Globalization

DEFINITION: Intercontinental integration of regional economies, cultures, and political and financial systems, driven by the transnational exchange and circulation of labor, ideas, technologies, products, services, languages, and popular culture

Globalization in the early twenty-first century rested on a free trade or neoliberal economic model, favoring open markets and global competition among states and non-state actors in the world economy. Intense competition among developing nations to secure investment and jobs from huge transnational corporations pushed any ecological interests in those countries to the background of their political agendas. Corporate interests in the developed world tended to suppress movements for ecological reform that would cut into corporate profits.

The modern state emerged in western Europe in 1648 with the Peace of Westphalia, which brought to a close the Thirty Years’ War among Europe’s various princes and ended the political struggle between the Roman Catholic Church and the European state, with the secular state arising as the sovereign and independent actor on the world stage. In this state-centric model, each state was recognized by other states as having the exclusive right to determine domestic policy, and each was expected to address common issues and to resolve conflicted interests through negotiations with other states in a process referred to as international relations.

After World War II ended in 1945, the United Nations was established (in October 1945) to usher in a new era of post-international or global relations. The United Nations followed the model of the League of Nations, created in 1919 after World War I (1914–8) under the Treaty of Versailles, “to promote international cooperation and to achieve peace and security.” The extent and appalling nature of the World War II crimes of the Nazis against Jews and other victim groups forged a consensus among members of the global regarding shared norms of behavior, while structural reconstruction of Europe and elsewhere after the war welded global economic networks; these factors together ultimately undermined the import of state sovereignty in favor of global cooperation. New global realities demanded that states cooperate with each other to deal with common threats, develop markets, exchange technologies, manage conflict, and share power with rising non-state actors, nongovernmental organizations (NGOs). Soon, NGOs took the form of economic organizations such as transnational corporations, advocacy organizations such as Amnesty International and Greenpeace, and service organizations such as the Red Cross and Doctors Without Borders. However, the post-World War II era also saw the emergence of less benevolent non-state actors networking globally. Terrorist organizations expanded globally as did transnational criminal syndicates.

The twenty-first century model of globalization has many varied and interwoven aspects, and it has been evolving for a very long time, congealing most intensely since the mid-twentieth century. Globalization is primarily an economic system and is characterized by globalized financial markets, trade networks, foreign investment, and capital flows, but it has many aspects, including political globalization (effected through the proliferation of international and regional coalitions of states and non-state actors), military globalization (networks of military force and alliances), environmental globalization (global efforts to address environmental degradation and global warming at the supranational level), and cultural globalization (through an “acculturation” process whereby people’s everyday lives are fundamentally altered by the exchange of foods, people, ideas, technologies, and other products).

The General Assembly of the United Nations is the forum where members of the global community meet to negotiate political interests and address common problems and challenges. Trade practices in the global economy are regulated by three international institutions: the World Trade Organization, which regulates global trade and rules on disputes in the global marketplace; the World Bank, which makes short-term, high-interest loans to economically struggling nations; and the International Monetary Fund, which intervenes in debt-bearing nations to reorient their trade practices and financial policies. Global cooperation has fostered trade and economic development across the planet, but economic prosperity—in the developing world as well as in the developed world—is often purchased at the cost of human rights and ecological devastation. Globalization also fosters international debate on these problems, however, and has sparked global movements for “fair trade” practices and Green movements that have culminated in ongoing cooperation and international agreements to restrict polluting practices.

Controversies

Globalization is the subject of heated debate around the world, among politicians and economists as well as among scientists and environmental activists. From the standpoint of environmental ethics, globalizing trade practices have had devastating effects on the earth’s natural environment. Regional neglect and the of air, land, and ocean waters are driven by the “race to the bottom” phenomenon that pits developing countries against each other in efforts to lure global investors. Critics argue that the existing system is simply a broader reaching, more profitable model of colonialism, a neocolonialism, whereby governments act as mere salespersons, promoting the profits of their corporations in a global marketplace.

Critics charge also that developing countries have no fighting chance in the global trade game, and so the rich get richer through the growing exploitation of the global poor and the devastation of the environment, in both the developed and the developing nations. Globalists, in contrast, assert that “free trade” promotes freedom and democracy, and that even as global inequality rises, poverty can be reduced through free trade. They argue that problems such as environmental degradation and global warming should be viewed as opportunities for entrepreneurial innovation and new economic ventures, and not as problems to be addressed through political intervention and legal restrictions.

Some critics have also highlighted the possibility that the complex supply chains of a globalized world can be more vulnerable to disruption from a wide range of man-made and natural events. These critics point to a number of examples, such as the global supply chain crisis that occurred during the COVID-19 pandemic, which began in China in late 2019 and spread around the world during the first months of 2020, as well as disruptions that occurred in the energy industry in Europe following Russia's invasion of Ukraine in February 2022. Amid these economic setbacks, some countries, such as the US, sought to encourage domestic manufacturing and other economic strategies viewed as less vulnerable to these types of disruptions.

Bibliography

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Glyn, Andrew. Capitalism Unleashed: Finance, Globalization, and Welfare. Oxford UP, 2006.

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Kaplinsky, Raphael. Globalization, Poverty, and Inequality: Between a Rock and Hard Place. John Wiley, 2013.

Sultan, Tarek. "5 Ways the COVID-19 Pandemic Has Changed the Global Supply Chain." World Economic Forum, 14 Jan. 2022, www.weforum.org/agenda/2022/01/5-ways-the-covid-19-pandemic-has-changed-the-supply-chain/. Accessed 6 Aug. 2024.