Globalization: Lessons on Underlying Philosophies

LESSON 1 - UNDERLYING PHILOSOPHIES OF THE STUDY OF GLOBALIZATION The Wall Street Journal reported that Kentucky Fried Chicken wants to take over Africa. Like McDonald's and other fast-food giants, KFC parent company Yum Brands has been countering the slowdown in American spending with expansion ove...

LESSON 1 - UNDERLYING PHILOSOPHIES OF THE STUDY OF GLOBALIZATION The Wall Street Journal reported that Kentucky Fried Chicken wants to take over Africa. Like McDonald's and other fast-food giants, KFC parent company Yum Brands has been countering the slowdown in American spending with expansion overseas. Having populated China with KFC outlets, Yum now plans to double the number of stores in Africa to 1,200. KFC has had an outlet in South Africa since 1971, but Yum plans to open them, and sister restaurants, in Nigeria, Namibia, Mozambique, Ghana, Zambia, and elsewhere. According to the Yum CEO, Yum is betting that its expansion will be supported by a growing African middle class—more than 40% of Africans now live in urban areas, and the number of families with disposable income is surging. Though they ignored the continent for a long time, firms "are now focusing on the emerging world, with a bit of a gold rush going on," The term globalization is not new in the modern context. Many researches, debates and discussions were made as to the meaning of the word - GLOBALIZATION However, after the Cold War the term was already used to define an interdependent world when it comes to its economical and informational dimensions. Robertson (1992), in his article, Globalization: Social Theory and Global Culture, defined globalization as the “understanding of the world and the increased perception of the world as a whole.” Therefore, the term has a rich concept that people need to have deliberate grasp in order to fully understand the term. In fact, Albrow and King (1990) defined globalization as “all those processes by which the people of the world are incorporated into a single world society. This only means that peoples around the globe live in a borderless community. It is, however, significant to say that globalization has exerted a tremendously serious impact on each sovereign state. The transnational spread of capital and the formation of the global markets have replaced the disintegrated economies of various countries. There is a rapid interconnection worldwide that links among people in the local, national and even in regional context. This interconnectedness is created because of social and economic relationships and networks which are relevant in the global interactions. The term globalization should be confined to a set of complexes, sometimes contradictory, social processes that are changing our current social condition based on the modern system of independent nation-states. Indeed, most scholars of globalization have defined their key concept along those lines as a multidimensional set of social processes that create, multiply, stretch, and intensify worldwide social interdependencies and exchanges while at the same time fostering in people a growing awareness of deepening connections between the local and the distant. The IMF conveyed that there are some countries that have been able to integrate into the global market rapidly, yet there are also some that have not yet integrated. Those countries that were able to integrate in the global market are growing fast and are able to reduce problems of poverty. To reiterate, globalization is not a recent phenomenon and there is nothing mystifying about it. In the 1980’s, the term “globalization” has become a common word manifesting advances in modern technologies that have made international transactions, in both trade and finances, easy, convenient, and accessible. Huttons and Giddens expressed that the balance between science or knowledge and resources has changed in such a way that science and knowledge have become, perhaps the most significant factor in the determination of the country’s standard of living. Truly, the countries with the most advanced economies are the countries with the most modern technology based on science and knowledge. (America, Japan, countries in Europe) Steger (2014) pointed out that in the mid-1990’s, more population in the global north and south had accepted globalism’s core claims, thus internalizing large parts of its overarching neo-liberal framework that advocated the deregulation of markets, the liberalization of trade, the privatization of state-owned enterprises, and, after 9/11, the qualified support of the global ‘War on Terror’ under US leadership. The five core claims of market globalism are as follows: This perspective explains the relevant functions of free market-its rationality and efficiency, as well as its alleged ability to bring about greater social integration and material progress-can only be realized in a democratic society that values and protects individual freedom. The second claim is that, Globalization is inevitable and irreversible it deals with market globalism is always interlaced with a belief that markets have the capacity to use new technologies to solve social problems. Nobody is in charge of globalization is the third claim. This claim highlights the semantic link between ‘globalization-market’ and the adjacent idea of ‘leaderlessness’. Robert Hormats (1998) discoursed that ‘The great beauty of globalization is that no one is in control.’ This only means that no individual, no government or no institution has the control over globalization. Similarly, Thomas Friedman (1999:112-3) emphasized that the most basic truth about globalization is this: ‘No one is in charge…But the global marketplace today is an Electronic Herd of often anonymous stock, bond, and currency traders and multinational investors, connected by screens and networks.’ Economic growth and progress in today’s interdependent world is bound up with the process of globalization. Globalization provides great opportunities for the future, not only for our countries, but for all others, too. Its many positive aspects include an unprecedented expansion of investment and trade; the opening up to international trade of the world’s most populous regions and opportunities for more developing countries to improve their standards of living; the increasingly rapid dissemination of information, technological innovation, and the proliferation of skilled jobs. The fifth and the last claim is that, Globalization furthers the spread of democracy in the world. While globalization and capital development do not automatically produce democracies, ‘the level of economic development resulting from globalization is conducive to the creation of complex civil societies with a powerful middle class. It is this class and societal structure that facilitates democracy’. LESSON 2 - THE GLOBAL ECONOMY President Trump made it clear during the 2016 presidential campaign that he intended to either renegotiate or withdraw from most of the United States’ international trade agreements. In 2018, he may finally focus his energy on these campaign promises, which would put the prosperity at risk. Early on in 2017, he announced the U.S. withdrawal from the Trans-Pacific Partnership. We’re already beginning to see the negative impact of that decision. Our economic and political influence in Asia may decline in 2018 and the years ahead. He has also set his sights on the North American Free Trade Agreement and began renegotiating its terms. Talks are likely to accelerate in 2018, with the pact’s unraveling a real possibility. And in interviews, he has declared the World Trade Organization “a disaster.” International trade deals are an often misunderstood part of U.S. economic policy. However, they can have a large impact on the economy. Since the end of World War II, the U.S. has taken the lead in setting up a multilateral, rules-based system of international trade. Central to this system was the General Agreement on Tariffs and Trade. In 1994, this agreement was transformed into the WTO. Under this system, world trade has expanded dramatically over the last 70 years. In 1947, trade accounted for approximately 6 percent of U.S. gross domestic product, whereas it now accounts for approximately 15 percent. Today, U.S. exports support over 11 million jobs, while imports of many staples from overseas increase the purchasing power of domestic households. A retreat from a multilateral rules-based system of trade brings with it many problems. Domestically, it increases the probability of “trade wars” with the major trading partners. Relatively minor disputes could easily escalate into trade sanctions and countersanctions, like in the aftermath of the Depression-era Smoot-Hawley Tariff, which raised tariffs on hundreds of imports. Internationally, it could make it more difficult for developing countries to engage in trade relations with their much larger and wealthier counterparts. While the Trump administration has drawn attention to the U.S.’s large trade deficit, most economists agree that trade agreements have little to no effect on that. Certainly, some aspects of institutions such as NAFTA and the WTO can be questioned. However, a general retreat from the postwar system of trade could be a dangerous path for both the U.S. and the broader world economy. The discussion will primary be guided by this question: “Why the regions around the globe are have glaring differences when it comes to economy?” For the past centuries, the global economy has significantly changed. In the 11th century, the long-distance trading flourished between Venice and the Netherlands. The woolen industry in the 13th century in Flanders and in 14th century in Florence can also be an example of a sustained economic growth throughout history. Those global changes have contributed much to the economy of the world. There was the birth of capitalism. (Entrepreneurship, free enterprise, or private enterprise) Conversely, the standards of living of most of the population in the globe have remained at the subsistence (survival) levels until in the middle of 18th century. In Gary Gereffi’s journal, The Global Economy: Organization, Governance, and Development, he mentioned that the global changes are attributed to how the global economy is organized and governed. He furthered that these changes give impact not only to the flow of goods and services across national borders, but also the implications of these processes for how a particular country move up or down in the international scene. These development strategies are manifested in a shift in theoretical frameworks from those centered on the legacies and actors of nation-states to a greater concern with supranational institutions and transnational organizations. Developed countries and developing countries like the Philippines have to fully understand the impact of the contemporary global economy to improve their position in the global system. There is no singular academic field that can completely explain the topic of global economy because it is inherently interdisciplinary. According to Gereffi, the global economy can be studied at different levels of analysis. First is at the macro level in which this includes the international organizations and regimes that establish rules and norms for the global community. The World Bank, the International Monetary Fund, the World Trade Organization, and the International Labor Organization are the existing international organizations that make impact to the economy of the world. The regional integration schemes like the European Union and the North American Free Trade Agreement are also part of these organizations. Since these regimes blend both the rules and resources, they substantiate the widest parameters within which the global economy operates. Next is the meso level in which it is believed that the building blocks for the global economy are the countries and firms. The global economy is seen as the arena in which countries compete in different product markets. The last is at the micro level. There is a growing literature on the resistance to globalization by consumer groups, activists, and transnational social movements. Therborn (2000) expressed, “There are many theories related to economic sociology incorporate the global economy in their frameworks, but they differ in the degree to which it is conceptualized as a system that shapes the behavior and motivation of actors inside it, or as an arena where nationally determined actors meet, interact, and influence each other.” According to world-systems theory, the upward or downward mobility of nations margin is determined by a country’s mode of incorporation in the capitalist world-economy, and these shifts can only be accurately portrayed by an in-depth analysis of the cycles of capitalist accumulation in the longue durée of history. The foundation for a process of industrialization and new international divisions of labor on a global scale is attributed to the dynamics of the capitalist world-system. Adam Smith, an eighteenth-century political economist, defined “division of labor” as the specialization of workers in different parts of the production process, usually in factory setting. In a global scope, the “classic” international division of labor was between the industrial countries producing manufactured goods and the non-industrialized economies that supplied raw materials and agricultural products to the industrial nations which became a market for basic manufacturers. Years after World War II, trade flows have become far more complex, and so have the relationships between the developed and the developing nations of the global economy. LESSON 3 – MARKET INTEGRATION Beginning in the late nineteenth century, globalization swept through Asia, transforming its product and labor markets. By the 1880s steamships had largely replaced sailing vessels for transport within Asia as well as to Western markets, and shipping fares had begun to fall sharply. Also, already underway was the mass migration of Indian and Chinese workers, principally from the labor-abundant areas of Madras in India and the provinces of Kwangtung (Guangdong) and Fukien (Fujian) in Southeastern China, to land-abundant but labor-scarce parts of Asia. Chief among the immigrant-receiving countries were Burma, Malaya and Thailand (Siam) in Southeast Asia. Indian and Chinese labor inflows to these countries constituted the bulk of two of three main late nineteenth- and early twentieth-century global migration movements, the other being European immigration to the New World. Immigration to Southeast Asia was almost entirely in response to its growing demand for workers which, in turn, derived from rapidly expanding demand in core industrial countries for Southeast Asian exports. Studies established the development of an integrated Asian rice market beginning in the latter part of the nineteenth century. Furthermore, a series of articles and books reveal that internationally integrated commodity markets and relative factor price convergence in conjunction with pre-World War II globalization. But in contrast to work on product market integration, the possible emergence of an integrated Asian labor market has attracted less attention. In part this reflects the lack of Asian wage data. Researchers observe, “analysis of the low-wage periphery, which is most relevant to modern [globalization] debate, is restricted by data availability”. This article makes available for the first time the data needed to test for labor market integration over a large part of Asia. This article has two main aims. One is to analyze whether as part of pre-World War II globalization an integrated Asian market for unskilled labor existed to encompass Asia’s chief emigrant-sending regions of South India and Southeastern China and the principal Southeast Asian receiving countries for Indian and Chinese immigrants. The metric for integration, following both econometric work on GDP convergence and Robertson’s recent analysis of integrated labor markets, comprises three complementary criteria: (i) that wages do not diverge from a common trend; (ii) that over time wage dispersion does not increase; and (iii) that a correction mechanism pushes wages towards an equilibrium relationship after-shocks. It can be misleading, as Robertson (2000, p.728) warns, to rely on price as a criterion for integration. Markets are integrated if adjustment mechanisms operate to correct deviations from a wage differential or “gap”. Second, the article aims to compare wage trends in the area of Asia from South India to South China and including Burma, Malaya and Thailand with an industrial core of the global economy, defined as the United Kingdom, United States, Germany and France. Were unskilled labor markets in Asia and the industrial core similarly affected by globalization such that in these two parts of the world wages followed a common trend? Or, in contrast to commodity markets, was globalization in Asia and the industrial core associated with a drifting apart of real unskilled wages? We argue that by the late nineteenth century South India, Southeastern China and the three Southeast Asian countries had become integrated and constituted a unified labor market. Furthermore, Asian evidence reveals a period of real wage convergence prior to the 1930s. But labor market integration that characterized Asia, and, also obtained in the industrial core, stopped at the geographical frontiers of each of these two regions. Unlike Asia’s export of primary commodities, flows of Asian labor hardly penetrated either the core industrial countries, or the wider Atlantic economy. The pre-World War II labor market pattern was, instead, one of strong divergence between Asia and the world’s rapidly developing and industrializing core economies. Global corporations are inseparable from the more general phenomenon of globalization itself. It follows that how one identifies globalization serves to “locate” global corporations, both in the complex interactive pattern defined by globalization and within given historical periods. In early historical periods as both cities and countries extended their reach beyond their own borders, this view holds, a form of globalization was initiated which then followed complex patterns of interactive engagements organized through trade and directly influenced by the emergent and subsequently dominant technologies, especially in shipping and navigation. The vast heterogeneity of this long period, however, leads a majority of scholars to situate the direct antecedents of the contemporary global corporation within the dynamics of a two plus-centuries long duration spanning the period prior to the end of WW II in which the modern nation state system emerged in ways that allowed invention and social organization to combine that vastly increased world capital and the wealth of nation states. Coupled with an extraordinary rise in global population that attended the industrial revolution, the societies that arose would invent new ways to organize the world itself through colonialism and imperialism that vastly weakened their interactions between peoples, states and regions such that a clearly differentiated era of global interaction can be said to exist (Harvey, 1990). Many of the characteristics of the global corporation that we examine directly in this chapter date from this period (e.g. patterns of equity ownership, corporate ownership and management of subsidiaries, the relationship of “central” organizational functions to supply and distribution chains, etc.) as attributes of corporate structures in the most prosperous and globally-engaged nations (largely through colonial and imperialist relationships). This period from the end of WWII to the present can be viewed, therefore, as a third and distinct period in the transformation of the global corporation. As the next parts of this chapter detail, the transformations of the global corporation occurring within this third period have been far reaching and distinctive, reflecting changes taking place within the broader structural dimensions of globalization itself and at the same time significantly contributing to those continuing changes. The International companies are importers and also, they are exporters, typically without investment outside of their home country; Multinational companies have investment in other countries, but do not have coordinated product offerings in each country. They are more focused on adapting their products and services to each individual local market. Global companies have invested in and are present in many countries. They typically market their products and services to each individual local market. Transnational companies are more complex organizations which have invested in foreign operations, have a central corporate facility but give decision-making, research and develop (R&D) and marketing powers to each individual foreign market. WE will employ the term “global corporation” to refer to all of these types, seeking within specific contexts to be clear about which usage most applies. As many of the citations employed below indicate, however, these distinctions are often not employed within the literature. U.S corporations operating internationally had enormous advantages in the immediate post-war period as they—virtually alone in the world—emerged from the war with their productive, organization and distributional capacities intact. What would take shape as the beginning of contemporary globalization, however, dates from the economic recovery of capital structures in Japan and Europe and the re-entry into global markets of their national corporations. By 1974 Barnet and Muller in a path-breaking volume could both define the MNC as a major economic global actor and begin an effective description of how this particular corporate form was coming to dominate various aspects of global production and exchange (Barnet and Muller, 1974). A considerable amount of other scholarly work documents various “waves” of global corporate development through the subsequent six decades to the present. The overall structure of this system would stay in place and continue to develop throughout the 1970s and 1980’s—a period that stands chronologically just prior to three fundamental innovations that have substantially changed the character of the global corporation: the advent and impact of digitalization and instantaneous global communications; the structural transformation of global commerce from producer-driven commodity chains to buyer-driven; and the increasing role performed through the global system by financial elements and the emergence of the global financial firm. (The post- war period can be delineated in a number of ways. Geriffe for example emphasizes three structural periods: Investment-based globalization (1950-1970); Trade-based globalization (1970-1995); Digital globalization (1995 onwards.) Within this analysis the nature of the global corporation changes accordingly, being driven in each case by its evolving purposes and by its extended reach and abilities (Geriffe 2001: 1616-18). Another method of projecting this growth is to examine the sources and levels of Foreign Direct Investment (FDI) most of which was of corporate origin. As Hedley indicates, in 1900 only European corporations were major investors, to be joined by some American firms in the 1930s. Citing UN data he dates 1960 as the major turning point for FDI as the major driver of extended global corporate development. In each subsequent decade until the turn of the century, FDI would triple Throughout these periods economists, other scholars and government actors at both the national and transnational level tended to “frame” the progressive growth of the global corporate structure (again, referred to almost indiscriminately as either MNC’s or TNC’s) through efforts to define, measure and assess the extent and consequences of foreign direct investment, defined initially and primarily as the entry of private capital from a source external to a country into a receiving country. Usually referred to in terms of “out- ward” and “in-ward” flows, supplies of FDI were viewed as the major elements of global economic development, and during various policy periods as “essential” for the development of what was then viewed as the “third” world, even if in reality the vast majority of FDI into the 1990s was between countries of the “developed” world—primarily North America, Europe and Japan. Since 1964 the United Nations Conference on Trade and Development (UNCTAD) has focused on the various roles that FDI plays in the development process and has maintained an extensive policy library of global FDI statistics as well as the dense structure of regulation that frame global corporate cross- border engagements (Fredriksson 2003). Periods of intense FDI changed the global corporate landscape. During the period 1985-1990 FDI grew at an average rate of 30% a year. One result, unsurprisingly, was the landscape of corporate units and their relationship to each other. DeAnne Julius indicates that the expansion of FDI, inter- corporate alliances, and intra-firm trade during this period reached a level at which “a qualitatively different set of linkages” was created among advanced economies (Julius 1990). It was estimated that some 20,000 new corporate alliances were formed just in the period 1996-1998 (Gilpin, 2000: 170). The organization of the dominant global firms during this period was powerfully influenced by the transformation within national economies of the older manufacturing companies brought by what was viewed as the progressive “de-industrialization” of these economies through wide-scale off-shoring of labor applications and its related costs. This progressive shift in the silting of manufacture transformed the dominant manufacturing firms of these older developed companies into more fully extended and integrated organizational forms that moved many such firms from a self-conscious understanding of themselves as “national firms operating internationally” into more authentically global firms that required extensive corporate integration of their activities throughout the world. U.S. firms in particular had sought to transport these models abroad to their international manufacturing holdings. The emergence of Japan as a major producer nation, especially of automobiles and consumer electronics from the 1970’s on, brought onto the scene new models of effective production focused especially on quality and regimes of flexible production—a move that was echoed within European firms rejoining the global commodity chains. These activities were experienced by U.S. firms as unwelcome challenges to their previously virtually unchallenged positions on product design, production efficiency, and quality—and ultimately on the ability of these corporate structures to maintain their accustomed returns on investment. The result was a progressive “re-inventing” of the American business model, especially the industrial model—a challenge that would dominate the curricula of U.S. business schools for over two decades (Risi 2005) and which is also continuously associated with the global value shift from manufacturing capital to finance and human capital in progressively networking societies The relative size, growth and range of activity of global corporations from the emerging economies suggest that they are on a trajectory that will soon situate them firmly within those of the historically more developed economies. The number of global corporations from the emerging market economies listed in the Fortune Global 500, which ranks corporations by revenue, rose from 47 firms in 2005 to 95 in 2010. These companies have also become active in the broad pattern of global mergers and acquisitions (M&A), a primary vehicle by which corporate concentration takes place The fact that the global economic slowdown resulting from the financial crisis of 2007 has had a lesser impact on many developing economies, especially the BRICS, indicates the extent to which they have become a new and important source of capital within the global system. Examples include China’s Lenovo corporation’s purchase of IBM’s PC business and India’s investment in various historically British firms including Jaguar Land Rover (Economist, 2011). Increased North-South investments during this period allowed global North corporations to rebound quickly from their profit losses and restore income growth. The relative robust nature of the emerging economies has continued to attract FDI and to create conditions leading to the rapid expansion of their nationally based global corporations. The importance of global corporations in Brazil, India and China to the current and projected global economy is singular. With 40% of the world’s population the BRICS represent a primary force in both global production and consumption. The relative import of their global corporate cultures can be gauged in part by the fact that in 2012 global corporations in China made up 73 of the largest in the Fortune 500 list (CNN Money 2012), and whereas Brazil and India with 8 apiece currently account for a small share of such corporations, emergent market countries are projected to account for a near doubling of their share of world trade over the next 40 years, reaching nearly 70% by 2050 (Ahern, 2011). In 1998 only one of the top 100 global corporations was located outside the US, Europe or Japan LESSON 4 – THE GLOBAL INTERSTATE SYSTEM Twenty thousand people attended a meeting there to hear speeches marking the Nazis’ first year in power and denouncing the regime. The rally was organized as a mock trial and was advertised in the press as the ‘Case of civilization against Hitler’, with indictment, witnesses and, eventually, a judgment delivered by a Minister of the Community Church of New York City. ‘Hitlerism denounced as a crime against civilization,’ ran the headline in the New York Times the following day. Organized principally by the American Jewish Congress, the meeting anticipated Nuremberg in its consciousness of the power of what the scholar Louis Anthes calls ‘publicly deliberative drama’. It looked forward, too, to the Cold War in its evocation of a joint Judeo-Christian civilization ranged against the threat of totalitarianism. But in its emphasis on that common ‘civilization’ it looked backwards, to the concept that lay at the heart of the claim to world leadership that Europeans had been advancing since at least the early nineteenth century. The 19th century witnessed a globally dominant Europe. Empires expanded, colonies amassed – all pushed energetically forward by the Industrial Revolution. Colonies provided the raw materials and luxury commodities to meet rising consumer demand, in return promising vast markets for European products. Abuse and inequality were excused as a necessary part of ‘civilising’ savage peoples. The gradual ending of slavery was followed by new forms of intolerance and racism. By 1914 European countries ruled about 30% of the world’s population. Europe had been involved in overseas exploration and trade for centuries, but the benefits of the Industrial Revolution enabled Europe to tighten its grip on other continents. The incorporation of the European level into the universal is formulated within a paradigm of universal history. This search goes through different periods that are the same for all the nations. Each period is at the same time a step towards the final truth where Europe realizes its universal potentials. The universal driving forces here are not arts and virtue, but politics and religion or morals that materialize in different European institutions (church, cities, states) and ideas (Christianity and political freedom.) The approachment of truth is seen as a process of unity both in Europe as such and in the different European states. European civilization comes to play a new and powerful role in the imperialist discourse of late 19th century. But in this discourse, there is no exchange between a universal and a European level. Rather, it is taken for granted that Europe is the civilization, or in more racial forms that civilization is white. In another, more intra-European discourse civilization popped up as a negative term contrasted to culture. In France, Guizot abandoned the Enlightenment project of fitting Europe into a scheme of universal history for the [Herderian] task of tracing the continent’s own cultural roots. As he put it in his History of civilization in Europe: ‘civilization is a sort of ocean, constituting the wealth of a people, and on whose bosom all the elements of the life of that people, all the powers supporting its existence, assemble and unite’. It was just possible, thought Guizot, to locate among the various civilizations of the world specifically European variant: ‘It is evident,’ he wrote, ‘that there is a European civilization; that a certain unity pervades the civilization of the various European states...’ Napoleon was a great contrast. On the one hand, he was a man of the French Revolution. He had achieved fame only because of the opportunities the revolutionary armies provided. Unable to invade Britain after the Battle of Trafalgar, Napoleon tried to economically strangle Britain with a European boycott of British goods, creating what he hoped would be a self-sustaining internal European economy: the “Continental System.” By late 1807 all continental European nations, except Denmark, Sweden, and Portugal, had closed their ports to British commerce. Napoleon demanded that Denmark and Portugal comply with his Continental System. Britain countered by bombarding Copenhagen and seizing the Danish fleet, an example that encouraged the Portuguese to defy Napoleon and to protect their profitable commerce with Britain. Napoleon responded with an invasion of the Iberian peninsula in 1808 (initially an ally of the Spanish monarchy, Napoleon summarily booted the king from his throne and installed his own brother Joseph as the new monarch), which in turn sparked an insurrection in deeply conservative Spain. The British sent a small but effective expeditionary force under the Duke of Wellington to support the insurrection, and Napoleon found himself tied down in a guerrilla war – the term “guerrilla,” meaning “little war,” was invented by the Spanish during the conflict. Napoleon’s forces ended up trapped in this new kind of war, one without major battles or a clear enemy army. The financial costs of the invasion and occupation were enormous, and over the next seven years almost 200,000 French soldiers lost their lives in Spain. Even as Napoleon envisioned the further expansion of his empire, most of his best soldiers were stuck in Spain. Napoleon came to refer to the occupation as his “Spanish ulcer,” a wound in his empire that would not stop bleeding. Whether one believed like Mill that civilization was singular and hierarchical, or plural and historically relative—and as time went on Mill would win out over Guizot—what came to be seen as self-evident was civilization’s location in Europe. Mill finds human beings acting together for common purposes in large bodies, and enjoying the pleasures of social intercourse, we term them civilized. Mill, accordingly call a people civilized, where the arrangements of society, for protecting the persons and property of its members, are sufficiently perfect to maintain peace among them; i.e. to induce the bulk of the community to rely for their security mainly upon social arrangements, and renounce for the most part, and in ordinary circumstances, the vindication of their interests (whether in the way of aggression or of defense) by their individual strength or courage. As a generalization and adaptation of the values of the Concert of Europe, international law was designed as an aid to the preservation of order among sovereign states, and its principles were explicitly stated as applying only to civilized states—much as Mill saw his principles of liberty as applying solely to members of ‘a civilized community’. In 1845 the influential American international lawyer Henry Wheaton had actually talked in terms of the ‘international law of Christianity’ versus ‘the law used by Mohammedan Powers’; but within twenty or thirty years, such pluralism had all but vanished. According to the late nineteenth century legal commentator, W. E. Hall, international law ‘is a product of the special civilization of modern Europe and forms a highly artificial system of which the principles cannot be supposed to be understood or recognized by countries differently civilized… Such states only can be presumed to be subject to it as are inheritors of that civilization. International law faced the issue of the relationship between a civilized Christendom and the non-civilized world. States could join the magic circle through the doctrine of international recognition, which took place when ‘a state is brought by increasing civilization within the realm of law.’ In the 1880s James Lorimer suggested there were three categories of humanity— civilized, barbaric and savage, and thus three corresponding grades of recognition (plenary political; partial political; natural, or mere human). Lorimer shared the commonsense assumption of the period that posited three levels of human society and, accordingly, three types of recognition. There were civilized, barbarian and savage nations to which corresponded three types of recognition: plenary, partial and purely human recognition. The names largely indicate their sense. The highest level comprised the civilized societies – that is to say, European societies and European settlement colonies entitled to full recognition of their identity as independent political communities and carriers of all of the accompanying rights and obligations. The second level comprised the great Asian states – China, Japan, Siam and, to an extent, Turkey. They were entitled to a kind of functional recognition. On the basis of an assessment of their development in a particular regard, international law could be applied to them. There was no point in applying the law of nations to savages. They could benefit from only purely human recognition Most Victorian commentators believed that barbaric states might be admitted gradually or in part. Westlake proposed, for instance, that: ‘Our international society exercises the right of admitting outside states to parts of its international law without necessarily admitting them to the whole of it.’ Others disagreed: entry ‘into the circle of law-governed countries’ was a formal matter, and ‘full recognition’ all but impossible. The Ottoman Empire, also known as the Turkish Empire, was founded at the end of the 13th century in northwestern Anatolia in the vicinity of Bilecik and Söğüt by the Oghuz Turkish tribal leader Osman. After 1354, the Ottomans crossed into Europe, and with the conquest of the Balkans the Ottoman Beylik was transformed into a transcontinental empire. The Ottomans ended the Byzantine Empire with the 1453 conquest of Constantinople by Mehmed the Conqueror. Of course European states had been making treaties with the sultans since the sixteenth century. following the Crimean War the empire was declared as lying within the ‘Public law of Europe’—a move which some commentators then and now saw as the moment when international law ceased to apply only to Christian states but which is perhaps better viewed as a warning to Russia to uphold the principles of collective consultation henceforth rather than trying to dictate unilaterally to the Turks. The Crimean War (1853–1856) was part of this long-running contest between the major European powers for influence over territories of the declining Ottoman Empire. It ended when the Russian Empire lost to an alliance of France, Britain, the Ottoman Empire, and Sardinia. The immediate cause was the rights of Christian minorities in the Holy Land, part of the Ottoman Empire. The French promoted the rights of Roman Catholics while Russia promoted those of the Eastern Orthodox Church. The longer-term causes were the decline of the Ottoman Empire and the unwillingness of Britain and France to allow Russia to gain territory and power at Ottoman expense. The conflict began during the 1850s with a religious dispute. Under treaties negotiated during the 18th century, France was the guardian of Roman Catholics in the Ottoman Empire while Russia was the protector of Orthodox Christians. For several years, however, Catholic and Orthodox monks had disputed possession of the Church of the Nativity and the Church of the Holy Sepulchre in Palestine. During the early 1850s, the two sides made demands which the Sultan could not possibly satisfy simultaneously. In 1853, the Sultan adjudicated in favor of the French, despite the vehement protestations of the local Orthodox monks. We can see this clearly in contemporary attitudes towards the military occupation of Ottoman territory by European armies. After the Franco-Prussian War, international lawyers had devised the notion of belligerent occupation—a state of affairs in which a military occupant interfered as little as was compatible with military necessity in the internal affairs of the occupied country so as not to prejudice the rights of the former ruler of that territory who was regarded as remaining sovereign until a peace settlement might conclude otherwise. The continuing collapse of the Ottoman Empire led to two wars in the Balkans, in 1912 and 1913, which were a prelude to world war. By 1900 nation states had formed in Bulgaria, Greece, Montenegro, and Serbia, but many of their ethnic compatriots lived under the control of the Ottoman Empire. In 1912, these countries formed the Balkan League. There were three main causes of the First Balkan War. The Ottoman Empire was unable to reform itself, govern satisfactorily, or deal with the rising ethnic nationalism of its diverse peoples. Second, the Great Powers quarreled among themselves and failed to ensure that the Ottomans would carry out the needed reforms. This led the Balkan states to impose their own solution. Most important, the members of the Balkan League were confident that it could defeat the Turks. Their prediction was accurate, as Constantinople called for terms after six weeks of fighting. The First Balkan War broke out when the League attacked the Ottoman Empire on October 8, 1912 and was ended seven months later by the Treaty of London. After five centuries, the Ottoman Empire lost virtually all of its possessions in the Balkans. In the case of Ottoman territory, the Powers felt no such inhibitions: the Russians in Bulgaria in 1877, the Habsburgs in Bosnia the following year, and the British in Egypt in 1882 all demonstrated through their extensive rearrangement of provincial administrations, that although they would allow the Ottoman sultan to retain a fig-leaf of formal sovereignty, in fact the theory of belligerent occupation did not apply in his lands. Thirty years later, the Austrians [in 1908] and the British [in 1914] went further: on both occasions they unilaterally declared Ottoman sovereignty over the territories they were occupying at an end, suggesting that whatever had or had not been agreed at Paris in 1856, by the early twentieth century, the Ottoman empire was regarded once again as lying outside the circle of civilization. [The fact that it was a Muslim power was certainly not irrelevant to this. In 1915, when the French and Russians prepared a diplomatic protest at the mass murder of Ottoman Armenians, their initial draft condemned the massacres as ‘crimes against Christendom’. Only when the British mentioned that they were worried over the possible impact of such a formulation on Indian Muslim opinion was the wording changed to ‘crimes against humanity. European and American lawyers extended the notion of the protectorate—originally employed for new European states such as Greece—to the new colonial situation, ostensibly as a way of shielding vulnerable non-European states from the depredations of other European Powers, but more urgently, to avoid complications among the Powers which might trigger off further conflict. In the increasingly radicalized world-view of late nineteenth century European imperialism, protectorates might be a way of slowing down social transformation—in the interests of ‘native customs’—as much as they were of introducing it. ‘Much interest attaches to legislation for protectorates, in which the touch of civilization is cautiously applied to matters barbaric, ‘wrote a commentator in the Journal of the Society of Comparative Legislation in 1899. Yet the concept of civilization remained vital. The treaty that followed Berlin Colonial Conference of 1884–85, which marked the attempt to diplomatically manage the Scramble for Africa, talked of the need ‘to initiate the indigenous populations into the advantages of civilization.’ Inside Europe—and in other areas of the world colonized by Europeans—there was the sphere of civilized life: this meant—roughly—the protection of property; the rule of law on the basis—usually—of codes or constitutions; effective administration of its territory by a state; warfare conducted by a regular army; and freedom of conscience. The fundamental task of international law in this zone was to resolve conflicts between sovereign states in the absence of an overarching sovereign. Outside this sphere, the task was to define terms upon which sovereignty—full or partial—might be bestowed. It was thus in the non-European world that the enormity of the task required in acquiring sovereignty could best be grasped. There, too, the potential costs—in terms of legalized violence—of failing to attain the standard of civilization were most evident. But where no reciprocity of civilized behavior could be expected, European armies were taught they need not observe them—or indeed in some versions—any rules at all Britain’s General J.F.C. Fuller noted that ‘in small wars against uncivilized nations, the form of warfare to be adopted must tone with the shade of culture existing in the land, by which I mean that, against people possessing a low civilization, war must be more brutal in type.’ The 1914 British Manual of Military Law, too, emphasized that ‘rules of International Law apply only to warfare between civilized nations… They do not apply in wars with uncivilized states and tribes.’ After all, savages were impressed only by force; fanaticism could be stopped only through an awesome demonstration of technological superiority. ‘A shell smashing into a putative inaccessible village stronghold is an indication of the relentless energy and superior skill of the well-equipped civilized foe. Instead of merely rousing his wrath, these acts are much more likely to make [the fanatical savage] raise his hands in surrender.’ These were the words of Colonel Elbridge Colby, an interwar US advocate of air power in colonial insurgencies (and father of William Colby, future director of the CIA and architect of the Advanced Pacification Campaign in Vietnam). The United States was, by the century’s end, regarded from this point of view as a European power, if not of the first rank. But Washington—which had stood on the sidelines during the carve-up of Africa, had achieved a special relationship to international law following the war with Spain. Through the Roosevelt Corollary, it toughened up its reading of the Monroe Doctrine, while at the same time encouraging the pan American codification of international law as a way of enshrining its own regional hegemony. Siam was admitted to the Hague conferences as a mark of respect; but in China, where the Boxer Rebellion was put down with enormous violence—on the grounds that it was ‘an outrage against the comity of nations’—the unequal treaties remained in force. It was only the Japanese who seriously challenged the nineteenth century identification of civilization with Christendom. Having adhered to several international conventions, and revised their civil and criminal codes, they managed to negotiate the repeal of the unequal treaties from 1894 onwards, as well as to win back control over their tariffs, and their victory over Russia in 1905 simply confirmed their status as a major Power. Not surprisingly, the Young Turks—desperate to repeal the humiliating capitulations—could not hear enough of the Japanese success. But the Japanese achievement was also unique. After the ending of the Russo-Japanese war, the Second Hague Conference of 1907 talked of ‘the interests of humanity, and the ever progressive needs of civilization.’ But could civilization (with a capital C) really ever be universalized, and how far could it be extended Many had their doubts. German and Italian jurists essentially ruled out any non-European power receiving full recognition; the prominent Russian jurist de Martens was equally emphatic. As for the empire-builders, in Africa, in particular, as well as in the Pacific, many liberals and Gladstonians came to terms with imperialism at century’s end—as Saul Dubow has recently reminded us—because they thought in terms of a kind of an imperial cosmopolitanism or commonwealth, in which individual peoples might preserve their own distinctive cultures. Where necessary, of course, civilized powers had to rule others to ensure this. Unilaterally abrogating Ottoman sovereignty in Egypt in December 1914, the British proclaimed that they regarded themselves as ‘trustees for the inhabitants’ of the country. Their unilateralism was only one sign of the death of the old Concert and its values. Blazing a trail that others would follow in the wars of the coming century, they tore up one of the fundamental axioms of the late-nineteenth century European order—that the basic legitimacy of the sovereign ruler would always be respected—and replaced it with a new understanding in which sovereignty inhered, not in the head of state, but in the people or nation. What Nehal Bhuta has recently—in the case of Iraq—called the doctrine of ‘transformative occupation’ thus makes its appearance. LESSON 5 - CONTEMPORARY GLOBAL GOVERNANCE Philippine President Rodrigo Duterte has had a bumpy relationship with the International Criminal Court. He once described it as “bulls---,” then in February said he welcomed its preliminary investigation into allegations of crimes against humanity during Duterte’s war on drugs. Now, he says he’ll pull the Philippines from the court altogether, “effective immediately,” though the BBC reports that formally withdrawing from the ICC is a year- long process. “It is apparent that the ICC is being utilized as a political tool against the Philippines,” he said, while blasting the “baseless, unprecedented, and outrageous attacks” directed at him by the UN. The Guardian looks at the recent-most bad blood between the two that apparently spurred those comments. Duterte’s government put a UN special rapporteur on a list of communist terrorists, leading the body’s commissioner for human rights to say that Duterte needs “some sort of psychiatric examination.” Should the Philippines successfully withdraw its ratification of the treaty that created the ICC, it would be only the second country to do so, after Burundi. But that wouldn’t protect Duterte from a potential trial, as the treaty states “withdrawal shall not affect any cooperation with the court in connection with criminal investigations.” Still, the BBC notes it could make the Philippines less cooperative. Speaking of cooperation, the country’s Senate flagged the constitutional provision that requires the Senate to agree to the revocation of any international treaty. Duterte contends the Senate failed to publicize its 2011 ratification of the treaty as required by law, reports the Associated Press. Globalization is a rich and a broad concept and may be defined in various perspectives. It cannot be denied that globalization has made a tremendous impact on the sovereign state. Fowler and Bunck (1996) emphasized that a sovereign state has a territory, the people, and a government. Any state admitted as a member of the United Nations will be upon the decision of the General Assembly as recommended by the Security Council. The United Nations membership requirements are (1) the state must be a peace-loving state which accepts the obligations contained in the present Charter, and (2) in the judgment of the Organization, must be able and willing to carry out these obligations. Although all UN members are fully sovereign states at the present, the Belarus, India, Philippines, and Ukraine- four of the original members- were not independent at the time of their admission in the organization. Even from the seventeenth century, the legal framework of a sovereign state has served as a definitive ground for political governance and economic system. Sovereignty has been constitutionally used both on national and international levels. The intercontinental spread of capital and the formation of global markets have eventually substituted the fragmented (divided) national economies. Sovereign states are experiencing increased difficulties in supplying regulatory and redistributive public goods and establishing and enforcing property rights in the face of relatively open trade, rapid information-technology advances, and considerable financial deregulation. Moreover, both market relations and political discontent with economic policies have virtually become “borderless.” The international system has now become less state-centric that makes a way into the political constitution of domestic policies. Notably, the advancements in technology and its innovations have increased the speed of the migration and transplantation of legal rules and policies. The transnational actors, which are non-state, such as the intergovernmental organizations (IGOs), international nongovernmental organizations (INGOs), and transnational corporations (TNCs) have assumed relevant roles in global governance. They have created transnational law that runs many dimensions of the political economy that was once governed by the sovereign states. Relevant changes in the international system definitely affect the shape of sovereignty and the future of the state law. However today, any sovereign state cannot just neglect issues that are related to the interests of the humanity, may they be within the borders or outside the borders of the state. Individuals and groups enjoy greater recognition as subjects of international law, as seen in the expansion of legal regimes and enforceable mechanisms in the fields of international human rights law, international refugee law, international criminal law, and the like. Victor Peskin observes that the United Nations Security Council's ad hoc tribunals for the former Yugoslavia and Rwanda continued to trump state sovereignty insofar as targeted states and all other UN members were legally bound to comply. However, the development of international criminal tribunals suggests a changing balance of tribunal authority and state sovereignty. He criticizes the next generation of war crimes tribunals as supporting the expansion of the influence of state judicial actors as well as the strengthening of the doctrine of sovereignty. The Rome statute of the International Criminal Court (ICC) upholds the principle of complementarities and recognizes that state do not have to collaborate with the court unless they have ratified the statute. However, this is only part of the picture. The establishment of special hybrid courts in Cambodia, East Timor, Lebanon, and Sierra Leone means that states no longer see sovereign state law alone as a sufficient means of punishing serious war crimes. The decisions of international judges and prosecutors now permeate and shape the domestic criminal law of these countries. William Burke- White further asserts that the ICC has become part of a system of multilevel global governance through its alteration of state preferences and policies and its deterrence of future crimes through judicial and prosecutorial pronouncements. This system supplies the normative mechanisms for the establishment of IGOs and the facilitation of the international response to issues as diverse as nuclear proliferation, climate change, ocean use, and the functioning of the world trade system. Alexandra Khrebtukova insightfully points out, “[n]ational borders no longer confine the diverse views that prioritize subjects of international law … different perspectives are often less identifiable with specific states than with discrete branches of the law, each manifesting separate functional perceptions of what that law should take as its primary focus. A state may, in some point in time, opt to comply with the international and transnational standards. However, the adaptive power of the state law should not be underestimated. Generally speaking, the laws that govern the sovereign state are strong and flexible enough to endure the many challenges along the way. Even with globalization around, the laws are here to stand firm on the political influence over the lives of sovereign state’s people and the majority of peoples around the globe. LESSON 6 – THE GLOBAL DIVIDES: THE NORTH AND SOUTH Discriminatory policies of Myanmar’s government since the late 1970s have compelled hundreds of thousands of Muslim Rohingya to flee their homes in the predominantly Buddhist country. Most have crossed by land into Bangladesh, while others have taken to the sea to reach Indonesia, Malaysia, and Thailand. Beginning in 2017, renewed violence, including reported rape, murder, and arson, triggered an exodus of Rohingya, as Myanmar’s security forces claimed they were carrying out a campaign to reinstate stability in the country’s western region. The United Nations has said that those forces showed “genocidal intent,” and international pressure on the country’s elected leaders to end the repression continues to rise. The Rohingya, a highly persecuted Muslim group numbering over one million, face discrimination both from their neighbors and their nation, and are not considered citizens by Myanmar’s government. Buddhist nationalist groups, including the MaBaTha and the anti-Muslim 969 movement, regularly call for boycotts of Muslim shops, the expulsion of Muslims from Myanmar, and attacks on Muslim communities. After two waves of violence, reprisals, and riots in June and October of 2012 intensified the century-old conflict in the predominantly Buddhist country, more than one hundred thousand Muslim Rohingyas were internally displaced and hundreds killed. The government refuses to grant the Rohingya citizenship, and as a result most of the group’s members have no legal documentation, effectively making them stateless. Myanmar’s 1948 citizenship law was already exclusionary, and the military junta, which seized power in 1962, introduced another law twenty years later that stripped the Rohingya of access to full citizenship. Until recently, the Rohingya had been able to register as temporary residents with identification card s, known as white cards, which the junta began issuing to many Muslims, both Rohingya and non- Rohingya, in the 1990s. The white cards CONFERRED LIMITED RIGHTS BUT WERE NOT RECOGNIZED AS PROOF OF CITIZENSHIP. Tensions between Buddhist and Muslim communities in Myanmar's Rakhine State have escalated dramatically since late August 2017. A series of attacks by a group of Rohingya militants calling itself the ARAKAN ROHINGYA SALVATION ARMY (ARSA) on military and police outposts killed more than seventy people, including twelve Burmese security forces personnel. In response, the military launched a brutal crackdown on Rohingya villages, causing over seven hundred thousand people to flee across the border to Bangladesh since August 2017. Widespread reports indicate indiscriminate killings and burning of Rohingya villages, escalating to the point that the UN HUMAN RIGHTS COMMISSIONER CALLED THE SITUATION IN RAKHINE STATE “a textbook example of ethnic cleansing.” The violence has led to a growing humanitarian crisis in neighboring Bangladesh, where nearly one million Rohingya now reside in refugee camps along the border. This outburst of violence by the military comes after a similar attack on a security post along the Bangladeshi border in October 2016 killed nine police officers. The army responded to that attack with a month-long crackdown on unarmed Muslim civilians, causing more than one thousand civilian deaths and driving tens of thousands more to flee their homes in search of safety. The North-South Divide (or Rich-Poor Divide) is THE SOCIO-ECONOMIC AND POLITICAL DIVISION THAT EXISTS BETWEEN THE WEALTHY DEVELOPED COUNTRIES, known collectively as “the North,” and the poorer developing countries (least developed countries), or “the South.” Although most nations comprising the “North” are in fact located in the Northern Hemisphere, the divide is not primarily defined by geography. As nations become economically developed, they may become part of the “North,” regardless of geographical location, while any other nations which do not qualify for “developed” status are in effect deemed to be part of the “South.” The North is home to four out of five permanent members of the United Nations Security Council and all members of the G8. “The North” mostly covers the West and the First World, with much of the Second World. The expression “North-South divide” is still in common use, but the terms “North” and “South” are already somewhat outdated. MEMBERS OF G8 - Canada, France, Germany, Italy, Japan, Russia, the United Kingdom and the United States. FIVE PERMANENT MEMBER OF UN SECURITY - China, France, Russian Federation, the United Kingdom, and the United States LATIN AMERICA - Peru, Venezuela, Chile, Guatemala, Ecuador, Cuba, Bolivia, Haiti, Dominican Republic, Honduras, Paraguay, El Salvador, Nicaragua, Costa Rica, Panama, Puerto Rico, Uruguay, Guadeloupe, Martinique, French Guiana, Saint Martin and Saint Barthelemy NORTH HEMISPHERE Rich, Industrialized, Wealthy Nations Democratic Capitalist Countries Southern Hemisphere Developing Nations Non-Democratic Countries WHAT IS THE CONCEPT OF GLOBAL RELATIONS? International relations have used globalization to reach its goal: of understanding cultures. International relations focus on how countries, people and organizations interact and globalization is making a profound effect on International relations. Understanding culture, globalization, and international relations is critical for the future of not only governments, people, and businesses, but for the survival of the human race. THE CONCEPT OF A GAP BETWEEN THE GLOBAL NORTH AND THE GLOBAL SOUTH in terms of development and wealth THE NORTH-SOUTH DIVIDE DOES NOT MEAN A DIVISION ALONG THE EQUATOR, BUT THE LINE DIVIDING THE RICHEST AND THE POOREST COUNTRIES ON THIS PLANET. MORE ON THE DIVISION OF THE SOCIAL, ECONOMIC, AND POLITICAL. ALTERNATIVE TERMS FOR THE GLOBAL SOUTH ARE THE LESS-DEVELOPED WORLD, DEVELOPING COUNTRIES, MAJORITY WORLD, NON-WESTERN WORLD, POOR WORLD, THE SOUTH, THIRD WORLD, AND THE UNDEVELOPED WORLD. The term Global South IS A DYNAMIC TERM THAT DOES NOT CONSIDER GEOGRAPHIC LOCATIONS, meaning that, members of this grouping who reach a certain development threshold may cross over to the Global North. Even in the Global North, some regions within the developed countries live in conditions that resemble the conditions of the Global South. Where does one ‘see’ globalization? Geographers, anthropologists, and sociologists; those who study the phenomenon from the bottom up; tell us that global interconnectedness is woven into the fabric of everyday life. It is visible to those who observe. One does not need to look far to see markers of global interconnectedness, even global modernity. There are Starbucks branches in both Melbourne and Manila, New York and New Delhi. All these branches look more or less the same, and they have similar menus of espresso- based drinks. This sameness represents the cultural homogenization that many critics have associated with globalization. despite the common aesthetic of these cafes, the worlds outside them can be very different. In Manila and New Delhi, there is a good chance that, upon leaving the cafe, you will find a child beggar in tattered clothes and ‘worn-down slippers. Walk a block or two and, with your latte still hot, you may find a shantytown, where houses are built from discarded plywood and galvanized iron sheets. These shanties have poor sanitation; many of its residents are employed in the informal economic sector; its children, some of whom are child laborers, cannot afford to go to school. There is also a good chance that these shanties' residents are under threat of being evicted or having their homes demolished to make way for a large commercial development, which will service the city's middle class. Given their lack of political influence within the state, the residents of the shanty have very few avenues for redress. They live in so-called ‘weak states’, where governments are too poor, weak, corrupt, and unstable to supply its citizens with basic needs. You are unlikely to find New Delhi-type shanties in New York, despite that city also being a site of large-scale injustice. Harlem may be poor, but it does not have many child laborers. There is something more confronting about poverty in the global south, and the north/south divide is as visible as the processes of globalization that engender it. The divide thus reminds us that globalization creates undersides. The coexistence of the Starbucks and the shanty point to the incompleteness of globalization in the global south. If one conceives of globalization as the spreading and consumption of cultural/commercial signifiers, the shanty represents the tenacity of the local, which is unable to participate in a cosmopolitan culture represented by the Starbucks. The underdevelopment of the global south, it would seem, prevents it from being globalized, revealing the inherent unevenness of the process. Poverty is backward. It is not modern. It is not cosmopolitan. It is not global. But this assumes one cannot locate the shanty within globality or, at the very least a globality. For while the shanties' dwellers may not participate in consuming the symbols of global modernity, its very presence is already prefigured by mechanisms that are also global in scope. International relations theories can help us understand the way the international systems work, as well as how nations engage with each other and view the world. Varying from liberal, equality-centric strategies to straightforward realist concepts, international relations theories are often used by diplomats and international relations experts to dictate the direction that a government may take in regard to an international political issue or concern. By studying the following key international theories, professionals in the field can better discern the motivations and goals driving policy decisions worldwide. The theory further states that a nation’s foremost interest should be self-preservation and that continually gaining power should always be a social, economic, and political imperative. The nature of realism implies that seeking a moral high ground is a goal that governments cannot always achieve, and that deceit and violence can be highly effective tools for advancing national interests. THE WORLD IS A HARSH AND DANGEROUS PLACE. THE ONLY CERTAINTY IN THE WORLD IS POWER. A powerful state will always be able to outdo—and outlast—weaker competitors. The most important and reliable form of power is military power. A STATE’S PRIMARY INTEREST IS SELF-PRESERVATION. THEREFORE, THE STATE MUST SEEK POWER AND MUST ALWAYS PROTECT ITSELF In modern times, realism is evident in the foreign policies of China and Russia. The relationship between Russia and Syria is one that has raised eyebrows in Europe and around the world; despite the bloody civil war in Syria—and the international community’s pleas for intervention—Russia has maintained strategic relations with the government of Bashar Al-Assad in order to protect Russian interests in the region. Similarly, China continues its diplomatic and economic association with North Korea in spite of the latter’s appalling human rights record and aggressive nuclear testing. Chinese encroachment into the South China Sea and Russia’s incursions into Ukraine also highlight the two countries’ aggressive—and at times violent—realist political approach to international affairs. Rather than relying on direct force, such as military action, liberalism places an emphasis on international cooperation as a means of furthering each nation’s respective interests. Liberalists believe that the negative consequences of force—such as economic losses and civilian casualties—far exceed its potential benefits. Therefore, liberal politicians generally prefer the use of economic and social power in achieving their national goals (for instance, obtaining the agreement of a neighboring country to help secure a border). In today’s globalized society, using economic tactics—such as bilateral trade agreements and international diplomacy—can be more effective in advancing political interests than threatening force. As liberalism has become more rooted in international cooperation through the establishment of organizations like the United Nations, realism has started to wane as a viable political strategy. It can be argued that the liberalist tradition, perpetuated by the United States, has become the dominant system in international relations, with established values and international institutions in place to regulate this order. The world is a harsh and dangerous place, but the consequences of using military power often outweigh the benefits. International cooperation is therefore in the interest of every state. Military power is not the only form of power. Economic and social power matter a great deal too. EXERCISING ECONOMIC POWER HAS PROVEN MORE EFFECTIVE THAN EXERCISING MILITARY POWER. Constructivists also argue that STATES ARE NOT THE MOST IMPORTANT ACTORS IN INTERNATIONAL RELATIONS, BUT THAT INTERNATIONAL INSTITUTIONS AND OTHER NON-STATE ACTORS ARE VALUABLE IN INFLUENCING BEHAVIOR THROUGH LOBBYING AND ACTS OF PERSUASION. For this reason, constructivism has become a popular and important theory in recent decades as non-state actors like international organizations such as Amnesty International, OXFAM, and Greenpeace gain political influence. International organizations play a role in promoting human rights and making them an international standard to which countries are expected to conform. For example, since German aggression served as the primary catalyst for the Second World War, Germany deploys its armed forces outside of German borders only when its government is certain of the need to intervene in instances of genocide or conflict that threatens to spill over into other nations. This has been demonstrated by the country’s foreign policy following the first and second Gulf War (the latter of which Germany refused to participate), as well as its reluctant participation in United Nations-led operations in Somalia and Yugoslavia. Karl Marx was a Prussian philosopher and economist whose works postulated that societies could escape the self-destructive nature of capitalist socioeconomic systems by implementing socialist theory into their policies, both locally and abroad. Marxism, A THEORY THAT CLOSELY ANALYZES SOCIAL CLASSES, aims to dismantle the capitalist structure of the international system, as it states that capitalism is no longer practically sustainable in the modern world. Marx believed that private property should be replaced by cooperative ownership, with the emphasis placed entirely on satisfying human needs for consumption, rather than creating private profit. Under an ideal socialist international regime, societies would work together to ensure that basic human needs were met on a global scale. Marxism was a dominant political ideology during the Cold War and inspired socialist revolutions in countries such as China, Vietnam and Cuba. Postmodern make practices of representation, discourse, and interpretation central to the analyses of world politics. Foregrounding the relations between language, politics, and social structure, they are informed by a “shared acknowledgement of the ‘constitutive nature of language’ and an antipathy toward ‘closed system of knowledge” They challenge disciplinary boundaries by taking to task the discursive limits of the discipline constructed in the language of modern social sciences, which presumes a unity between natural and social sciences and the possibility to distinguish between facts and values. They draw on the distinction between politics—that sphere of social life that comprises institutionalized processes, activities, subjects assumed to be the premises of political life (elections, political parties, policymaking, international treaties, diplomacy, etc.) LESSON 7 – ASIAN REGIONALISM TRADE WAR LOOMS U.S. President Donald Trump announced heavy and substantial tariffs on US$50 billion of Chinese imports as Beijing threatened to respond in kind, in a move that looks set to ignite a trade war between the world’s two largest economies. Trump, whose hardline stance on trade has seen him wrangle with allies, said in a statement that a 25 per cent tariff would be imposed on a list of strategically important imports from China. He also vowed further measures if Beijing struck back. Why did the US impose tariffs on Chinese imports? The US has a massive trade deficit of $504 billion dollars with China. Donald Trump mentioned in his speech that it is the largest deficit of any country in the history of our world. The US has targeted to reduce this deficit by $100 billion. It has accused China of unfair trade practices. Hence, the tariffs. The US also wants to protect its domestic producers from competition from cheap Chinese products. It wants to protect jobs in the US. A trade deficit is an amount by which the cost of a country's imports exceeds its exports. It's one way of measuring international trade, and it's also called a negative balance of trade. You can calculate a trade deficit by subtracting the total value of a country's exports from the total value of its imports.1 A trade deficit occurs when a country does not produce everything it needs and borrows from foreign states to pay for the imports. That's called the current account deficit A trade deficit also occurs when companies manufacture goods in other countries. The raw materials for manufacturing that are shipped overseas for factory production count as an export. The finished manufactured goods are counted as imports when they're shipped back to the country. The imports are subtracted from the country's gross domestic product even though the earnings may benefit the company's stock price, and the taxes may increase the country's revenue stream.3 Effects Initially, a trade deficit is not necessarily a bad thing. It can raise a country's standard of living because residents can access a wider variety of goods and services for a more competitive price.4 It can also reduce the threat of inflation since it creates lower prices.5 Washington and Beijing appeared increasingly headed toward a trade war after several rounds of negotiations failed to resolve U.S. complaints over Chinese industrial policy, market access and a US$375 billion trade gap. Trump’s initial list included 818 products worth US$34 billion in Chinese goods. The remainder of the US$50 billion is still to be decided. Trump has triggered a trade war with Canada, Mexico and the European Union over steel and aluminum and has threatened to impose duties on European cars. China has published its own list of threatened tariffs on US$50 billion in U.S. goods, including soybeans, aircraft, and autos, and has said it would hit back if Washington followed up with further measures. Beijing and Washington have held three rounds of high-level talks since early May that have yet to yield a compromise. Trump has been unmoved by a Chinese offer to buy an additional US$70 billion worth of U.S. farm and energy products and other goods, according to people familiar with the matter. TOWARDS ASIAN REGIONALIZATION Asian regionalism is the product of economic interaction, not political planning. As a result of successful, outward oriented growth strategies, Asian economies have grown not only richer, but also closer together After world war 2, regionalist movement increase everywhere in world. World war 2 was very harmful for economy and world peace. To rebuild the economy, states in particular places began to work together. Interactions and relations between states in same region increased with regionalist policies. States established institutions for sustaining relations. The region’s economy is already similar in size to those of Europe and North America, and its influence in the world continues to increase. In many Asian countries, the cycle of poverty has been broken; in others, this historic aim is within sight. It assesses the ideas of regionalism that have been promoted by great power actors, as well as those that have been promoted by middle powers, looking at how different actors sell their vision of the region to others, build support for their ideas, and maneuver against competing proposals. Although ideas about regionalism often appear to be thinly disguised expressions of national interests, an important question for Asia is whether or not ideas about the region can move beyond the limits of narrow national interests into a shared sense of community. Asia is now so important to the world economy that it must also play a larger role in global economic leadership. Regional economic cooperation is essential for addressing these challenges. Asia’s economic rise is unprecedented because the region is home to over half the world’s population, produces three tenths of global output (in terms of purchasing power), and consistently records the world’s highest economic growth rates. The Asian “miracle” (World Bank 1993) did not end with the 1997/98 financial crisis a decade ago; for some countries, it marked the beginning of renewed acceleration. The question is no longer whether Asia will be central to the 21st century economy, but rather how it will exercise its prominent role and how its dependence on the rest of the world has decreased. Remember, there is no single Asian idea of regionalism. Individual countries such as South Korea and Japan demonstrate vast internal differences in developing, modifying, and shifting ideas of regionalism. Asia’s economies are increasingly connected through trade, financial transactions, direct investment, technology, labor and tourist flows, and other economic relationships. Asian ideas of regionalism have interacted with non-Asian ideas. Asian ideas have been the outcome of power struggles, with competing actors promoting their own particular idea of regionalism while attempting to undermine rival claims. The question is no longer whether Asia will be central to the 21 st century economy, but rather how it will exercise its prominent role and how its dependence on the rest of the world has decreased. This includes some of the world’s wealthiest economies and some of its poorest, large continental powers as well as small citystates, continuously independent countries and former colonies. Its strength derives from the openness, diversity, and dynamism of its interconnected economies. Asian economies are principally connected through markets— but where markets lead, governments are following. Asian leaders have committed to work together more closely and have already taken concrete steps in some areas. It could help sustain the region’s growth, underpin its stability, and—with the right policies—reduce inequality. And it could help marshal a common response to major new challenges that often arise suddenly and unexpectedly. As this study goes to press, for instance, Asia is grappling with the wrenching economic and financial uncertainty sparked by the global credit crunch since August 2007, several devastating natural disasters, and the pressing need to ensure affordable food supplies throughout Asia. A vibrant, integrated Asia could bring the region’s immense intellectual and economic resources to bear on these and tomorrow’s challenges. And it could help power and stabilize the global economy by boosting productivity, raising living standards, and reducing poverty everywhere. A stable, cohesive, and productive Asia is thus in everyone’s interest. This study draws on the 42 years of experience of the Asian Development Bank (ADB) in financing, analyzing, and advising on Asian economic growth. This knowledge base provides a unique perspective on Asia’s economic integration and the potential contributions of its emerging regionalism. Regional cooperation, effectively structured and implemented, is a powerful new tool in Asia’s policy arsenal. It can help Asia address regional challenges as well as provide stronger foundations for its global role. An integrated Asia can: The opportunities are clear, which is why regional integration deserves a high priority in national policy making. Yet the challenge of cooperation should not be underestimated; it will require trust, innovation, and compromise—and, most likely, time. Policy makers at the highest levels appear committed to pushing the regional agenda forward, but considerable leadership and energy are needed to achieve results. These benefits from cooperation could extend also to developing Asian economies that are not yet part of the region’s integrating core. Indeed, in relative terms, newcomers to regional integration have the most to gain from the expanded opportunities for economic development that it provides. Hence, an important aim of this study is to make the case for integration to countries that have not yet adopted an outward-oriented development strategy and to provide guidance on how to build stronger regional connections. The rest of the world could benefit, too. So long as Asia’s economies continue to integrate not just with each other, but also with the rest of the world, sustained Asian dynamism, strengthened by regional cooperation, could bolster Asia’s role as a new and stabilizing engine of global economic growth. There are many reasons why Asia is likely to remain outward-looking—not least because its economy is in large part built on economies of scale and scope in manufacturing and so requires global markets to perform at its potential. Indeed, because an integrated Asia will continue to have a powerful stake in the global economy, it would have both an incentive and the leverage to play a bigger role in keeping global markets open and vibrant. An integrated Asia can: While Asian regionalism is primarily motivated by the desire to advance welfare in the region, it would not do so by detracting from development elsewhere. On the contrary, Asian regionalism can help to sustain global economic progress at a time when other major regions are reaching economic maturity. In the 1930s, countries created preferential trade blocs in an attempt to shelter their economies from the Great Depression. Several countries established discriminatory currency blocs with strict exchange controls against outsiders. Far from helping, these arrangements led to the collapse of international trade and financial flows, accelerating the downward spiral of economic activity. This experience was foremost in the mind of the architects of the post-war global economic system as they adopted the principle of nondiscrimination as a central pillar of the General Agreement on Tariffs and Trade (GATT), the forerunner of the World Trade Organization (WTO). Many economists and policy makers remain skeptical about regionalism because of its potentially negative impact on the multilateral trade and financial system. The case for regional cooperation is still more specific: it addresses problems that are inherently regional in scope or, for other reasons, cannot be solved at a global or national level. In practice, though, reaching and implementing global agreements is difficult, and international market failures that ideally ought to be addressed globally often are not. Rapid regional growth and integration generate new commercial opportunities and demands for governmental cooperation and institutional development. But because regional action could introduce new distortions, global cooperation is often preferable.