Critically Evaluate the Claim That the Processes of Globalization Are Undermining the Democratic State - Essay Example

Table of Contents Introduction 3 Democracy and Globalization 3 Is Globalization a Threat to Democratic 4 Impact of Corporate world 4 Dominance of the Riches 5 Contradictions 6 Globalization and Authoritarian Countries 7 Impact of International Organizations 8 Role of Governments and Individuals 10 Role of Economic Globalization 11 Conclusion 12 References 13 Castells, M. (2010), The Rise of the Network Society: With a New Preface, Volume I, Second edition, Chapter 2, The New Economy: Informationalism, Globalization, Networking. 14 Introduction The aim of the paper is to evaluate the claim that the processes of globalization are undermining the democratic state. Globalization is actually quite a controversial and complex process. The world has been changed in many ways due to it and several countries have come closer due to this. However, although globalization has played a part in bringing countries together, in some ways it has even drifted them apart. Amongst the many changes that have happened due to Globalization, one of the most controversial is the change in the political culture in different countries of the world. Held (2004:34), Dryzek and Patrick (2009:122) and Thompson (1999:76) established that the status of the best form of government is being given to democracy commonly around the world. The discussion includes the definitions of globalization and democracy and the interrelation between them. It proceeds to discuss the threat caused by globalization to democracy and factors of globalization responsible for this threat. The roles of the governments and individuals with to globalization and its impact on democracy has also been evaluated in the paper along with the role of economic globalization in undermining democratic state. The argument is supported by adequate evidences to support the idea of the discussion. Democracy and Globalization Democracy as a concept dates back to the Ancient Greek civilization. The ancient Greek term from which this word is derived is dēmokratía meaning “rule of the people”. Democracy is defined as “a form of government in which the supreme power is vested in the people and exercised directly by them or by their elected agents under a free electoral system.” (dictionary.com, 10 March 2010). Since the downfall of communism, in the late 1980’s, democracy has increased in popularity as a form of government. On a parallel basis, globalization has also received increasing popularity in the last decades with countries opening themselves to it. American entrepreneur Charles Russell created this concept in the late 1800’s, but it got popular by the social scientists and economists. Those in favour of this phenomenon, the Pro-Globalists, have an argument that countries inevitably have to open their borders as they cannot put up a barrier against globalization. If they do so it would mean isolation from the rest of the world and a loss of many benefits that they could have achieved. Hence, through this essay it will be examined if globalization has been the reason these countries have lost the powers of a democratic government set up and if they have, the reasons behind this will be evaluated. Is Globalization a Threat to Democratic State Many scholars agree with the idea that instead of helping the growth of a democratic state, globalization actually poses a threat to them. According to Roland (2002:24), globalization weakens the vital requirements of national identity, patriotism and state autonomy. Due to this reason, one can say that in terms, political globalization is contradictory. According to one of the anti-Globalist theories, the decline of the nation state is being caused due to globalization as governments now have lesser controls over their trade, economy and borders. Impact of Corporate world In another view, complete control over markets, capitals and exchange rates had belonged to the nation state. Today, the state is becoming outdated while trans-national companies have become greatly vital to the economy. Such situations are supportive of the argument that the power of the state and democracy is being reduced due to globalization, which is resulting in a void democracy. According to the Skeptics school of thought, while globalization leads to promotions of opportunities to increase in wealth and greater growth, it has also resulted in greater socioeconomic disparity amongst people, resulting in nations which are less democratic and instead being ruled by rich multinationals (McGrew, 2002:79). According to Nanz and Steffek (2004:27), the main competition among governments is about access to foreign capital and governments now compete amongst each other for foreign capital and design their policies for appeasement of global firms and investors, who might not be accountable to, and nor work for the best interests of the public, the voters. Thompson (1999) asserted that when such a situation prevails, the decline of democracy follows. As previously stated, scholars like Held (1999:34), Thomson (1999:122) and Dryzek (1999:8) are on the point of view that those who are less fortunate, do not receive benefits of globalization and are instead crippled due to it. Held (1999:34) argues that local companies which are unable to compete with multinationals due to the competition getting an international scale inevitably loose from greater economic openness. Dominance of the Riches Hence, in this globalization battle, the unfortunate losers tend to gather unity and support through their religious or ethnic identities. With this, the wealthy economic winners are encouraged to maintain their dominance over the poor ones and to reduce their opportunities. Robertson (1992:32) is of the belief that such actions increase social inequality and affect the progress of the poor which can be done in a true democratic state. However, this inequality is not limited to a country but it can seen at the international level. Speaking in terms of the international community, the drift between the developing countries of the south and the developed countries from the west has also intensified due to globalization. Held (1995:52) points out further that in International forums and organizations, an example of which is the United Nations, it can be seen commonly that the countries of the elite wealthy class have the final say on important issues and conflicts which are discussed; even the politics of the less developed countries are then swayed to their own favor. An argument presented by Held (2006:53), the concept of participation and citizenship should be rooted and active in the population for a democracy to work in a stable and functional manner. Due to Globalization an individual has been transformed into a material man working more for their economic interest and less concerned with the public policy content. Contradictions Observed from the above arguments, there are various reasons to describe how globalization has led to the weakening of democracy around the world. However, as considering any other controversial issue, both the sides of the argument need to be evaluated, so that the implications of the statements could be fully comprehended. As for this reason, several notable scholars have made claims which defend the idea that the spread of democracy in the world has been facilitated by globalization (King and Kendall, 2004:38). According to Schumpeter (2001:98), economic development has been promoted by globalization and this has lead to an increase in the number of well trained and educated citizens. In turn, this has led to reduce income inequality, a quiet contrast to the previous statements. This argument is an illustration of how globalization benefits the freedom and development of people. Globalization and Authoritarian Countries Globalization has increased international business and authoritarian rulers tend to keep the control of business into their own hands which is not possible in a democratic country. Due to globalization, multinationals and their powers have increased immensely since past few years and they also prefer to deal with authoritarian rulers. Nevertheless, there are many people, according to whom, democracy is an important element in international business and it is important for the stability and peace. Its importance cannot be declined for the purpose of investing in international countries. Presently, there have been many revolutions in non-democratic countries and there has been a growing demand for establishment democratic governments in those countries to maintain the peace worldwide. Democratic governments are required because as the economic links get stronger, the authoritarian countries feel the pressure from other countries. Authoritarian countries or states get minimum opportunities to strengthen their economic links and they do not get benefits of globalization because of their rigid policies, as the focus of globalization in authoritarian countries to decentralize their power and hand over the control to the democratic market. Globalization might help immensely in promoting democracy. Wendt (2003:57) suggested that globalization might promote democracy, but what it has promoted so far is the widening gap between the rich and the poor. People are of the view that by trying to make the autocratic countries democrat, there would be intense globalization. Countries are transforming their activities from the national level to the global level. Globalization is not at all about various states, but it is being done at the international level (Held et al., 1999:234). According to Dahl (1999:42), all the states are willing to deal internationally and there is no more a concept of dealing at the national level. The idea of dealing at the national level is an old concept nowadays. Globalization has many challenges to deal with, and there are various challenges in dealing globally. In contrast, globalization helps countries to become independent like NAFTA, EU, WTO and UN. These are the organizations who are working globally and likewise, other organizations are emerging on the bigger and global level. Impact of International Organizations Because of the fast paced era of globalization, states can no longer make independent economic or even social policies. Organizations like the WTO and IMF are asked to make policies because of which market remains as free and liberal as possible by reducing the tax rates, deregulating, make it privatize and considering social activities. These policies of the international organizations encouraged capitalism in the world which has again undermined democracy. Castells (2010: 254) is of the view that because of the various factors like budget and monetary policies, government dependence and exchange rates, governments do not have proper control which they used to have before the era of globalization. At the national level, it has become immensely difficult to control various policies like, monetary policies, not just that, but deciding about the budget, policies related to trade and production, corporate taxes and ability to fulfill the commitments related to social benefits. This means that in order to make a nation progressive, a country needs to adapt globalization. However, there are various points of views where people consider globalization as a serious threat to a welfare state and this is the reason that Scholte (2000:38) noticed that there is a reduction in provisions related to the welfare of the majority of a country. According to Dryzek (1999:41) the era of welfare states is declining with the passage of time as the globalization is increasing. There would be major constraints of the welfare state because of the highly globalized pattern. Though, it should be noted that it does not convey the idea that national level work is completely obsolete because of the highly globalized environment. According to Held (2006:37), it is a nostalgic fiction. Moreover, it does not also convey the idea that these rapid changes are due to the growth of power of MNCs or because of centralized and global financial markets. With the passage of time, there is an increase in the requirement of human rights and the growth on the similar factors, and hence, democracy is the only alternative available for the countries that are following autocratic strategies. The democratic countries have this concept that whosoever is not meeting the demands of humanitarian law, is disobeying the laws of democracy and hence they are considered as autocratic nations which are considered as non progressive in their policies (Dean, 2009:47). Democratic nations feel that autocratic countries do not give this power to its people to raise their voice and government do not consider their opinions while making strategies for the country and this is the reason that many countries took this decision to become democratic. The countries include Iraq and other Sub Saharan Africa. Recently, the organizations like the World Bank and IMF took major steps and decisions to reform authoritarian countries in order to make them investing countries and make them the potential favorites for international investment opportunities. In this way, these countries would also become a significant part of the globalization (Dryzek, 1999:65). Due to globalization, the conflicts between militaries are rising among international countries. Many countries are of the view that globalization gave immense pressure to them to become democratic nation and follow the values made by western culture. Since the period of globalization, there is a cold war between the western democratic countries and the rest of the world. There are countries that do not consider and follow the western pattern of doing economic transactions are pressured and threatened to follow the western practices and are pressured to open up their economic boundaries in order to dial internationally. Democracy is encouraged by globalization and there are numerous benefits associated with globalization. Worldwide global markets rely on the values which are democratic and the organizations which follow democratic practices can enjoy the benefits on globalization as they get this chance to open up their economic boundaries and allow other countries to do various economic activities and explore available opportunities. The involvement of INGO’s and other organizations improve the transparency of dealings which reduces the involvement of states and these all things help in making a country democratic in its economic dealings. Role of Governments and Individuals Governments nowadays are trying to make foreign policies in order to attract worldwide investors to explore the available opportunities and make the most out of it. The policies are solely made to attract the international investors and this may not work in the favor of the citizens of the country which destroys its main purpose (Quan & Reuveny, 2003:39). There are numerous people who do not get benefited with the advantages of globalization; likewise, there are many organizations that cannot compete with multinational internationally which results in the negative outcomes. These negative outcomes of various small countries lead to the failure of the economy of that specific country and hence results in weakness of democracy in that country. Therefore, globalization made all the individuals concerned about their investment and make them feel more interested in exploring the opportunities internationally by coming up with their own strategies and public policies. Globalization has indeed made positive efforts towards making a country democratic in its policies. Through globalization, the productivity has also increased immensely and it helped people to become more educated and independent, that actually leads to economic development for various countries and also it decreases the inequality of the country based on economic activities. If a country has to compete internationally, they have to make democratic policies in order to maintain peace and sustainability in their country and other investing countries internationally (Gill, 2003:48). Role of Economic Globalization As soon as the economic activities become expanded, authoritarian countries feel the pressure in order to become politically liberal countries. Globalization help the authoritarian countries to make their activities decentralized and become part of the democratic activities, not only that, but globalization also help and encourage authoritarian countries to decentralize their power and control to step in the international markets, which are actually following the democratic policies made by various countries, because of globalization, there is a reduced costs in various activities, like travelling and information cost (Keohane, 2001:448). People now can access the information without spending money. It has become easy to get the information from their own government and from the overall world, which actually means that autocratic countries can take and follow the policies of democratic countries and become an integral part of globalization. Autocratic countries can minimize their spending on information while following the democratic policies (Hanen, 1990:76). These are the various reasons because of which globalization is encouraged by various INGO’s and because of them the democratic policies and activities are growing and expanding at a rapid pace since previous decades. Hence, it can be concluded that democracy has lead to various activities of globalization and irrespective of the fact that it has decreased the power of various nations but the democracy has been spread worldwide because of the growing pattern of globalization. Conclusion Though, there are many economists who are of the opinion that globalization has paved the way for the formation of democratic states where there is no democracy. The people of those authoritarian countries have started demanding for democracy and this could have been possible because of the globalization. According to the theories of democracy it is the government of the people, for the people and by the people. If we examine the impact of globalization on these theories we may say that there are democratic governments formed by the people. But according to the moral principles of democracy it can be easily observed that the globalization has undermined the democratic state. The welfare of the common people is totally neglected in this age of globalization and it has also widened the gap between the rich and the poor tremendously. Globalization has increased international business and international flow of wealth but it is limited to only a few people who are capitalists and virtually, they control the world economy and the policies of many countries. This has led to movements like ‘Occupy Wall Street’ in America and similar movements in other democratic countries of the world. If the people of the oldest democratic country of the world are not satisfied with the policies of their democratic government, it sure puts a question mark on the process of globalization. The overall issue is very complex, and difficult to understand. It can also be considered as a serious threat to democracy as it damages the national identity, individuality of a nation and the basic necessities of a state. Many people are of the view that because of globalization, various nations are declining and they lose their control over their country’s economy along with the control over trade and borders. In the recent times, the concept of state is being obsolete and transnational companies are at boom and became a necessity for the economy. Though, there are various advantages and opportunities in being global and dealing globally, the biggest advantage and the opportunity is to grow economically at national and international level simultaneously. The benefits of globalization can outweigh the demerits if the democratic governments make their policies efficiently. This war is two sided and the role of governments is as important as the expanded powers of corporations. Economic and political globalizations do have severe impacts of the state procedures and policies but the widespread benefits of these globalization aspects should benefit the large populations. References Castells, M. (2010), The Rise of the Network Society: With a New Preface, Volume I, Second edition, Chapter 2, The New Economy: Informationalism, Globalization, Networking. Dahl, R. A. (1999) ‘Can international organizations be democratic?’ in I. Shapiro and C. Hacker-Cordon (eds) Democracys Edges, Cambridge: Cambridge University Press, pp19-36.  David Held (2004) ‘Democratic Accountability and Political Effectiveness from a Cosmopolitan Perspective’, Government and Opposition 39(2)  Dean, J. (2009) Democracy and other neo-liberal fantasies: communicative capitalism and left politics, Durham and London: Duke University Press  Dryzek, J. S. (1999) ‘Transnational democracy’, The Journal of Political Philosophy, 7(1): 30-51.  Dictionary.com Unabridged. Random House, Inc.Random House, Inc. Dictionary.com. http://dictionary.reference.com/browse/democracy (accessed March 2010, 10). Dryzek, John and Patrick Dunleavy (2009) Theories of the Democratic State, Basingstoke: Palgrave MacMillan, Ch.14 ‘Globalization’.  Gill, G. (2003) The Nature and Development of the Modern State’, Basingstoke: Palgrave Macmillan, Chapter 7 ‘State Capacity in a Globalised World’  Held, D. (2006) Models of Democracy (3rd edition), Cambridge, Polity, Chapter 11 ‘Democracy, the Nation-State and the Global system’.  Held, D. (2006) ‘From City States to a Cosmopolitan Order?’ in Goodin, R.E. and Pettit, P. (eds) Contemporary Political Philosophy, London: Blackwell, pp.107-125  Held, D. (2006) ‘From City States to a Cosmopolitan Order?’ in Goodin, R.E. and Pettit, P. (eds) Contemporary Political Philosophy, London: Blackwell, pp. 674-696  Held, David (1995) Democracy and the global order: from the modern state to cosmopolitan governance, Cambridge: Polity, especially chapters 6 and 12.  Held, David (1999) ‘The transformation of political community’, in I. Shapiro and C. Hacker-Cordon (eds) Democracys Edges, Cambridge, Cambridge University Press Keohane, R. (2001) Governance in a Partially Globalized World, “American Political Science Review”, 95(1):1-13.  Marsh, D. et al (2006) ‘Globalization and the State’, in Hay, C. et al. (eds.) The State. See also Ch.10 Sorensen, The Transformation of the State’  McGrew, A. (2002) ‘Transnational Democracy: Theories and Prospects’, in A. Carter and G. Stokes (eds) Democractic Theory Today, Cambridge, Polity Press, pp.269-294.  Nanz, P. and Steffek, J. (2004) ‘Global Governance, Participation and the Public Sphere’, Government and Opposition, 39(2):314-336.  Roland A., (2002) ‘What’s Wrong with Cosmopolitan Democracy?’ in Nigel Dower and John Williams, (eds) Global Citizenship: a Critical Reader, Edinburgh: Edinburgh University Press.  Schumpeter, J. A. (2001) Capitalism, Socialism and Democracy.New York: Harper and Row, 1950. Thompson, D. (1999) ‘Democratic Theory and Global Society’, Journal of Political Philosophy, 7(2):111-125.  Quan & Reuveny, Li & Rafael. 2003, Economic Globalization and Democracy: An Empirical Analysis. British Journal of Political Science, 29-54. Wendt, A. (2003) ‘Why a World State is Inevitable’, European Journal of International Relations, Vol.9 (4), pp.491-542.  Read More