Globalization: A Very Short Introduction PDF

Globalization: A Very Short Introduction  VERY SHORT INTRODUCTIONS are for anyone wanting a stimulating and accessible way in to a new subject. They are written by experts, and have been published in more than 25 languages worldwide. The series began in 1995, and now represents a wide var...

Globalization: A Very Short Introduction  VERY SHORT INTRODUCTIONS are for anyone wanting a stimulating and accessible way in to a new subject. They are written by experts, and have been published in more than 25 languages worldwide. The series began in 1995, and now represents a wide variety of topics in history, philosophy, religion, science, and the humanities. Over the next few years it will grow to a library of around 200 volumes- a Very Short Introduction to everything from ancient Egypt and Indian philosophy to conceptual art and cosmology. Very Short Introductions available now: ANCIENT P H I L O S O P H Y CONTINENTAL P H I L O S O P H Y Julia Annas Simon Critchley THE ANGLO-SAXON AGE COSMOLOGY Peter Coles John Blair CRYPTOGRAPHY ANIMAL RIGHTS David DeGrazia Fred Piper and Sean Murphy ARCHAEOLOGY Paul Bahn DADAAND SURREALISM ARCHITECTURE David Hopkins Andrew Ballantyne DARWIN Jonathan Howard ARISTOTLE Jonathan Barnes DEMOCRACY Bernard Crick ART HISTORY Dana Arnold DESCARTES Tom Sorell ARTTHEORY Cynthia Freeland DRUGS Leslie Iversen THE HISTORYOF TH E EARTH Martin Redfern ASTRONOMY Michael Hoskin EGYPTIAN MYTHOLOGY ATHEISM Julian Baggini Geraldine Pinch AUGUSTINE HenryChadwick EIGHTEENTH-CENTURY BARTHES Jonathan Culler BRITAIN Paul Langford THE B I B L E John Riches THE ELEMENTS Philip Ball BRITISH POLITICS EMOTION Dylan Evans Anthony Wright EMPIRE Stephen Howe BUDDHA Michael Carrithers ENGELS Terrell Carver BUDDHISM DamienKeown ETH ICS Simon Blackburn CAPITALISM James Fulcher THE EUROPEAN UNION THE CELTS Barry Cunliffe John Pinder CHOICETHEORY EVOLUTION Michael Allingham Brian and Deborah Charlesworth CHRISTIAN ART Beth Williamson FASCISM Kevin Passmore CLASSICS Mary Beard and THE FRENCH REVOLUTION John Henderson William Doyle CLAUSEWITZ Michael Howard FREUD AnthonyStorr THE COLD WAR GALILEO Stillman Drake Robert McMahon GANDHI BhikhuParekh GLOBALIZATION PLATO Julia Annas Manfred Steger POLITICS Kenneth Minogue H E G E L Peter Singer POLITICAL PHILOSOPHY H E I D E G G E R Michael Inwood David Miller HINDUISM KimKnott POSTCOLONIALISM HISTORY John H. Arnold Robert Young H O B B E S Richard Tuck POSTMODERNISM HUME A.J. Ayer Christopher Butler IDEOLOGY Michael Freeden POSTSTRUCTURALISM INDIAN PHILOSOPHY Catherine Belsey Sue Hamilton PREHISTORY Chris Gosden INTELLIGENCE Ian J. Deary PRESOCRATIC PHILOSOPHY ISLAM Malise Ruthven Catherine Osborne JUDAISM Norman Solomon PSYCHOLOGY Gillian Butler and JUNG Anthony Stevens Freda McManus KANT Roger Scruton QUANTUM THEORY KIERKEGAARD Patrick Gardiner John Polkinghorne THE KORAN Michael Cook ROMAN BRITAIN PeterSalway LINGUISTICS Peter Matthews ROUSSEAU Robert Wokler LITERARY THEORY RUSSELL A. C Grayling Jonathan Culler RUSSIAN LITERATURE LOCKE John Dunn Catriona Kelly LOGIC Graham Priest THE RUSSIAN REVOLUTION MACHIAVELLI Quentin Skinner S. A. Smith MARX Peter Singer SCHIZOPHRENIA MATHEMATICS Timothy Gowers Chris Frith and Eve johnstone MEDIEVAL BRITAIN SCHOPENHAUER John Gillingham and Christopher Janaway Ralph A. Griffiths S H A K E S P E A R E Germaine Greer MODERN IRELAND SOCIAL AND CULTURAL Senia PaŠeta ANTHROPOLOGY MOLECULES Philip Ball John Monaghan and Peter Just MUSIC Nicholas Cook SOCIOLOGY Steve Bruce NIETZSCHE Michael Tanner SOCRATES C. C.W.Taylor NINETEENTH-CENTURY SPINOZA Roger Scruton BRITAIN Christopher Harvie and STUART BRITAIN John Morrill H. C. G. Matthew TERRORISM Charles Townshend NORTHERN IRELAND THEOLOGY David F. Ford Marc Mulholland THE TUDORS John Guy PAU L E. P. Sanders TWENTIETH-CENTURY PHILOSOPHY Edward Craig BRITAIN Kenneth O. Morgan PHILOSOPHY OF SCIENCE WITTGENSTEIN A. C. Grayling SamirOkasha WORLD MUSIC Philip Bohlman Available soon: AFRICAN HISTORY HIEROGLYPHS John Parker and Richard Rathbone Penelope Wilson ANCIENT EGYPT Ian Shaw HIROSHIMA B. R.Tomlinson THE BRAIN Michael O'Shea HUMAN EVOLUTION BUDDHIST ETHICS Bernard Wood Damien Keown INTERNATIONAL RELATIONS CHAOS Leonard Smith Paul Wilkinson CHRISTIANITY Linda Woodhead JAZZ Brian Morton C I T I Z E N S H I P Richard Bellamy MANDELA Tom Lodge CLASSICAL ARCHITECTURE MEDICAL ETHICS Robert Tavernor Tony Hope CLONING Arlene Judith Klotzko THE MIND Martin Davies CONTEMPORARY ART MYTH Robert Segal Julian Stallabrass NATIONALISM Steven Crosby THE CRUSADES PERCEPTION Richard Gregory Christopher Tyerman P H I L O S O P H Y O F RELIGION DERRIDA Simon Glendinning Jack Copeland and Diane Proudfoot DESIGN John Heskett PHOTOGRAPHY DINOSAURS David Norman Steve Edwards DREAMING J. Allan Hobson THE RAJ Denis Judd ECONOMICS Partha Dasgupta THE RENAISSANCE T H E E N D O F T H E WORLD Jerry Brotton Bill McGuire RENAISSANCE ART EXISTENTIALISM Thomas Flynn Geraldine Johnson THE FIRST WORLD WAR SARTRE Christina Howells Michael Howard THESPANISH CIVILWAR F R E E W I L L Thomas Pink Helen Graham FUNDAMENTALISM TRAGEDY Adrian Poole Malise Ruthven THETWENTIETH CENTURY HABERMAS Gordon Finlayson Martin Conway For more information visit our web site www.oup.co.uk/vsi  Manfred B. Steger GLOBALIZATION A Very Short Introduction OXFORD UNIVERSITY PRESS  OXPORD UNIVERSITY PRESS Great Clarendon Street, Oxford o x 2 6 D p Oxford University Press is a department of the University of Oxford. It furthers the University's objective of excellence in research, scholarship, and education by publishing worldwide in Oxford New York Auckland Bangkok Buenos Aires Cape Town Chennai Dar es Salaam Delhi Hong Kong Istanbul Karachi Kolkata Kuala Lumpur Madrid Melbourne Mexico City Mumbai Nairobi Sao Paulo Shanghai Taipei Tokyo Toronto Oxford is a registered trade mark of Oxford University Press in the UK and in certain other countries Published in the United States by Oxford University Press Inc., New York © Manfred B. Steger 2003 The moral rights of the author have been asserted Database right Oxford University Press (maker) First published as a Very Short Introduction 2003 All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, without the prior permission in writing of Oxford University Press, or as expressly permitted by law, or under terms agreed with the appropriate reprographics rights organizations. Enquiries concerning reproduction outside the scope of the above should be sent to the Rights Department, Oxford University Press, at the address above You must not circulate this book in any other binding or cover and you must impose this same condition on any acquirer British Library Cataloguing in Publication Data Data available Library of Congress Cataloging in Publication Data Data available ISBN 13: 978-0-19-280359-7 ISBN 10: 0-19-280359-X 9 10 Typeset by RefineCatch Ltd, Bungay, Suffolk Printed in Great Britain by Ashford Colour Press Ltd., Gosport, Hampshire For my students at Illinois State University and the University of Hawai'i-Manoa. This page intentionally left blank ContentszyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLK Preface xi Abbreviations xv List of illustrations xvii List of maps xix 1 1 Globalization: a contested concept 1 2 2. Is globalization a new phenomenon? 17zyxwvutsrqponmlkjihgfe 3 3 The economic dimension of globalization 37 4 4 The political dimension of globalization 56 5 5 The cultural dimension of globalization 69 6 6 The ideological dimension of globalization 93 7 7 Challenges to globalism 113 8 8 Assessing the future of globalization 131 References 137 Index 143 This page intentionally left blank PrefacezyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIH It is a daunting task to write a short, accessible introduction to such a complex topic as 'globalization'. This challenge becomes even more formidable in the case of a very short introduction. Hence, it is not surprising that the authors of the few existing short introductions to the subject have opted to discuss only one aspect of globalization - usually the emerging global economic system, its history, structure, and supposed benefits and failings. While helpful in explaining the intricacies of international trade policy, global financial markets, worldwide flows of goods, services, and labour, transnational corporations, offshore financial centres, foreign direct investment, and the new international economic institutions, such narrow accounts often leave the general reader with a shallow understanding of globalization as primarily an economic phenomenon. To be sure, the discussion of economic matters must be a significant part of any comprehensive account of globalization, but the latter should not be conflated with the former. The present volume makes the case that globalization is best thought of as a multidimensional set of social processes that resists being confined to any single thematic framework. Indeed, the transformative powers of globalization reach deeply into the economic, political, cultural, technological, and ecological dimensions of contemporary social life. In addition, globalization contains important discursive aspects in the form of ideologically charged narratives that put before the public a particular agenda of topics for discussion, questions to ask, and claims to make. The existence of these narratives shows that globalization is not merely an objective process, but also a plethora of stories that define, describe, and analyse that very process. The social forces behind these competing accounts of globalization seek to endow this relatively new buzzword with norms, values, and meanings that not only legitimate and advance specific power interests, but also shape the personal and collective identities of billions of people. In order to shed light on these rhetorical manoeuvres, any introduction to globalization ought to examine its ideological dimension. After all, it is mostly the question of whether globalization ought to be considered a 'good' or a 'bad' thing that has spawned heated debates in classrooms, boardrooms, and on the streets. This book has been written with a keen awareness that the study of globalization falls outside currently established academic fields. Yet, the lack of a firm disciplinary home also contains great opportunity. 'Globalization studies' is emerging as a new field that cuts across traditional disciplinary boundaries. This strong emphasis on interdisciplinarity requires students of globalization to familiarize themselves with literatures on subjects that have often been studied in isolation from each other. The greatest challenge facing today's globalization researcher lies, therefore, in connecting and synthesizing the various strands of knowledge in a way that does justice to the increasingly fluid and interdependent nature of our postmodern world. In short, globalization studies calls for an interdisciplinary approach broad enough to behold the 'big picture'. Such a comprehensive intellectual enterprise may well lead to the rehabilitation of the academic generalist whose status, for too long, has been overshadowed by the specialist. Finally, let me add a word of clarification. While the main purpose of this book lies in providing its audience with a descriptive and explanatory account of the various dimensions of globalization, the careful reader will detect throughout the chapters a critical undertone. However, my sceptical perspective on the nature and the effects of contemporary forms of globalization should not be interpreted as a blanket rejection of the phenomenon itself. I believe that we should take comfort in the fact that the world is becoming a more interdependent place that enhances people's chances to recognize and acknowledge their common humanity. I welcome the progressive transformation of social structures that goes by the name of globalization, provided that the global flow of ideas and commodities, and the rapid development of technology, go hand in hand with greater forms of freedom and equality for all people, as well as with more effective protection of our global environment. The brunt of my critique is directed at particular manifestations and tendencies of globalization that strike me as being at odds with the noble cosmopolitan vision of a more egalitarian and less violent global order. It is a pleasant duty to record my debts of gratitude. First, I want to thank my colleagues and friends at the Globalization Research Center at the University of Hawai'i-Manoa for their consistent support of my research agenda. Special thanks are also due to my colleagues at Illinois State University, particularly Jamal Nassar and Lane Crothers, for their willingness to read parts of the manuscript and offer helpful suggestions. I am grateful to Kay Stults, a graphic designer at ISU, for her excellent work on the maps. I also want to express my deep appreciation to numerous readers, reviewers, and audiences around the world, who, over several years, made insightful comments in response to my public lectures and publications on the subject of globalization. I am grateful to Eldon Wegner, chair of the department of sociology at the University of Hawai'i-Manoa, for his efforts to provide me with valuable office space as well as with the opportunity to teach relevant summer courses in social theory. I also appreciate the enthusiastic research assistance provided by my graduate assistant Ryan Canney. Franz J. Broswimmer, a wonderful friend and hard-working research specialist at the Globalization Research Center in Honolulu, deserves special recognition. He supplied me with valuable information on the ecological and historical aspects of globalization. Shelley Cox, my editor at Oxford University Press, has been a shining example of professionalism and competence. Finally, as always, I want to thank my wife, Perle Besserman, for her untiring support. Many people have contributed to improving the quality of this book; its remaining flaws are my own responsibility. AbbreviationszyxwvutsrqponmlkjihgfedcbaZYXWVU AOL America Online APEC Asian Pacific Economic Cooperation ASEAN Association of South East Asian Nations BCE Before the Common Era CE Common Era CEO Chief Executive Officer CFCs Chlorofluorocarbons CITES Convention on International Trade in Endangered Species of Wild Flora and Fauna CNN Cable News Network CNBC Cable National Broadcasting Corporation EU European Union FTAA Free Trade Area of the Americas G8 Group of Eight GATT General Agreement of Tariffs and Trade GDP Gross domestic product GNP Gross national product INGO International non-governmental organization IMF International Monetary Fund MAI Multilateral Agreement on Investment MERCOSUR Mercado Comun del Sur (Southern Common Market) MTV Music Television NAFTA North American Free Trade Agreement NATO North Atlantic Treaty Organization NGO Non-governmental organization OECD Organization for Economic Cooperation and Development OPEC Organization of Petroleum Exporting Countries TNCs Transnational Corporations UN United Nations UNESCO United Nations Educational, Scientific and Cultural Organization WTO World Trade Organization List of illustrationszyxwvutsrqponmlkjihgfedcbaZYXW 1 Osama bin Laden on Al- 6 Eastern European Jazeera Television, immigrants arriving 7 October 2001 3 in New York City, Al-Jazeera TV, Rex Features late 1800s 34 Bentley Historical Library, 2 The globalization scholars University of Michigan, Theodore and the elephant 15 Koch Collection, box 12,1-US Kenneth Panfilio and Immigration. Photo: Underwood Ryan Canney & Underwood, NY 3 Assyrian clay tablet 7 Bretton Woods with cuneiform writing, Conference, 1944 39 UN/DPI photo c. 1900-1800 BCE 23 © Christie's Images/Corbis 8 The New York Stock 4 The Great Wall Exchange 46 © Gail Mooney/Corbis of China 25 © Corbis 9 The Security Council 5 The sale of the island of the United Nations of Manhattan, 1626 30 in session 60 © Corbis/Bettmann UN photo 10 Jihad vs McWorld: selling fast food in Indonesia 74 © AP Photo/Firdia Lisnawati 11 The Greenhouse 15 WTO protestors in Effect 89 downtown Seattle, Union of Concerned Scientists, 30 November 1999 125 USA © Nick Cobbing/Rex Features 12 Microsoft CEO 16 The burning twin towers Bill Gates 94 of the World Trade © Ethan Miller/Corbis Center, 11 September 2001 129 13 Patrick J. Buchanan 117 Sean Adair/STR, © Reuters 2001 © Najlah Feanny/Corbis SABA 14 Ralph Nader 120 Brendan McDermid, © Reuters 2000 List of mapszyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQP 1 Early human migrationszyxwvutsrqponmlkjihgfedcbaZYXWVUTS 21 2 Major world trade networks, 1000-1450 27 3 Volkswagen's transnational production network SO 4 The eastward expansion of the European Union 66 5 The world by income, 1999 1O6/1O7 This page intentionally left blank Chapter 1 Globalization: a contested conceptzyxwvutsrqponmlkjihgfedcbaZYX In the autumn of 2001,I was teaching an undergraduate class on modern political and social theory. Still traumatized by the recent terrorist attacks on the World Trade Center and the Pentagon, most of my students couldn't quite grasp the connection between the violent forces of religious fundamentalism and the more secular picture of a technologically sophisticated, rapidly globalizing world that I had sought to convey in class lectures and discussions. 'I understand that "globalization" is a contested concept that refers to sometimes contradictory social processes,' a bright history major at the back of the room quipped, "but how can you say that the TV image of a religious fanatic who denounces modernity and secularism from a mountain cave in Afghanistan perfectly captures the complex dynamics of globalization? Don't these terrible acts of terrorism suggest the opposite, namely, the growth of parochial forces that undermine globalization?' Obviously, the student was referring to Saudi-born Al Qaeda leader Osama bin Laden, whose videotaped statement condemning the activities of'international infidels' had been broadcast worldwide on 7 October. Struck by the sense of intellectual urgency that fuelled my student's question, I realized that the story of globalization would remain elusive without real-life examples capable of breathing shape, colour, and sound into a vague concept that had become thezyxwvutsrqponm 1 buzzword of our time. Hence, before delving into necessary matters of definition and analytical clarification, we ought to approach our subject in less abstract fashion. I suggest we begin our journey with a careful examination of the aforementioned videotape. It will soon become fairly obvious why a deconstruction of those images provides important clues to the nature and dynamics of the phenomenon we have come to call 'globalization'. Deconstructing Osama bin Laden The infamous videotape bears no date, but experts estimate that the recording was made less than two weeks before it was broadcast. The timing of its release appears to have been carefully planned so as to achieve the maximum effect on the day the United States commenced its bombing campaign against Taliban and Al Qaeda ('The Base') forces in Afghanistan. Although Osama bin Laden and his top lieutenants were then hiding in a remote region of the country, they obviously possessed the hi-tech equipment needed to record the statement. Moreover, Al Qaeda members clearly enjoyed immediate access to sophisticated information and telecommunication networks that kept them informed - in real-time - of relevant international developments. Bin Laden may have denounced the forces of modernity with great conviction, but the smooth operation of his entire organization was entirely dependent on advanced forms of technology developed in the last two decades of the 20th century. To further illustrate this apparent contradiction, consider the complex chain of global interdependencies that must have existed in order for bin Laden's message to be heard and seen by billions of TV viewers around the world. After making its way from the secluded mountains of eastern Afghanistan to the capital city of Kabul, the videotape was dropped off by an unknown courier outside the local office of Al-Jazeera, a Qatar-based television company. This network had been launched only five years earlier as 2 1. Al Qaeda leader Osama bin Laden addressing a global audience on 7 October 2OO1. a state-financed, Arabic-language news and current affairs channel that offered limited programming. Before the founding of Al- Jazeera, cutting-edge TV journalism - such as free-ranging public affairs interviews and talk shows with call-in audiences - simply did not exist in the Arab world. Within only three years, however, Al-Jazeera was offering its Middle Eastern audience a dizzying array of programmes, transmitted around the clock by powerful satellites put into orbit by European rockets and American space shuttles. Indeed, the network's market share increased even further as a result of the dramatic reduction in the price and size of satellite dishes. Suddenly, such technologies became affordable, even for low-income consumers. By the turn of the century, Al-Jazeera broadcasts could be watched around the clock on all five continents. In 2001, the company further intensified its global reach when its chief executives signed a lucrative cooperation agreement with CNN, the leading news network owned by the giant multinational corporation AOL-Time-Warner. A few months later, when the world's attention shifted to the war in Afghanistan, Al-Jazeera had already positioned itself as a truly global player, powerful enough to rent equipment to such prominent news providers as Reuters and ABC, sell satellite time to the Associated Press and BBC, and design an innovative Arabic- language business news channel together with its other American network partner, CNBC. Unhampered by national borders and geographical obstacles, cooperation among these sprawling news networks had become so efficient that CNN acquired and broadcast a copy of the Osama bin Laden tape only a few hours after it had been delivered to the Al- Jazeera office in Kabul. Caught off guard by the incredible speed of today's information exchange, the Bush administration asked the Qatari government to 'rein in Al-Jazeera', claiming that the swift airing of the bin Laden tape without prior consultation was contributing to the rise of anti-American sentiments in the Arab 4 world and thus threatened to undermine the US war effort. However, not only was the perceived 'damage' already done, but segments of the tape - including the full text of bin Laden's statement - could be viewed online by anyone with access to a computer and a modem. The Al-Jazeera website quickly attracted an international audience as its daily hit count skyrocketed to over seven million. There can be no doubt that it was the existence of this chain of global interdependencies and interconnections that made possible the instant broadcast of bin Laden's speech to a global audience. At the same time, however, it must be emphasized that even those voices that oppose modernity cannot extricate themselves from the very process of globalization they so decry. In order to spread their message and recruit new sympathizers, antimodernizers must utilize the tools provided by globalization. This obvious truth was visible even in bin Laden's personal appearance. The tape shows that he was wearing contemporary military fatigues over traditional Arab garments. In other words, his dress reflects the contemporary processes of fragmentation and cross-fertilization that globalization scholars call 'hybridization' - the mixing of different cultural forms and styles facilitated by global economic and cultural exchanges. In fact, the pale colours of bin Laden's mottled combat dress betrayed its Russian origins, suggesting that he wore the jacket as a symbolic reminder of the fierce guerrilla war waged by him and other Islamic militants against the Soviet occupation forces in Afghanistan during the 1980s. His ever-present AK-47 Kalashnikov, too, was probably made in Russia, although dozens of gun factories around the world have been building this popular assault rifle for over 40 years. By the mid-1990s, more than 70 million Kalashnikovs had been manufactured in Russia and abroad. At least 50 national armies include such rifles in their arsenal, making Kalashnikovs truly weapons of global choice. Thus, bin Laden's AK-47 could have come from anywhere in the world. However, given the astonishing globalization of organized crime during the last two decades, it is quite conceivable that bin Laden's rifle was part of an illegal arms 5 deal hatched and executed by such powerful international criminal organizations as Al Qaeda and the Russian Mafia. It is also possible that the rifle arrived in Afghanistan by means of an underground arms trade similar to the one that surfaced in May 1996, when police in San Francisco seized 2,000 illegally imported AK-47s manufactured in China. A close look at bin Laden's right wrist reveals yet another clue to the powerful dynamics of globalization. As he directs his words of contempt for the United States and its allies at his hand-held microphone, his retreating sleeve exposes a stylish sports watch. Journalists who noticed this expensive accessory have speculated about the origins of the timepiece in question. The emerging consensus points to a Timex product. However, given that Timex watches are as American as apple pie, it seems rather ironic that the Al Qaeda leader should have chosen this particular chronometer. After all, Timex Corporation, originally the Waterbury Clock Company, was founded in the 1850s in Connecticut's Naugatuck Valley, known throughout the 19th century as the 'Switzerland of America'. Today, the company has gone multinational, maintaining close relations to affiliated businesses and sales offices in 65 countries. The corporation employs 7,500 employees, located on four continents. Thousands of workers - mostly from low-wage countries in the global South - constitute the driving force behind Timex's global production process. Our brief deconstruction of some of the central images on the videotape makes it easier to understand why the seemingly anachronistic images of an antimodern terrorist in front of an Afghan cave do, in fact, capture some essential dynamics of globalization. Indeed, the tensions between the forces of particularism and those of universalism have reached unprecedented levels only because interdependencies that connect the local to the global have been growing faster than at any time in history. The rise of international terrorist organizations like Al Qaeda represents but one of the many manifestations of 6 globalization. Just as bin Laden's romantic ideology of a 'pure Islam' is itself the result of the modern imagination, so has our global age with its obsession for technology and its mass-market commodities indelibly shaped the violent backlash against globalization. Our deconstruction of Osama bin Laden has provided us with a real-life example of the intricate - and sometimes contradictory - social dynamics of globalization. We are now in a better position to tackle the rather demanding task of assembling a working definition of globalization that brings some analytical precision to a contested concept that has proven to be notoriously hard to pin down. Toward a definition of globalization Since its earliest appearance in the 1960s, the term 'globalization' has been used in both popular and academic literature to describe a process, a condition, a system, a force, and an age. Given that these competing labels have very different meanings, their indiscriminate usage is often obscure and invites confusion. For example, a sloppy conflation of process and condition encourages circular definitions that possess little explanatory power. For example, the often- repeated truism that 'globalization [the process] leads to more globalization [the condition]' does not allow us to draw meaningful analytical distinctions between causes and effects. Hence, I suggest that we use the term globality to signify a social condition characterized by the existence of global economic, political, cultural, and environmental interconnections and flows that make many of the currently existing borders and boundaries irrelevant. Yet, we should not assume that 'globality' refers to a determinate endpoint that precludes any further development. Rather, this concept points to a particular social condition that, like all conditions, is destined to give way to new, qualitatively distinct constellations. For example, it is conceivable that globality might be transformed into something we could call 'planetarity' - a new social formation brought about by the successful colonization of our 7 solar system. Moreover, we could easily imagine different social manifestations of globality: one might be based primarily on values of individualism and competition, as well as on an economic system of private property, while another might embody more communal and cooperative social arrangements, including less capitalistic economic relations. These possible alternatives point to the fundamentally indeterminate character of globality; it is likely that our great-grandchildren will have a better sense of which alternative is likely to win out. Conversely, the term globalization should be used to refer to a set of social processes that are thought to transform our present social condition into one of globality. At its core, then, globalization is about shifting forms of human contact. Indeed, the popular phrase 'globalization is happening' contains three important pieces of information: first, we are slowly leaving behind the condition of modernity that gradually unfolded from the 16th century onwards; second, we are moving toward the new condition of (postmodern) globality; and, third, we have not yet reached it. Indeed, like 'modernization' and other verbal nouns that end in the suffix '-ization', the term 'globalization' suggests a sort of dynamism best captured by the notion of'development' or 'unfolding' along discernible patterns. Such unfolding may occur quickly or slowly, but it always corresponds to the idea of change, and, therefore, denotes the transformation of present conditions. Hence, scholars who explore the dynamics of globalization are particularly keen on pursuing research questions related to the theme of social change. How does globalization occur? What is driving globalization? Is it one cause or a combination of factors? Is globalization a uniform or an uneven process? Is globalization extending modernity or is it a radical break? How does globalization differ from previous social developments? Does globalization create new forms of inequality and hierarchy? Notice that the conceptualization of globalization as an ongoing process rather than as a static condition forces the researcher to pay 8 close attention to shifting perceptions of time and space. This explains why globalization scholars assign particular significance to historical analysis and the reconfiguration of social space. To argue that globalization refers to a set of social processes propelling us towards the condition of globality may eliminate the danger of circular definitions, but it gives us only one defining characteristic of the process: movement towards greater interdependence and integration. Such a general definition of globalization tells us very little about its remaining qualities. In order to overcome this deficiency, we must identify additional qualities that make globalization different from other sets of social processes. Yet, whenever researchers raise the level of specificity in order to bring the phenomenon in question into sharper focus, they also heighten the danger of provoking scholarly disagreements over definitions. Our subject is no exception. One of the reasons why globalization remains a contested concept is because there exists no scholarly consensus on what kinds of social processes constitute its essence. Despite such strong differences of opinion, however, it is possible to detect some thematic overlap in various scholarly attempts to identify the essential qualities of globalization processes. Consider, for example, the following five influential definitions of globalization. They suggest that four distinct qualities or characteristics lie at the core of the phenomenon. First, globalization involves the creation of new and the multiplication of existing social networks and activities that increasingly overcome traditional political, economic, cultural, and geographical boundaries. As we have seen in the case of Al-Jazeera television, the creation of today's satellite news corporations is made possible by the combination of professional networking, technological innovation, and political decisions that permit the emergence of new social orders that transcend parochial arrangements. 9 Globalization can thus be defined as the intensification of worldwide social relations which link distant localities in such a way that local happenings are shaped by events occurring many miles away and vice versa. Anthony Giddens, Director of the London School of Economics The concept of globalization reflects the sense of an immense enlargement of world communication, as well as of the hori- zon of a world market, both of which seem far more tangible and immediate than in earlier stages of modernity. Fredric Jameson, Professor of Literature at Duke University Globalization may be thought of as a process (or set of pro- cesses) which embodies a transformation in the spatial organization of social relations and transactions - assessed in terms of their extensity, intensity, velocity and impact - generating transcontinental or interregional flows and networks of activity, interaction, and the exercise of power. David Held, Professor of Political Science at the London School of Economics Globalization as a concept refers both to the compression of the world and the intensification of consciousness of the world as a whole. Roland Robertson, Professor of Sociology at the University of Pittsburgh Globalization compresses the time and space aspects of social relations. James Mittelman, Professor of International Relations at American University 10 The second quality of globalization is reflected in the expansion and the stretching of social relations, activities, and interdependencies. Today's financial markets stretch around the globe, and electronic trading occurs around the clock. Gigantic shopping malls have emerged on all continents, offering those consumers who can afford it commodities from all regions of the world - including products whose various components were manufactured in different countries. To return to our initial example, we now know that the spatial reach of Osama bin Laden's organization rapidly expanded during the late 1990s. Aided by new technology and economic deregulation, terrorist cells sprang up in dozens of nations on all five continents, ultimately turning Al Qaeda into a global terrorist network capable of planning and executing attacks on a heretofore unimaginable scale. The same process of social stretching applies to less sinister associations such as non-governmental organizations, commercial enterprises, social clubs, and countless regional and global institutions and associations such as the United Nations, the European Union, the Association of South East Asian Nations, the Organization of African Unity, the Common Market of the South, Doctors Without Borders, Amnesty International, the Union of Concerned Scientists, the World Economic Forum, Microsoft, and General Motors, to name but a few. Third, globalization involves the intensification and acceleration of social exchanges and activities. The Internet relays distant information in mere seconds, and satellites provide consumers with real-time pictures of remote events. As Anthony Giddens notes in his definition, the intensification of worldwide social relations means that local happenings are shaped by events occurring far away, and vice versa. In other words, the seemingly opposing processes of globalization and localization actually imply each other. The 'local' and the 'global' form the endpoints of a spatial continuum whose central portion is marked by the 'national' and the 'regional'. 11 To elaborate on this point, let us return to the example of Osama bin Laden. It is reasonable to assume that his terrorist strategy is being shaped continuously by technological breakthroughs achieved in American and Indian computer labs, as well as by political and military decisions made in Washington, DC, Brussels, and other parts of the world. At the same time, the activities of US politicians, military engineers in the United Kingdom, and Israeli secret service agents are significantly impacted by Osama bin Laden's strategy. The often-repeated phrase that 'globalization compresses time and space' simply means that things are getting faster and distances are shrinking dramatically. As the Spanish sociologist Manuel Castells has pointed out, the current rise of the global 'network society' would not have been possible without a technological revolution - one that has been powered chiefly by the rapid development of new information and transportation technologies. Proceeding at an ever-accelerating pace, these innovations are reshaping the social landscape of human life. Fourth, the creation, expansion, and intensification of social interconnections and interdependencies do not occur merely on an objective, material level. As Roland Robertson notes in his definition, globalization processes also involve the subjective plane of human consciousness. Hence, we must not forget that globalization also refers to people becoming increasingly conscious of growing manifestations of social interdependence and the enormous acceleration of social interactions. Their awareness of the receding importance of geographical boundaries and distances fosters a keen sense of becoming part of a global whole. Reinforced on a daily basis, these persistent experiences of global interdependence gradually change people's individual and collective identities, and thus dramatically impact the way they act in the world. It seems that we have now identified some of the essential qualities of globalization. This allows us to offer the following definition: 12  Globalization refers to a multidimensional set of social pro- cesses 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. More areas of contestation Although we arrived at an adequate working definition of globalization by drawing out some common insights that appear in other influential definitions, we must not lose sight of the fact that there still remain several areas of contestation. After all, globalization is an uneven process, meaning that people living in various parts of the world are affected very differently by this gigantic transformation of social structures and cultural zones. Hence, the social processes that make up globalization have been analysed and explained by various commentators in different, often contradictory ways. Scholars not only hold different views with regard to proper definitions of globalization, they also disagree on its scale, causation, chronology, impact, trajectories, and policy outcomes. For example, the academic dispute over the scale of globalization revolves around the question of whether it should be understood in singular or differentiated terms. This notion of 'multidimensionality' appears as an important attribute of globalization in our own definition; still it requires further elaboration. The ancient Buddhist parable of the blind scholars and their encounter with the elephant helps to illustrate the nature of the academic controversy over the various dimensions of globalization. Since the blind scholars did not know what the elephant looked like, they resolved to obtain a mental picture, and thus the knowledge they desired, by touching the animal. Feeling its trunk, one blind man argued that the elephant was like a lively snake. Another man, 13 rubbing along its enormous leg, likened the animal to a rough column of massive proportions. The third person took hold of its tail and insisted that the elephant resembled a large, flexible brush. The fourth man felt its sharp tusks and declared it to be like a great spear. Each of the blind scholars held firmly to his own idea of what constituted an elephant. Since their scholarly reputation was riding on the veracity of their respective findings, the blind men eventually ended up arguing over the true nature of the elephant. The ongoing academic quarrel over which dimension contains the essence of globalization represents a postmodern version of the parable of the blind men and the elephant. Even those scholars who agree that globalization is best thought of as a singular process clash with each other over which aspect of social life constitutes the primary domain of the phenomenon. Some scholars argue that economic processes lie at the core of globalization. Others privilege political, cultural, or ideological aspects. Still others point to environmental processes as the essence of globalization. Like the blind men in the parable, each globalization researcher is partly right by correctly identifying one important dimension of the phenomenon in question. However, their collective mistake lies in their dogmatic attempts to reduce such a complex phenomenon as globalization to a single domain that corresponds to their own expertise. To be sure, one of the central tasks for globalization researchers consists of devising better ways for gauging the relative importance of each dimension without losing sight of the interconnected whole. But it would be a grave mistake to cling to a one-sided understanding of globalization. Fortunately, more and more researchers have begun to heed this call for a genuine multidimensional approach to globalization that avoids pernicious reductionism. Since globalization contains multifaceted and differentiated processes, it is safe to say that virtually no areas of social life escape its reach. Or is it? 14 2. The globalization scholars and the elephant. Before we come to this important conclusion, let us consider several objections raised by those scholars who belong to the camp of the 'globalization sceptics'. These objections range from the accusation that fashionable 'globalization talk' amounts to little more than 'globaloney' to less radical suggestions that globalization is a much more limited and uneven process than the sweeping arguments of the so-called 'hyperglobalizers' would have us believe. In many ways, the most radical globalization sceptics resemble the blind scholar who, occupying the empty space between the elephant's front and hind legs, groped in vain for a part of the elephant. Finding none, he accused his colleagues of making up fantastic stories about non-existent things, asserting that there were no such animals as 'elephants' at all. However, evidence pointing to the rapid intensification of worldwide social relations is mounting. Hence, I will not attempt to refute those few globalization sceptics who go so far as to deny its existence altogether. On the other hand, I am rather sympathetic to the notion that globalization may be a geographically limited and uneven process. As I will argue myself in subsequent chapters, large segments of the world population - particularly in the global 15 South - do not enjoy equal access to thickening global networks and infrastructures. In that sense, then, globalization is associated with inequality. Nevertheless, even if it can be shown that the intensification of social interconnections and interdependencies appears to be concentrated in the economically advanced countries of the global North, it would still be entirely justified to engage in extensive 'globalization talk'. After all, the existence of patterns of rising interdependence in the global North does reflect a partial globalization trend, one that is likely to have significant impacts on other regions of the world. In my view, the most challenging question that has emerged from the camp of globalization sceptics is the following: is globalization primarily a phenomenon of the modern age? Critics would respond to this question in the negative, adding that the concept of globalization has been applied in an historically imprecise manner. In a nutshell, this thoughtful group of sceptics contends that even a cursory look at history suggests that there is not much that is 'new1 about contemporary globalization. Hence, before we explore in some detail the five main dimensions of globalization in subsequent chapters of this book, I suggest we give this weighty argument a fair hearing. Indeed, such a critical investigation of globalization's alleged novelty is closely related to yet another difficult question hotly debated in the fledgling field of globalization studies. What does a proper chronology and periodization of globalization look like? Let us turn to Chapter 2 to find answers to this question. 16 Chapter 2zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONM Is globalization a new phenomenon?zyxwvutsrqponmlkjihgfedcbaZ If we asked an ordinary person on the streets of London, New York, Bangkok, or Rio de Janeiro about the essence of globalization, the answer would probably involve some reference to growing forms of political and economic interdependence fuelled by 'new technologies' like personal computers, the Internet, cellular phones, pagers, fax machines, palm pilots, digital cameras, high-definition televisions, satellites, jet planes, space shuttles, and supertankers. As subsequent chapters will show, however, technology provides only a partial explanation for the existence of contemporary forms of globalization. Yet, it would be foolish to deny that these new innovations have played a crucial role in the creation, multiplication, expansion, and intensification of global social interconnections and exchanges. The Internet, in particular, has assumed a pivotal function in facilitating globalization through the creation of the World Wide Web that connects billions of individuals, private associations, and governments. Since most of these technologies have been around for less than three decades, it seems to make sense to agree with those commentators who claim that globalization is, indeed, a new phenomenon. At the same time, however, the definition of globalization we arrived at in the previous chapter stresses the dynamic nature of the phenomenon. The enhancement of worldwide interdependence 17 and the general growth of awareness of deepening global connections are gradual processes with deep historical roots. For example, the engineers who developed laptop computers and supersonic jet planes stand on the shoulders of earlier innovators who created the steam engine, the cotton gin, the telegraph, the phonograph, the telephone, the typewriter, the internal-combustion engine, and electrical appliances. These products, in turn, owe their existence to much earlier technological inventions such as the telescope, the compass, water wheels, windmills, gunpowder, the printing press, and oceangoing ships. In order to acknowledge the full historical record, we reach back even further to such momentous technological and social achievements as the production of paper, the development of writing, the invention of the wheel, the domestication of wild plants and animals, the emergence of language, and, finally, the slow outward migration of our African ancestors at the dawn of human evolution. Thus, the answer to the question of whether globalization constitutes a new phenomenon depends upon how far we are willing to extend the chain of causation that resulted in those recent technologies and social arrangements that most people have come to associate with this fashionable buzzword. Some scholars consciously limit the historical scope of globalization to the last four decades of postindustrialism in order to capture its contemporary features. Others are willing to extend this timeframe to include the ground-breaking developments of the 19th century. Still others argue that globalization really represents the continuation and extension of complex processes that began with the emergence of modernity and the capitalist world system some five centuries ago. And a few remaining researchers refuse to confine globalization to time periods measured in mere decades or centuries. Rather, they suggest that these processes have been unfolding for millennia. No doubt, each of these contending perspectives contains 18 important insights. As we will see in subsequent chapters, the advocates of the first approach have marshalled impressive evidence for their view that the dramatic expansion and acceleration of global exchanges since the early 1970s represents a quantum leap in the history of globalization. The proponents of the second view correctly emphasize the tight connection between contemporary forms of globalization and the explosion of technology known as the Industrial Revolution. The representatives of the third perspective rightly point to the significance of the time- space compression that occurred in the 16th century. Finally, the advocates of the fourth approach advance a rather sensible argument when they insist that any truly comprehensive account of globalization falls woefully short without the incorporation of ancient developments and enduring dynamics into our planetary history. While the short chronology outlined below is necessarily fragmentary and general, it nonetheless gives us a good sense that globalization is as old as humanity itself. This brief historical sketch identifies five distinct historical periods that are separated from each other by significant accelerations in the pace of social exchanges as well as a widening of their geographical scope. In this context, it is important to bear in mind that my chronology does not necessarily imply a linear unfolding of history, nor does it advocate a conventional Eurocentric perspective of world history. Full of unanticipated surprises, violent twists, sudden punctuations, and dramatic reversals, the history of globalization has involved all major regions and cultures of our planet. Thus, it behoves us to refrain from imposing deterministic ideas of 'inevitability' and 'irreversibility' on globalization. However, it is important to note the occurrence of dramatic technological and social leaps in history that have pushed the intensity and global reach of these processes to new levels. Approaching our short chronology of globalization with these caveats in mind, we will be 19 able to appreciate both the novelty of each period and the continuity of the phenomenon itself. The prehistoric period (10,000 BCE-3,500 BCE) Let us begin our brief historical sketch of globalization about 12,000 years ago when small bands of hunters and gatherers reached the southern tip of South America. This event marked the end of the long process of settling all five continents that was begun by our hominid African ancestors more than one million years ago. Although some major island groups in the Pacific and the Atlantic were not inhabited until relatively recent times, the truly global dispersion of our species was finally achieved. The successful endeavour of the South American nomads rested on the migratory achievements of their Siberian ancestors who had crossed the Bering Strait into North America a thousand years earlier. In this earliest phase of globalization, contact among thousands of hunter and gatherer bands spread all over the world was geographically limited and mostly coincidental. This fleeting mode of social interaction changed dramatically about 10,000 years ago when humans took the crucial step of producing their own food. As a result of several factors, including the natural occurrence of plants and animals suitable for domestication as well as continental differences in area and total population size, only certain regions located on or near the vast Eurasian landmass proved to be ideal for these growing agricultural settlements. These areas were located in the Fertile Crescent, north-central China, North Africa, northwestern India, and New Guinea. Over time, food surpluses achieved by these early farmers and herders led to population increases, the establishment of permanent villages, and the construction of fortified towns. Roving bands of nomads lost out to settled tribes, chiefdoms, and, ultimately, powerful states based on agricultural food production. The decentralized, egalitarian nature of hunter and gatherer groups 20 Map 1. Early human migrations. was replaced by centralized and highly stratified patriarchal social structures headed by chiefs and priests who were exempted from hard manual labour. Moreover, for the first time in human history, these farming societies were able to support two additional social classes whose members did not participate in food production. One group consisted of full-time craft specialists who directed their creative energies toward the invention of new technologies, such as powerful iron tools and beautiful ornaments made of precious metals, complex irrigation canals, sophisticated pottery and basketry, and monumental building structures. The other group was comprised of professional bureaucrats and soldiers who would later play a key role in the monopolization of the means of violence in the hands of the rulers, the precise accounting of food surpluses necessary for the growth and survival of the centralized state, the acquisition of new territory, the establishment of permanent trade routes, and the systematic exploration of distant regions. For the most part, however, globalization in the prehistoric period was severely limited. Advanced forms of technology capable of overcoming existing geographical and social obstacles were largely absent; thus, enduring long-distance interactions never materialized. It was only towards the end of this epoch that centrally administered forms of agriculture, religion, bureaucracy, and warfare slowly emerged as the key agents of intensifying modes of social exchange that would involve a growing number of societies in many regions of the world. The premodern period (3,500 BCE-1,500 CE) The invention of writing in Mesopotamia, Egypt, and central China between 3,500 and 2,000 BCE roughly coincided with the invention of the wheel around 3,000 BCE in Southwest Asia. Marking the close of the prehistoric period, these monumental inventions amounted to one of those technological and social boosts that moved globalization to a new level. Thanks to the auspicious east-west orientation of Eurasia's major continental axis - a 22 geographical feature that had already facilitated the rapid spread of crops and animals suitable for food production along the same latitudes - the diffusion of these new technologies to distant parts of the continent occurred within only a few centuries. The importance of these inventions for the strengthening of globalization processes should be obvious. Among other things, the wheel spurred crucial infrastructural innovations such as animal-drawn carts and permanent roads that allowed for the faster and more efficient transportation of people and goods. In addition to the spread of ideas and inventions, writing greatly facilitated the coordination of complex social activities and thus encouraged large state formations. Of the sizeable territorial units that arose during this period, only the Andes civilizations of South America managed to grow into the mighty Inca Empire without the benefits of either the wheel or the written word. 3. Assyrian clay tablet with cuneiform writing, c. 19OO-18OO BCE. 23 Thus the premodern period was the age of empires. As some states succeeded in establishing permanent rule over other states, the resulting vast territorial accumulations formed the basis of the Egyptian Kingdoms, the Persian Empire, the Macedonian Empire, the American Empires of the Aztecs and the Incas, the Roman Empire, the Indian Empires, the Byzantine Empire, the Islamic Caliphates, the Holy Roman Empire, the African Empires of Ghana, Mali, and Songhay, and the Ottoman Empire. All of these empires fostered the multiplication and extension of long-distance communication and the exchange of culture, technology, commodities, and diseases. The most enduring and technologically advanced of these vast premodern conglomerates was undoubtedly the Chinese Empire. A closer look at its history reveals some of the early dynamics of globalization. After centuries of warfare between several independent states, the Ojn Emperor's armies, in 221 BCE, finally unified large portions of northeast China. For the next 1,700 years, successive dynasties known as the Han, Sui, T'ang, Yuan, and Ming ruled an empire supported by vast bureaucracies that would extend its influence to such distant regions as tropical Southeast Asia, the Mediterranean, India, and East Africa. Dazzling artistry and brilliant philosophical achievements stimulated new discoveries in other fields of knowledge such as astronomy, mathematics, and chemistry. The long list of major technological innovations achieved in China during the premodern period include redesigned plowshares, hydraulic engineering, gunpowder, the tapping of natural gas, the compass, mechanical clocks, paper, printing, lavishly embroidered silk fabrics, and sophisticated metalworking techniques. The construction of vast irrigation systems consisting of hundreds of small canals enhanced the region's agricultural productivity while at the same time providing for one of the best river transport systems in the world. The codification of law and the fixing of weights, measures, and values of coinage fostered the expansion of trade and markets. The standardization of the size of cart axles and the roads they travelled on allowed Chinese merchants for the first 24 time to make precise calculations as to the desired quantities of imported and exported goods. The most extensive of these trade routes was the Silk Road. It linked the Chinese and the Roman Empires, with Parthian traders serving as skilled intermediaries. Even 1,300 years after the Silk Road first reached the Italian peninsula, in 50 BCE, a truly multicultural group of Eurasian and African globetrotters - including the famous Moroccan merchant Ibn Battuta and his Venetian counterparts in the Marco Polo family - relied on this great Eurasian land route to reach the splendid imperial court of the Mongol Khans in Beijing. By the 15th century CE, enormous Chinese fleets consisting of hundreds of 400-foot-long ocean-going ships were crossing the Indian Ocean and establishing short-lived trade outposts on the east coast of Africa. However, a few decades later, the rulers of the 4. The Great Wall of China, begun in 214 BCE and rebuilt repeatedly. The only human artefact discernible from space. 25 Chinese Empire implemented a series of fateful political decisions that halted overseas navigation and mandated a retreat from further technological development. Thus, they cut short their empire's incipient industrial revolution, a development that allowed much smaller European states to emerge as the primary historical agents behind the intensification of globalization. Towards the end of the premodern period, then, the existing global trade network consisted of several interlocking trade circuits that connected the most populous regions of Eurasia and northeastern Africa. Although both the Australian and the American continents still remained separate from this expanding web of economic, political, and cultural interdependence, the empires of the Aztecs and Incas had also succeeded in developing major trade networks in their own hemisphere. The existence of these sprawling networks of economic and cultural exchange triggered massive waves of migration, which, in turn, led to further population increase and the rapid growth of urban centres. In the resulting cultural clashes, religions with only local significance were transformed into the major 'world religions' we know today as Judaism, Christianity, Islam, Hinduism, and Buddhism. But higher population density and more intense social interaction over greater distances also facilitated the spread of new infectious diseases like the bubonic plague. The enormous plague epidemic of the mid-14th century, for example, killed up to one-third of the respective populations of China, the Middle East, and Europe. However, these unwelcome by-products of unfolding globalization processes did not reach their most horrific manifestation until the fateful 16th-century collision of the 'old' and 'new' worlds, when the nasty germs of European invaders killed an estimated 18 million Native Americans. 26 Map 2. Major world trade networks, 1OOO-145O. The early modern period (1500-1750) The term 'modernity' has become associated with the 18th-century European Enlightenment project of developing objective science, achieving a universal form of morality and law, and liberating rational modes of thought and social organization from the perceived irrationalities of myth, religion, and political tyranny. The label 'early modern', then, refers to the period between the Enlightenment and the Renaissance. During these two centuries, Europe and its social practices served as the primary catalyst for globalization. Having contributed little to technology and other civilizational achievements before about 1,000 CE, Europeans northwest of the Alps greatly benefited from the diffusion of technological innovations originating in Islamic and Chinese cultural spheres. Despite the weakened political influence of China and the noticeable ecological decline of the Fertile Crescent some 500 years later, European powers failed to penetrate into the interior of Africa and Asia. Instead, they turned their expansionistic desires westward, searching for a new, profitable sea route to India. Their efforts were aided by such innovations as mechanized printing, sophisticated wind and water mills, extensive postal systems, revised maritime technologies, and advanced navigation techniques. Add the enormous impact of the Reformation and the related liberal political idea of limited government, and we have identified the main forces behind the qualitative leap that greatly intensified demographic, cultural, ecological, and economic flows between Europe, Africa, and the Americas. Of course, the rise of European metropolitan centres and their affiliated merchant classes represented another important factor responsible for strengthening globalization tendencies during the early modern period. Embodying the new values of individualism and unlimited material accumulation, European economic entrepreneurs laid the foundation of what later scholars would call the 'capitalist world system'. However, these fledgling capitalists 28 could not have achieved the global expansion of their commercial enterprises without substantial support from their respective governments. The monarchs of Spain, Portugal, the Netherlands, France, and England all put significant resources into the exploration of new worlds and the construction of new interregional markets that benefited them much more than their exotic 'trading partners'. By the early 1600s, national joint stock companies like the Dutch and British East India companies were founded for the express purpose of setting up profitable overseas trade posts. As these innovative corporations grew in size and stature, they acquired the power to regulate most intercontinental economic transactions, in the process implementing social institutions and cultural practices that enabled later colonial governments to place these foreign regions under direct political rule. Related developments, such as the Atlantic slave trade and forced population transfers within the Americas, resulted in the suffering and death of millions of non-Europeans while greatly benefiting white immigrants and their home countries. To be sure, religious warfare within Europe also created its share of dislocation and displacement for Caucasian populations. Moreover, as a result of these protracted armed conflicts, military alliances and political arrangements underwent continuous modification. Ultimately evolving from the Westphalian states system, the sovereign, territorial nation-state had emerged by 1648 as the modern container of social life. As the early modern period drew to a close, interdependencies among nation-states were multiplying as well as increasing in density. The modern period (1750-1970) By the late 18th century, Australia and the Pacific islands were slowly incorporated into the European-dominated network of political, economic, and cultural exchange. Increasingly 29 5. The sale of the island of Manhattan in 1626. confronted with stories of the 'distant' and images of countless 'others', Europeans and their descendants on other continents took it upon themselves to assume the role of the world's guardians of universal law and morality. In spite of their persistent claims to civilizational leadership, however, they remained strangely oblivious to their racist practices and the appalling conditions of inequality that existed both within their own societies and between the West and the 'rest'. Fed by a steady stream of materials and resources that originated mostly in other regions of the world, Western capitalist enterprises gained in stature. Daring to resist powerful governmental controls, economic entrepreneurs and their academic counterparts began to spread a philosophy of individualism and rational self-interest that glorified the virtues of an idealized capitalist system supposedly based upon the providential workings of the free market and its 'invisible hand'. Written in 1847 by the German political radicals Karl Marx and Friedrich Engels, the following passage from their famous Communist Manifesto captures the qualitative shift in social relations that pushed globalization to a new level in the modern period. Indeed, the volume of world trade increased dramatically between 1850 and 1914. Guided by the activities of multinational banks, The discovery of America prepared the way for mighty indus- try and its creation of a truly global market. The latter greatly expanded trade, navigation, and communication by land. These developments, in turn, caused the further expan- sion of industry. The growth of industry, trade, navigation, and railroads also went hand in hand with the rise of the 31  bourgeoisie and capital which pushed to the background the old social classes of the Middle Ages... Chased around the globe by its burning desire for ever-expanding markets for its products, the bourgeoisie has no choice but settle everywhere; cultivate everywhere; establish connections everywhere... Rapidly improving the instruments of production, the bourgeoisie utilizes the incessantly easing modes of communication to pull all nations into civiliza- tion - even the most barbarian ones... In a nutshell, it creates the world in its own image. Translated by the author capital and goods flowed across the borders relatively freely as the sterling-based gold standard made possible the worldwide circulation of leading national currencies like the British pound and the Dutch gilder. Eager to acquire their own independent resource bases, most European nation-states subjected large portions of the global South to direct colonial rule. On the eve of World War I, merchandise trade measured as a percentage of gross national output totalled almost 12% for the industrialized countries, a level unmatched until the 1970s. Global pricing systems facilitated trade in important commodities like grains, cotton, and various metals. Brand name packaged goods like Coca-Cola drinks, Campbell soups, Singer sewing machines, and Remington typewriters made their first appearance. In order to raise the global visibility of these corporations, international advertising agencies launched the first full-blown transborder commercial promotion campaigns. As Marx and Engels noted, however, the rise of the European bourgeoisie and the related intensification of global interconnections would not have been possible without the 19th- century explosion of science and technology. To be sure, the 32 maintenance of these new industrial regimes required new power sources such as electricity and petroleum. The largely unregulated use of these energy sources resulted in the annihilation of countless animal and plant species as well as the toxification of entire regions. On the up side, however, railways, mechanized shipping, and 20th- century intercontinental air transport managed to overcome the last remaining geographical obstacles to the establishment of a genuine global infrastructure, while at the same time lowering transportation costs. These innovations in transportation were complemented by the swift development of communication technologies. The telegraph and its transatlantic reach after 1866 provided for instant information exchanges between the two hemispheres. Moreover, the telegraph set the stage for the telephone and wireless radio communication, prompting newly emerging communication corporations like AT&T to coin advertising slogans in celebration of a world 'inextricably bound together'. Finally, the 20th-century arrival of mass circulation newspapers and magazines, film, and television further enhanced a growing consciousness of a rapidly shrinking world. The modern period also witnessed an unprecedented population explosion. Having increased only modestly from about 300 million at the time of the birth of Christ to 760 million in 1750, the world's population reached 3.7 billion in 1970. Enormous waves of migration intensified existing cultural exchanges and transformed traditional social patterns. Popular immigration countries like the United States of America, Canada, and Australia took advantage of this boost in productivity. By the early 20th century, these countries entered the world stage as forces to be reckoned with. At the same time, however, they made significant efforts to control these large migratory flows, in the process inventing novel forms of bureaucratic control and developing new surveillance techniques designed to accumulate more information about nationals while keeping 'undesirables' out. 33 6. Eastern European immigrants arriving in New York City in the late ISOOs. When the accelerating process of industrialization sharpened existing disparities in wealth and well-being beyond bearable limits, many working people in the global North began to organize themselves politically in various labour movements and socialist parties. However, their idealistic calls for international class solidarity went largely unheeded. Instead, nationalist ideologies captured the imagination of millions of people around the world. There is no question that interstate rivalries intensified at the outset of the 20th century as a result of mass migration, urbanization, colonial competition, and the excessive liberalization of world trade. The ensuing period of extreme nationalism culminated in two devastating world wars, a long global economic depression, and hostile measures to protect narrowly conceived political communities. The defeat of the axis powers in 1945 and the process of decolonization slowly revived global flows and international exchanges. A new political order of nation-states anchored in the charter of the United Nations raised the prospect of global democratic governance. During the 1950s, however, such cosmopolitan hopes quickly faded as the Cold War divided the world for four long decades into two antagonistic spheres: a liberal- capitalist camp dominated by the United States, and an authoritarian-socialist realm controlled by the Soviet Union. For the first time in human history, the spectre of a global conflict capable of destroying virtually all life on our planet had been raised. The contemporary period (from 1970) As we noted at the beginning of this chapter, the dramatic creation, expansion, and acceleration of worldwide interdependencies and global exchanges that have occurred since the early 1970s represent yet another quantum leap in the history of globalization. But what exactly is happening? Why does what is happening justify the creation of a buzzword that has not only captured the public imagination, but has also elicited such powerful conflicting 35 emotional responses? Is contemporary globalization a 'good' or a 'bad' thing? Throughout this book we will consider possible answers to these crucial questions. In doing so, we will limit the application of the term 'globalization' to the contemporary period while keeping in mind that the dynamic driving these processes actually started thousands of years ago. Before we embark on this next stage of our journey, let us pause and recall an important point we made in Chapter 1. Globalization is not a single process but a set of processes that operate simultaneously and unevenly on several levels and in various dimensions. We could compare these interactions and interdependencies to an intricate tapestry of overlapping shapes and colours. Yet, just as an auto mechanic apprentice must turn off and disassemble the car engine in order to understand its operation, so must the student of globalization apply analytical distinctions in order to make sense of the web of global interdependencies. In ensuing chapters we will identify, explore, and assess patterns of globalization in each domain while keeping in mind its operation as an interacting whole. Although we will study the various dimensions of globalization in isolation, we will resist the temptation to reduce globalization to a single aspect. Thus will we avoid the blunder that kept the blind men from appreciating the multidimensional nature of the elephant. 36 ChapterBzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONM The economic dimension of globalizationzyxwvutsrqponmlkjihgfedcbaZYXWV At the beginning of the previous chapter we noted that new forms of technology are one of the hallmarks of contemporary globalization. Indeed, technological progress of the magnitude seen in the last three decades is a good indicator for the occurrence of profound social transformations. Changes in the way in which people undertake economic production and organize the exchange of commodities represent one obvious aspect of the great transformation of our age. Economic globalization refers to the intensification and stretching of economic interrelations across the globe. Gigantic flows of capital and technology have stimulated trade in goods and services. Markets have extended their reach around the world, in the process creating new linkages among national economies. Huge transnational corporations, powerful international economic institutions, and large regional trading systems have emerged as the major building blocs of the 21st century's global economic order. The emergence of the global economic order Contemporary economic globalization can be traced back to the gradual emergence of a new international economic order assembled at an economic conference held towards the end of World War II in the sleepy New England town of Bretton Woods. Under the leadership of the United States of America and Great 37 Britain, the major economic powers of the global North reversed their protectionist policies of the interwar period (1918-39). In addition to arriving at a firm commitment to expand international trade, the participants of the conference also agreed to establish binding rules on international economic activities. Moreover, they resolved to create a more stable money exchange system in which the value of each country's currency was pegged to a fixed gold value of the US dollar. Within these prescribed limits, individual nations were free to control the permeability of their borders. This allowed states to set their own political and economic agendas. Bretton Woods also set the institutional foundations for the establishment of three new international economic organizations. The International Monetary Fund was created to administer the international monetary system. The International Bank for Reconstruction and Development, later known as the World Bank, was initially designed to provide loans for Europe's postwar reconstruction. During the 1950s, however, its purpose was expanded to fund various industrial projects in developing countries around the world. Finally, the General Agreement on Tariffs and Trade was established in 1947 as a global trade organization charged with fashioning and enforcing multilateral trade agreements. In 1995, the World Trade Organization was founded as the successor organization to GATT. As we will see in Chapter 8, the WTO became, in the 1990s, the focal point of intense public controversy over the design and the effects of economic globalization. In operation for almost three decades, the Bretton Woods regime contributed greatly to the establishment of what some observers have called the 'golden age of controlled capitalism'. Existing mechanisms of state control over international capital movements made possible full employment and the expansion of the welfare state. Rising wages and increased social services secured in the 38 7. The Bretton Woods Conference of 1944- wealthy countries of the global North a temporary class compromise. By the early 1970s, however, the Bretton Woods system collapsed. Its demise strengthened those integrationist economic tendencies that later commentators would identify as the birth pangs of the new global economic order. What happened? In response to profound political changes in the world that were undermining the economic competitiveness of US-based industries, President Richard Nixon abandoned the gold-based fixed rate system in 1971. The ensuing decade was characterized by global economic instability in the form of high inflation, low economic growth, high unemployment, public sector deficits, and two unprecedented energy crises due to OPEC's ability to control a large part of the world's oil supply. Political forces in the global North most closely identified with the model of controlled capitalism suffered a series of spectacular election defeats at the hands of conservative political parties who advocated a 'neoliberal' approach to economic and social policy. 39  Neoliberalism Neoliberalism is rooted in the classical liberal ideals of Adam Smith (1723-9O) and David Ricardo (1772-1823), both of whom viewed the market as a self-regulating mechanism tending toward equilibrium of supply and demand, thus securing the most efficient allocation of resources. These British philosophers considered that any constraint on free competition would interfere with the natural efficiency of market mechanisms, inevitably leading to social stagnation, political corruption, and the creation of unresponsive state bureaucracies. They also advocated the elimination of tariffs on imports and other barriers to trade and capital flows between nations. British sociologist Herbert Spencer (182O- 19O3) added to this doctrine a twist of social Darwinism by arguing that free market economies constitute the most civilized form of human competition in which the 'fittest' would naturally rise to the top. Yet, in the decades following World War II, even the most conservative political parties in Europe and the United States rejected those laissez-faire ideas and instead embraced a rather extensive version of state interventionism propagated by British economist John Maynard Keynes, the architect of the Bretton Woods system. By the 1980s, however, British Prime Minister Margaret Thatcher and US President Ronald Reagan led the neoliberal revolution against Keynesianism, consciously linking the notion of globalization to the 'liberation' of economies around the world. This new neoliberal economic order received further legitimation with the 1989-91 collapse of communism in the Soviet Union and Eastern Europe. Since then, the three most significant 40  Concrete neoliberal measures include: 1. Privatization of public enterprises 2. Deregulation of the economy 3. Liberalization of trade and industry 4. Massive tax cuts 5. 'Monetarist' measures to keep inflation in check, even at the risk of increasing unemploymentzyxwvutsrqponmlkjihgfedcbaZ 6. Strict control on organized labour 7. The reduction of public expenditures, particularly social spending 8. The down-sizing of government 9- The expansion of international markets 1O. The removal of controls on global financial flows developments related to economic globalization have been the internationalization of trade and finance, the increasing power of transnational corporations, and the enhanced role of international economic institutions like the IMF, the World Bank, and the WTO. Let us briefly examine these important features. The internationalization of trade and finance Many people associate economic globalization with the controversial issue of free trade. After all, the total value of world trade exploded from $ 57 billion in 1947 to an astonishing $ 6 trillion in the late 1990s. In the last few years, the public debate over the alleged benefits and drawbacks of free trade reached a feverish pitch as wealthy Northern countries have increased their efforts to establish a single global market through regional and international trade-liberalization agreements such NAFTA and GATT. Free trade proponents assure the public that the elimination or reduction of existing trade barriers among nations will enhance consumer 41 choice, increase global wealth, secure peaceful international relations, and spread new technologies around the world. To be sure, there is evidence that some national economies have increased their productivity as a result of free trade. Moreover, there are some benefits that accrue to societies through specialization, competition, and the spread of technology. But it is less clear whether the profits resulting from free trade have been distributed fairly within and among countries. Most studies show that the gap between rich and poor countries is widening at a fast pace. Hence, free trade proponents have encountered severe criticism from labour unions and environmental groups who claim that the elimination of social control mechanisms has resulted in a lowering of global labour standards, severe forms of ecological degradation, and the growing indebtedness of the global South to the North. We will return to the issue of global inequality in Chapter 7- The internationalization of trade has gone hand in hand with the liberalization of financial transactions. Its key components include the deregulation of interest rates, the removal of credit controls, and the privatization of government-owned banks and financial institutions. Globalization of financial trading allows for increased mobility among different segments of the financial industry, with fewer restrictions and greater investment opportunities. This new financial infrastructure emerged in the 1980s with the gradual deregulation of capital and securities markets in Europe, the Americas, East Asia, Australia, and New Zealand. A decade later, Southeast Asian countries, India, and several African nations followed suit. During the 1990s, new satellite systems and fibre-optic cables provided the nervous system of Internet-based technologies that further accelerated the liberalization of financial transactions. As captured by the snazzy title of Microsoft CEO Bill Gates' 42 The global South: a fate worse than debt Amount of money owed by the world's 47 poorest $422 billion and most indebted nations Amount of money spent by Western industrialized $422 billion nations on weapons and soldiers every year Amount of money raised by 'Live Aid' in 1985 to $200 million combat famine in Ethiopia Amount of money all African countries need for $200 million weekly foreign debt service (interest only) Amount of money the United Nations estimates is $15 billion needed annually to curb the AIDS epidemic in Africa through education, prevention, and care Amount of money African nations pay to service $13.5 billion their debts each year (interest only) Annual income per person in Zaire $110 Amount of money each resident of Zaire would $236 have to pay to extinguish the country's debt to foreign creditors Percent of the Zambian budget allocated for 40% foreign debt repayment in 1997 Percent of the Zambian budget allocated for basic 7% social services, including healthcare and education Percent of debt owed by the world's most heavily 100% indebted nations that the World Bank and IMF can afford to cancel without jeopardizing their operations Percent of debt that they have actually agreed to 33% cancel Profits made by Exxon in 2000 16.9 billion 43  Total debt burden of Benin, Burundi, Chad, Guinea 16.9 billion Bissau, Sao Tome, Togo, Rwanda, Central African Republic, Sierra Leone, Mali, Somalia, and Niger Sources: David Roodman, Still Waiting for the Jubilee: Pragmatic Solutions to the Third World Debt Crisis, WorldWatch paper 1555 (Washington, DC: WorldWatch Institute, April 2001): Jubilee 2000 United Kingdom website www.jubilee2000uk.org, viewed 17 May 2001; Jubilee U.S.A. Network website www.j2000usa.org/action5.htm; Drop the Debt website www.dropthedebt.org, viewed 22 May 2001; Joseph Kahn, 'U.S. offers Africa billions to fight AIDS', New York Times, 18 July 2000. Secondary Source: World Watch, Vol. 14, No. 4, July/ August 2001, p. 39. The advance of deregulation and liberalization, 198O-98. Source: Vincent Cable, Globalization and Global Governance (The Royal Institute of International Affairs, 1999), p. 20. best-selling book, many people conducted business @the-speed-of- thought. Millions of individual investors utilized global electronic investment networks not only to place their orders, but also to receive valuable information about relevant economic and political developments. In 2000, 'e-businesses', 'dot.com firms', and other 44 virtual participants in the information-based 'new economy' traded about 400 billion dollars over the Web in the United States alone. In 2003, global business-to-business transactions are projected to reach 6 trillion dollars. Ventures that will connect the stock exchanges in New York, London, Frankfurt, and Tokyo are at the advanced planning stage. Such a financial 'supermarket' in cyberspace would span the entire globe, stretching its electronic tentacles into countless decentralized investment networks that relay billions of trades at breathtaking velocities. Yet, a large part of the money involved in these global financial exchanges has little to do with supplying capital for such productive investments as putting together machines or organizing raw materials and employees to produce saleable commodities. Most of the financial growth has occurred in the form of high-risk 'hedge funds' and other purely money-dealing currency and securities markets that trade claims to draw profits from future production. In other words, investors are betting on commodities or currency rates that do not yet exist. For example, in 2000, the equivalent of over 2 trillion US dollars was exchanged daily in global currency markets alone. Dominated by highly sensitive stock markets that drive high-risk innovation, the world's financial systems are characterized by high volatility, rampant competition, and general insecurity. Global speculators often take advantage of weak financial and banking regulations to make astronomical profits in emerging markets of developing countries. However, since these international capital flows can be reversed swiftly, they are capable of creating artificial boom-and-bust cycles that endanger the social welfare of entire regions. The 1997-8 Southeast Asia Crisis represents but one of these recent economic reversals brought on by the globalization of financial transactions. 45 8. The New York Stock Exchange. Billions of shares change hands on an average trading day. The Southeast Asia Crisis In the 1990s, the governments of Thailand, Indonesia, Malaysia, South Korea, and the Philippines gradually aban- doned control over the domestic movement of capital in order to attract foreign direct investment. Intent on creating a stable money environment, they raised domestic interest rates and linked their national currencies to the value of the US dollar. The ensuing irrational euphoria of international investors translated into soaring stock and real estate mar- kets all over Southeast Asia. However, by 1997, those inves- tors realized that prices had become inflated much beyond their actual value. They panicked and withdrew a total of $1O5 billion from these countries, forcing governments in the region to abandon the dollar peg. Unable to halt the ensuing free fall of their currencies, those governments used up their entire foreign exchange reserves. As a result, eco- nomic output fell, unemployment increased, and wages plummeted. Foreign banks and creditors reacted by declin- ing new credit applications and refusing to extend existing loans. By late 1997, the entire region found itself in the throes of a financial crisis that threatened to push the global economy into recession. This disastrous result was only nar- rowly averted by a combination of international bail-out packages and the immediate sale of Southeast Asian com- mercial assets to foreign corporate investors at rock-bottom prices. Today, ordinary citizens in Southeast Asia are still suffering from the devastating social and political consequences of that economic meltdown. 47 The power of transnational corporations Transnational corporations are the contemporary versions of the early modern commercial enterprises we discussed in the previous chapter. Powerful firms with subsidiaries in several countries, their numbers skyrocketed from 7,000 in 1970 to about 50,000 in 2000. Enterprises like General Motors, Walmart, Exxon-Mobil, Mitsubishi, and Siemens belong to the 200 largest TNCs, which account for over half of the world's industrial output. None of these corporations maintains headquarters outside of North America, Europe, Japan, and South Korea. This geographical concentration reflects existing asymmetrical power relations between the North and the South. Yet, clear power differentials can also be found within the global North. In 1999,142 of the leading 200 TNCs were based in only three countries - the United States, Japan, and Germany. Rivalling nation-states in their economic power, these corporations control much of the world's investment capital, technology, and access to international markets. In order to maintain their prominent positions in the global marketplace, TNCs frequently merge with other corporations. Some of these recent mergers include the $l60-billion marriage of the world's largest Internet provider, AOL, with entertainment giant Time-Warner; the purchase of Chrysler Motors by Daimler-Benz for $43 billion; and the $115-billion merger between Sprint Corporation and MCI WorldCom. A close look at corporate sales and country GDPs reveals that 51 of the world's 100 largest economies are corporations; only 49 are countries. Hence, it is not surprising that some critics have characterized economic globalization as 'corporate globalization' or 'globalization-from-above'. TNCs have consolidated their global operations in an increasingly deregulated global labour market. The availability of cheap labour, resources, and favourable production conditions in the global South has enhanced corporate mobility and profitability. Accounting for 48 Transnational corporations versus countries: a comparison Country GDP ($ mil) Corporation Sales ($ mil) 1. Denmark 174,363.0 General Motors 176,558.0 2. Poland 154,146.0 Wal-Mart 166,809.0 3. South Africa 131,127.0 Exxon Mobil 163,881.0 4. Israel 99,068.0 Royal Dutch/ 105,366.0 Shell 5. Ireland 84,861.0 IBM 87,548.0 6. Malaysia 74,634.0 Siemens 75,337.0 7- Chile 71,092.0 Hitachi 71,858.5 8. Pakistan 59,880.0 Sony 60,052.7 9. New Zealand 53,622.0 Honda Motor 54,773.5 10. Hungary 48,355.0 Credit Suisse 49,362.0 Sources: Sales: Fortune, 31 July 2000; GDP: World Bank, World Development Report 2OOO. over 70% of world trade, TNCs have boosted their foreign direct investments by approximately 15% annually during the 1990s. Their ability to disperse manufacturing processes into many discrete phases carried out in many different locations around the world reflects the changing nature of global production. Such transnational production networks allow TNCs like Nike, General Motors, and Volkswagen to produce, distribute, and market their products on a global scale. Nike, for example, subcontracts 100% of its goods production to 75,000 workers in China, South Korea, Malaysia, Taiwan, and Thailand. Transnational production net