Globalization: an Economical, Social, Cultural... Cancer

I thought of writing about this ever since the G8 Summit took place in Germany about a month ago, between 8 nation leaders who have interests in promoting Globalization, the spread and merger of the world's markets into one large free market economy. Furthermore,

Globalization refers to increasing global connectivity, integration and interdependence in the economic, social, technological, cultural, political, and ecological spheres. Globalization is an umbrella term and is perhaps best understood as a unitary process inclusive of many sub-processes (such as enhanced economic interdependence, increased cultural influence, rapid advances of information technology, and novel governance and geopolitical challenges) that are increasingly binding people and the biosphere more tightly into one global system.

Even by looking at the definition of globalization can one understand why there is opposition and support for the ideology and practices of globalization itself.

Sounds nice, doesn't it? As a radical social libertarian and economic centrist (above all, I'm Muslim first), I support a free market, as it is compliant with Islamic principles and has been widely supported historically by Islamic scholars (2 and 3). Free markets encourage trade of rare, exotic, much-needed and socially/biologically/(etc.) valuable goods between people, and can also foster good relations between people the world over, delineate misunderstandings between people, and can also introduce people to cultures almost unheard of and unspoken of.

Of course, such an idealistic free market system would be possible should world nations be equal and all people regard each other as equals. It would be possible without nationalism, war, hate, and all such ills that make this world a bleak place to live in, save for the bubbly haven that you call home (and family and all other entities of sentimental value). But as has been stated on countless occasions, this isn't the Land of the Smurfs or Care-a-lot Castle, but rather the place that Sci-Fi geeks like to call "Terra" and other people refer to as "Earth". It is a planet scarred by centuries of warfare, nationalism, hate, colonialism, and all such events that oppose peace and cooperation. Boycotts, trade sanctions and financial corruption spring from these conflicts and those who seek to control the world with an iron hand of injustice and oppression. It is for that reason that one might conclude that there really is no such thing as a "free market".

The International Monetary Fund has provided a rather objective case in stating pros and cons of Globalization (4). While their brief as a whole tackled possible resources that nations can exploit, it fails to address the fact that there are external political influences on many third-world nations that have limited their progress. The brief also claims that while there is progress, it still doesn't scope out the internal and external factors that ensure the income gap is maintained at the expense of those who live below the poverty line, and even those who live slightly above it; in effect, it proposes a solution in welfare, which only seeks to increase the dependence of the lower economic classes on other unconventional sources of income, and that discourages social progress by maintaining the income gap: that gap can only decrease if those in lower economic classes are independent in acquiring income and able to control their monetary resources, both input and output. Furthermore, the brief fails to counter the ideological aspect of Globalization: the unipolarization of culture and social norms by deceiving people to buy more and consume more.

And along with that lack of economic freedom, there is also an invasion of ideological rights, as has been mentioned before, as cultures worldwide are being dramatically changed by expanding Trans-National Corporations (TNC's), among them being McDonald's and Apple, icons of "Consumer Culture", an oxymoron in its own right. Thus, it can be argued that the main tools of globalization are two faces of the same coin: Materialism and Consumerism. Both are commonplace, and seek to dull the colorful colors of the diverse cultures that dot this Earth (5). Dr. Leslie Jermyn of the Global-Aware Independent Media network put it rather nicely:

We all know we live in a highly materialistic culture in which conspicuous consumption governs much of our lives. We strive to acquire goods which will define us to ourselves and to others and somehow satisfy our human need to justify existence. At the end of the day, we also all know that there’s a trap built into the system: the more you consume, the more you are pressed to consume more because whatever satisfaction possession of things brings us is always fleeting thus driving us further and further down the material path of life seeking nirvana around the next corner at the mall.

Many modern philosophers have pondered this question, often giving rise to scathing critiques of consumerism as shallow; the product of a decadent and decaying culture. This is where most people turn away, not because they reject what the philosophers say, but precisely because they know it to be at least partially accurate and this is unbearable. It’s unbearable because while we know the meaning of life can’t be reduced to a new SUV, we don’t know what on earth we would replace consumerism with if we were to abandon it as the bedrock of our daily lives. What would we do with our time? Why would we work overtime? Why would we get up in the morning?

What Dr. Jermyn is getting at is that consumerism has been in many places entrenched in the very core of our society to the extent that we have forgotten loads of other things that could help us find more meaning in our lives. In that sense, consumerism/materialism, spread by a rampaging globalizing force, has acted as a form of control, and moreover seeks to keep those in the higher economic classes and those who own TNC's (see above for definition of this abbreviation) richer, and those otherwise poorer. Their vehicle is globalization, but their controlling ideology is consumerism and materialism. It creates new demands for the people by changing "want" into "need", and drives people into emptying their pockets and teetering on the brink of bankruptcy. Those who can survive join the upper economic classes, becoming part of the elite and unknowingly keep inequality worldwide prevalent (6).

The control TNC's have over production in even third-world countries is shocking and repulsive, to say the least. TNC's are the new imperialists, seeking to employ workers in (near) slave labor conditions, all the while giving them meager salaries and keeping most of the income in the "clutches" of the TNC's (7). True enough, TNC's like Walmart, JC Penney, and even Nike make use of sweatshops, which exploit poor workers at less than humane conditions, all for the sake of driving materialism into our hearts and minds the world over, while they get paid dirt cheap for their labor (8, 9). But the real danger lies within the power of these TNC's. They have grown to be economically gigantic: their "economies" are as big if not larger than tens if not hundreds of third-world nations! How did they do this? They've exploited "cheaper" sources of labor, spread a dangerous and domineering ideology, and, worst of all, even supported wars launched to destroy third-world economies like those of Iraq and Afghanistan (10). Edward S. Herman, contributor to the "New Politics" journal, bluntly wrote:

As the globalization process has been engineered by corporate elites, and serves their interests, they have successfully conveyed the impression that globalization is not only inevitable but has been a great success. This is fallacious. Even ignoring for the moment its distributional effects, globalization has been marked by substantial declines in rates of output, productivity, and investment growth. Under the new regime of enhanced financial mobility and power, with greater volatility of financial markets and increased risk, real interest rates have risen substantially. The average rate of the G-7 countries (U.S., Britain, France, Italy, Germany, Canada and Japan) has gone from 0.4 percent, 1971- 82, to 4.6 percent, 1983-94.[fn 2] This has discouraged long term investment in new plant and equipment and stimulated spending on the re-equipment of old facilities along with a large volume of essentially financial transactions--mergers, buybacks of stock, financial maneuvers, and speculative activities. This may help explain why overall productivity growth [fn 3] in the countries that are members of the OECD fell from 3.3%, 1960-73 to 0.8%, 1973- 95, or by some 75 percent. Gross fixed investment fell from 6.1%, 1959-1970, to roughly 3.1% thereafter, or by half. OECD country annual rates of growth of real GDP fell from 4.8%, 1959-1970 to 2.8%, 1971-94, or by 42 percent.

But the elites have done well despite the slackened productivity growth. Because globalization has helped keep wages down, while increasing real interest rates, the upper 5 percent of households have been able to skim off a large fraction of the reduced productivity gains, thereby permitting elite incomes and stock market values to rise rapidly. But it was a different story for the global majority. Income inequality rose markedly both within and between countries. In the United States, despite a 35 percent increase in productivity between 1973 and 1995, the median real wage rate was lower in the latter year. Inequality rose to levels of 70 years earlier, and underemployment, job insecurity, benefit loss, and worker speedup under "lean" production systems all increased. [fn 4 Insecurity is functional. As Alan Greenspan complacently explained to Congress in 1997, wage rates were stagnant in this country because worker insecurity was high. [fn 5] That this high insecurity level reduced the well-being of the affected workers did not bother Greenspan, or Congress and the mainstream media.

The gap in incomes between the 20 percent of the world's population in the richest and poorest countries has grown from 30 to 1 in 1960 to 82 to 1 in 1995, and Third World conditions have in many respects worsened. Per capita incomes have fallen in more than 70 countries over the past 20 years; some 3 billion people--half the world's population, live on under two dollars a day; and 800 million suffer from malnutrition. [fn 6] In the Third World unemployment and underemployment are rampant, massive poverty exists side-by-side with growing elite affluence, and 75 million people a year or more seeking asylum or employment in the North, as Third World governments allow virtually unrestricted capital flight and seek no options but to attract foreign investment. [fn 7]

The new global order has also been characterized by increased financial volatility, and from the Third World debt crisis of the early 1980s to the Mexican breakdown of 1994-95 to the current Asian debacle, financial crises have become more and more threatening. With increasing privatization and deregulation, the discrepancy between the power of unregulated financial forces and that of governments and regulatory bodies increases and the potential for a global breakdown steadily enlarges.

Only an elite perspective permits this record to be regarded as an economic success.

Let's recap the above: apparently, it's not just a rise in interest rates and lowering of worker wages, but also a decrease in the average worker wage per country. This means that a lot of people are getting low wages, with a few "Bill Gates"'s getting a large part of the income. Even in developed nations like Canada is such a gap becoming wider as time flies by (11), with lower quintiles/quartiles receiving less than 5% of the nation's income. Globalization itself, then, also has stemmed the many financial crises that plagued developing nations over the past few years.

Globalization has also challenged supposedly the best form of government ever: democracy. By infringing on third-world economic freedoms and maintaining corrupt third-world nations through - what else did you expect? - financial support, third-world nations were thus discouraged from developing out of the economic hellholes that they dwelt in. As Herman stated in his brief,

One of the main objectives of TNC movement abroad has been to tap cheaper labor sources. Labor is often cheapest, and least prone to cause employer problems, in authoritarian states that curb unions and enter into virtual joint venture arrangements with foreign capital, as in Suharto's Indonesia and PRI's Mexico. Capital moves to such friendly investment climes in an arbitrage process, shifting resources from the more expensive to the less costly locale, in a process that penalizes and thereby weakens democracy.

The actual shift of capital abroad, and the use of the external option to drive hard bargains at home, has weakened labor. Labor has also been weakened by deliberate government policies of tight money and restrictive budget policies to contain inflation, at the expense of high unemployment. These policies, and the incessant focus on labor market "flexibility" as the solution to the unemployment problem, reflect a corporate and antilabor policy agenda, fully institutionalized. There have even been more open and direct attacks on organized labor--both Reagan and Thatcher engaged in union busting, and the latter was quite explicit in her aim to weaken labor as a political force. [fn 9] Democracy, according to pluralistic theory, is said to rest on the existence of intermediate groups, like labor organizations, that can bargain and work on behalf of an otherwise atomized population. The deliberate weakening of such groups is thus an attack on democracy.

Herman alludes to the lack of a political voice for the labor force, thereby, as he brilliantly stated, weakening the so-called democracy of such a nation, or strengthening the authoritarianism of that nation should democracy not be the nation's option. Support for conservative authoritarian governments, in that respect, reduces chances of labor unions to rise up and protest such violations of labor rights.

But is that really all? In the spirit of Marx, Weber, and other pessimistic intellectuals, Herman brings into the fore the problem of ideology. Ideology has been the primary tool of governnment agencies, political bodies and TNC's themselves in justifying the global economic inequalities that are running rampant and have done nothing but increase over the past few years, if not decades. He writes,

In the United States, Britain, Canada, and other countries the business community has also mounted a sustained ideological campaign to make their preferred policies part of common understanding. These campaigns have proceeded in parallel with globalization and have been remarkably similar, reflecting the global flow of ideology and overlapping sources of funding. The favored neoliberal ideology pushes the idea that the market can do it all, that government is a burden and threat, and that deregulation and privatization are inherently good and inevitable. It presses an extreme individualism and the value of "personal responsibility," which is highly advantageous to corporate power, leaving bargaining between large firms and isolated individuals. Collective and community values, the threat of externalities and ecological damage from unconstrained business growth, free market instability--all are shunted aside in this ideological system. This ideological campaign has been highly successful, because vast sums of business money fed to intellectuals and think-tanks, and business domination of the mass media, has allowed their views to prevail. Heritage Foundation leader Edwin Feulner has described the strategy of his corporate- funded and globally linked thinktank as analogous to Procter & Gamble's in selling soap--saturate the market with messages that overwhelm any that are less well funded. [fn 10] But this is a corruption of democracy; it is a bought market of ideas, not a free market of ideas.

Money has thus bought out free open-minded intellectualism and replaced it with a "concrete" set of values that have been set as yardsticks for "morality" and "civilization": democracy, free capitalism... all that stuff that seems to promise a better world. Sure, as much as I shun government, I shun whatever seeks to control people through subversive means as much if not more. Also,

The business community has also mounted a powerful effort to dominate governments--either by capture or by limiting their ability to serve ordinary citizens. Globalization has contributed to this effort, partly by the arbitraging process mentioned earlier, which favors authoritarian rule. Apart from this, by enlarging business profits and weakening labor it has shifted the balance of power further toward business, so that political parties have been even more decisively influenced by business money in elections. In the United States, it is notorious that Mr. Clinton has sought and received enormous sums from business and serves their interests almost exclusively, with only token efforts on behalf of the major nonbusiness constituencies of the Democratic Party. The globalizing corporate media have added their growing strength to the advance of neoliberal ideology and opposition to any vestiges of social democracy, making social democratic policies difficult to implement. The Murdoch effect on British elections, and the current Murdoch-Blair connection illustrates the point.[fn 11]

Another well-known and important antidemocratic force is the power of global financial markets to limit political options. Social democratic policies make for an unfavorable investment climate. Businesses will therefore respond to politicians and acts serving ordinary citizens with threatened or actual exit. Financial market effects on exchange and interest rates can be extremely rapid and damaging to the economy. Spokespersons for the new global economy actually brag about the ability of capital to penalize "unsound" policies, and the fact that money capital now rules.[fn 12]

This kind of reminds you of the sanctions that the Quartet imposed on Palestine after the election of Hamas, even though they were well aware of the toll this would take on innocent Palestinians. The same happened with Iraq back in the 90's, when a U.S.-supported U.N. sanctioned left 1,000,000 Iraqis, mainly children, starved to death. But either way,

we are in the midst of an antidemocratic counterrevolution in which globalization and its imperatives are being used to weaken popular and elected authority in favor of a system of domination by super-citizens, the TNCs. This process sows the seeds of its own destruction, as it serves a small global minority, damages the majority, breeds financial instability, and exacerbates the environmental crisis. Its destructive tendencies are likely to produce an explosion if the process is not contained and democracy is not rehabilitated.

Halting this antidemocratic juggernaut will be difficult, not only because of the power of its beneficiaries, but also because it operates within the framework of nominally democratic structures and musters plausible arguments. But these arguments are self-serving and wrong, and should be vigorously contested. An agenda should be advanced that serves ordinary citizens rather than the TNCs and financial institutions. Negatively, this agenda will include strenuous opposition to all supranational arrangements that take power out of the hands of democratic governments to serve some alleged economic need. Positively, the agenda requires support for the imposition of serious limits and responsibilities on TNCs, including capital controls and other deterrents to financial speculation. Pursuit of this agenda is going to require a combination of understanding and effective organization of the large majority who are the victims of globalization.

Like Herman said, consumerist globalization in the form of TNC's, etc. have been deeply rooted in our world village like a giant redwood on bedrock. It is going to take a long while before this tumor is plucked out by those who seek a world with equity and equality amongst human beings, despite the economic differences that plague us.

Long story, short... Globalization: bad. Consumerism: bad. What can we do about it? We obviously can't control the selfish interests of businesses and corrupt governments in plundering the world of resources and at the same time exploiting fellow humans in ways that lead to a system that will increase the dependence of third-world nations on the wealth that "developed nations" offer, all the while having their own wealth stolen from them thanks to high interest rates, low wages and increased resource extraction (depletion, to those living in developing nations). This new imperialism has grown more powerful than colonialist imperialism as this new imperialism has "justified" its presence in third-world countries, destroying traces of culture and replacing culture with material necessities, giving priority to material consumption, and making our lives all in all shallower than any of us could ever expect, thereby reducing our existence to serving selfish and elitist economic/business interests. This global economic tyranny has yet to be usurped by the people of the world, and even in such "democracies" do we end up serving people, not ourselves, and not just people, but a small minority of corporate fatcats. I say, What goes up must come down. The Kapitalist empires of the world have gone up since the days of colonialism. From the material listed above, Globalization will be the cause of its own demise. The big questions are: when is this going to happen, and how is it going to happen?

Salaam, from Saracen

DISCLAIMER: I know I might have sounded socialist or leftist at points. This is largely due to my despite for capitalism. Socialism, however, is as serving to certain interests, though not as much as capitalism, as it has taken a global scale. So for those who just love punching hippies and pinko-commies, please look for someone else to beat up. You've got the wrong house.