Globalization in Question

Paul Hirst, Grahame Thompson, Simon Bromley

• Publisher: Polity
• Year: 2015
• ISBN:
  9780745697345
• Edition: 3
• Topic: Política y relaciones internacionales
• Subtopic: Globalización

'Globalization' is one of the key concepts of our time. It is used by both the right and the left as the cornerstone of their analysis of the international economy and polity. In both political and academic discussions, the assumption is commonly made that the process of economic globalization is well under way and that this represents a qualitatively new stage in the development of international capitalism. But is there in fact such a thing as a genuinely global economy? Globalization in Question investigates this notion, providing a very different account of the international economy and stressing the possibilities for its continued and extended governance.

The new edition of this best-selling text has been thoroughly revised and updated to take into account new issues which have become salient in the period since the first and second editions were published. Several new chapters have been added and others combined or re-written to assess the growing supra-national regionalization of the international economy, the emergence of India and China as new super-powers, and the possibilities for the continued governance of the global system. A new author has been added to strengthen the analytical embrace of the book given the untimely death of Paul Hirst in 2003.

Globalization in Question 's third edition is a continuing intervention into current discussions about the nature and prospects of globalization. The book has far-reaching implications which will be of interest to students and academics in a number of disciplines including politics, sociology, economics and geography, as well as to journalists and policy-makers.

1

Introduction: The Contours of Globalization

All old-established national industries have been destroyed or are daily being destroyed. They are dislodged by new industries, whose introduction becomes a life and death question for all civilized nations, by industries that no longer work up indigenous raw material, but raw material drawn from the remotest zones; industries whose products are consumed, not only at home, but in every quarter of the globe. In place of the old wants, satisfied by the productions of the country, we find new wants, requiring for their satisfaction the products of distant lands and climes. In place of old local and national seclusion and self-sufficiency, we have intercourse in every direction, universal inter-dependency of nations.

(K. Marx and F. Engels, The Communist Manifesto, 1850, repr. in Marx and Engels Selected Works, London: Lawrence & Wishart, 1968, p. 39.)

The inhabitant of London could order by telephone, sipping his morning coffee in bed, the various products of the whole earth, in such quantity as he might see fit, and reasonably expect their early delivery upon his doorstep; he could at the same moment and by the same means adventure his wealth in the natural resources and new enterprises in any quarter of the world, and share, without exertion or even trouble, in their prospective fruits and advantages; or he could decide to couple the security of his fortunes with the good faith of the townspeople of any substantial municipality in any continent that fancy or information might recommend. He could secure forthwith, if he wished it, cheap and comfortable means of transit to any country or climate without passport or other formality.

(J. M. Keynes, The Economic Consequences of the Peace. London: Macmillan, 1919, pp. 6–7)

The basic argument

Globalization has become a fashionable concept in the social sciences, a core dictum in the prescriptions of management gurus, and a catch-phrase for journalists and politicians of every stripe. It is widely asserted that we live in an era in which the greater part of social life is determined by global processes, in which national cultures, national economies, national borders and national territories are dissolving. Central to this perception is the notion of a rapid and recent process of economic globalization. A truly global economy is claimed to have emerged or to be in the process of emerging, in which distinct national economies and, therefore, domestic strategies of national economic management are increasingly irrelevant. The world economy has globalized in its basic dynamics, it is dominated by uncontrollable market forces, and it has as its principal economic actors and major agents of change truly transnational corporations that owe allegiance to no nation-state and locate wherever on the globe market advantage dictates.

This image is so powerful that it has mesmerized analysts and captured political imaginations. But is it the case? This book is written with a mixture of scepticism about global economic and political processes and optimism about the possibilities of control of the international economy and about the continued viability of national political strategies. One key effect of the concept of globalization has been to paralyse radical reforming national strategies, to see them as unfeasible in the face of the judgement and sanction of global markets. If, however, we face economic changes that are more complex and more equivocal than the extreme globalists argue, then the possibility remains of political strategy and action for national and international control of market economies in order to promote social goals.

We began this investigation, originally in the early 1990s, with an attitude of moderate scepticism. It was clear that much had changed since the 1960s, but we were cautious about the more extreme claims of the most enthusiastic globalization theorists. In particular it was obvious that radical expansionary and redistributive strategies of national economic management were no longer possible in the face of a variety of domestic and international constraints. However, the closer we looked, the shallower and more unfounded became the claims of the more radical advocates of economic globalization. In particular we began to be disturbed by three facts. First, the absence of a commonly accepted model of the new global economy and how it differs from previous states of the international economy. Second, in the absence of a clear model against which to measure trends, the tendency casually to cite examples of the internationalization of sectors and processes as if they were evidence of the growth of an economy dominated by autonomous global market forces. Third, the lack of historical depth and the tendency to portray current changes as unique, without precedent and firmly set to persist long into the future.

To anticipate, as we proceeded, our scepticism deepened until we became convinced that globalization, as conceived by the more extreme globalizers, is largely unfounded. Thus we argue that:

1 the present highly internationalized economy is not unprecedented: it is one of a number of distinct conjunctures or states of the international economy that have existed since an economy based on modern industrial technology began to be generalized from the 1860s. In some respects, the current international economy has only recently become as open and integrated as the regime that prevailed from 1870 to 1914.

2 genuinely transnational companies appear to be relatively rare. Most companies are based nationally and trade regionally or multinationally on the strength of a major national location of assets, production and sales, and there seems to be no major tendency towards the growth of truly global companies.

3 capital mobility has only recently begun shifting investment and employment from the advanced to the developing countries, and here it is just a very few of the emerging economies that are benefiting. Foreign direct investment (FDI) is still highly concentrated among the advanced industrial economies, and the Third World remains marginal in both investment and trade, a small minority of newly industrializing countries apart. As we show below, however, the emergence of India and particularly China represents a disruption to this imagery, though as yet it has not significantly shifted the centre of gravity from the already advanced countries.

4 as some of the extreme advocates of globalization recognize, the world economy is far from being genuinely ‘global’. Rather trade, investment and financial flows are concentrated in the Triad of Europe, Japan/East Asia and North America, and this dominance seems set to continue. In fact, the growth of supranational regionalization is a trend that is possibly stronger than that of globalization as normally understood.

5 these major economic powers, centred on the G8 with China and India, thus have the capacity, especially if they coordinate policy, to exert powerful governance pressures over financial markets and other economic tendencies. Global markets are thus by no means beyond regulation and control, even though the current scope and objectives of economic governance are limited by the divergent interests of the great powers and the economic doctrines prevalent among their elites.

These and other more detailed points challenging the globalization thesis will be developed in later chapters. We should emphasize that this book challenges the strong version of the thesis of economic globalization, because we believe that, without the notion of a truly globalized economy, many of the other consequences adduced in the domains of culture and politics would either cease to be sustainable or become less threatening. Hence most of the discussion here is centred on the international economy and the evidence for and against the process of globalization. However, the book is written to emphasize the possibilities of national and international governance, and as it proceeds issues of the future of the nation-state and the role of international agencies, regimes and structures of governance are given increasing prominence. But in addition, given one of the intriguing (but also infuriating) aspects of the globalization debate is that the term ‘globalization’ seems to have an almost infinite capacity to inflate – so that more and more aspects of the modern condition are increasingly drawn under its conceptual umbrella – we have taken the opportunity in this introduction to expand our discussion a little beyond the book’s central focus on economic globalization and governance. Globalization is now a term with such a wide embrace that it seems incumbent upon us at least to comment on some of these matters. This we do below, but mainly only in so far as it serves to clarify what this particular book is not about.

Challenges and responses

The third edition of this book is very much a product of the previous two editions. While its basic thesis remains substantially the same – that is, there is an exaggeration of both the extent and the significance of ‘globalization’ – things have moved on from the previous two editions. In this edition we have tried to capture many of these developments without undermining the basic thesis, to which, as will become clear below, we still hold. Of course, if this volume were being entirely written afresh in early 2008 we would no doubt recast it somewhat differently, and in the rest of this introduction we allude to these recastings. But it seriously concerns us that the strong ‘globalization’ thesis is now largely and uncritically accepted as the mainstream, whether it be by the public authorities or our academic colleagues. Thus it seems worthwhile – to us at least – to re-emphasize and reinforce the original thesis in the light of the more or less total acquiescence to a strong globalization imagery by all shades of opinion.

For an example of the attitudes of the public authorities one need look no further than the UK Treasury’s thinking on ‘globalization’. Gordon Brown (the chancellor when the reports alluded to in a moment were written but who subsequently became the prime minister), and the New Labour government more generally, has completely fallen under the spell of the full globalization story. Among a number of reports from the Treasury in the mid-2000s about globalization and the UK economy can be found one titled Long-Term Global Economic Challenges and Opportunities for the UK (HM Treasury 2004). This document buys completely into a conventional and uncritical globalization story, for the UK economy and the international economy beyond. It is a great shame that no one from the Treasury seems to have read any critical books and papers produced over the past five years or so that have challenged the full globalization thesis, though admittedly these are few and far between. If, however, they had done so, then the Treasury might have been much better informed of the options facing the UK economy in its relationship with the EU and, indeed, the rest of the world. Instead we have had other documents which just repeat the mantra, and this time directed at telling ‘Europe’ how it should reform to meet the same undifferentiated global challenges: Global Europe: Full Employment Europe (HM Treasury 2005a) and Responding to Global Economic Challenges: UK and China (HM Treasury 2005b).

Of course, the academic literature is another matter, but even here a largely acquiescent position is to be found. It is one thing to be sceptical about various uses of the concept of globalization, it is another to explain the widespread development and academic reception of the concept since the 1970s. But the literature on globalization is vast and varied. Although we have deliberately chosen not to rewrite this book so as to summarize and criticize this literature, in part because, given the scale and rate of publication on the topic, that would be a never-ending enterprise, it is perhaps incumbent upon the third edition to address this in part, and to respond to some of the more cogent critics. We begin with the positions and move on to the criticisms and our responses later.

Alternative globalizations

As pointed out above, it is not our intention to review all the positions in respect to globalization. The following discussion picks on the most notable and forceful of these. By and large these positions take globalization as an accomplished fact, though they all hedge about this in various ways and with various degrees of reservation. And, as will become clear, these alternative positions are not totally exclusive of one another: rather they overlap and merge into one another. We outline these positions here, beginning with those that are furthest from the immediate concerns of this book, gradually moving closer towards those that are nearest to our own perceptions and analytical stance on the globalization debate – which, it should be emphasized, is concerned mainly with its political economy and governance aspects.

1) The first proposition on globalization is one that is furthest from our concerns. In fact, it is one that actually challenges it from what is termed a ‘post-colonial perspective’. Often based around avant-garde anthropological and post-structuralist intellectual tendencies, this position works with a number of complex concepts, stressing such aspects as different spatial levels in the global arena and their imbrications, which involve multiple connections, and relationships, flexibilities, flows, etc. (Ong and Collier 2004; Tsing 2005). These ‘assemblages’ are argued to be continually dissolving and evolving, producing new and surprising terrains of activity. In this case globalization is treated as an accomplished fact – the consequence of these multiple flows and connections – and one that now needs to be transcended. One of the most forceful of the terms within this perspective is ‘planetarity’. This is designed to describe a possible world ‘above’ the North–South divide, ‘beyond’ the colonial and the Other, ‘outside’ of the national and the global (Spivak 2003, chap. 3). The project associated with ‘planetarity’ involves the development of a certain kind of new analytical language and discourse to express this possible world that lies ‘beyond globalization’.

Although it is not directly aligned with the post-colonial discourses, there is a closely associated conception that perceives the global as a series of ‘camps’ – zones of indistinction and the suspension of the rule of law – that infect the rest of the social order (e.g. Agamben 1998, 2005). One rather pessimistic consequence of this conception is that such zones of indistinction embody the final expression of a degenerate modernity. It can lead to a rather hopeless and disarming response: the global is beyond control, management or regulation.

2) A second characterization is one that does not offer a critique of globalization as such but rather a critique of a particular political appropriation of it. In this case current globalization is expressed as the emergence of a new empire based upon the hegemony of the USA. The USA is considered the only truly global power, and it is using this status, aligned with neo-conservative ideology, to construct a world order in its own image. In doing so it has thrown off the mantle of proceeding through multilateral agreements and compromises with its partners. Instead it has adopted a new strategy of unilateral action, building under its leadership transient ‘coalitions of the willing’ that vary in composition depending upon the objective at hand. In the section immediately following this one we assess this claim in the context of the idea of imperialism, seen as a possible mode of contemporary global governance.

Somewhat aligned to this position, we would suggest, is one that sees the global arena as made up of a ‘clash of civilizations’ or as a ‘clash of fundamentalisms’ (e.g. Huntingdon 1996). The USA is seen as the central defender of Western civilization, thus it is in the forefront of constructing a coalition to reinforce its hegemonic leadership in this respect. But in this case the global is fatally fractured, something we allude to in the comments on the cosmopolitan position discussed below. But this is in no way meant to endorse this position. There may be clashes in the international arena, but for us these are not clashes between such large aggregations as civilizations or fundamentalisms. The problem is whether civilizations or fundamentalisms exist in any seriously homogeneous way such that there could be an organized clash between them. Rather, there would seem to be as many clashes within civilizations (whatever these may be) as between them, and fundamentalisms do not exist as unitary entities either, but are already always riven with rivalries, disputes and indeed armed clashes (as in the case of religious fundamentalist-driven insurgencies in many Middle East contexts). But fundamentalisms are not just religious based; there are also secular fundamentalisms such as extreme neo-liberal market fundamentalism and some animal rights activism (Thompson 2007).

3) A third position on globalization would stress the emergence of a new international cosmopolitanism in the wake of the complex interdependency and integration that characterizes what is seen as the break-up of the West-phalian international system. In this case, new political responses are required to address the deterritorialization of authority in the global system. Very much developed in the shadow of Kant’s pamphlet Perpetual Peace (Kant [1919] 1990) – which itself was a call to arms for a new world order – this position stresses the role of transnational civil society actors in the formation of global democratic accountability and political responsibility. The most incisive and insistent advocate of this position has been David Held and his co-authors (e.g. Held and McGrew 2002, chap. 9; Held 2004). It is particularly embodied in his call for a ‘new global covenant’ among the ‘democratic peoples’ of the globe designed to address the growing democratic deficit he sees as resulting from the leaking of power from sovereign states towards what is at present a highly problematic and unsatisfactorily ungoverned but coordinated international market order.

Again, there is a nuanced and elaborated defence to be made of this position, but we would stress that it is underpinned (at least implicitly) by an acceptance of the full globalization story, otherwise why is there a need for such a radical and new political order? But if – as we would argue is demonstrated by our analysis in the chapters below – there is no complete globalization of the international system, then the ‘global’ of globalization does not (yet?) exist in this form: there is no single ‘cosmos’ for cosmopolitanism to address. Against this we would argue that we are still caught in a ‘pluriverse’ rather than in a ‘universe’ (e.g. Latour 2004): there remains a set of heavily competing voices in the international system that do not necessarily address one another in a ‘common language’, and without such a universal language for all to lock into these voices will continue to a large extent to speak past one another (as in the case of fundamentalism briefly mentioned above). Thus we are not in a position to forge such an ambitious global covenant or a global cosmopolitanism. Rather we will have to continue to learn to live with – and within – a certain disorder (as outlined later in this introduction), where the best that can be hoped for is ad hoc and limited governance responses to emergent problems combined with fire-fighting ‘crises’ as they arise, and the installation of prudential regulation in their wake.

4) A fourth take on globalization is to see this as involving the development of networks of cross-cutting relationships in various domains that straddle national borders (Castells 2000). In part this conceives of the system in the light of issues about the role of ICTs in stimulating locational disengagement, and the move towards global standard-setting discussed below. Global standard-setting involves not only the traditional public bodies of international governance but also increasingly fully private or quasi-private actors that both claim and exercise a public power in this respect (Cutler et al. 1999; Cutler 2003). An added aspect to this development is the way ‘international governance’ is increasingly being rendered into various networked legal forms, something stressed (and celebrated) by Slaughter (2004), but also involving the progressive juridicalization and constitut...

Table of contents

• Cover
• Contents
• Dedication
• Title page
• Copyright page
• Figures
• Tables
• Preface
• List of Abbreviations
• Acknowledgments
• 1 Introduction: The Contours of Globalization
• 2 Globalization and the History of the International Economy
• 3 Multinational Companies and the Internationalization of Business Activity
• 4 Globalization and International Competitiveness
• 5 Emerging Markets and the Advanced Economies
• 6 Supranational Regionalization or Globalization?
• 7 General Governance Issues
• 8 Globalization, Governance and the Nation-State
• Notes
• References
• Index