1.5 Globalization, Power, and Politics

Throughout the world, globalization is transforming patterns of economic development, as local self-sufficiency is giving way to global interdependence and international trade. While for a time there was anticipation that globalization would lead to more prosperity for all, the economic recession that began in 2007 cast a spotlight on the unpredictable effects of global interdependence. In that year, economic disruptions in the United States and Europe resulted in powerful ripple effects that reached around the world. Foreclosures in the U.S. housing market meant that European banks that had invested in U.S. mortgages faltered and some failed; consumers in the United States and Europe shopped and vacationed less; some business borrowers as well as indebted country governments, such as Greece and Ireland, could not make loan payments and, as a result, many factory workers across the world lost their jobs. These connections between distant regions are known as interregional linkages. The term globalization refers to the worldwide changes brought about by many types of these interregional linkages and flows that reach well beyond economics. Attitudes and values are modified because of global connections and resultant culture change; ethnic identity may be reinforced or erased; personal or collegial relationships may be established between people who will never actually meet. Globalization is the most complex and far-reaching of the thematic concepts described in this book.

What Is the Global Economy?

The global economy includes the parts of any country’s economy that are involved in global flows of resources—mined minerals, agricultural commodities, manufactured products, money, and people and their ideas. Most of us participate in the global economy every day. For example, books like this can be made from trees cut down in Southeast Asia or Siberia and shipped to a paper mill in Oregon. Many books are now printed in Asia because labor costs are lower there. Globalization is not new. At least 2500 years ago, silk and other goods were traded along the Central Asian Silk Road that connected Greece and then Rome in the Mediterranean with distant China, an expanse of over 4000 miles (6437 kilometers).

European colonization was an early expansion of globalization. Starting in about 1500 c.e., European countries began extracting resources from distant parts of the world that they had conquered. The colonizers organized systems to process those resources into higher-value goods to be traded wherever there was a market. Sugarcane, for example, was grown on Caribbean and Brazilian plantations with slave labor from Africa (Figure 1.16) and made locally into crude sugar, molasses, and rum. It was then shipped to Europe and North America, where it was further refined and sold at considerable profit. The global economy grew as each region produced goods for export, rather than just for local consumption. At the same time, regions also became increasingly dependent on imported food, clothing, machinery, energy, and knowledge.

FIGURE 1.16 European use of colonial resources. Among the first global economic institutions were Caribbean plantations like the one shown here in a nineteenth-century painting of St. Croix Island. In the eighteenth century, thousands of sugar plantations in the British West Indies, subsidized by the labor of slaves, provided vast sums of money for England and helped fund the Industrial Revolution. Courtesy De Agostini/Getty Images

The new wealth derived from the colonies, and the ready access to global resources led to Europe’s Industrial Revolution. No longer was one woman producing the cotton or wool for clothes by spinning thread, weaving the thread into cloth, and sewing a garment. Instead, these separate tasks were spread out among many workers, often in distant places, with some people specializing in producing the fiber and others in spinning, weaving, or sewing. These innovations in efficiency were followed by labor-saving improvements such as mechanized reaping, spinning, weaving, and sewing.

This larger-scale mechanized production accelerated globalization, as it created a demand for raw materials and a need for markets in which to sell finished goods. European colonizers managed to integrate the production and consumption of their colonial possessions in the Americas, Africa, and Asia. For example, in the British Caribbean colonies, hundreds of thousands of enslaved Africans wore rough garments made of cheap cloth woven in England from cotton grown in British India. The sugar that slaves produced on British-owned plantations with iron equipment from British foundries was transported to European markets in ships made in the British Isles of trees and resources from the North American colonies and other parts of the world.

Until the early twentieth century, much of the activity of the global economy took place within the colonial empires of a few European nations (Britain, France, the Netherlands, Germany, Belgium, Spain, and Portugal). By the 1960s, global economic and political changes brought an end to these empires, and now almost all colonial territories are independent countries. Nevertheless, the global economy persists in the form of banks and multinational corporations, such as Shell, Chevron, IBM Canada, Walmart, Coca-Cola, Bechtel, Apple, British Petroleum, Toyota, Google, and Cisco, that operate across international borders. These corporations extract resources (including intellectual properties) from many places, make products in factories located where they can take advantage of cheap labor and transportation facilities, and market their products wherever they can make the most profit. Their global influence, wealth, and importance to local economies enable the multinationals to influence the economic and political affairs of the countries in which they operate.

Workers in the Global Economy

VIGNETTE

Sixty-year-old Olivia lives near Soufrière on St. Lucia, an island in the Caribbean (Figure 1.17A). She, her daughter Anna, and her three grandchildren live in a wooden house surrounded by a leafy green garden dotted with fruit trees. Anna has a tiny shop at the side of the house, from which she sells various small everyday items and preserves that she and her mother make from the garden fruits.

FIGURE 1.17 Workers in the global economy. 1.17a Courtesy UIG via Getty Images, 1.17b Courtesy Saeed Khan/AFP/Getty Images, 1.17c Courtesy Yalonda M. James/Charlotte Observer/MCT via Getty Images

Thinking Geographically

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On days when the cruise ships dock, Olivia heads to the market shed on the beach with a basket of homegrown goods. She calls out to the passengers as they near the shore, offering her spices and snacks for sale. In a good week she makes U.S.$50. Her daughter makes about U.S.$100 per week in the shop and is constantly looking for other ways to earn a few dollars.

Olivia and Anna support their family of five on about U.S.$170 a week (U.S.$8840 per year). From this income they take care of their bills and other purchases, including school fees for the granddaughter who will go to high school in the capital next year and perhaps college if she succeeds. Their livelihood puts them at or above the standard of living of most of their neighbors.

In Malacca, Malaysia, 30-year-old Setiya, an illegal immigrant from Tegal, Indonesia, is boarding a bus that will take him to a jobsite where he is helping build a new tourist hotel (see Figure 1.17B). Like a million other Indonesians attracted by the booming economy, he snuck into Malaysia, risking arrest, because in Malaysia average wages are four times higher than at home.

This is Setiya’s second trip to Malaysia. His first trip was to do work legally on a Malaysian oil palm plantation. Upon arrival, however, Setiya found that he would have to work for 3 months just to pay off his boat fare from Indonesia. Not one to give in easily, he quietly went to another city and found a construction job earning U.S.$10 a day (about U.S.$2600 a year), which allowed him to send money home to his family in Indonesia.

In 2008, Malaysia announced it was expelling 500,000 foreign workers; Setiya was one of them. The country was suffering from growing unemployment due to the global recession, and its leaders wanted to save more jobs for locals by expelling foreign workers. When the recession is alleviated, young fathers from Indonesia (like Setiya) may once again risk trips on leaky boats to illegally enter Malaysia and Singapore in order to support their families.

Fifty-year-old Tanya works at a fast-food restaurant outside of Charleston, South Carolina, making less than U.S.$7.50 an hour. She had been earning U.S.$8 an hour sewing shirts at a textile plant until it closed and moved to Indonesia. Her husband is a delivery truck driver for a snack-food company.

Between them, Tanya and her husband make $30,000 a year, but from this income they must cover all their expenses, including mortgage, gasoline, and car payments. In addition, they help their daughter, Rayna, who quit school after eleventh grade and married a man who is now out of work. They and their baby live at the back of the lot in an old mobile home (see Figure 1.17C).

With Tanya’s now-lower wage (almost $1000 less a year), there will not be enough money to pay the college tuition for her son, who is in high school. He had hoped to become an engineer, and would have been the first in the family to go to college. For now, he is working at the local gas station.

These people, living worlds apart, are all part of the global economy. Workers around the world are paid startlingly different rates for jobs that require about the same skill level. Varying costs of living and varying local standards of wealth make a difference in how people live and regard their own situation. Though Tanya’s family has the highest income by far, compared to their neighbors they live in poverty, and their hopes for the future are dim. Olivia’s family, on the other hand, are not well off, but they do not think of themselves as poor because they have what they need, others around them live in similar circumstances, and their children seem to have a future. They can subsist on local resources, and the tourist trade promises continued cash income. But their subsistence depends on circumstances beyond their control; in an instant, the cruise-line companies can choose another port of call. Setiya, by far the poorest, seems trapped by his status as an illegal worker, which robs him of many of his rights. Still, the higher pay that he can earn in Malaysia offers him a possible way out of poverty. [Source: From Lydia Pulsipher’s and Alex Pulsipher’s field notes. For detailed source information, see Text Credit pages.]

The Debate over Globalization and Free Trade

The term free trade refers to the unrestricted international exchange of goods, services, and capital. Free trade is an ideal that has not been achieved and probably never will be. Currently, all governments impose some restrictions on trade to protect their own national economies from foreign competition, although such restrictions are far fewer than in the 1980s. Restrictions take two main forms: tariffs and import quotas. Tariffs are taxes imposed on imported goods that increase the cost of those goods to the consumer, thus giving price advantages to competing, locally made goods. Import quotas set limits on the amount of a given good that may be imported over a set period of time, thus curtailing supply and keeping prices high, again to protect local producers.

These and other forms of trade protection are subjects of contention. Proponents of free trade argue that the removal of all tariffs and quotas encourages efficiency, lowers prices, and gives consumers more choices. Companies can sell to larger markets and take advantage of mass-production systems that lower costs further. As a result, businesses can grow faster, thereby providing people with jobs and opportunities to raise their standard of living. These pro–free trade arguments have been quite successful, and in recent decades, restrictions on trade imposed by individual countries have been greatly reduced. Several regional trade blocs have been formed; these are associations of neighboring countries that agree to lower trade barriers for one another. The main ones are the North American Free Trade Agreement (NAFTA), the European Union (EU), the Southern Common Market in South America (Mercosur), and the Association of Southeast Asian Nations (ASEAN).

One of the main global institutions that supports the ideal of free trade is the World Trade Organization (WTO), whose stated mission is to lower trade barriers and to establish ground rules for international trade. Related institutions, the World Bank (officially named the International Bank for Reconstruction and Development) and the International Monetary Fund (IMF), both make loans to countries that need money to pay for economic development or financial adjustment projects. Before approving a loan, the World Bank or the IMF may require a borrowing country to reduce and eventually remove tariffs and import quotas. These requirements are part of larger structural adjustment policies (SAPs)—belt-tightening measures that the IMF imposes on countries seeking loans, such as the requirement to close or privatize government enterprises and to reduce government services, mostly to the detriment of the poor.

Those opposed to free trade and the SAPs that have long promoted it argue that a less-regulated global economy can be chaotic, leading to rapid cycles of growth and decline that only increase global wealth disparity and can wreak havoc on smaller national economies. Labor unions point out that as corporations relocate factories and services to poorer countries where wages are lower, jobs are lost in richer countries, creating poverty. In the poorer countries, multinational corporations often work with governments to prevent workers from organizing labor unions that could bargain for living wages, minimum wages high enough to support a healthy life. Environmentalists argue that in newly industrializing countries, which often lack effective environmental protection laws, multinational corporations tend to use highly polluting and unsafe production methods to lower costs. Many fear that a “race to the bottom” in wages, working conditions, government services, and environmental quality is underway as countries compete for profits and potential investors. Multinational corporations that have recently agreed to address worker abuses include Nike, Walmart, and Apple.

In October 2011, activists around the world joined what was dubbed the Occupy Wall Street movement, protesting what they saw as the downside of free trade: the growing disparity of wealth worldwide and the unfettered role of global financial institutions, commodity speculators, and the superrich in molding the global economy to suit their ends. Labeling the superrich the “1 percent” and the rest of the world’s population the “99 percent,” the “Occupy” demonstrations spread throughout Europe and to hundreds of cities in Asia, Africa, Europe, Oceania, and the Americas.

Fair trade, proposed as an alternative to free trade, is intended to provide a fair price to producers and to uphold environmental and safety standards in the workplace. Economic relationships surrounding trade are rearranged in order to provide better prices for producers from developing countries. For example, “fair trade” coffee and chocolate are now sold widely in North America and Europe. Prices are somewhat higher for consumers, but the extreme profits of middlemen are eliminated; growers of coffee and cocoa beans, who produce for “fair trade” companies, receive living wages and improved working conditions.

In evaluating free trade, globalization, and fair trade, consider how many of the things you own or consume were produced in the global economy—your computer, clothes, furniture, appliances, car, and foods. These products are cheaper for you to buy, and your standard of living is higher as a result of lower production costs as well as competition among many global producers. However, you or someone you know may have lost a job because a company moved to another location where labor and resources are cheaper. Underpaid workers (even children) working under harsh conditions that possibly generate high levels of pollution may have made those cheap products. If workers can’t earn living wages, often some family members end up migrating, perhaps without the proper papers, to earn a better wage. Given all these factors, consider the advantages and drawbacks of both free trade and fair trade.

1.5.1 Power and Politics

For geographers studying globalization, the social and spatial distribution of political power is an area of increasing interest (see Figure 1.18). Recent years have produced what appears to be a transition toward political systems guided by competitive elections, a process often called democratization. This trend is of particular interest because it runs counter to authoritarianism, a form of government that subordinates individual freedom to the power of the state or elite regional and local leaders. In democratic systems of government, beyond the right to participate in free elections, average individuals have more economic and political freedoms, such as the right to be an entrepreneur, the right to peacefully protest government policies, the right to access information of all types, the right to marshal public support through the media (including print, broadcast, the Internet, and social media) for particular programs or candidates or election issues, and the right to take action against injustice, especially through legal systems.

FIGURE 1.18 Photo Essay: Power and Politics The map and accompanying photo essay show two related trends in political power. Generally speaking, countries with fewer political freedoms and lower levels of democratization also suffer the most from violent conflict. Countries are colored on the map according to their score on a “democracy index” created by The Economist magazine, which uses a combination of statistical indicators to capture elements crucial to the process of democratization. These elements include the ability of a country to hold peaceful elections that are accepted as fair and legitimate, the ability of people to participate in elections and other democratic processes, the strength of political freedoms (such as a free media and the right to hold political gatherings and peaceful protests), and the ability of governments to enact the will of their citizens and be free of corruption. Also displayed on the map are major conflicts initiated or in progress since 1990 that have resulted in at least 10,000 casualties. Aspects of the connections between democratization and armed conflict are explored in the photo captions. 1.18a Courtesy Raul Arboleda/AFP/Getty Images, 1.18b Courtesy Joseph Eid/AFP/Getty Images, 1.18c Courtesy Michael Bradley/Getty Images, 1.18d Courtesy Gwenn Dubourthoumieu/AFP/Getty Images

Geographers do not necessarily conclude that democracy is the “best” system of government. Indeed, many geographers are critical of the imposition of democracy, often by foreign governments or organizations, in places where long-standing cultural traditions support other political arrangements. They say that a democratic form of government should be achieved democratically. Nevertheless, few would deny that the shift toward more democratic systems of government over the past century and into recent times has been extremely significant, if not always peaceful. In this regard, geographers and other scholars are particularly interested in the role of democracy at the state and local levels, in addition to the roles that social movements, international organizations, and a free media play in democratization. 23. PROMOTING DEMOCRACY: A CONTROVERSIAL THEME

The Expansion of Democracy

The twentieth century saw a steady expansion of democracy throughout the world, with more and more countries holding elections of their leaders—at least at the national level. While democracy has become an ideal to which most countries aspire, there is little agreement about just what constitutes democratic institutions. Can the principles of a specific religion be part of democratic constitutions? Is it possible to have democratic government at the national level but quite authoritarian rule at the local level? What about forms of democratic participation other than voting, such as the ability to speak openly to leaders, to protest, to lobby for or against particular laws (Figure 1.18A)? Are not these also essential components of democracy? The Arab Spring movements, which commenced in early 2011 in a number of countries in North Africa and Southwest Asia, demonstrated that popular will can achieve amazing turnovers of power, as was the case in Tunisia, Egypt, and Libya. However, in Egypt in the 2012 elections, the Muslim Brotherhood—a male-dominated Islamist political party with authoritarian leanings—won an easy majority, causing concern that voters had quashed broader democratic reforms. Popular uprisings don’t always work well, smoothly, or at all (see Figure 1.18B, D). In Syria, Bahrain, and Yemen, where opposition demonstrations against authoritarian regimes also began early in 2011, the bloodshed continued for more than a year—and who shall ultimately have power remains unresolved. In all six of these countries, only time will tell if activists, unfamiliar with marshalling broad-based political will, can design systems that satisfy enough people to create a calm interim during which these governing systems can be refined peacefully.

What Factors Encourage Successful Democratization?

Here are some of the most widely agreed-upon factors that support the idea that the public should have an active role in their own governance:

• Peace: Peace is essential to creating an environment in which “free and fair” elections can take place.
• Broad prosperity: As a broader segment of the population gains access to more than the bare essentials of life, there is generally a shift toward freer elections, which put more power in the hands of citizens. Whether general prosperity must be in place before truly stable democracy can be established is still widely debated, as is the question of whether prosperity necessarily leads to democracy.
• Education: Better-educated people tend to want a stronger voice in how they are governed. Although democracy has spread to countries with relatively undereducated populations, leaders in such places sometimes become more authoritarian once elected.
• Civil society: The social groups and traditions that function independently of the state and its institutions can foster a sense of unity and informed common purpose among the general population. Civil society institutions can include the media, nongovernmental organizations (NGOs; discussed below and in Figure 1.19), political parties, universities, unions, community service organizations such as Rotary and Lions clubs, and in some cases, religious organizations (see Figure 1.18C).

  civil society the social groups and traditions that function independently of the state and its institutions to foster a sense of unity and informed common purpose among the general population

FIGURE 1.19 Nongovernmental organizations (NGOs) in action. A doctor examines a patient as part of an NGO-based effort to provide medical assistance and food aid to famine-stricken parts of Somalia. This doctor volunteers with South Africa–based “Gift of the Givers,” which is the largest NGO started and staffed completely by Africans.
Courtesy The Times/Gallo Images/Getty Images

Democratization and Geopolitics

As the map in Figure 1.18 shows, democratization at the global level has not yet been achieved (in fact, it is not a goal shared by all). A possible explanation is that democratization is often at odds with geopolitics, the strategies that countries use to ensure that their own interests are served in relations with other countries. Geopolitics was perhaps most obvious during the Cold War era, the period from 1946 to the early 1990s when the United States and its allies in western Europe faced off against the Union of Soviet Socialist Republics (USSR) and its allies in eastern Europe and Central Asia. Ideologically, the United States promoted a version of free market capitalism—an economic system based on the private ownership of the means of production and distribution of goods, driven by the profit motive and characterized by a competitive marketplace. By contrast, the USSR and its allies favored what was called communism, but what was actually a state-controlled economy—a socialized system of public services and a centralized government in which citizens participated only indirectly through the Communist Party.

The Cold War became a race to attract the loyalties of unallied countries and to arm them. Sometimes the result was that unsavory dictators were embraced as allies by one side or the other. Eventually, the Cold War influenced the internal and external policies of virtually every country on Earth, often oversimplifying complex local issues into a contest of democracy versus communism.

In the post–Cold War period of the 1990s, geopolitics shifted. The Soviet Union dissolved, creating many independent states, nearly all of which began to implement some democratic and free market reforms. Globally, countries jockeyed for position in what looked like a possible new era of trade and amicable prosperity rather than war. But throughout the 1990s, while the developed countries enjoyed unprecedented prosperity, many unresolved political conflicts emerged in southeastern Europe, Central and South America, Africa, Southwest Asia, and South Asia. Too often these disputes erupted into bloodshed and the systematic attempt to remove (through ethnic cleansing) or exterminate (through genocide) all members of a particular ethnic or religious group.

The new geopolitical era ushered in by the terrorist attacks on the United States on September 11, 2001, is still evolving. Because of the size and the global power of the United States, the attacks and the U.S. reactions to them affected virtually every international relationship, public and private. The ensuing adjustments, which will continue for years, are directly or indirectly affecting the daily lives of billions of people around the world.

International Cooperation

So far there has been no serious effort to engage the principles and practices of democratization at the global scale. However, many aspects of globalization favor international cooperation over national self-interest.

The prime example today of international cooperation is the United Nations (UN), an assembly of 193 member states. The member states sponsor programs and agencies that focus on economic development, general health and well-being, democratization, peacekeeping assistance in “hot spots” around the world, humanitarian aid, and scientific research. Thus far, various countries have been unwilling to relinquish sovereignty, the right of a country to conduct its internal affairs as it sees fit without interference from outside. Consequently, the United Nations has limited legal authority and often can enforce its rulings only through persuasion. Even in its peacekeeping missions, there are no true UN forces. Rather, troops from member states wear UN designations on their uniforms and take orders from temporary UN commanders.

Nongovernmental organizations (NGOs) are an increasingly important embodiment of globalization. In such associations, individuals, often from widely differing backgrounds and locations, agree on political, economic, social, or environmental goals. For example, some NGOs, such as the World Wildlife Fund, work to protect the environment. Others, such as Doctors Without Borders, provide medical care to those who need it most, especially in conflict zones. The Red Cross and Red Crescent provide emergency relief after disasters, as do Oxfam and Catholic Charities and Gift of Givers (Figure 1.19). The educational efforts of an NGO such as Rotary International can raise awareness among the global public about important issues such as childhood vaccinations.

NGOs can be an important component of civil society, yet there is some concern that the power of huge international NGOs might undermine democratic processes, especially in small, poor countries. Some critics feel that NGO officials are a powerful, do-gooder elite that does not interact sufficiently well with local people. A frequent target of such criticism is Oxfam International (a networked group of 17 NGOs), the world leader in emergency famine relief. Oxfam was a major provider of relief after the 2004 Indian Ocean tsunami and the 2010 Haiti earthquake. It has now expanded to cover long-term efforts to reduce poverty and injustice, which Oxfam sees as the root causes of famine. This more politically active role has brought Oxfam into conflict with local officials and with WTO policies on trade. The wisest NGOs solicit input from a wide range of individuals and organizations—a feature that political scientists consider essential to building civil society. 22. NGOs PLAY LARGER ROLE IN WORLD AFFAIRS