1. POLS 374 Foundations of Global Politics
Lectures 9-10: Globalization and Production
October 24 and 31, 2006

2. Globalization and Production
Chapter: Main Points
The relationship between capitalism and globalization is reciprocal. That is, capitalist development drives globalization, but globalization also drives capitalism
This reciprocal relationship, in general, has created the basis for the development of a new form of capitalism, which the author refers to as hypercapitalism

3. Globalization and Production
Hypercapitalism
Hypercapitalism, to repeat, is an extreme form of capitalism. Extreme in terms of reach and embeddedness in society

4. Globalization and Production
Hypercapitalism: Commodification
In terms of reach, hypercapitalism stretches to virtually every corner of the world today, including to such supposedly isolated spots as North Korea

5. Globalization and Production
Hypercapitalism: Commodification
Capitalism in North Korea?
To see a video on the Kaesong Industrial Complex: Click on either picture

6. Globalization and Production
Hypercapitalism--Embeddedness
The expansion of capitalism has also entailed greater and greater embeddedness, not only in economic matters, but also in our consciousness
Today, people throughout the world increasingly associate capitalism with democracy, freedom, progress, and with the fulfillment of human potential

7. Globalization and Production
Expanded Commodification
Author breaks down the process of commodification into several areas:
primary and industrial capital
consumer capital
finance capital
information and communications capital
genetic and atomic capital
care capital

8. Globalization and Production
Expanded Commodification
Primary and industrial capital—e.g., agricultural products, mining, heavy manufacturing (steel, chemicals, shipbuilding), construction, oil and gas
These used to be the core of any major economy, but they have been steadily declining in relative importance

9. Globalization and Production
Expanded Commodification: Consumer Capital
Consumer capital: Refers to surplus accumulation that is realized in the context of hedonistic consumption

10. Globalization and Production
Expanded Commodification: Consumer Capital
An Example of Consumer Capital: The Diet Industry

11. Globalization and Production
Expanded Commodification: Consumer Capital
Key Point: Consumer capital and globalization are intimately related
For instance, once a new desire is created in one part of the globe it quickly spreads to other parts of the globe:
Commodities become largely de-nationalized in a globalized world, which spurs even greater accumulation

12. Globalization and Production
Expanded Commodification: Consumer Capital
Denationalized Products: Athletic Shoes

13. Globalization and Production
Expanded Commodification: Finance capital
Key point: In the past, “finance” was primarily a medium of exchange
It still is today, but it is also a commodity in that people use the trading and selling of money itself to accumulate a surplus

14. Globalization and Production
Expanded Commodification: Finance capital
Another Example: Real Estate
In real estate, an increasing number of people buy houses not to live in them, but to profit from “flipping them”
This is made even easier by the fact that banks have come out with new types of loans “products” (stated-income, ARMs, “principal only” loans) that make it possible for even relatively poor people to buy multiple properties
For an interesting case, click here

15. Globalization and Production
Expanded Commodification: Other forms
Information and communications capital (ICC)
Genetic and atomic capital (e.g., biotechnology and nanotechnology)
Care capital

16. Globalization and Production
Expanded Commodification
Summary: globalization has played an important role in widening the range of capitalism and reorienting the relative weights of accumulation away from “merchandise” (commercial and industrial capital) toward “intangibles” (finance, information, communications, genetic and nano capital). To this extent the “real” economy has acquired a different reality.

17. Globalization and Production
Altered Organization
Globalization and hypercapitalism are characterized by significant shifts in organization; these shifts are most clearly emphasized in the following areas:
Proliferation of offshore centers
Emergence of global companies
Dramatic increase in mergers and acquisitions
Rise in concentration

18. Globalization and Production
Altered Organization
Offshore Gambling Sites: Recently offshore gambling has become a major enterprise. Consider the following site:

19. Globalization and Production
Altered Organization
Global Companies
List of Largest Global Companies:
Compare to economic size of countri es