders   Crime, drugs, disease, terrorism spread across national borders more easily   Exploitation of labor and capital in poorer nations by mnc’s   Increased pressure to compete globally   Pollution, crime, prostitution, urbanization, societal upheaval   Women still don’t have access to capital, mobility, power   Cultural homogenization: “Americanization” of culture, norms, consumption

Globalization’s benefits   Interdependence leads to increased need to cooperate   Reduction in trade barriers, increased investment   Rapid economic growth   More consumer choice   More access to information, technology, capital   Development of global institutions to cope with globalization leads to increased cooperation   Spread of democratic norms and human rights   Increased ability to spread political messages across borders   Empowerment of non-state actors (ngo’s)   New avenues for political access, redress of grievances   Evolving sense of global citizenship, breaking down of barriers between nations, groups, individuals