Internationalism Projects of Perestroika and NAFTA - Essay Example

Internationalism Running Head: INTERNATIONALISM PROJECT Internationalism Project By Internationalism 2 Internationalism Project The advent of globalization has opened a lot of doors. The trade of goods virtually unfettered by stringent regulations has made it possible for developing and underdeveloped countries to trade with highly industrialized nations and the latter have found new market for their products, signaling economic growth for all parties. There is however a downside to globalization. The international open door policy not only made possible free trade of goods but herald the arrival of transnational crimes as well. “Perestroika” and NAFTA are two policies which have changed the course of lives not only for countries which opened their doors for the first time to economic trades but to the United States as well who was made a major party of the said countries’ assimilation to the international economic landscape. The Birth of Perestroika and NAFTA “Perestroika” is a Russian term which literally means rebuilding. It originated first in the 18th century and re-emerged in the 1980s when Mikhail Gorbachev, then the President of the Union of the Soviet Socialist Republic (USSR), used it as the slogan for his economic reforms. During that time, perestroika was used not only to refer to economic reforms with the use of technological advances at the minimum cost of time, resources and effort but eventually evolved into a revolutionary term which subsumed social and civic reforms. But rather than the usual Internationalism 3 ‘class struggle’ implied with the Marxist kind of revolution, perestroika sought to foster class cooperation for the good of society (Zemtsov 1991). Perestroika was born in the 1980s as an emergency response to the crisis in the USSR. The nation was then spiraling down on many levels: the economy was perilously going downwards, and; alcoholism, drug addiction, corruption were collectively causing social breakdown. The prospects of the nation were bleak and it needed a dose of radical change to keep it alive. Hence, there was a need to implement perestroika (Zemtsov 1991). When Carlos Salinas assumed the presidency of Mexico in 1988, the General Agreement on Tariffs and Trade (GATT) was already in effect in the country. Continuing the liberalization efforts of the previous administration, Salinas implemented more economic reforms like privatization of public corporations and opening the economy. The immediate effect however, was unemployment and a deepening poverty of the people. Discontentment and loss of political support for the Salinas’ administration ensued and the President had to find a drastic remedy which came in the form of an open trade negotiation with the United States and Canada Thus, the North American Free Trade Association was born (Bromley 2004). NAFTA actually consisted of two parts. The first part came in 1986 which was an agreement only between two countries – the USA and Canada – and was called the Free Trade Agreement (FTA). In 1992, the entry of Mexico made it into a trilateral agreement and the pact has the following objectives: “to eliminate barriers to trade in the region covered by the agreement; to promote fair competition within the region; to expand investment opportunities in the region; to ensure the proper protection and exercise of intellectual property rights within the region; to establish effective procedures for the execution of agreements and the settlement of Internationalism 4 disputes, and; to create a framework for diversified regional cooperation among the three economies, so as to increase the benefits produced by the agreements (Yamazawa 2000). Perestroika and the NAFTA: Economic, Political and Social Global Impact The policy of perestroika had unwittingly caused the breakdown not only of the Soviet economy but also the integrity of its own territory. As a means of implementing perestroika, Gorbachev decentralized “decision-making to the enterprise level”, encouraged “the cooperative movement” and attempted to “open the Soviet economy to the world market.” These three reform measures further destabilized the already ailing Soviet economy because the first two created an increase of demand on supplies unfettered by unvarying prices. People hoard supplies to protect themselves and as a result there was a shortage of goods. Previous to perestroika, the Soviet’s abided by the policy of autarky or economic self-sufficiency and non-dependence on imports and outside aid. When the Soviets however opened up their markets, the long reliance on the policy of autarky revealed that the Soviets had lagged behind in technology and in order for their products to compete globally they had to allow their prices to take a virtual freefall. The Soviet economic condition was further exacerbated by the collapse of Eastern European countries, the Soviet bloc and eventually the USSR itself (Hardt et all 1992). The political impact of the perestroika is that it eventually brought the end of the cold war. The power which was previously shared on the opposite side of spectrum and in a constant political clash by the United States and the Soviet Union had shifted to one side and took the Internationalism 5 other side out of the equation. When the Soviet Union, led by Gorbachev decided to focus on the issue of economic reforms, for once acknowledging the declining economy of the nation, it had tacitly given up its claim as one of the top world powers alongside the USA. The actual collapse of the Soviet Union and its formal announcement in 1991 heralding the official end of the cold war did not come as a surprise. The classical view according to author Ernesto Cordova is that free trade would result in an “efficient allocation of scare resources, while at the same time expanding a country’s consumption possibility frontier.” The NAFTA experience however, do not clearly establish a positive economic advantage. In Mexico, the manufacturing sector and the Foreign Direct Investments have risen over the years corresponding to the NAFTA implantation but there are other possible explanations to these not attributable to NAFTA (Cordova 2001). Comparatively speaking however, among the three countries it would seem that Mexico profited from the agreement with the US gaining less from it and Canada in the middle which could lead to the conclusion “that the larger the economy, the lesser is the impact of the free trade” (Chamber & Smith 2002). NAFTA likewise brought about “the restructuring of the Mexican economy. Together with the accompanying phenomenon of the intellectualization of production, it raised the importance of the service industry, thereby modifying the previously prevalent sectoral schemes (Barrow et al 2003) The successful negotiation by President Salinas of the NAFTA had led to his political stability in Mexico. Prior to NAFTA, his victory at the polls was largely suspected as fraudulent and his reforms led to unemployment and alienation at home. NAFTA gave Salinas political credence and the resurgence of his party in Mexico (Bromley 2004). Mexico’s s entry in the Internationalism 6 NAFTA earned the country a reputation for having gone global. Placing Mexico in a circle with two of the most industrialized nations in the world and in the region created a certain political image for the country. Likewise, it revived talks on its relationship with a neighbor with which it had a history of conflict in the past (Barrow et al 2003). Perestroika and NAFTA: Transnational Crimes, Public Corruption and Economic Growth According to the book International Terrorism and Political Violence, perestroika became a springboard for the growth of organized crimes. The economic disturbance and “trifling of the underground economy” gave rise to the so-called organized crimes (Barnhart and Lewis). As a result of perestroika, where the Soviet Union had let loose Eastern European countries from the Soviet bloc, and businesses were privatized, organized crimes began to grow and flourish. These groups penetrated the markets and the emerging economies and the Russian mafia began to grow. When perestroika gave economic powers to the enterprise level and allow them to dictate and determine the production of goods, the traditional standard of the working elite profile changed. The professionals like doctors, lawyers, teachers and the like were overtaken at the top by the rich entrepreneurs who were willing to use their money and even commit crimes. Statistics show that organized crimes grew by 16% from 1989 to 1994 and crime rates by 100%. Criminals went scot-free because judges who had low salaries were often bribed by Mafia bosses (Dawisha 1997). Also, because the borders in the said countries are loose, and the currencies are Internationalism 7 easily convertible, drug trafficking as well as other crimes have become rampant and the drug addiction rate are growing at an alarming rate (Farer & Stone 1999). Perestroika inspired corruption in the Soviet. Liberalization, privatization and denationalization which are all subsumed in the policy of perestroika were implemented, the powerful took advantage to get their hands on the converted wealth of the Soviet Republic. “State resources, in the form of property, low interest credits, and profitable contracts, started to flow over to semi-state and later to private entities” (Klein & Pomer 2001). The emergence of transnational crimes due to free trade agreements has never been illustrated clearly than in the NAFTA case. Perhaps this is due to the fact that the US and Mexico are separated by mere borders and are navigable by land, making it easier to smuggle illicit goods and even people. The implementation of the NAFTA has unwittingly given opportunities for increased drug trafficking and illegal immigration. In Mexico, for example drug traffickers have established all kinds of fronts like warehouses in anticipation of the cross-border commerce because of NAFTA (Farer & Stone 1999). According to the book The Three US-Mexico Border Wars, drug cartels today cross the US-Mexico borders by using the NAFTA trucks to load their illicit goods. Tons of these illegal drugs are hidden inside these trucks under the very noses of the Border patrol. The rationale for this is that only a small portion of the 5 million trucks that cross borders everyday are being inspected due to time constraints (Payan 2006). Recently, there is less enthusiasm for NAFTA because of unfavorable results like illegal immigration which has not waned despite the NAFTA, unresponsive Mexican economy, inadequate increase of jobs, a steadily growing corruption in addition to unabated drug trafficking (Payan 2006). Internationalism 8 References Barnhart, Stephen R & Lewis, Barry Dean. (2002) International Terrorism and Political Violence. Trafford Publishing, pp 240.   Barrow, Clyde W & Didou-Aupetit, Sylvie. (2003). Globalisation, Trade Liberalisation, and Higher Education in North America. Springer 2003 Bromley, Simon. (2004). Making the International: Economic Interdependence and Political Order. Pluto Press, p Chambers, Edward J., & Smith, Peter H. (2002). NAFTA in the New Millennium. University of Alberta, p 26 Córdova, Ernesto López. (2001). NAFTA and the Mexican economy: Analytical Issues and Lessons. BID-INTAL, p 12 Dawisha, Karen. (1997). The International Dimension of Post-Communist Transitions in Russia. M.E. Sharpe Farer, Tom J. & . Stone, Jon R. (1999). Transnational Crime in the Americas: An Inter-American Dialogue Book. Routledge, p. 14 Hardt, John Pearce & Kaufman, Richard F. (1993). The Former Soviet Union in Transition. M.E. Sharpe, pp 39-32 Klein, Lawrence R. & Pomer, Marshall I. (2001). The New Russia: Transition Gone Awry. Stanford University Press, p 234 Internationalism 9 Payan, Tony. (2006). The Three U.S.-Mexico Border Wars: Drugs, Immigration, and Homeland. Greenwood Publishing, p 34. Wiarda, Howard J. & MacLeish, Margaret. (2003). Politics and Social Change in Latin America: Still a Distinct Tradition? Greenwood Publishing Group, p 276 Yamazawa, Ippei. (2000). Asia Pacific Economic Cooperation (APEC): Challenges and Tasks. Routledge. Zemtsov, Ilya. (1991). Encyclopedia of Soviet life. Transaction Publishers, p 223. Read More