Globalization and Politics - Coursework Example

Globalization and Politics [Lecturer] Introduction The issue of politics, let alone globalization may offer sensational headlines, heated debates and varying opinions within their own right let alone on how each may affect the other, however it is important to note that many of the issues of globalization are closely tied to capital inflows, direct foreign investment (Berger 2000) and hence the resultant creation of opportunities in a variety of contexts within the country concerned. The political aspect thereof can be viewed in a number of ways, as well as the effects of such globalization upon policy framework, which includes the likes of foreign exchange policies and related issues pertinent to companies engaging in global operations in various economic markets and sectors. With authors suggesting that Politics (or the State) and Globalization are incompatible (Cameron & Palan 2004) to that of “domestic politics remain resilient in the face of globalization” and “income inequality” (Mahler 2004), privatized economies who remain under the control of governments (Keating 2004) and the effect of such globalization on the society by influencing the law policies and policy making procedures of a country or region (Caruso 2006) which are inadvertently brought about by the ruling political party of the day. One might therefore draw the conclusion that politics certainly do influence globalization issues within a specific country, making it either attractive or unattractive to the company seeking such expansion opportunities, with the political infrastructure once again influencing the resultant income equalities or inequalities of such capital inflow and direct foreign investment within a defined region. These opinions can be viewed from either end of the spectrum, and within this analysis the issue of globalization is viewed as a positive aspect of an economy and discussion will be made regarding the positive impact politics can have thereupon. Politics and Economics The very definition of globalization itself remains a contested topic amongst academics, and discontents alike. However in order to view and argue the case of globalization, an assumed or at the very least an accepted definition of the concept and term is required to gauge the impact of politics thereupon. Scholte (2000) provides that a widely acceptable fact is held amongst politicians and marketing agents that the concept remains a “malleable, catchall term that can be invoked in whatever way the user finds convenient”, however this is inconvenient with respect to “serious social analysis and the policy recommendations that flow from it” (p. 42). Within the aforementioned context this poses a problem for the politician and politics in both of these views, as the politician may well wish to encourage foreign investment, whilst at the same time ensure legal and sound policy framework and infrastructure incorporating the aspects of companies, and other countries, investing in the jurisdiction concerned. This balance between what one may view as an opportunistic perspective within the marketing realm, and the policy and legal perspective is arguably where many problems may arise of the view of globalization, albeit on a perceptive basis. Politics, according to Keating () have often times been given the blame for economic policy formulations and framework within a country based upon globalization, however the author further provides that although this is a contributing factor, it is but one of many and more importantly “in most instances it is not the most important reason” (p.7). This serves to confirm that politics does in fact affect the progress of globalization based upon the formulation of the mentioned economic policies and framework within a respective country, however what needs to be established is the motivation in terms of both politics and economic framework of a country that globalization is taken into account for during these processes. A closer look at politics provides insight into the motivation of certain policy frameworks, within the context of the economic sector, which encompasses specific issues pertaining to globalization, and how these issues may affect such globalization. Essentially the underlying framework of a country or region either allows or disallows for market entry of a corporation with respect to expansion into the given region. This allowance or disallowance is held in the policies of the region concerned with respect to advantageous or disadvantageous business and environmental conditions pertaining to foreign companies investing and entering the market in question. Keating (2004) provides that from an external perspective of politics, it “is increasingly seen as a process of brokering special interests instead of fulfilling a vision of the public good” (p. 158). This may raise the question as to whether the political agenda is skewed with possible reference to a corruptive element within decision making processes when it comes to such economic policy framework. The political players “of the day” may therefore influence policy framework, either guided by the perceived wellbeing of the voters that put the politicians into power, or motivated by their own motives with respect to passing any relevant allowances or disallowances from both an economic and a legal perspective within the region, which is apparent within many emerging markets that have traditionally been marginalized. In understanding why and how politics play a role here, Brady, Seeleib-Kaiser & Beckfield (2005) provide how politics are inextricably linked within the economic perspective via the fact that we in order to understand we have to comprehend “the nature of the linkages between national economies and the world economy, and changes in such linkages”, which supports the preceding discussion of such motivation being tied to the mentioned linkages of national economies together with that of the world economy and factors directly and indirectly affecting these connections. The type of State in question with respect to the political ideology may well be prone to the influence of globalization on politics and vice versa, which is further confirmed within Brady et. al. study of the welfare state and the effect of such globalization, which in itself presents a large number of conflicting theory with respect to how each of these aspects either affect each other, or the region in question. In delving deeper into the relationship of politics and economics, Caparoso and Levine (1992) provide valuable insight into these concepts. The authors provide that these two concepts are in fact very similar with respect to the fact that they are “both methods of allocation”, with the differences being largely held in the formalities of authority within the case politics, and “juridically voluntary exchange” within the case of economics (p. 16). Caparaaso & Levine support the preceding discussion of motive or motivation of such resource allocation based upon such allocation, being based upon the self-interest or the collective interest. Globalization There are a variety of ‘definitions’ and perceptions surrounding the very term of globalization, and just as many debatable issues too. In order to appreciate the effect that politics may or may not have on globalization, it would make sense to establish as broad a definition as is possible. This is required to ensure at the very least the most impartial analysis of such political effects upon globalization. Additionally one has to define globalization within the context within which it is being discussed, this is due to the fact that authors such as McCall, Mobley & Weldon (1999) provide a relevant and accurate definition of globalization, however it is more concerned with the use of products that may not necessarily be based upon the traditional norms of a culture, within their analysis of the replacement of traditional garments being replaced by the blue jeans clothing item, and thereby disrupting a social or national ‘equilibrium’ or so called tradition (p. 146). The implication of this is beyond the scope of this discussion as the context herein refers specifically to that of the political, as well as the economic environment and within the realm of ‘doing business’ so to speak across borders, regions and social divides. A more ‘economically based’ definition would therefore be required to justify this analysis and discussion, of which Baghwati (2007), who also considers the issues of child labor, environmental degradation and the aforementioned homogenization of cultures provides a more economic view thereof. Additionally the view that “globalization is often seen as global Westernization” (Boli & Lechner p. 16 2004) is not the issue at hand here, as this can be argued more within the mentioned homogenization of cultures, and if one considers the amount of trade, products and services moving from East to West this raises a new discussion in its own right. Therefore for the purposes hereof the definition of globalization that is considered is taken, and adapted from Gangopadhyay (2005) in the existence and continued development of connectedness, dependency and interdependency of economic exchange on a global basis “as a process of extending certain economic activities to other parts of the globe” (pp. 212-214). The concepts of economics and economic exchange are addressed herein, and are discussed in preceding section, whilst the concepts of connectedness, dependency and interdependency follow herewith. Connectedness may refer to trade agreements and arrangements that enable regions to trade freely, or within the parameters as laid out with the statutory laws and regulations of the time, and specific countries. The reason as to why this might come about may vary quite vastly, and a simple analogy might include the fact that one region may have an excessive production or resource of a specific commodity as compared to another, which enables such a commodity to be made available to the region lacking such commodity. An example of this may be quoted as supplies, whether essential or luxury and are in demand by those lacking such supplies, as in the case of gold production in South Africa which is one of their main export commodities and therefore contributors to the economy, which occurred even in times of ‘isolation’ during the apartheid era (Venter 2004). Additionally the formation of the North American Free Trade Agreement (NAFTA) and the European Union (EU) further support the issue of connectedness, with respect to the relevant countries and regions within the mentioned free trade agreements and regions. In terms of interdependency, which may arguably be the best case scenario, in that both ‘parties’ stand to benefit from such a relationship would provide that each country or region has something which the other requires and therefore such a interdependency is forthcoming in addressing such needs. Dependency is perhaps the root of many of the arguments and debates that surround globalization within the broader context, and this may apply specifically apply to that of nations that may well require foreign direct investment in order to create employment, and whereby the companies concerned take advantage thereof, as in the well known case of the Nike “sweatshops”. Alternatively the dependency may be viewed within the context of countries that have degraded so badly, even under their own leadership such as that of Zimbabwe and a number of other countries, that such dependency exists from a lack of resources largely due to the mismanagement and corruption of so called elected officials and politicians. Although this may be a tragic state of affairs, such globalization in terms of dependency may well be a saving grace in the longer term, which of course extends beyond this discussion. Globalizations and Politics Although mention is made of policy-makers and governments, the fact that politics occurs within the structure of governments and the fact that these governments are normally accordingly elected by virtue of political activities (Caporaso & Lebine) must be taken into account as to the use of these institutions, individuals and statutory bodies where relevant. Having discussed the two sides of the topic here, it becomes easier to put forward an argument or opinion within the matter of whether politics has an effect on globalization, and how important such effect really is. Once again there will always be conflicting opinions, arguments and debates within this discussion and it may well continue for a long time to come, especially considering the fact that in the opinion of authors such as Gangopadhyay (2005) provide that the globalization and interconnectedness of nations has been developing, and changing in excess of five hundred years, and continues to do so today as certain political ideologies arise and others crumble. If the politician truly wishes to retain a typical welfare state, Brady, Seeleib-Kaiser & Beckfield (2005) provide that the governments cannot “scale back expensive welfare programs”, however the result of not doing so places that welfare state at a disadvantage of economic competitiveness and integration, which in turn will directly affect the production and resultant employment within the region concerned. This is due to that fact that simple market ‘laws’ continue to determine demand & supply factors such as that of pricing, which is based upon such competitiveness between organizations or nations. Additionally if we take Held’s (2000) thoughts on the matter of globalization, and specifically that of policy-makers, Held provides that in order to embrace economic globalization the policy maker (and even politician) will have to “disempower themselves and to settle for a reduced set of expectations of what can still be done to manage the international economy and perhaps equally importantly, to manage any single national economy so as to protect the living standards of its citizens” (p. 122). This last quotation from Held is essentially the center of this analysis in that the politician must decide whether such globalization is in fact within the region’s (or country’s) best interest, which will directly affect the participants, being the society of that region, either positively or negatively. The importance of politics on globalization therefore can never be understated, but rather within a democratic society the onus rests upon the people who will put their representatives into power. References Bhagwati, J. N. (2007). In defense of globalization. Oxford: Oxford University Press. Beck, U. (2000). What is globalization?. Cambridge [u.a.: Polity Press Berger, Suzanne. 2000. Globalization and Politics. Annual Review of Political Science 3:43–62. Boli, J., & Lechner, F. (2004). The globalization reader. Malden, Mass. [u.a.: Blackwell. Brady, D., Seeleib-Kaiser, M., & Beckfield, J. (2005). Economic Globalization and the Welfare State in Affluent Democracies, 1975-2001. American Sociological Review, 70, 6, 921-948. Cameron, A., & Palan, R. (2004). The imagined economies of globalization. London [u.a.: SAGE Publ. Caporaso, J. A., & Levine, D. P. (1992). Theories of political economy. Cambridge u.a: Cambridge Univ. Press. Held, D. (2000). A globalizing world?: culture, economics, politics. London: Routledge in association with The Open University. Keating, M. (2004). Who rules?: How government retains control in a privatised economy. Annandale, NSW: Federation Press. Mahler, V. A. (November 01, 2004). Economic Globalization, Domestic Politics, and Income Inequality in the Developed Countries: A Cross-National Study. Comparative Political Studies, 37, 9, 1025-1053. McCall, M. W., Mobley, W. H., & Weldon, E. (1999). Advances in global leadership. San Diego, CA: JAI Press. Gangopadhyay, P. (2005). Economic globalization in Asia. Aldershot [u.a.: Ashgate. Scholte, J. A. (2000). Globalization: A critical introduction. Basingstoke, Hampshire [u.a.: Palgrave. Read More