GLOBALIZATION – A SHORT DEFINITION
Globalization (or Globalisation) refers to the increasingly global relationships of culture, people, and economic activity. It is generally used to refer to economic globalization: the global distribution of the production of goods and services, through reduction of barriers to international trade such as tariffs, export fees, and import quotas and the reduction of restrictions on the movement of capital and on investment. Globalization may contribute to economic growth in developed and developing countries through increased specialization and the principle of comparative advantage. The term can also refer to the transnational circulation of ideas, languages, and popular culture.
ECONOMIC EFFECTS – OVERVIEW
International trade in manufactured goods increased more than 100 times (from $95 billion to $12 trillion) between 1955 and 2007. China's trade with Africa rose sevenfold during 2000–07 alone.
By the early part of the 21st century more than $1.5 trillion in national currencies were traded daily to support the expanded levels of trade and investment.
Survival in the new global business market required companies to upgrade their products and use technology skilfully in order to survive increased competition.
According to Jagdish Bhagwati, a former adviser to the U.N. on globalization, although there are obvious problems with overly rapid development, globalization is a very positive force that lifts countries out of poverty. According to him, it causes a virtuous economic cycle associated with faster economic growth.
The costs and benefits of globalization have not been equally distributed across regions and nations. For example, manufacturing employment in the Midwestern section of the United States declined while growing exponentially in developing countries.
INTERPRETATIONS
POSITIVE
Neoliberals generally argue that higher degrees of political and economic freedom in the form of democracy and capitalism in the developed world are ends in themselves and also produce higher levels of material wealth. They see globalization as the beneficial spread of liberty and capitalism.
Marshall McLuhan popularized the term Global Village beginning in 1962. His view suggested that globalization would lead to a world where people from all countries will become more integrated and aware of common interests and shared humanity.
Supporters of democratic globalization believe that the economic development was the first phase of globalization, and should be followed by a phase of building global political institutions. Dr. Francesco Stipo, Director of the United States Association of the Club of Rome, advocated for unifying nations under a world government, suggesting that it "should reflect the political and economic balances of world nations. A world confederation would not supersede the authority of the State governments but rather complement it, as both the States and the world authority would have power within their sphere of competence".
Former Canadian Senator Douglas Roche, O.C., viewed globalization as inevitable and advocated creating institutions such as a directly elected United Nations Parliamentary Assembly to exercise oversight over unelected international bodies.
Economist Paul Krugman is a staunch supporter of globalization and free trade and has a record of disagreement with many critics of globalization. He argues that many of them lack a basic understanding of what comparative advantage is.
NEGATIVE
The establishment of the WTO in 1995 led to an anti-globalization movement that was primarily concerned with the negative impact of globalization in developing countries. Their concerns ranged from environmental issues to issues like democracy, national sovereignty and the worker exploitation.
Opponents in developed countries were disproportionately middle-class and college-educated. This contrasted sharply with the situation in developing countries, where the anti-globalization movement was more successful in enlisting a broader group, including millions of workers and farmers.
"Anti-globalization" activities include attempts to demonstrate sovereignty, practice democratic decision-making, restrict the international transfer of people, goods and disfavored beliefs, particularly free market deregulation. Naomi Klein argued that the term could denote either a single social movement or encompass multiple social movements such as nationalism and socialism.
Hirst and Thompson reject the term as too vague. Podobnik states that "the vast majority of groups that participate in these protests draw on international networks of support, and they generally call for forms of globalization that enhance democratic representation, human rights, and egalitarianism."
Other terms include Global Justice Movement, the Anti-Corporate-Globalization , the Movement of Movements (Italy), the Alter-globalization (France) and Counter-Globalization.
Joseph Stiglitz and Andrew Charlton write:
„The anti-globalization movement developed in opposition to the perceived negative aspects of globalization. The term 'anti-globalization' is in many ways a misnomer, since the group represents a wide range of interests and issues and many of the people involved in the anti-globalization movement do support closer ties between the various peoples and cultures of the world through, for example, aid, assistance for refugees, and global environmental issues.“
Critiques of economic globalization typically look at both the damage to the planet as well as the human costs. They challenge directly traditional metrics, such as GDP, and look to other measures, such as the Happy Planet Index. They point to a "multitude of interconnected fatal consequences–social disintegration, a breakdown of democracy, more rapid and extensive deterioration of the environment, the spread of new diseases, increasing poverty and alienation" which they claim are the unintended consequences of globalization.
The terms globalization and anti-globalization are used in various ways. Noam Chomsky stated:
„The term "globalization" has been appropriated by the powerful to refer to a specific form of international economic integration, one based on investor rights, with the interests of people incidental. That is why the business press, in its more honest moments, refers to the "free trade agreements" as "free investment agreements" (Wall St. Journal). Accordingly, advocates of other forms of globalization are described as "anti-globalization"; and some, unfortunately, even accept this term, though it is a term of propaganda that should be dismissed with ridicule. No sane person is opposed to globalization, that is, international integration. Surely not the left and the workers movements, which were founded on the principle of international solidarity — that is, globalization in a form that attends to the rights of people, not private power systems.
The dominant propaganda systems have appropriated the term "globalization" to refer to the specific version of international economic integration that they favor, which privileges the rights of investors and lenders, those of people being incidental. In accord with this usage, those who favor a different form of international integration, which privileges the rights of human beings, become "anti-globalist." This is simply vulgar propaganda, like the term "anti-Soviet" used by the most disgusting commissars to refer to dissidents. It is not only vulgar, but idiotic. Take the World Social Forum, called "anti-globalization" in the propaganda system – which happens to include the media, the educated classes, etc., with rare exceptions. The WSF is a paradigm example of globalization. It is a gathering of huge numbers of people from all over the world, from just about every corner of life one can think of, apart from the extremely narrow highly privileged elites who meet at the competing World Economic Forum, and are called "pro-globalization" by the propaganda system. An observer watching this farce from Mars would collapse in hysterical laughter at the antics of the educated classes.“
Critics argue that globalization results in:
- Poorer countries suffering disadvantages: While it is true that free trade encourages globalization among countries, some countries try to protect their domestic suppliers. The main export of poorer countries is usually agricultural goods. Larger countries often subsidise their farmers (e.g., the EU's Common Agricultural Policy), which lowers the market price for foreign crops.
- The shift to outsourcing: Globalization allowed corporations to move manufacturing and service jobs from high cost locations, creating economic opportunities with the most competitive wages and worker benefits.
- Weak labor unions: The surplus in cheap labor coupled with an ever growing number of companies in transition weakened labor unions in high-cost areas. Unions lose their effectiveness and workers their enthusiasm for unions when membership begins to decline.
- An increase in exploitation of child labor: Countries with weak protections for children are vulnerable to infestation by rogue companies and criminal gangs who exploit them. Examples include quarrying, salvage, and farm work as well as trafficking, bondage, forced labor, prostitution and pornography.
Critics charged that globalization developed according to corporate interests. They advocated global institutions and policies that they believe better addressed the moral claims of poor and working classes as well as environmental concerns.
Critics included church groups, national liberation factions, peasant unionists, intellectuals, artists, protectionists, anarchists, those in support of relocalization (e.g., consumption of nearby production) and others. Some were reformist, (arguing for a more moderate form of capitalism) while others were revolutionary (power shift from private to public control) or reactionary (public to private).
Economic arguments by fair trade theorists claim that unrestricted free trade benefits those with more financial leverage (i.e. the rich) at the expense of the poor.
Americanization related to a period of high political American clout and of significant growth of America's shops, markets and object being brought into other countries. So globalization, a much more diversified phenomenon, relates to a multilateral political world and to the increase of objects, markets and so on into each others countries.
Critics of globalization talk of Westernization. A 2005 UNESCO report showed that cultural exchange is becoming more frequent from Eastern Asia but Western countries are still the main exporters of cultural goods. In 2002, China was the third largest exporter of cultural goods, after the UK and US. Between 1994 and 2002, both North America's and the European Union's shares of cultural exports declined, while Asia's cultural exports grew to surpass North America. Related factors are the fact that Asia's population and area are several times that of North America.
Some opponents of globalization see the phenomenon as the promotion of corporatist interests. They also claim that the increasing autonomy and strength of corporate entities shapes the political policy of countries.
Source and further information with links: http://en.wikipedia.org/wiki/Globalization (as of March 27, 2012)