Intro to IS

Why has interest in rare ores like coltan and lithium increased since the 2010s?

• The use of oil has decreased

What are humans’ “essential needs”?

• They are context dependent and historically contingent

Why didn’t English manufacturers use water mills during the era of industrialization in the nineteenth century?

• Access to running water was made complex due to having to deal with the property rights of different types of land

• Steam engines could be set up close to workers in urban centers

How was the move from coal to oil socially beneficial?

• Oil extraction happened far away in the Middle East and didn’t bother the public, whereas coalmines were close to the people

What kind of an issue is climate change and how should it not be addressed?

• Developing countries do not want to pay for the carbon dioxide emissions of their colonizers

• Developing countries do not want to reach a compromise between sustainibility and economic growth, because they are so much backwards compared to their colonizers, ex: Guyana’s discovery of oil reserves in 2015

• It is easier for developing countries to make their economies sustainable, shift to renewable energy, compared to their colonizers

What warning did concerned scientists issue in 1992?

• Option 1: Spend resources on war and violence

• Option 2: Spend resources on sustainability

Who are the different actors in the process of addressing climate change? What roles do they play?

• States and state companies: Taxation, obligation and prohibition

• Consumers and NGOs: Creating social trends and movements to lobby states

What slows down the process of addressing climate change?

• Conflicting economic interests of different parts of the population

• Democracy, waiting for a collective decision to be made

What are the effects of climate change?

• Rising sea levels

• Extreme weather

• Disappearance of agricultural land

• Migration

What are some of the causes of climate change?

• Transportation Vehicles

• Cattle

• Industry

• Heating

What are some of the solutions to climate change?

• Renewable energy

• Meat Substitutes

• Less travellling with electric cars and planes

What are some of the international treaties on the neutrality or equal use of resources?

• The Antarctic Treaty (1959)

• The Outer Space Treaty (1966)

• United Nations Convention on the Law of the Sea (1982)

What is legal personhood and what some real life examples of it?

• Some natural resources have their own rights by law

• Rainforest Te Urewera in New Zealand (2014)

• Whanganui River in New Zealand (2017)

• Lake Erie in North America (2019)

• Magpie River in Canada (2021)

What are some of the problems of depending on oil from the Gulf region?

• Oil export boycott of 1973: shortages

• 1991 Gulf War: get Iraq out of Kuwait

• Peace settlement between Iran and Saudi Arabia in 2023: China’s growing influence

• Fracking 2010: US extracts oil from US soil

What is a major limitation of specialization in a few goods for international trade?

• Pandemics or disease outbreaks may disrupt supply routes, therefore some degree of self-reliance is necessary to pre-empt crises

Who has the largest Coltan reserves and why is it difficult to extract it?

• Democratic Republic of Kongo, eastern part near Rwanda

• Conflict between Rwandan military and rebel forces

Where are the main reserves of lithium? What is lithium used for?

• Australia

• Chile

• Bolivia

• Batteries

Where are the main reserves of niobium? What is niobium used for?

• Nano-technology

• Brazil

What are the potential disadvantages of globalization according to Joseph Stiglitz?

• Private markets are imperfect most of the time because of a lack of transparency between buyers and sellers

• Increased unemployment due to capital market liberalization (deregulation). Foreign capital injection increases growth and incomes, increased growth and income increases taxes. Unstable growth can lead foreign investors to leave, domestic workers can’t leave=unemployment.

• Social Darwinist Approach and lack of a democratic global economy: Less benefits for people in developing countries while the rich benefit more. Poor countries can’t compete with industry subsidies in rich countries when trading goods.

• Weakened states: Global institutions’ decisions influence the decisions of nation-states

• Erosion of cultures

• Environmental degradation

• Reduced security 

What is the main problem with globalization according to Joseph E. Stiglitz?

• Unequal global trade agreements founded on conflicting interests

What are the benefits of globalization according to Joseph E. Stiglitz?

• Less knowledge inequality due to faster and easier exchange of information between developed and underdeveloped countries: Global political movements such as feminism

• Better living standards and public health: More sources of funds, access to medicine, and increased access to technologies to increase productivity

• Poor people become less poorer than before but still remain poor

• Reduced risk of global recessions and less unexpected turns in the global economy

• Increased potential of states to finance global public goods together: public health, environmental protection and peace.

What is Joseph E. Stiglitz’ main argument in his conclusion?

• Countries can’t choose whether to become a part of globalization or not, but the way each country makes use of globalization and adapts to it is a matter of choice, the extent to which they participate in globalisation is contingent. Gloabalization should take place slowly enough so that cultures and their environments aren’t destroyed, but improved and adapted to a global system.

• Gloabalisation is misunderstood by many, the hegemonic interpretation of it is problematic for society on the whole while only benefiting the few

What are the different ways in which states can finance global public goods according to Joseph E. Stiglitz?

• Revenue from the sale of Global Natural Resources, ex: Charge for polluting the ozone layer

• Revenue from Global Taxes, ex: “Tobin Tax” for international financial transactions and carbon tax for greenhouse gas emissions

What is the main issue with the global reserve system?

• Money in the reserves can’t enter the money supply

• People in developing countries put their money in reserves (ex: Treasury bills) instead of investing it in more profitable assets (ex: Stock market)

Why do countries need a reserve system?

• So that people can receive their money in cash when they want to withdraw their funds from their bank

What is the problem with relying on the US too much for money?

• US could become the largest debtor instead of the largest creditor

• If the US dollar weakens, the whole system can fall apart since the majority of debt in the world is denominated in dollars

What is Joseph E. Stiglitz’ solution to the global reserve system’s over-reliance on the US?

• New currency for the reserves of developing countries (can be exchanged for other currencies)

• Increase the global money supply

• Help developing countries spend more than they produce

What is Stiglitz’ solution for countries defaulting on their loans?

• Enforce the reorganization of the country’s economy and the creation of a payment plan by law instead of injecting external funds 

What was the turning point in the global economy after the East Asian financial crisis?

• Industralized countries began to rethink the way their bank regulation systems worked

• Overreliance on capital adequacy standards (the size of a bank’s reserves for withdrawals) and stingy lending practices created a shortage of credit

How should the IMF change according to Stiglitz?

• IMF should help countries only at times of crises, not for long-term development that lasts more than a couple years

• IMF should allow for the formation of competing monetary funds in specific regions, so that those funds can offer subsidies and increase transparency in countries’ economies

• IMF should create conditions for financial assisstance eligibility based on a country’s ability to repay instead of making decisions based on the political interests of IMF’s directors, it should be less restrictive when it comes to the type of assisstance it provides, considering different solutions offered by different people instead of enforcing its own from the get-go

• IMF should be surveilled, supervised and held accountable by independent agencies

• IMF should have its own feedback mechanism to improve its models and identify previous errors in its forecasts

• IMF should consider employment and poverty when making forecasts instead of simply taking into account economic growth and trade deficits

• IMF should make its forecasts and models public, openly declare who is benefitting from its financial assisstance how and why

• IMF should give workers a voice in its commitees, as well as additional representation for African executive directors even though they may not be given exclusive voting rights in the commitees

What is a major problem with the IMF?

• Finance and trade ministers who aren’t directly accountable to democratically elected politicians in their countries lead the commitees at IMF

• Rich countries with veto power determine which decisions are taken despite the fact that taxpayers in poor countries bear the burden of repaying the bailouts provided by rich countries

What are the six reforms to IMF proposed by Stiglitz?

• Basic governance

• Competition

• Transparency

• Accountability

• Perspectives

• Only Crisis Assistance

What are the three reforms necessary for the improvement of the global economic system according to Stiglitz?

• Revenues from Public Goods

• Bankruptcies instead of Bailouts

• Increased Money Supply instead of Larger Reserves

What are Stiglitz’ arguments against globalization?

• Countries that abided by the Washington Consensus (10 economic policies to stabilize and grow economies)

• Countries such as Chile, India and Korea achieved economic growth by applying some of the principles of globalization and ignoring others (ex: increasing exports but refusing to remove import barriers)

• Globalization wouldn’t benefit poor countries who don’t have much to trade

• Globalization left poor countries worse off despite the corruption involved in their economic institutions

Why was the IMF founded according to Joseph E. Stiglitz?

• To prevent local financial crises from global ones through international capital markets

What are externalities?

• Effects of an economic acvitiy between two parties on another, third entity

What are some potential negative effects of globalization on politics?

• Foreign investors can determine who has power

• Foreign investors prioritize short-term financial benefits over long-term social disadvantages

• International organizations perpetuate colonialism through economic means, by controlling the finances of developing countries

What was the effect of the 1994 trade acccord: Uruguay round?

• Made Sub-Saharan Africa worse off while benefiting the Norht

What advice does the Washington consensus give to developing countries?

• No government intervention

• Flexible exchange rates

• Open borders for the free flow of goods and capital

Why has the price of lithium increased over the years?

• Demand for electric cars has increased

What are the benefits of batteries using lithium?

• Can be recharged thousands of times

• Battery lasts a long time

• Store lots of chemical energy in a small space

• Light

• Current lithium reserves can last decades

Why can’t we make electric cars with lead acid batteries?

• Battery too large and heavy

Which location has the highest amount of lithium reserves?

• Northern Atacama desert in Chile

What are some disadvantages of mining lithium from Chile’s reserves?

• Decreases water supply to indigenous communities

• Chile doesn’t profit as much from the reserves as foreign companies

• It is hard to fully recycle lithium

Who controls the market for lithium production and why?

• China controls the refining of the materials to produce more batteries than it consumes, and it consumes a lot

• Improved the quality of its batteries in 2015-16 to match South Korean and Japanese batteries

What is the difference between lithium batteries and hydrogen fuel cells?

• Hydrogen is more expensive

• Lithium battery prices have fallen by 90 %

What is the purpose of the Grand Renaissance Dam?

• Produce 6000 megawatts of electricity especially for more than 65 million Ethiopians in rural areas who don’t have access to it

How was the Grand Renaissance Dam funded?

• Donations from the public (organisations and institutions) and bonds

Why is the Grand Renaissance Dam in Ethiopia controversial?

• Decreases teh supply of water reaching Sudan and Egypt

Why is the Nile important for Egyptians?

• 90-95 percent of water usage is provided by the Nile

• Provides water for almost all irrigation (agricultural benefit)

• It doesn’t rain much in Egypt