Globalisation in the New Millennium - Essay Example

Globalisation in the New Millennium Introduction Globalisation is a hot topic for many individuals, agencies, organizations and government departments who find themselves of having to defend or attack the current globalisation trends. The debate over its positive and negative effects continues on. Like some other isms, it has become an all-purpose tag that can be wielded in almost any ideological direction that it is perceived differently by diverse groups who have their own set of definitions. Much of the globalisation literature actually is confused according to Sociologist Leslie Sklair (1999) which may explain the ever-which-way globalisation is defined. Partly, this may be because not all those who use the term distinguish it clearly enough from the popular notion of internationalization. Some writers, in fact, use the two terms interchangeably (Ibid.). Literature shows there is no single agreed definition of globalisation, but that it may be the concept of the 1990s. According to Sklair’s (1999) research, its importance is much exaggerated, but most books suggest it is an idea whose time has come. To sort out all these ideas, globalisation as a concept makes use of Sklair’s (1999) taxonomy of perceiving globalisation in this paper towards the end. Each model is briefly discussed and analyzed from the point of view of sociology. The discussion tapers with a summary of these models, and as presented by Sklair (1999) makes note that they are dominated by European European-North American literature devoid of views from Asia. However, these are only done after discussions in light of how globalisation as a phenomenon has prevailed in the new millennium. Globalisation in the new millennium What follows are how globalisation has visited the new millennium politically, economically, socially or otherwise. Globalisation, interpreted as global economic integration, is argued, as not being recent since there have been periods of globalisation over many centuries. (IPS, n.d.) It is only that there is now the increasing speed of movement of goods and services, people, capital and technology being experienced around the world. Specifically globalisation in the new millennium is marked by accelerated reduction in transport and communication costs, greater international specialization because of liberalization of trade, increasing trade in services due to the digital revolution, and increasing integration of major emerging markets into the world economy. (IPS, n.d.) . Politically, Macedo (n.d.) would add, the increasing alignment of cultural standards and standards of consumption; the weakening of the idea of Nation State, and the development of commercial blocs. To demonstrate the power that a large company can have over a medium sized country, WGTR (2005) searched the newspapers for a story showing how a translational corporation may deal with a contentious issue that negatively affects the sovereignty of a country. An Oct 2003 story tells how Ford is planning to cut jobs at a plant in a European country. The Toronto Star story (10/2/2003) entitled “Ford set to scrap 3,000 Belgian jobs” was written by Raf Casert of Associated Press. Filed from Brussels, it said Ford Motor Company has cut more deeply into its European workforce, scrapping 3,000 jobs at the company’s main Belgian plant in Genk and cancelling promised investment. This was allegedly because of the deteriorating car market. The President of that country has met with Ford officials but the cuts are going to take place anyway. According to the story, Belgium is upset that they previously gave concessions to Ford in order that Ford would do business in the country and employ many people, but this has not been reciprocated as much as Belgium would have liked. Because of globalisation, technological advances in transportation have increased the speed and improved the reliability of transport, enabling firms to extend beyond the country. Advances in communications also have facilitated global transactions and improved the flow of information. This kind of change, however, has also affected the structure of firms and the location of ownership and management among regions and countries (IPS, n.d.). The worldwide web and the internet, for example, have contributed to further integration of international markets, enabling competition that is more effective and international convergence in prices for traded goods and services. They have also facilitated fundamental changes in the way businesses are run (Ibid). The technological changes of the past few years, however, have eliminated more jobs than they have created. The competition is that, as part of globalisation, the winners come out on top and win big, and the losers lose even bigger. Further, higher profits no longer mean more job security and better wages so that actually globalisation delinks the fate of the corporation from the fate of its employees." (Korten, 1998. Quoting Klaus Schwab and Claude Smadja, respectively president and managing director of the World Economic Forum. International Herald Tribune. 2.1.1996). Renato Ruggiero (1996) of the World Trade Organization spoke the most enthusiastic of what he calls today’s globalizing economy already launched on a path towards global economy. Ruggiero said changes are reflected in the growing volumes of world trade. He said, “One by one, trade and investment barriers will continue to be swept away by globalisation, like leaves on an autumn day. But the force of these winds of changes is already testing our ability to adapt.” The immediate challenge accordingly is to integrate a rapidly ascendant developing world. In his own words - Production is now mobile, capital footloose, technology diffuse. Developed and developing alike, we are all competing for the same investments, for the same markets, for the same innovative edge. In this sense, globalisation has erased the old ground rules of economic growth, providing countries, once relegated to perpetual "third world" status, with the tools to fast-forward their development. Unprecedented growth rates of certain industrializing countries in Asia and Latin America are evidence that a huge shift in economic power is underway. Developing countries now account for a quarter of world trade compared to less 20 per cent five years ago. A third of the worlds 25 leading exporters and importers are now developing countries, including Argentina. . Some disagree, however, with this entire positive appraisal. Wall Street Journal/NBC News poll found that 58% of Americans believed that trade had reduced U.S. jobs and wages, a view that is almost never expressed by commentators or those who shape public opinion. As recorded by WTGR (2005), American public opinion is, in the majority, negative towards Globalisation. Canadians are even further affected on an individual basis by international trade since a higher proportion of Canadians have jobs that are affected by international business competitiveness. Campbell (n.d.) said globalisation should be seen not as a model for economic development, but rather an ideological argument to defend exploitation, environmental destruction and the devastation of large parts of the world for the sake of profit. In the world economy, he said, production has become more international and some industries such as electronics ad textiles have been able to relocate to the underdeveloped world. Campbell (n.d.) explained that most economic activity, however, takes place between industrialized countries and those countries that are not located in North America and Europe whereas Southeast Asia have been left to stagnate. To Korten (1998) who gives a scathing evaluation to globalisation, this phenomenon is causing severe economic dislocation and social instability. As he expounds, an unregulated global economy dominated by corporations that recognize money as their only value “is inherently unstable, egregiously unequal, destructive of markets, democracy, and life, and is impoverishing humanity in real terms even as it enriches a few in financial terms.” Writing for agriculture in India, Mollah (2002) said globalisation has also had an adverse effect on work and wages, food security and employment. Export oriented agriculture is gradually reducing the area of food cultivation, as more and more land is being used for cash crop production, she said. Accordingly, this is helping only the rich farmers who get all help from the government and increase their income by exporting their products. Moreover, the impact of globalisation on the agrarian sector has worsened the plight of agricultural workers. Accordingly, the shift of labour force from agriculture to other sectors, as projected by the World Bank-IMF model, has not taken place, because about 65 per cent are still engaged in agriculture (Ibid) 2002). She wrote - “Most of agricultural workers are illiterate, backward and poor, and have no idea of the mechanism of exploitation and miseries which the rich countries are heaping on them through their philosophy of globalisation and its insidious methods. If these suffering masses fail to identify their real enemies, they will only continue to blame their fate and stars or their immediate neighbours. There is also the risk that vested interests may misuse the situation to pit the agricultural workers against, say, poor or middle peasants or against industrial workers.” In the social sphere, Frank Lechner (2000) who maintains a website on globalisation says the concept of globalisation broadly refers to the expansion of global linkages, the organization of social life on a global scale, and the growth of a global consciousness, hence to the consolidation of world society. This definition, he says, captures much of what the term commonly means, but many dispute its meaning. Culturally, globalisation would refer to "the compression of the world and the intensification of consciousness of the world as a whole" (Robertson, 1992). In thought and action, it makes the world a single place, and what it means to live in this place, and how it must be ordered, become universal questions. These questions, accordingly, receive different answers from individuals and societies that define their position (Ibid).Ruggiero (1996) would enthuse - “The most fundamental transformation of all is occurring at the level of awareness. Telecommunications is creating a global audience. Transport is creating a global village. From Buenos Aires to Boston to Beijing, ordinary people are watching MTV, they are wearing Levis jeans, and theyre listen to Sony Walkmans as they commute to work. Perhaps in the present world we can still imagine some government blocking Levis jeans or MTV at the border. However, if you stop goods and services the consequence would be massive migration of people and of investment. What is going on is a citizens revolution on a global scale. In addition, even those who do not like the direction globalisation is taking us, have no realistic plan to put the Genie back in the bottle. “ Giving the Islamic fundamentalism as a case in point, Lechner (2000) says globalisation provokes reaction or resistance. Change can originate anywhere, he said, but the theory of world culture is “causally agnostic.” In addition, as demographic changes will reshape the global economy, population aging will generally occur faster in advanced economies, international migration will increase markedly (IPS, n.d.). With globalisation, it is anticipated that there will be increasing pressure on all countries to “move up the value” chain, that is, engage in high value-added productive activities. To do this, most countries will need to accelerate innovation and the diffusion of new technologies. Moreover, they will also have to improve skill levels of their workforces. Therefore, while skill levels are rising worldwide, they are rising most rapidly in emerging market economies. Rising skill levels is said to contribute to the rapid decline of some traditional sectors, needing structural adjustments that may be painful. (Ibid.). Integration A CEPR report  released in July 2002 .through their website (www.cepr.org/press/PP8.htm, cited in Lechner 2000) finds that many of the charges levelled against globalisation are misguided. According to the website, many economic evidences point out that globalisation brings great benefits as well as costs. It offers the opportunity for a higher rate of sustainable growth that translates into longer, healthier lives and improved living standards.  It says trade is also associated with lower inflation and less corruption. There is openness to trade, financial liberalization, and global   financial integration that are necessary conditions for sustained economic growth. Moreover, the report said, the increasing integration of the worlds economies does not inevitably increase the inequality of incomes as reported now and then by different quarters. In other words, it does not cause poverty. Further, there is little evidence that governments are losing power to multinational corporations (Ibid). Consumers in both advanced and emerging economies are said to have benefited from the increase in the range of goods and services that global integration has made possible. Often these goods and services are cheaper. However, people and work have to adjust changes in the nature and location of these economic activities. Capital and labor may have to move from traditional to expanding industries. Impacts vary as they fall disproportionately on particular individuals and activities. For some individuals, there may have to adapt to change in new culture, acquire new skills, and find new employment. (IPS, n.d.). Korten (n.d.), however, has a score about global corporations and their diverse depleting effects. According to him, global corporations find their powers in mergers and do a lot of destruction. Of global corporations, he said - “They consolidate and concentrate their power through mergers, acquisitions, and strategic alliances beyond the reach of any state. They deplete natural capital by stripping mining forests, fisheries and mineral deposits, and aggressively marketing toxic chemicals and dumping hazardous wastes that turn once productive lands and waters into zones of death. They also deplete human capital by maintaining substandard working conditions… They also deplete social capital by breaking up unions, bidding down wages, treating workers as expendable commodities, and uprooting key plants on which community economies are dependent to move to lower cost locations-leaving it to society to absorb the family and community breakdown and violence that are inevitable consequences of the resulting stress. Finally, they deplete institutional capital by undermining the necessary function and credibility of governments and democratic governance as they pay out millions in campaign contributions to win public subsidies, bailouts, and tax exemptions and fight to weaken environmental, health, and labor standards essential to the long-term health of society. (Korten, n.d). The research of Sklair (1999) has categorized studies in globalisation and has come up with a category of four approaches in thinking through this concept: global system, global culture, global society, and global economy. Each accordingly has its own distinctive strengths and weaknesses. The world-system model tends to be economistic, minimizing then the importance of political and cultural factors, but as globalisation is often interpreted in terms of economic actors and economic institutions, this does seem to be a realistic approach. On the other hand, the globalisation of culture model according to Sklair (1999) tends to be culturalist or minimizing economic factors, but as much of the criticism of globalisation comes from those who focus on the negative effects of homogenizing mass media and marketing on local and indigenous cultures, the culturalist approach has many adherents. The world society model tends to be both optimistic and all-inclusive, an excellent combination for the production of world-views, but less satisfactory for social science research programmes. Finally, the global capitalism model, by prioritising the global capitalist system and paying less attention to other global forces, runs the risk of appearing one-sided. Writers identified with this approach all strive towards a concept of the `global that involves more than the relations between nation-states and state-centrist explanations of national economies competing against each other. In sum, Leslie Sklair (1999) states that globalisation encompasses a distinct set of changes, which can be studied from four perspectives she labels world-systems, global culture, global society and global capitalism. Among these four, Sklair appears to find fewer faults on the last. According to WGTR (2005), the front page of the National Post (7/9/2002) quotes a Jan Cienski who cites that free markets are being credited with reducing misery and yet the gap between rich and poor widens. Cienski was recorded as saying that many globalisation critics are "poorly informed about the historical record, and appear not to be aware of the contribution played by  globalisation in the struggle against poverty.” Cienski was said to make the interesting point that "Improved communications has had the perverse effect of undermining the case for globalisation because "the poor that remain, though a shrinking proportion of the whole population, are more than ever aware of their relative deprivation." The study, referred to by the Cienski article, was by the London-based  Centre for  Economic Policy  Research. Earlier, in the Leslie Sklair (1999) research, she mentioned about a model in globalisation literature as not only an academic pooling but also deliberately institutionalized through a research center, channeled by a publication. And yet, in her evaluation, the view of this general model is somewhat limited and obsolete in some respects. In the words of Sklair (1999) - “The world-systems approach is, unlike the others, not only a collection of academic writings but also a highly institutionalized academic enterprise. It is based at the Braudel Center at SUNY Binghamton, supports various international joint academic ventures, and publishes the journal, Review. “ Conclusion Sociologist Sklair’s (1999) research shows that globalisation studies to date have focused on a limited scope, mostly European and North American literature that have seen print through the years. From the same research, each model or approach interprets globalisation as guided by the writer’s own personal space or from where he stands. The debate on globalisation is heated, but as Sklair noted, only the vociferous side of the Europeans and North Americans are being read, and nothing of the Asians are presented. In sum, the spread of literature for those engaged in passing on knowledge may be said to be imbalanced as being received by research centers, universities, as well as teachers and students. What is revealing is the bias of some institutions sticking to one limited perspective through the years and perpetuating that bias through their publications. No wonder, there is the confusing maze that makes globalisation lesser understood than it should be. Sklair (1999) has fortunately given the academe a big boast by her taxonomy of literature on the concept of globlisation to simplify matters. Different conceptions of globalisation being developed in some places tend to oversimplify. For example, `global culture theorists say globalisation is more or less the same as Westernization or Americanization or McDonaldization. The bias in globalisation literature has to be tackled. What is clear from these studies is that globalisation to international business must not be a matter of profit alone but also have respect for human life. Corporate interests must not supplant truth, and profit must not supersede ethics. International business should up to a higher level and it has many opportunities to do that, for example where dignity of labour is much respected. References ‘Global Policy forum.’ December 9, 2005, Available at: http://www.globalpolicy.org/globaliz/define/. ‘Globalization,’ WGTR. www.witiger.com. Last updated June 16 2005. 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Mukherjee, A. ‘Gandhi and Globalisation.’ University of Warwick. December 9, 2005, Available at: http://www.mkgandhi.org/articles/globalisation.htm. Robertson, R. 1992. Globalization: Social Theory and Global Culture. London: Sage. Ruggiero, R. (Director General of the World Trade Organization). ‘Managing a world of free trade and deep interdependence.’ Address to the Argentinian Council on Foreign Relations (Consejo Argentino para las Relaciones Internacionales) in Buenos Aires. September 10, 1996. December 11, 2005, http://www.wto.org/english/news_e/pres96_e/pr055_e.htm. Sklair, L. 1999. ‘Competing conceptions of globalisation.’ Journal of World-Systems Research, Vol V, 2, 1999, 143-162. ISSN 1076-156X. December 10, 2005, Available at: http://jwsr.ucr.edu/archive/vol5/number2/html/sklair/. Read More