Chapter 14.2 Economic Globalization
Following World War II, the entire world was hit with a wave of economic globalization, mainly through the industrialization among the Global South
Economic development and industrialization became a priority for developing nations
It was a difficult task granted the class, ethnic, and religious divisions, and also a lack of sufficient leadership. The economy was also dominated by the capitalist bloc already focused on limiting the USSR during the Cold War
Success stories:
The Asian Tigers of South Korea, Singapore, Hong Kong, and Taiwan were focused on an export-driven growth.
Deng’s China started edging the U.S. Economy after growing larger than Japan.
India opened its market up and had economic growth steel, chemical, automotive, and pharmaceutical industries
Oil countries created a monopoly on oil as they raised the price of the material in the 70s’.
Failures:
In much of Africa, the Arab world, and parts of Asia, economic development was infrequent after independence.
Thus in the 21st, African countries encouraged economic growth through international investment and the expansion of its middle class.
Differences can be accounted for geography, natural resources, colonial experiences, and the degree of political and social stability.
With modern development and industrial growth came a new network of global economic relationships:
After WWI and the Depression wrecked the economy, international trade and investment declined as nations focused their money on rebuilding autonomy.
What happened after WWII was a continuation of these earlier trends but in a more global sphere.
In what ways have global economic connections deepened during the past century? What have been the consequences of these deepening connections?
Global economic connections have deepened in the areas of monetary policy.
After the US capitalists won WWII and tried to avoid the nationalist uprisings and economic contractions following WWI, they created a new set of institutions through the Bretton Woods system: the World Bank and International Monetary Fund (IMF),
World Bank
a major international lending agency that began to view the entire world as a single market (neoliberalism, essentially) that favored free trade— the reduction of tariffs, the free global movement of capital, a mobile and temporary workforce, the privatization of state-run enterprises, and tax and spending cuts
These policies, facilitated by spending after WWII, skyrocketed the circulation of goods and capital, through world trade.
Many developing countries were too reliant on exports, usually for raw materials and agricultural products.
Money surged around the planet as investors and financiers spent trillions purchasing foreign currencies or stock with the intention to sell them quickly thereafter.
Transnational Corporations (TNCs):
Global businesses that produce goods or deliver services simultaneously in many countries.
Companies like Toyota, Sony, and General Motors were of such size that they often trumped countries in assets and power.
Growth from a economic globalization:
Economic globalization accompanied and helped generate the largest spurt of economic growth in history.
Facilitated population growth and life expectation, the output of the economy, and industrial output.
Higher rate of literacy worldwide on a huge scale
The instability of the world economy:
1973 Oil Crisis resulted in economic stagnation in many industrialized nations and crises in developing nations, with huge profits for the oil-producing countries.
The Latin America Debt Crisis of the 1980s came from an inability to pay debt and resulted in a major setback of econ. development
The Asian Financial Crisis of 1997 resulted in the collapse of businesses, unemployment, and upheaval in Indonesia and Thailand.
The Great Recession of 2007 came from the collapse of the US housing market (bubble) and created a huge contraction in the global economy,
This spread to Iceland, Sierra Leone, which “rippled” out to other nations, affecting European economic integration.
Worst economic crisis since the Great Depression.
Inequality:
Globalization was unable to fix the problems of economic inequality, with great disparities between the rich and poor nations in income, resources, and opportunities. Oil-rich economies of the Middle East sold far more than the fruit-specialized countries in Central America, for example.
Domestically, income inequality has increased within the US as its transnational corporations moved to companies with cheap labor.
Its steel industry was shrunk in size as many Americans moved towards high-tech industries.
Mexico was also faced with inequality as its northern part grew more prosperous due to its ties with the US, as its south faced slower economic growth.
China’s economic miracle created an inequality between its rural sector and its cities
How economic globalization was resisted:
After the defeated of communism, economic disparity between the rich Global North and the developing Global South deepened and became a prominent issue.
The way the Global North organized its system of world trade and let political entities represent themselves in multinational economic organizations
1970s: the Group of 77 (all developing countries) made an attempt to economically unite, but to little success.
Global South countries often spoke against the protectionist taxes on their exports imposed by the rich countries.
World Trade Organization (WTO)
An international body of 149 nations negotiating the rules for trade and promoting free trade; they have often been the site of people protesting for the Anti-globalization movement.
North American Free Trade Agreement (NAFTA)
a free trade agreement between the U.S., Mexico, and Canada in 1984
Trans-Pacific Partnership
a free trade partnership between economies of the Pacific, most notably including Mexico, the U.S., and Japan.
The Anti-globalization movement:
Comprised of diverse critics of globalization, hailing from poor and rich countries alike.
Believed that a free-market-driven corporate globalization…
lowered working standards (social)
caused ecological degradation (environmental)
endangered poor nations for economic extraction (economic)
enhanced global inequality in that it favors the rich countries and TNC’s (economic, social)
Events:
1999 Seattle WTO Protests: a huge gathering of protesters ultimately focused on issues including workers' rights, sustainable economies, and ecological and social issues. (if you wanted to summarize it briefly)
In 1994, Mexican peasants revolted against the government’s privatized reforms of communal land
Related to Mexico’s entry into NAFTA.
Late 1990s: South Indian protests against the opening of corporate Kentucky Fried Chicken restaurants and the American chemical giant Monsanto who grew genetically modified cotton.
Grassroots resistance to the spread of multinational and transnational practices in the agricultural and food sectors, showing a long cultural continuity of an Indian agrarianism
Opposition to globalization also emerged from conservatives, particularly after the Great Recession.
Britain’s leave of the European Union in 2016 is an example of this.
The EU supported multilateralist alliances and neoliberalism through the creation of the WTO which supported free trade.
Donald Trump withdrew the United States from the Trans-Pacific Partnership and demanded to renegotiate NAFTA.
Both candidates in the 2016 election feared that international trade agreements would threaten American jobs.
In Turkey, Russia, China, and India, political leaders became more prideful in the purity of their nationality and culture.
Following World War II, the entire world was hit with a wave of economic globalization, mainly through the industrialization among the Global South
Economic development and industrialization became a priority for developing nations
It was a difficult task granted the class, ethnic, and religious divisions, and also a lack of sufficient leadership. The economy was also dominated by the capitalist bloc already focused on limiting the USSR during the Cold War
Success stories:
The Asian Tigers of South Korea, Singapore, Hong Kong, and Taiwan were focused on an export-driven growth.
Deng’s China started edging the U.S. Economy after growing larger than Japan.
India opened its market up and had economic growth steel, chemical, automotive, and pharmaceutical industries
Oil countries created a monopoly on oil as they raised the price of the material in the 70s’.
Failures:
In much of Africa, the Arab world, and parts of Asia, economic development was infrequent after independence.
Thus in the 21st, African countries encouraged economic growth through international investment and the expansion of its middle class.
Differences can be accounted for geography, natural resources, colonial experiences, and the degree of political and social stability.
With modern development and industrial growth came a new network of global economic relationships:
After WWI and the Depression wrecked the economy, international trade and investment declined as nations focused their money on rebuilding autonomy.
What happened after WWII was a continuation of these earlier trends but in a more global sphere.
In what ways have global economic connections deepened during the past century? What have been the consequences of these deepening connections?
Global economic connections have deepened in the areas of monetary policy.
After the US capitalists won WWII and tried to avoid the nationalist uprisings and economic contractions following WWI, they created a new set of institutions through the Bretton Woods system: the World Bank and International Monetary Fund (IMF),
World Bank
a major international lending agency that began to view the entire world as a single market (neoliberalism, essentially) that favored free trade— the reduction of tariffs, the free global movement of capital, a mobile and temporary workforce, the privatization of state-run enterprises, and tax and spending cuts
These policies, facilitated by spending after WWII, skyrocketed the circulation of goods and capital, through world trade.
Many developing countries were too reliant on exports, usually for raw materials and agricultural products.
Money surged around the planet as investors and financiers spent trillions purchasing foreign currencies or stock with the intention to sell them quickly thereafter.
Transnational Corporations (TNCs):
Global businesses that produce goods or deliver services simultaneously in many countries.
Companies like Toyota, Sony, and General Motors were of such size that they often trumped countries in assets and power.
Growth from a economic globalization:
Economic globalization accompanied and helped generate the largest spurt of economic growth in history.
Facilitated population growth and life expectation, the output of the economy, and industrial output.
Higher rate of literacy worldwide on a huge scale
The instability of the world economy:
1973 Oil Crisis resulted in economic stagnation in many industrialized nations and crises in developing nations, with huge profits for the oil-producing countries.
The Latin America Debt Crisis of the 1980s came from an inability to pay debt and resulted in a major setback of econ. development
The Asian Financial Crisis of 1997 resulted in the collapse of businesses, unemployment, and upheaval in Indonesia and Thailand.
The Great Recession of 2007 came from the collapse of the US housing market (bubble) and created a huge contraction in the global economy,
This spread to Iceland, Sierra Leone, which “rippled” out to other nations, affecting European economic integration.
Worst economic crisis since the Great Depression.
Inequality:
Globalization was unable to fix the problems of economic inequality, with great disparities between the rich and poor nations in income, resources, and opportunities. Oil-rich economies of the Middle East sold far more than the fruit-specialized countries in Central America, for example.
Domestically, income inequality has increased within the US as its transnational corporations moved to companies with cheap labor.
Its steel industry was shrunk in size as many Americans moved towards high-tech industries.
Mexico was also faced with inequality as its northern part grew more prosperous due to its ties with the US, as its south faced slower economic growth.
China’s economic miracle created an inequality between its rural sector and its cities
How economic globalization was resisted:
After the defeated of communism, economic disparity between the rich Global North and the developing Global South deepened and became a prominent issue.
The way the Global North organized its system of world trade and let political entities represent themselves in multinational economic organizations
1970s: the Group of 77 (all developing countries) made an attempt to economically unite, but to little success.
Global South countries often spoke against the protectionist taxes on their exports imposed by the rich countries.
World Trade Organization (WTO)
An international body of 149 nations negotiating the rules for trade and promoting free trade; they have often been the site of people protesting for the Anti-globalization movement.
North American Free Trade Agreement (NAFTA)
a free trade agreement between the U.S., Mexico, and Canada in 1984
Trans-Pacific Partnership
a free trade partnership between economies of the Pacific, most notably including Mexico, the U.S., and Japan.
The Anti-globalization movement:
Comprised of diverse critics of globalization, hailing from poor and rich countries alike.
Believed that a free-market-driven corporate globalization…
lowered working standards (social)
caused ecological degradation (environmental)
endangered poor nations for economic extraction (economic)
enhanced global inequality in that it favors the rich countries and TNC’s (economic, social)
Events:
1999 Seattle WTO Protests: a huge gathering of protesters ultimately focused on issues including workers' rights, sustainable economies, and ecological and social issues. (if you wanted to summarize it briefly)
In 1994, Mexican peasants revolted against the government’s privatized reforms of communal land
Related to Mexico’s entry into NAFTA.
Late 1990s: South Indian protests against the opening of corporate Kentucky Fried Chicken restaurants and the American chemical giant Monsanto who grew genetically modified cotton.
Grassroots resistance to the spread of multinational and transnational practices in the agricultural and food sectors, showing a long cultural continuity of an Indian agrarianism
Opposition to globalization also emerged from conservatives, particularly after the Great Recession.
Britain’s leave of the European Union in 2016 is an example of this.
The EU supported multilateralist alliances and neoliberalism through the creation of the WTO which supported free trade.
Donald Trump withdrew the United States from the Trans-Pacific Partnership and demanded to renegotiate NAFTA.
Both candidates in the 2016 election feared that international trade agreements would threaten American jobs.
In Turkey, Russia, China, and India, political leaders became more prideful in the purity of their nationality and culture.
