The Globalization Of The World Economy


Globalization is a process of universal economic, political, and cultural integration and unification. It is the process of dragging world economies that share a common system of the international division of labor, as well as economic and political relations into the world market. It entails the concomitant interweaving of these economies on the basis of transnationalizm or regionalization. On this phase the global networked economy emerges (geo-economy and its infrastructure), which results in the states' national sovereignty being undermined.

This leads to the new international division of labor, migration of capital, labor power and productive resources, as well as to the standardization of legislation, economic and technological processes. Although globalization is conducive to the hemorrhage of talent, it also has many positive aspects. Cultural dimension of globalization is one such aspect. Cultural globalization seals the post-Cold War reconciliation between the business and consumer cultures of different countries. It also leads to the increase in international tourism and communication. At the same time, English prevails over other world languages. Thus, national and cultural identity of many countries dwindles to nothing. This process blurs ethnic specificities of indigenous culture, creating a kind of "hybrid of cultures".

Growing economic globalization manifests itself through the alarming increase in magnitude and pace of capital flows, staggering growth of international trade (in juxtaposition to the GDP growth), and emergence of round-the-clock financial markets. Information systems launched over the course of the last few decades immeasurably enhanced an ability of the finance capital to be quickly transmitted. This constitutes a potential threat to the sustainable economic systems of the nation states.

Felicitous junction of free market and laissez-faire tactics was the main characteristic of the 19th century liberal capitalism under British hegemony. The British Empire disavowed its protectionist policy, reducing a lion's share of tariffs and quotas in the 1830s. Simultaneously, progressive commodification of capital, land and other resources led to the emergence of a generalized labor market. On the other hand, neoliberal globalization is the internationalization of economic, political, and cultural life of the humanity, accompanied by the disregard of many civilizing imperatives. It contributes to the dissipation of national wealth of the underdeveloped economies, bleeds their economies white by purchasing the unfathomable bounty that lies beneath their territories at a contemptible small price. Neoliberal globalization has all chances to spawn polarization of humanity into the "golden billion" represented by the West and powerless periphery represented by the rest of the world. By and large, liberal capitalism aspired to disencumber the world economies of the overwhelming economic difficulties in the not-so-civilized century, while neoliberal globalization allows, or rather instigates, the world's "economic turbo-chargers" to take advantage of the underdeveloped economies in the...

National state capitalism is an economic system, in which state plays the role of a key entrepreneur, holds sway over the means of production, hires workers, and disposes of gross profit. In stark contrast to the neoliberal economies, those that subscribed to the national state capitalism in the short twentieth century were under thorough and ubiquitous state control. A steady trend of the public sector growth in the productive realms of society occurred during the short twentieth century. Share of public expenses increased by nearly 40% throughout the world.

Multinational companies (MNCs) are among the major beneficiaries of the liberal capitalism. Developing countries that espouse this economic system often fall a prey to MNCs, as the latter often exploit cheap labor in these countries. Furthermore, MNCs transfer their profits from the overseas economies to the country of domicile.

Liberal capitalism rests on three whales, namely private ownership of the means of production, free market, and laissez-faire tactics. Political philosophy of liberalism is premised on the idea of free trade and free markets as well. Thus, liberal approach towards global politics bears out the claims that MNCs benefit the most from periods of liberal capitalism.

Dynastic sovereignty

Dynastic sovereignty in a balance of power system can be defined as a personal and hereditary (i.e. patrimonial in nature) power to rule, impose taxes, decree and adjudicate. Dynastic sovereignty was embodied in the monarch who reckoned both public and private realms as his patrimonial estate. Thus, dynastic sovereignty may be regarded as proprietary kingship or generalized personal preponderance. Dynastic sovereignty differs significantly from the contemporary notion of sovereignty.

The doctrine of popular sovereignty was elaborated by a French philosopher Jean-Jacques Rousseau in the 18th century. He defined sovereign as a collective creature composed of individual persons that were commonly referred do as a people. The crux of the popular sovereignty lies in the paramount importance and overriding role of a people in the country. A people is regarded as the sole wielder of supreme power, or as a source of sovereign statehood. Popular sovereignty is widely believed to be an antagonist of dynastic sovereignty. In this case, the monarch is not regarded as a member of nation, but rather as an individual person - a wielder of the sovereign (absolutist, autocratic) state authority. Nevertheless, dynastic factor could not play the decisive role in forming nation states. Dynastic state had either to transmogrify into a nation state or dissolute in the long run. In the late 1780s, dynastic principle in Europe experienced a debacle, because peoples started preaching the political gospel of sovereignty in lieu of regarding themselves as an integral part of the universal unity. Last-ditch attempts of Louis XVI, a King of France, to continue dynastic politics in France triggered the French Revolution, which resulted in his being decapitated.

"Phenomenon of Napoleon" was a logical outcome and denouement of the French Revolution and the French Enlightenment in general. Napoleon was immediately delighted with the leftist ideas of the Jacobins when the latter emerged on the political arena of France, and was detained for his liaisons with Augustine Robespierre after the Girondists staged the French Revolution. Having brought himself to power as a result of a coup d'état in November 1799, Napoleon Bonaparte did not simply decide to introduce revolutionary order within France only, but to impose in on the rest of the world in general and Europe in particular. Napoleon's army entered cities in Italy, Spain, Austria, Prussia, Poland, Russia and other states with the French Revolution banners flying and proclaimed the French revolutionary slogan "Liberty, Equality, and Fraternity". At the same time, Napoleon did not employ humane tactics to graft the ideas of humanism onto Europe. In stark comparison to the Jacobins, Napoleon pursued the goal of building a lasting bulwark of the world revolution and utilized revolutionary traditions as political resources for the consolidation of his authority.

After Napoleon's exile to Elba, a plethora of other countries started plaguing Europe. Great Britain and Russia were the first to cause consternation among European states. However, European affairs were dominated by the German statesman Otto von Bismarck since 1860.

A few years into his rise to power, an Emperor of Germany Wilhelm II made Otto van Bismarck redundant. He embarked on the bellicose course of foreign policy and unleashed the First World War. Adolf Hitler, another notorious German leader, shared Wilhelm II's ambitions and embarked chose territorial aggrandizement as the main post-war thrust of German foreign policy.

In order to protect themselves from an external threat and ride the problems with the aggressors, many states resorted to the balance of power diplomacy in the early 20th century. They fell back on a number of different balancing tactics ("buck-passing", "chain-ganging" etc.) to extricate themselves from the security dilemma and create the countervailing force. Military balance of power started to shift in Germany's favor. The escalation of tensions was conducive to the outbreak of the First World War.

The Treaty of Versailles that marked the end of the World War One was signed in June 1919. Following the 1918 Armistice, terms of the treaty were elaborated at the Paris Peace Conference in 1919. According to the Treaty of Versailles, the Triple Entente (Britain, France, and Russia) together with other Allied Powers (Greece, Belgium, Romania etc.) prevailed over the Central Powers (German Empire, Austro-Hungarian Empire, Ottoman Empire, and the Kingdom of Bulgaria).


Dependency theory is an allied social sciences theory premised on the assertion that economic backwardness and political instability of the underdeveloped and developing countries is a result of their integration into the world economy and systematic oppression on the part of the developed countries. Dependency theorists maintain that peripheral (marginal) countries grow poorer because the developed countries peter out their deposits and drain their resources away. By and large, dependency theorists argue that pauperism of the underdeveloped countries does not stem from the lack of their integration with the global market, but instead from this integration.

Dependency theorists reckon that the spread of global capitalism exacerbates the so-called "dependent development" and thus generates global poverty. Those governments that bestir to remedy this deplorable state of affairs should transition to another socio-economic order.

Neoliberal globalists subscribe to the ideology of an unhampered movement of capital in a quest for the most favorable conditions of its utilization. Neoliberals refer to globalization as an argument to promote the idea of the capital's "social irresponsibility". Kingpins of the neoliberal globalism argue that countries vie for the jobs and thus try to enhance their investment attractiveness by means of eliminating multifarious barriers.

All dependent societies can be divided into three groups, namely those that were created ostentatiously, inadvertently, and premeditatedly. Usually, states that subsume under the category of a dependent society are characterized by the bloated public housing, lean and mean welfare, emerging media etc. This is because they espouse liberal teaching in schools.

Neoliberal globalists animadvert severely upon the concept of a broad welfare state, arguing that it begets a decrease in the economic efficiency and entails a risk of the population losing political freedoms. Thus, they throw their weight behind the concept of bureaucratic authoritarianism.

Reliance on bureaucratic authoritarian solutions was initially peculiar to a specified group of nations in the Southern Hemisphere collectively known as the Global South. However, on the cusp of the new millennium Russian President Vladimir Putin warned his compatriots solemnly to brace for the establishment of bureaucratic authoritarian regime. Although Putin has been recently reelected for the third term in office, he was forced to pigeonhole his grandiose plans due to several reasons. Some analysts have been deliberately fanning hysteria that the EU and the US may establish bureaucratic authoritarianism police state in the wake of recent developments, but these assumptions are clearly unsubstantiated.

Neoconservatives and New Realists

When the USSR split apart, the neoconservatives elaborated a new program, which called on the US to maintain its benevolent global hegemony throughout the world by exercising its political clout and immense prestige gained in the maelstrom of the Cold War. They exhorted the dissemination of American political principles (democracy, market economy, respect for human rights etc.) worldwide and embarked on the propaganda of patriotism and militaristic values (impressments and universal conscription) among the civilian population. At the same time, the new realists advocated that the US flex its military muscle every time a political conflagration broke out.

Neoconservatives bestowed name "unipolar world" on the new world order engendered by the dissolution of the USSR. When the USSR collapsed, the US could finally enjoy the status of the hegemon. According to Josephy Nye, one of the architects of the neoliberal ideology, soft power is a form of political power, an ability to achieve the desired results by means of co-optation, sympathy and persuasion. In stark contrast to soft power, hard power implies coercive measures, financial machinations, and other fraudulent activities.

When George W. Bush was sworn in, he looked for an ideological formula that could reciprocate two roles, namely role of the international community leader and that of a free world leader. The fledgling generation of neoconservatives did not hesitate to come to his assistance. President Bush appointed several prominent neoconservatives to vital positions in his administration. Moreover, neoconservatives started soon percolating into every arm of the US sophisticated bureaucracy. They lambasted at the idea of a drawdown of the US presence in the world's most volatile regions (Middle East, Africa etc.). Neoconservatives wielded political leverage over President Bush and spared no effort to reassure him to launch more overseas contingency operations.

Economic cost of these contingency operations is profoundly shocking. To tell that the US marred its reputation as the world's military superpower would not be fair. The "beacon of democracy" attained the overwhelming majority of its goals in Iraq and Afghanistan. However, the international community started casting doubt on the expediency of the US-led military campaigns.

Under the duumvirate of Barack Obama and Hilary Clinton, the problem of fly-blown American reputation became less rampant. They were a hair's breadth from diplomatic fiasco on a few occasions. However, they managed to prop up regional governments without getting bogged down in the political quagmire. Many issues still remain mired in political punditry, but hopefully a new tandem of President Obama and newly-minted diplomat John Kerry will iron out the remaining kinks in the US foreign policy.