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GE3 1ST EXAM Notes

Contemporary World (University of Mindanao)

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GE3 1ST EXAM NOTES Arjun Appadurai

Kinds of Globalization (scapes)
LESSON 1: WHAT IS GLOBALIZATION?  Ethnoscape – global movement of people.
 Mediascape – flow of culture
Is Globalization good or bad?  Technoscape – circulation of mechanical
Globalization is a complex phenomenon that goods and software
occurs at multiple levels.  Financescape – global circulation of money
 Ideoscape – Political ideas
It is an uneven process that affects people
LESSON 2 : THE GLOBALIZATION OF
differently
WORLD ECONOMICS
“anti-globalization” movement in the 1990’s
Refer to the act of opposing trade
International Monetary Fund (IMF –
deals among countries facilitated and
regards “economic globalization” as a
promoted by international organizations such
historical process representing the result of
as the World Trade Organizations (WTO)
human innovation and technological
progress. It is characterized by the
Academics view globalization in a much
increasing integration of economics around
broader context. They call this an
the world through the movement of goods,
interdisciplinary approach, used in the
services, and capital across borders. These
general education (GE).
changes are the products of people,
organizations, institutions and technologies.
Globalization – Manfred Steger, “The
expansion and intensification of social World Bank- International development
relations and consciousness across world organization owned by 189 countries. Its role
time and across world-space.” is to reduce poverty by lending money to the
governments of its poorer members so that
Expansion – “both the creation of new social they can improve their economics and the
networks and the multiplication of new social standard of living of their people, Since 1947,
networks and the multiplication of existing they funded over 12,000 development
connections that cut across traditional projects via traditional loans, interest-free
political, economic, cultural, and geographic credits, and grants.
boundaries.”
According to the IMF, the value of trade as a
Intensification – the expansion, stretching percentage of world GDP increases from
and acceleration of these networks. 42.1% in 1980 to 62.1% in 2007. Increased
trade means that investments are moving all
World time and across world-space – over the world at faster speeds.
Globalization processes do not occur merely
at an objective, material level but they also United Nations Conference on Trade and
involve the subjective plane of human Development (UNCTAD), the amount of
consciousness. foreign direct investments flowing across the
world was US$ 57 billion in 1982. By 2015,
Globalization represents the processes that that number was $1.76 trillion
allow for the expansion and intensification of A supercomputers can execute millions of
global connections, Globalism an ideology stock purchases and sales between different
is a widespread belief among powerful cities in a second through a process called
people that the global integration of High-frequency Trading.
economic markets is beneficial for everyone
as it spreads freedom and democracy across INTERNATIONAL TRADING SYSTEMS
the world.

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The Silk Road – the oldest international trade reserves to support their armies but several
route. It connected China to what is the were obliged to abandoned the gold
Middle East today and to Europe. It was standard. Since European countries had
called such because one of the most limited gold reserves, they adopted floating
profitable products traded through this currencies that no longer redeemable with
network was silk, which was highly prized. gold.

When the Han dynasty of China It is proven to be a restrictive form of

opened trade to the West in 130 BCE, globalizing trade.
traders utilized the Silk Road regularly. This
continued until the Ottoman Empire closed it In the 1920s-1930s, a global economic crisis
in 1453 BCE. occurred called the Great Depression. This
It did not include routes to the was considered as the worst and longest
American continents. experienced by the West. Some economists
argues that is was caused by the gold
When did full economic globalization start? standard as it limited the amount of
circulating money; therefore, reduced
Denis O. Flynn and Arturo Giraldez - demand and consumption.
Globalization began when “all important
populated continents began to exchange According to Barry Eichengreen, an
products continuously-both with each other economic historian, the US began to recover
directly and indirectly via other continents – when it abandoned the gold standard.
and In values sufficient to generate crucial
impacts on all trading partners” Though some still used the gold standard
They trace this back to 1571 with the until late 1970s, the world never returned to
establishment of the galleon trade that gold standard of the early 20th century.
connected Manila and Acapulco in Mexico.
This become the first tie that the Today, the world economy operated
Americans were directly connected to Asian based on Fiat Currencies- currencies that
trading routes within the country’s shores. are not backed by precious metals and
whose values are determined by their cost
Galleon Trade – The age of mercantilism. relative to other currencies.
(16th century-18th century)
Mercantilism was also a global trade It allows governments to freely and
system that had multiple restrictions. actively manage their economies by
increasing or decreasing the amount of
The Gold Standard – in 1867 at an money in circulations as they see fit.
International monetary conference in Paris.
Its purpose is to establish a common THE BRETTON WOODS SYSTEM
system that would enable more efficient Following the two world wars, In 1944 United
trade and prohibit the isolationism of the Nations Monetary and Financial Conference,
mercantilist era. This result the countries The Bretton Woods System was
developed a common basis for currency inaugurated with the goal of preventing past
prices as well as the fixed exchange rate catastrophes from happening again and
system that are all based on the value of impacting international connections.
gold.
Though it is making trade easier it It was influenced by the idea of Maynard
was extremely limiting system because it Keynes. The british economist believes that
required governments to back their a country experiences economic crises not
currencies with set gold reserves. The first when it does not have sufficient funds:
world war forced countries to use their gold
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rather, it happens when money is not being economies that were reliant to oil. To make
spent; thus, moved. matters worse, the stock markets crashed
from 1973-1974 after US stopped linking
According to him when economies slow dollar to gold, effectively ending the Bretton
down, governments have to reinvigorate Woods System. This results to Stagflation
markets with infusions of capital. This – in which a decline in economic growth and
managing of economic crises became the employment (stagnation) takes place
foundation for what would be called a system alongside a sharp increase in prices
of Global Keynesianism. (inflation).

Delegates at Bretton Woods agreed to Around this time, Friedrich Hayek and Milton
create two financial Institutions: Friedman argued that the governments
practice of pouring money into their
1. International Bank for Reconstruction and economics has caused inflation by
Development (IBRD) or the World Bank. increasing the demand of goods without
- Responsible for funding post war necessarily increasing supply.
reconstruction proects.
Friedman used this economic turmoil to
2. International Monetary Fund (IMF) challenge the consensus around the Keynes
- The Global Lender of last resort to ideas. What emerged was a new form of
prevent individual countries from spiraling economic thinking- Neoliberalism- from the
into credit crises. 1980s onward, it became the codified
strategy of the United States Treasury
Shortly after Bretton Woods, Department, World Bank, IMF and World
In 1947 General Agreement on Tariffs and Trade Organization (WTO) – a new
Trade (GATT). Its main objective was to organization founded in 1955 to continue the
reduce tariffs and other hindrances to free tariff reduction under the GATT. The policies
trade. they forwarded came to be called the
Washington Consensus.
NEOLIBERALISM AND ITS DISCONTENTS
From the mid-1940s-early1970s, Global 1980s-early 2000s, the Washington
Keynesianism was at its successful point. As Consensus controlled the global economic
the Governments spend more money his will policies:
allow consumers to buy more which - Government expenditure should be
increases the demand and eventually kept to a bare minimum in order to minimize
increases the cost of the products and debt.
eventually result to business to make more - Advocate Privatization of
money for expansion and lower government-run services such as water,
unemployment. According to Keynesian electricity, communications and
economists, these were necessary trade transportation.
odds for economic progress. - They pressure governments
particularly in the developing world, to
In the early 1970s, the price of oil reduce tariffs and open up their economies.
rose sharply as a result of the Organization Through this particular industries would be
of Arab Petroleum Exporting Countries harmed in the process, they believe that this
(OAPEC) imposition of embargo in response “shock therapy” was necessary for long-term
to the US and other countries resupply the economic success.
Israeli military with the needed arms during Ronald Reagan of US and Margaret
the Yom Kippur War. Arab countries used Thatcher of UK, justified their cuts in
the embargo to stabilize their economic government expenditures by comparing
growth. This affected the Western national economics to homes. Thatcher
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presented herself as a mother who controlled (MBSs). One MBS would be a combination
expenditures in order to lower national debt. of multiple mortgages that they assumed
would pay a steady rate.
In spite of this neoliberal politicians that
experience initial success, the Washington Sometime in 2007, home prices stopped
Consensus flaws became apparent. Post- increasing as supply caught up with demand.
communist Russia is a great example. After Moreover, it slowly became apparent that
Communism had collapsed in the 1990s, the families could not pay off their loans. As a
IMF called for the immediate privatization of result, MBS were quickly resold, as banks
all government industries, The IMF hoped and investors wanted to get rid of their
that by doing so, corrupts bureaucrats would disastrous assets. This risky cycle came to a
be removed from these industries and that braking point in September 2008, when big
they would be passed on to more active and investment banks such as Lehman Brothers
independent private investors. However only went bankrupt. The crisis spread beyond the
wealthy individuals from the previous US since many investors were foreign
communist order had the money to purchase governments, corporations and individuals.
these industries. In some cases, the These series of interconnections allowed for
economic elites relied on easy access to a global multiplier effect that sent ripples
government funds to take over the across the world.
industries. This practice established an
oligarchy that continues to rule the Russian ECONOMIC GLOBALIZATION TODAY
economy today. Economic globalization remains an uneven
process, with some countries, corporations
THE GLOBAL FINANCIAL CRSIS AND and individuals benefiting a lot more than
THE CHALLENGE TO NEOLIBERALISM others. The series of trade talks under the
Russia’s case was just one example of how WTO have led to unprecedented reductions
the “shock therapy” of neoliberalism did not in tariffs and other trade barriers, but these
lead to the ideal outcomes predicted by the processes have often been unfair.
economist who believed in perfectly free Developed countries are often
markets. The greatest reflection of this perfectionists as they repeatedly refuse to lift
thinking was the global financial crisis of policies that safeguard their primary products
2008-2009. that could otherwise be overwhelmed by
imports from the developing world. Faced
Neoliberalism came into strain during with these blatantly protectionist measures
this global financial crisis 2007-2008 when from powerful countries and blocs, poorer
the world experienced the Great Depression. countries can do very little to make economic
The crisis takes back on 1980s when US globalization more just. Trade imbalances,
systematically removed various banking and therefore characterize economic relations
investment restrictions. This continued to between developed and developing
decrease into the 2000s this is because countries.
government officials failed to regulate risky The beneficiaries of global commerce have
investments in the US housing market in been mainly transnational corporations
their efforts to promote a free market. Taking (TNCs) – they are concerned more with
advantage of “cheap housing loans”. profits than with assisting the social
Americans began building houses that were programs of the governments hosting them.
beyond their financial capabilities. In turn, host countries ease tax regulations,
preventing wages from rising while
To mitigate the risk of these loans , banks sacrificing social and environmental
that were lending homeowners money initiatives that safeguard society’s most
pooled these mortgage payments and sold vulnerable citizens.
them as “mortgage-backed securities”
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The phrase “race to the bottom” refers to the devise ways of cushioning the most
practice of countries decreasing their labor damaging effects of economic globalization
standards, especially worker protections, In while ensuring that its benefits accrue for
order to entice international investors looking everyone.
for big profit margins at the lowest possible
cost. Governments weaken environmental
laws to attract investors, thus, creating fatal LESSON 3: A HISTORY OF GLOBAL
consequences on their ecological balance POLITICS: CREATING AN
and depleting them of their finite resources INTERNATIONAL ORDER
such as oil, coal and minerals.
Scholars are studying International
Localizing the Material Relations. Moreover, when they explore the
deepening of interactions between states,
Philippine industries were devastated by they refer to the phenomenon of
unfair trade deals under the Internationalization.
GATT and eventually the WTO particularly Internationalization is not equal to
our agriculture sector. According to Walen globalization; however it is a major part of
Bello and a team of researchers at Focus on globalization. It is important to study this as a
the global south, the US used its power facet of globalization because
under the GATT system to prevent Philippine states/governments are key drivers of global
importers from purchasing Philippine poultry processes.
and pork-even as it sold meat to the
Philippines. The Attributes of Today’s Global System
4 Major Characteristics in today’s world
Although the Philippines expected to make politics:
up losses in sectors like meat with gains in 1. Independent Countries/states that rule
areas such as coconut products, no themselves.
significant change was realized. In 1993, 2. Countries who communicate with one
coconut exports amounted to $1.9 billion and another through diplomacy.
after a slight increase to $2.3 billion in 1997, 3. International institutions that enable these
it returned to $1.9 billion in 2000. Bello and interactions, such as the United Nations
company noted that the Philippines became (UN).
a net food importer under the GATT. 4. International institutions take on lives of
their own in addition to enabling meetings
Conclusion between governments.
International economic integration is a
central tenet of globalization. In fact, It is so Nation-state is a relatively modern
crucial to the process that many writers and phenomenon in human history, and people
commentators confuse this integration for the did not organize themselves as countries.
entirety of globalization. It should be noted It is composed of two non-
that economics is just one window into the interchangeable words. Not all stated are
phenomenon of globalization; it is not the nation, not all nation are states.
entire thing.
Nevertheless, globalization is In layman’s terms, state refers to a country
anchored on changes in the economy. Given and its government.
the stakes involved in economic 1. It exercises authority over a
globalization, It is perennially important to specific population, which is
ask how this system can be made more just. Referred to as its citizens.
International policymakers, therefore, should 2. It governs a specific territory
strive to think of ways to make trading deals 3. It has a structure of government
fairer. Government must also continue to that crafts various rules that people
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(society) follow. challenge by Napoleon Bonaparte.

4. It has sovereignty over its territory. Bonaparte spread the principles of French
Sovereignty – refers to internal and external Revolution – Liberty, equality, and fraternity
authority. to the rest of Europe and thus challenged the
Internally, no individuals or groups power of kings, the nobility and religion in
can operate in a given national territory by Europe. The Napoleonic Wars lasted from
ignoring the state. 1803-1815 with Napoleon and his armies
Externally, sovereignty means that a marching all over much of Europe. In every
state’s polices and procedures are country they conquered, the French
independent of the interventions of other implemented the Napoleonic Code - which
states. forbade birth privileges, encouraged freedom
or religion, and promoted meritocracy in
On the other hand, Nation- According to government service.
Benedict Anderson, is an “imagined Anglo and Prussian armies finally
community”. It is limited because it does not defeated Napoleon in the Battle of Waterloo
go beyond a given “official boundary” and in 1815, ending the latter’s mission to spread
because rights and responsibilities are his liberal code across Europe. To prevent
mainly the privilege and concern of the another war they created a new system to
citizens of that nation. “Imagined” means a restored the Westphalian system. The
nation allows one to feel a connection with a Concert of Europe 1815-1914 was an
community of people even if he/she will alliance of “great powers” – the UK, Austria,
never meet all ff the, in his/her lifetime. Russia and Prussia – it was an alliance that
sought to restore the sovereignty of states.
As catholics want more people to join their Under this Metternich system ( named after
community; they refer to it as the call to the Austrian diplomat, Klemens Von
discipleship. However, not everyone can Metternich, who was the systems main
simply become a filipino. architect).
Despite the challenge of Napoleon to
Nation and state are closely related because the Westphalian system and the eventual
it is nationalism that facilitates state collapse of the Concert of Europe after that
formation. States become independent and World War I, with our present system we still
sovereign because of the nationalist have traces of this history.
sentiment that clamors for this
independence. Internationalism
The world was split into independent,
Sovereignty is one of the fundamental sovereign entities under the Westphalian
principles of modern state politics 400 years and Concert systems. Some like Bonaparte,
ago. opposed the system. Others desire of a
system of heightened interaction between
Interstate System various sovereign states, particularly the
The origin of the present-day concept desire for increased cooperation and
of sovereignty can be traced back to the solidarity among states and people, which is
Treaty of Westphalia – a set of agreements the Internationalism
signed in 1648 to end the 33 years war Internationalism has two
between the major continental power of categories:
Europe. This recognize that the treaty
signers exercise complete control over their Liberal Internationalism – their first major
domestic affairs and swear not to meddle in thinker was the late 18th century German
each other’s affairs. Philosopher Imannuel Kant. Kant wants to
This provide stability for the nations “establish a continuously growing state
of Europe until it faces its first major consisting of various nations which will
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ultimately include the nations of the world”. In was the manifestation of liberal
short He wants a form of global government. internationalism’s principles.

British philosopher Jeremy Bentham (who From Kant, it emphasized the need to form
coined the word “international” in 1780) common international principles.
advocate the creation of “international law” From Mazzini, it enshrined the principles of
that would govern inter-state relations. cooperation and respect among nation-
Betham believed that objective global stated.
legislators should aim to propose legislation From Wilson, it called democracy and self-
that would create “the greatest happiness of determination.
all nations taken together.” These ideas create the United
Nations in 1946
The first thinker who reconcile nationalism
with liberal internationalism was the 19th Socialist Internationalism
century Italian patriot Giuseppe Mazzini. One of Mazzini’s opponent was Karl Marx
Mazzini was both an advocate of the (German socialist philosopher) who is an
unification of the various Italian-speaking internationalist but not a nationalist. He
mini-states and a major critic of the emphasized economic equality, dividing the
Metternich system. He believed in a world into classes rather than countries.
republican government (without kings,
queens and hereditary succession) and 1, Capitalist class – production
proposed a system of free nations that Proletariat class – worked for the capitalists.
cooperates with each other to create an
international system. He influences the US Marx and his co-author, Friedrich Engels,
president (1913-1921) Woodrow Wilson, believed that in a socialist revolution seeking
who became one of the 20th century’s most to overthrow the state and alter the
prominent internationalists. Like Mazzini, economy, the proletariat “had no nation.”
Wilson saw nationalism as a prerequisite for Their famous battle cry, “Workers of the
internationalism and forwarded the principle
world, unite! You have nothing to lose but
of self determination- the belief that the
your chains.” They opposed nationalism
world’s nations had a right to a free and
sovereign government. Wilson became the because they believed it prevented the
most notable advocate for the creation of the unification of the world’s workers.
League of Nations. After the World War I in
1918 he pushed to transform the league into Marx died in 1883, but his followers establish
a venue for conciliation and arbitration to the Socialist International (SI) – a union of
prevent another war. He was awarded the European socialist and labor parties
Nobel Peace Prize in 1919. Ironically the US established in Paris in 1889. Although short
was not able to join the organization due to lived.
strong opposition from the Senate. The Their achievements are; May1 as Labor Day
league was unable to stop another war from and International Women’s Day. It initiated a
breaking out. successful campaign for an 8-hour workday.
It was the World War II. On one side of the
war were the Axis Powers- Hitlers Germany, It collapsed during World War I as the
Mussolinis Italy and Hirohitos Japan – who member parties refused/unable to join the
violently impose their dominance over other internationalist efforts to fight for the war.
nations. It was in the midst of this war This was a reminder of Marx’s warning:
between Axis power and the Allied Powers workers and their organizations long-term
(US,UK, France, Holland and Belgium) that interests are jeopardized when they side with
internationalism would be eclipsed. their countries rather than each other.

Despite the failure, the League gave birth to A more radical version emerged, the so-
world Health Organization (WHO) and called Russian Revolution in 1917, Czar
International Labour Organization (ILO). It Nicholas II was overthrown and replaced by
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a revolutionary government led by the one facet of globalization. It is critical for

Bolshevik Party and its leader, Vladimir International organization like United Nations
Lenin. This new state was called the Union to promote the global rules and policies
of Soviet Socialist Republics (USSR). Unlike towards the increasing international
the member of SI, the Bolsheviks did not relations.
believe in obtaining power for the working
class through elections. Rather, they
exhorted the revolutionary “vanguard” partied
to lead the revolutions across the world,
using methos of terror. Today we refer this
parties as Communist parties.

Lenin established the Communist

International (Comintern) in 1919 to
encourage the socialist revolutions across
the world. The Comintern served as the
central body for directing Communist parties
all over the world. It was less democratic
than SI. It was feared by world states as it
was working in secret to stir up revolutions in
their countries. A problem arose when Soviet
Union join the Allied Powers in 1941 during
the world war II, they do not trust the Soviet
union against Hitler’s Germany as they
wondered if it was trying to promote
revolutions in their backyards. To ease his
allies, Lenin’s successor, Joseph Stalin
dissolved the Comintern in 1943.

After the war, Stalin re-established the

Comintern as the Communist Information
Bureau (Cominform). When the US, Soviet
Union and the Great Britain partitioned war-
torn Europe into their own areas of influence,
the Soviet Union took over the countries in
Eastern Europe. The Cominform, like the
Comintern before it, assisted in the direction
of the several communist parties that had to
come to power in Eastern Europe.

The Soviet Union collapsed in 1991, it

disappares the thought about communist
internationalism. The SI managed to re-
establish itself in 1951, but its influenced
remained primarily confined ito Europe and
has never been considered in international
relations in this day.

Conclusion
This lesson examined the roots of
international system. Internationalism is only
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