Topic 2Topic 2

The Formation The Formation

of the Global Systemof the Global System

Themes:Themes:

The changing historical form of politicaThe changing historical form of political globalizationl globalization

The growth of economic globalizationThe growth of economic globalization The development of the transnational The development of the transnational

organizationsorganizations

Questions:Questions:

What is a modern nation-state?What is a modern nation-state? What are the transnational political What are the transnational political

processes?processes? What are the principles of economic What are the principles of economic

globalization?globalization? What is the history of the development of What is the history of the development of

the global organizationthe global organization What is the implication of studying the What is the implication of studying the

global systemglobal system

Modern Nation-state Modern Nation-state and World Orderand World Order

Rise of the west: the growth of a European worldview effective enough to lend to the economic domination of the globe

Since the Second World War the modern nation-state has become the principal type of political rule across the globe.

The modern nation-states had a particular form- liberal or representative democracy, bureaucratic administration and monopoly of legitimate means of violence.

• In the arena of national politics, liberal democracy is featured by a cluster of rules and institutions:

• governing by elected representatives;• the right to vote for all adults in elections• the right to run for public office• the right for each citizen to freedom of expression and

association• the accessible sources of information.

Dynamics: The enormous flows of people national boundaries generate the problem of migration, immigration and creation of different identities. e.g. disapora, refuguees, refugees, exiles and nomads

Modern Nation-state and World Modern Nation-state and World Order (Cont’)Order (Cont’)

Modern Nation-state and World Modern Nation-state and World Order (Cont’)Order (Cont’)

liberal democracy became the dominant type of modern nation-state in 19th and 20th century.

There are three “waves” of democratization marking out the reach of liberal democracy over time:

• from the early 19th century to the mid-1920s;

• from Second World War to the early 1960s;

• from 1974 until now.

• by 1995, nearly 75% of all countries had established and adopted formal guarantees of political and civil rights.

modern nation-state system: the development of liberal democracy was taken place within a bounded political space.

States are institutions, nations are cross-class collectivities which share a sense of identity and collective political fate

The Emergence of Global PoliticsThe Emergence of Global Politics

Today the global transformation of politics had greatly changed the nation-state system.

A new kind of global order marked by new patterns of power, hierarchy and unevenness became dominant.

World Order and MilitaryWorld Order and Military

1945-89: Cold War ideology1945-89: Cold War ideology--NATO (USA)--NATO (USA)

--Warsaw (USSR)--Warsaw (USSR)

--Arab-Islamic (Middle East)--Arab-Islamic (Middle East)

1989: collapse of Soviet Union1989: collapse of Soviet Union--Rise of Japan--Rise of Japan

--Rise of Pacific Rim (East Asian Countries)--Rise of Pacific Rim (East Asian Countries)

--Development of EU--Development of EU

2000: Industrialized Warfare 2000: Industrialized Warfare --Four politico-economic ‘Core’ : North America, Europe, East --Four politico-economic ‘Core’ : North America, Europe, East

Asia and Middle EastAsia and Middle East

The Emergence of Global Politics The Emergence of Global Politics (Cont’)(Cont’)

Global politics is a term, using to capture:

“the stretching of political relations across space and time, and the extension of political power and activity across the boundaries of modern nation-state.”

It challenges the traditional distinctions between domestic/international, inside/outside, territorial/non-territorial politics.

The Emergence of Global Politics The Emergence of Global Politics (Cont’)(Cont’)

The state is confronted by a great number of intergovernmental organization (IGOs), international agencies and quasi-supranational institutions, like the European Union or World Bank.

Transnational bodies, such as multinational corporations, transnational pressure groups, transnational professional association, international social movements also participate intensively in global politics.

In the global arena, there emerged a “polyarchic mixed actor system” in which political authority and sources of political action are widely diffused.

The concept of global governance: “refers not only to the formal state institutions

and organizations, but also all organizations and pressure groups- from MNCs, transnational social movement to non-governmental organizations (NGOs) which pursue goals and objectives for transnational rule and authority.”

the United Nations System, the World Trade Organization, World Health Organization, Greenpeace (the globalization actors) are the central components of global governance.

rapid expansion of transnational links and the demand for international governance to deal with collective policy problems.

In 1997 G7 summit met in London to discuss the problem of unemployment.

This a symbolic importance at the time in bring unemployment to the top of international political agenda.

Responses to the Responses to the ideology of globalizationideology of globalization

Far from the end of ideology: Far from the end of ideology: Religious fundamentalism (911 Religious fundamentalism (911

trategeries) trategeries) Extreme Right (Market fundamentalist)Extreme Right (Market fundamentalist) Extreme Left (Marxism)Extreme Left (Marxism) Others: globalization from below and Others: globalization from below and

beyondbeyond

This led to significant changes in the decision-making structure of world politics.

New forms of multilateral and multinational politics have been established involving governments.

In 1909 there were 37 IGOs and 176 INGOs, while in 1996 there are nearly 260 IGOs and 5472 INGOs.

State thus appears not so much as a single actor on the world stage but as a multiplicity of actors in many different forums (refer to supplementary).

Global Social MovementsGlobal Social Movements

The extension of the concept of human The extension of the concept of human rights, the development of global civil rights, the development of global civil society, the recognition of worldwide society, the recognition of worldwide problems and social protest against problems and social protest against governments or transnational corporationsgovernments or transnational corporations

Spread of global social movements: Spread of global social movements: friends of Earth, the Greenpeace, Feminist friends of Earth, the Greenpeace, Feminist movements and Peace Movement movements and Peace Movement

Conclusion:

Globalization of politics is transforming the traditional forms of sovereign statehood and reordering international political relations.

But these transformative processes are neither historically inevitable nor by any means fully secure.

As a result, the contemporary world order is best understood as a highly complex and contested process.

Economic GlobalizationEconomic Globalization

After industrial Revolution, states were After industrial Revolution, states were independent politically but interdependent independent politically but interdependent economically. economically.

An integrated system based on international An integrated system based on international division of labor, like Taylor’s scientific division of labor, like Taylor’s scientific management and Ford’s assembly line management and Ford’s assembly line manufacturingmanufacturing

Development of TNC (Transnational corporation), Development of TNC (Transnational corporation), e.g. the use of credit card and rise of fast food e.g. the use of credit card and rise of fast food

Creation of weight-ness economy: information Creation of weight-ness economy: information tradingtrading

Economic GlobalizationEconomic Globalization

There is a corresponding transnationalization of economies, civil societies and communities.

This transnationalization is most conspicuous in relation to the globalization of finance and production and the development of MNCs. Eg. 1973, 239 national banks established the SWIFT (standard world interbank and financial transactions); by 1989 SWIFT had 1,000 members in 51 states.

Dual Effect: involving of people as consumers and producers whilst excluding people from substantive participation in the global economy

The historical development of the spread of economic globalization (see supplement)

Consumption and EconomyConsumption and Economy

The outcome of mass production is mass consThe outcome of mass production is mass consumption—American Dreamumption—American Dream

The direct advertising of products and the tranThe direct advertising of products and the transmission of idealised images of consumer cultsmission of idealised images of consumer culture have been carried out through mediaure have been carried out through media

The 20th Century witnessed the development The 20th Century witnessed the development of global communications and media networkof global communications and media networks, especially the electronic revolution and ‘ins, especially the electronic revolution and ‘information-super highway and the cyberworldformation-super highway and the cyberworld

Three principal ways of Economic Globalization:

• The emergence of a global market discipline in contrast with a mere global market-place;

• The economic activities are being re-conceptualized and re-organized:

• a) “real-time” activities where distance and location are no longer relevant as a determinant of economic operations,

• b) “material” activities where there is still some ‘friction of space’ that limits choice of location.

• 3. Money itself has become a “real-time” resource. International mobility of finance is qualitatively different from the previous eras.

A Global Market Discipline

A market-place: international division of labor and an international market exchange between different goods and services that are produced in different nations.

This is a pattern of inter-product trade.

(countries that specialized in the export of one type of product would exchange that product for other types that they did not produce themselves.)

A Global Market Discipline(Cont’)

A global market discipline: a pattern of intra-product trade.

At first, multinational companies adopted simple integration strategies.

They set up foreign affiliates producing the same standardized commodities.

Next, multinational companies adopted complex integration strategies.

A Global Market Discipline(Cont’)

They turned their fragmented production systems into regionally or globally integrated production networks.

In this way, multinational companies often farmed out different parts of the production process to different affiliates in different national locations.

Each subsidiary took part in the production process, but not one single affiliate produced the whole product from beginning to end.

In the early 1970s intra-product or intra-firm trade was accounted for 20% of world trade, by the early 1990s that share was around one-third.

Flexible Accumulation Through Global Webs

Relocation of factories and companies almost anywhere in the globe due to the decreasing cost of transporting standard products and communicating information.

The fusion of computer technology with telecommunications makes this possible.

Firms relocate an ever-widening range of operations and functions to wherever low cost of production.

Production capacity viewed as commodity, something that can be instantly bought and sold on the market.

This is flexible accumulation through global webs. eg, Nike footwear company.

Global Financial “Deepening”

The growth of the financial or "symbol" economy outpaced the growth of trade and investment.

Total annual value of transactions in the world's financial markets is now twice the total value of world production.

As Peter Drucker said, "90% or more of the transnational economy's financial transactions do not serve what economists would consider an economic function."

Global Financial “Deepening” (Cont’)

• Money is increasingly being made out of the circulation of money, regardless of traditional restrictions of space and time.

The financial revolution since the 1980s has been characterized by financial deregulation on the one hand with information technology on the other.

This led to a rapid increase in international mobility of capital.

Global Financial “Deepening” (Cont’)

This mobility refers not only to the speed and freedom with which money can now move across frontiers.

It refers to the way it is being disconnected from social relationships in which money and wealth were previously embedded.

5 Ideological Claims of Globalism5 Ideological Claims of Globalism

G is about liberalization and global G is about liberalization and global integration of marketsintegration of markets

G is inevitable and irreversibleG is inevitable and irreversible No one is in charge of GlobalizationNo one is in charge of Globalization G benefits everyoneG benefits everyone G furthers the spread of democracy G furthers the spread of democracy

in the worldin the world

To conclude: rethinking globalization

Globalization today drives cross-border economic integration to new levels of intensity.

But globalization is a process, not an end-state affairs.

There is no such thing as a global economy or a global society yet.

On what direction the process of globalization will go, it really depends on whether and how we resist the process or go along with it.