SOC100 Lecture Notes - Lecture 11: International Inequality, Neoliberalism, North American Free Trade Agreement
14 Jun 2018
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CHAPTER 15 - GLOBALIZATION: THE INTERCONNECTED WORLD
Overview:
- Globalization
- Globalization is the processes that appears to transform and weaken nationality to
globality
- Eg: the greater interconnectedness of the world’s peoples
- Controversy of globalization is that global trade is being exchanged for a loss of
sovereignty, thus leading to inequality
- Globalization is a process, and globality is a condition
- Globalization is a process that has been going on for a while
- Globality → condition, idea that through these processes of globalization
(emphasis on trade and economics globally), globality is the condition we are
moving towards (resulting in the loss of sovereignty, and leading to inequality in
some type of way)
- So if globalization is trade and economics occurring globally, then globality
is free trade occurring, leading to no sovereignty (having power over
something; no one has power over something specific anymore → everything
is allegedly “free”) → inequality.
- Emergence of globalization
- Historically → trade routes, migration
- Just because people were doing trades before, does not mean that the trades we
are doing now is similar to what was done before → globalization EXISTS
- It is not a natural process that you do not need to think about, but people
are deflecting and avoiding this by saying that we have traded all along
- However, the problem is that (and what globalization studies) the rules
that govern trade are different now. What used to be sovereignty
governed tade, is now free trade (leading to inequality)
- Lack of sovereignty entails lack of control; so you can no longer
control what you want to trade, and there is a higher power that
controls everything. If you just want a specific type of salmon
caught by a specific fishery, without sovereignty, you can no
longer get that specific fishery to give you and allow you to sell
salmon, but you have to sell what the higher power wants you to
sell → inequality because power dynamics
- 19th century technological developments
- Technology facilitates trade, and facilitates the movement of goods → is not
what globalization is in of itself.
- Eg: invention of the light bulb: no need to work with daylight; trade is
facilitated in that way
- Big deal, but is not what drives globalization. The rules of globalization is not
made due to technology, but rather we make our own new rules, and use
technology to facilitate it.
- Post WWII
- Decolonialization
- Colonialized countries demand for their independence but the
colonializers do not want to lose their economic benefits gotten from the
colonialized countries.
- Transnational political and financial institutions → came out of Bretton Woods
Agreement in 1945
- Financial institutions
- 1945 - World Bank
- Way to manage global currencies → certain countries
can take out loans and stuff → a long term loan
- Basically a way to reduce poverty → people who are
apart of the World Bank chip in money basically, to aid
long-term economic development, thus reducing poverty
in developing countries.
- Technical and financial support is available
- So it’s not like an emergency “bailout” like the IMF, but
rather it’s a means of literally providing support for
developing countries to function and be productive
economically
- 1946 - IMF
- Regulates which countries can get loans, who can
borrow and cannot borrow; stabilizes exchange rates
- Poor countries may be indebted when they attempt to
rebuild and loan money from the IMF
- Give short term loans to countries → manage the global
economy through credit and debit → so if you get a loan,
then it must be an emergency (stabilizes international
trade, results in country repaying loan at very expensive
interest rates)
- 1994 - World Trade Organization (WTO)
- Deals with the global rules of trade between nations. Its
main function is to ensure that trade flows as smoothly,
predictably and freely as possible → oversees different
trade agreements → sets rules for global trade
- Foundation of neoliberalism
- Philosophy for organizing global trade, belief of certain
types of principles.
- Neoliberalism occurs
- In US: the Washington Consensus
- Underlying ideology
- Political boundaries should not be a barrier to the efficient
distribution of commodities through markets → people should be
able to trade wherever they want, whenever they want, whatever
they want
- Problem: not every country is the same historically,
economically, or socially. If we all started at the same
place with the same resources and ability to produce
stuff, then it may be okay. But the world is not like this
- Less barriers will improve living conditions
- Problem: this has not happened still, even though we
have allowed free trade to go about
- Belief that markets can solve social problems
- Problem: not everyone comes from the same
background; we are privileged in one way, and
discriminated in another. We cannot solve these
problems through a free market. If anything, it just
exacerbates the problems
- Two fundamental features of neoliberalism
- Deregulation
- No such thing as deregulation; everything must be regulated
(market and trade)
- Claim of the neoliberal is that we need to re-regulate by
getting the government OUT of the marketplace.
- Government should not interfere with the market processes
- “Markets will correct themselves’
- Problem: there is an overproduction of food but food
prices are still going up, and people cannot afford and
starve → if market could correct, then this would not be
a problem (food price should go down)
- Includes reducing/eliminating welfare state
- Forces people to take any job in order to survive (since
no social services to help them)
- Privatization
- No state ownership/participation in the market transactions
- Characteristics of globalization
- Technological dimension facilitates all other dimensions of globalization
- Does not drive; facilitates → reasons that we use technology is to make the trade
agreements that we do
- Economic dimension
- Drives globalization → to expand markets after the crisis of WWII, and another
crisis in the 1970s.
- If everyone in the country has a washer and dryer, and you are selling
washers and dryers, then you would be having a sucky life, since no one
would want to buy them since they do not need
Document Summary
Globalization is the processes that appears to transform and weaken nationality to globality. Eg: the greater interconnectedness of the world"s peoples. Controversy of globalization is that global trade is being exchanged for a loss of sovereignty, thus leading to inequality. Globalization is a process, and globality is a condition. Globalization is a process that has been going on for a while. So if globalization is trade and economics occurring globally, then globality is free trade occurring, leading to no sovereignty (having power over something; no one has power over something specific anymore everything is allegedly free ) inequality. Just because people were doing trades before, does not mean that the trades we are doing now is similar to what was done before globalization exists. It is not a natural process that you do not need to think about, but people are deflecting and avoiding this by saying that we have traded all along.
