globalization in retreat.pdf

7/23/2019 GLOBALIZATION IN RETREAT.pdf

1/8

Globalization in RetreatAuthor(s): Walden Bello

Source: New Labor Forum, Vol. 16, No. 3/4 (Fall, 2007), pp. 109-115Published by: Joseph S. Murphy Institute, City University of New YorkStable URL: http://www.jstor.org/stable/40342719.

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2/8

By

Walden

Bello

GLOBALIZATION

IN RETREAT

It is assumed

that

globalization

is irreversible.

Yet,

as we

shall show

below,

globalization

s

n

crisis.

ndeed,

t s

n

retreat,

ndone

y

he conomic on-

tradictions

nd ocial

esistance

hat

nregulated

arketsave

roduced.

ather

than

eing

new,

ighertage

f

apitalism,

lobalization

as

n

fact

n effort

by

orporate

apital

o

scape

he

rises f

verproduction

nd veraccumulation

thathad stalked

t since the

mid-seventies.

Faced

with

a

process

of

global

economic

integration

hats

running

nto

rouble,

he ask

of abor

nd

progressive

orces

s not

to save

globalization

y

teering

t

n

a

social

emo-

cratic

irection

ut

to

cooperate

n

creating

a

truly

nternational

conomy

f

dynamic

national

conomies

marked

y

progressive

social relations nd ecologically ensitive

policies.

When

t first

ecame

part

f he

English

vocabulary

n

he

arly

990s,

lobalization

as

supposed

o be

the

wave f

he

future.

ifteen

years

go,

he

writings

f

lobalist

hinkers

uch

as Kenichi hmae

nd

Robert

eich elebrated

the

emergence

f

the so-called

borderless

world.

he

process

y

which

elatively

utono-

mous

national

conomies

ecome

unctionally

integrated

nto ne

global

conomy

as outed

as

irreversible.nd

he

eople

who

opposed

globalization

ere

disdainfully

ismissed

s

modern

ay

ncarnations

f heLuddites

ho

destroyedachinesuringhendustrialevo-

lution.

Fifteen

ears

ater,

espite unaway

hops

and

outsourcing,

hat

passes

for n interna-

tional

conomy

emainscollection

fnational

economies.

hese

conomies

re

nterdepen-

An

extended

version

of

this

article,

titled

The

Capitalist

Conjuncture:

Overaccumulation,

Financial

Crises,

and

the

Retreat

from

Globalization,

ppeared

in ThirdWorld

Quarterly,

ol.

27,

No.

8,

2006.

New

Labor

orum

6(3-4):

109-1

5,

all2007

Copyright

Joseph

.

Murphy

nstitute,

UNY

ISSN:

1095-7960/07

rint

DOI:10.1080/10957960701636729

http://www.jstor.org/page/info/about/policies/terms.jsphttp://www.jstor.org/page/info/about/policies/terms.jsphttp://www.jstor.org/page/info/about/policies/terms.jsp


3/8

dent o

doubt,

ut omestic

actorstill

argely

determineheir

ynamics.

Globalization,

n

fact,

asreachedts

high

watermark nd s

receding.

BRIGHTPREDICTIONS,

DISMAL OUTCOMES

GLOBALIZATION'S

EYDAY,

WE WERETOLD

that tate

olicies

o

onger

matterednd

that

orporations

ould

oon dwarf tates.

n

fact,

tatestill o matter.he

European

nion,

the

U.S.

government,

nd he

Chinese

tate re

stronger

conomic ctors

oday

han

hey

ere

a decade ago. In China, for instance,

transnational

orporations

TNCs)

march o

the une f he

tate

atherhan

he ther

way

around.

Moreover,

tate

olicies

hatnterfere

ith

themarketn

order obuild

p

ndustrialtruc-

tures r

protect

mployment

tillmake dif-

ference.

ndeed,

ver he ast

en

years,

nter-

ventionist

overnment

olicies

ave

pelled

he

differenceetweenevelopmentndunderde-

velopment,

rosperity

nd

poverty.

Malaysia'smposition

f

apital

ontrols

during

heAsian inancial

risis

n

1997-

98

prevented

t from

nraveling

ike

Thailand r

ndonesia.

trict

apital

on-

trols lso

nsulated hinafrom

he co-

nomic

ollapse

ngulfing

ts

neighbors.

Fifteen

ears go,

we were

oldto

expecthe mergencef transnational

capitalist

lite hatwould

manage

he

world

conomy.

ndeed,

globalization

became the

grand

trategy

f the

Clinton

administration,

hich envi-

sioned

the

U.S. elite

being

the

primus

nter

pares

first

mong

quals

ofa

global

oali-

tion

eading

he

way

o

the

new,

enign

world

order.

oday,

his

roject

ies n

hambles. ur-

ing

he

eign

f

George

W.

Bush,

he

national-

istfaction

as overwhelmed

he ransnational

faction

f he conomic

lite.

Nationalism-in-

flected

tates re

now

ompeting

harply

ith

one

another,

eeking

o

beggar

ne another's

economies.

The

G8

was

supposed

o become ne of

the

key

nstitutionsf

global

overnance

n

the

era of

globalization.

his

was,

n

fact,

ne of

the

key

bjectives

f heClinton-Blair

roject

in

the

ate 1990s.

Today,

owever,

heG8

is a

hollow

hell,

markedess

by

ooperation

han

by

ivalries

mong

he ominant

apitalistow-

ers. t

continues o meet

ut of

habit,

ut ts

original goal

of

serving

as a forum for

transnational

lite oordination

s more nd

more istant.

A decade

go,

heWorld rade

Organiza-

tion

WTO)

was

born,

oining

heWorld ank

and he nternational

onetary

und

IMF)

as

the

pillars

f he

ystem

f

nternationalco-

nomic

overnance

n the raof

globalization.

With

triumphant

ir,

fficials f thethree

States

till

matter. he

European

Union,

he

U.S.

government,

nd

the

Chinese tate re

stronger

economic ctors oday

than

hey

were

decade

ago.

organizations

eeting

n

Singapore

uring

he

firstministerial

athering

f the

WTO

in

December 996

aw he

emaining

ask f

glo-

bal

governance

s the

chievementf

coher-

110* New

Labor

Forum

W. Bello



4/8

ence,

hat

s,

he oordination

f heneoliberal

policies

f

he hree

nstitutions

n

order oen-

sure

he

mooth,

echnocratic

ntegration

f he

global

conomy.

Butnow

Sebastian

Mallaby,

he

n-

fluential

ro-globalization

ommentator

of

the

Washington

ost,

omplains

hat

tradeiberalization

as

talled,

id s ess

coherent

han t hould

e,

nd the

next

financial

onflagration

illbe

managed

by

n

njured

ireman.

n

fact,

he itua-

tion

sworse han

edescribes.

he

MF

is

practically

efunct.

nowing

ow he

Fund

precipitated

nd

worsened

he

Asian inancial

risis,

more ndmore f

the dvanced

eveloping

ountries

re

refusing

o

borrow

romtor

are

paying

ahead

of

chedule,

ith ome

declaring

heir

intentionever

oborrow

gain.

hese nclude

Thailand,

ndonesia,

Brazil,

nd

Argentina.

Since

he

und

budget

reatly

epends

n

debt

repayments

romhese

ig

orrowers,

his

oy-

cotts

translating

ntowhat ne

xpert

escribes

as a

huge

queeze

n the

udget

f he

rgani-

zation.

TheWorld

ank

may

eem

obe

n

better

health

han he

Fund.

But

having

een entral

to he ebacle

f tructural

djustment

olicies

that

eftmost

developing

nd

transitional

economies

hat

mplemented

hem

n

greater

poverty,

ith

reater

nequality,

nd

n

a state

of

tagnation,

he

Bank s

also

uffering

crisis

of

egitimacy.

his

an

only

e

worsened

y

he

recent

inding

fan

official

igh-level

xpert

panel

headed

by

former

MF chief

conomist

Kenneth

ogoff

hat

he

Bank

asbeen

ystem-

atically

anipulating

ts ata

o dvance

ts

ro-

globalization

position

and

conceal

globalizations

dverse

ffects.

But

he risis

f

multilateralism

s

perhaps

most cute

t

the

WTO. Last

July,

heDoha

Roundof

globalnegotiations

ormore rade

liberalizationnraveled

bruptly

hen

alks

among

he

o-called

Group

f ixbroke own

Advanced eveloping

countriesre

refusing

o

borrow

rom

he

MF

or

are

paying

head

of

schedule,

ith ome

declaringheirntention

never oborrow

gain.

in

acrimony

ver

heU.S.

refusalo

budge

n

its enormous ubsidies or

griculture.

he

round

s

practically

ead,

and

theWTO has

been

badly

wounded.

The

pro-free

rade

American

conomist red

ergsten

nce om-

pared

rade iberalization

nd theWTO

to a

bicycle: hey

ollapse

when

hey

renotmov-

ing

forward.

he

collapse

f

an

organization

that ne

of ts irector

enerals

nce

described

as

the

jewel

n

the rown f

multilateralism

may

e nearer

han t eems.

WHY GLOBALIZATION

STALLED

DID GLOBALIZATION

RUN AGROUND?

FlRST

of

ll,

he asefor

lobalization

asover-

sold.

The bulk

f

he

production

nd sales

of

most

NCs continues

o take

lace

within he

country

r

region

f

origin.

here

re

only

handful

f

ruly lobal

orporations

hose

ro-

duction

and

sales are

dispersedrelatively

equally

cross

egions.

Second,

ather

han

orge

common,

o-

operative

esponse

o

the

lobal

rises

f ver-

Globalization

in Retreat

New

Labor Forum

1 1

1



5/8

production,

tagnation,

nd environmental

ruin,

ational

apitalist

lites ave

competed

with ach other o shift he

burden

f

djust-

ment. he

Bush

dministration,

or

nstance,

has

pushed

weak-dollar

olicy

o

promote

The ase

or lobalization

wasoversold.

he

bulk

of

roduction

nd sales

of

most

NCscontinueso

take

lace

withinhe

country

r

region

of

rigin.

U.S.

economic

ecovery

nd

growth

t the

x-

pense

f

Europe

nd

Japan.

thas

also

refused

to

sign

the

Kyoto

rotocol n

order o

push

Europe

nd

Japan

o

absorbmost

f

he

osts

of

global

nvironmental

djustment,

nd thus

make

U.S.

ndustry

omparatively

ore om-

petitive.

he G8

may

vince he

mage

fco-

operation

n

their nnual

meetings,

ut he e-

ality

s

that f

ncreasingompetition

nd

ri-

valry.

While

ooperation

may

e therational

strategic

hoice

rom he

point

fview f

the

global

apitalist

ystem,

ational

apitalist

n-

terests

re

mainly

oncerned

ithnot

osing

out o

their ivalsn

the

hort erm.

A

third

actor as

been

the

orrosive

f-

fect f

he ouble

tandards

razenlyisplayed

by

the

hegemonic

ower,

he

United

tates.

While

he

Clinton

dministrationid

try

o

move

he

United

tates

oward ree

rade,

he

Bush

administration

has

hypocritically

preached

ree

rade hile

racticing

rotection-

ism.

ndeed,

he

rade

olicy

f

theBush d-

ministrationeems

obe

free

rade

or he est

of heworld nd

protectionism

or

heUnited

States.

Fourth,

here as been

too muchdisso-

nance etweenhe

romise

f

lobalization

nd

free trade and the

actual results

of

neoliberal

policies,

which have been

more

overty,nequality,

nd

tagnation.

One

ofthe

very

ew

laces

where

ov-

erty

iminishedver he

ast

ifteen

ears

is

China.But

nterventionisttate

oli-

cies that

managed

market

orces,

ot

neoliberal

rescriptions,

ere

esponsible

for

ifting

20 millionChinese

out of

poverty.

Moreover,

he advocates

of

eliminating

apital

ontrols ave

had to

face he ctual

ollapse

f he conomies

that ook

his

policy

o heart. he

glo-

balization f

finance

roceeded

much

faster

than he

globalization

f

production.

ut t

proved

obe

the

uttingdge

not

f

prosperity

but f haos.

heAsian inancial

risis

nd he

collapse

fthe

conomy

f

Argentina,

hich

had been

among

hemost octrinaire

racti-

tioners f

capital

ccount

iberalization,

ere

two ecisive

moments

n

reality's

evolt

gainst

theory.

Another

actor

nraveling

he

globalist

project

erives rom ts obsessionwith co-

nomic

rowth.

ndeed,

nending

rowth

s the

centerpiece

f

lobalization,

he

mainspring

f

its

egitimacy.

hile recentWorld ankre-

port

continues

amazingly

to

extol

rapid

growth

s

the

key

to

expanding

he

global

middle

lass,

global

warming,

eak

oil,

and

other

nvironmental

vents re

making

t

lear

to

people

hat

he ates nd

patterns

f

growth

that

omewith

lobalization

re

surefire

re-

scription

or

n

ecological rmageddon.

Thefinal

actor,

ot obe

underestimated,

112

New Labor

Forum

W.

Bello



6/8

has been

popular

esistanceo

globalization.

The battles

f

Seattle

n

1999,

rague

n

2000,

andGenoa

n

2001;

hemassive

lobal

ntiwar

march n

February

5,

2003,

when he nti-

globalization

ovement

orphed

nto

the

global

ntiwar

movement;

he col-

lapse

f heWTO

ministerial

eeting

n

Cancun

n

2003 nd

tsnear

ollapse

n

Hong Kong

n

2005;

the

French

nd

Dutch

eoples'

ejection

f he

eoliberal,

pro-globalization

uropean

onstitution

in2005- thesewere

llcritical

unctures

in

decade-longlobal

truggle

hat

as

rolled ack the

neoliberal

roject.

ut

these

igh-profile

vents

ere

merely

he

tip

f

he

ceberg,

he

ummation

f

hou-

sands

f

nti-neoliberal,

nti-globaliza-

tion

struggles

n thousands

f

communities

throughout

he world

nvolving

millions

f

peasants,

orkers,

tudents,

ndigenous

eople,

and

many

ectorsf

he

middle lass.

rganized

labor,

oth

n the

North nd

the

outh,

layed

a

not

nsignificant

ole

nthis

lobal

esistance.

DOWN

BUT

NOT

OUT

CORPORATE-DRIVEN

GLOBALIZATION

may

e

down,

t s not

out.

Though

is-

credited,

many

ro-globalization

eoliberal

policies

emain

n

place

n

many

conomies,

for

ack

of credible

lternative

olicies

n

the

eyes

f echnocrats.

ith

hings

ot

moving

t

theWTO,thebigtradingowers reempha-

sizing

ree

rade

greements

FTAs)

and eco-

nomic

artnershipgreements

EPAs)

with e-

veloping

ountries.

hese

agreements

re

n

many

ways

more

angerous

han

he

multilat-

eral

negotiations

t

the

WTO

since

hey

ften

require reater

oncessions

nterms

f

market

access

nd

tighter

nforcement

f

ntellectual

property

ights.

However,

hings

reno

onger

hat

asy

or

the

orporations

nd

trading

owers

nd the

corporations.

octrinaireeoliberalsre

being

easedoutof

key

ositions,

iving

ay

o

prag-

Interventionisttate

policies

hat

managed

market

orces,

ot

neoliberal

rescriptions,

were

esponsible

or

ifting

120 million hineseut

of overty.

matic

echnocrats

hooftenubvert

eoliberal

policies

n

practice

wing

o

popular ressure.

When t comes o

FTAs,

he

global

outh

is

becoming

ware f he

angers

nd s

begin-

ning

o resist.

ey

South

American

overn-

ments

nder

pressure

rom

heir

itizenries

derailedthe Free Trade of theAmericas

(FTAA)-

the

grand

lan

of

George

W. Bush

for he

Western

emisphere) during

he

Mar

del

Plata onference

n

November

005.

Also,

ne

of hereasons

many

eople

re-

sisted

rime

Minister haksin

hinawatra

n

themonths

eforehe ecent

oup

nThailand

washis

rush o

conclude

free rade

greement

with heUnited

tates.

ndeed,

n

January

,

2006,

ome

10,000

rotesters

ried o torm he

building

n

Chiang

Mai,

Thailand,

here

.S.

and

Thai officials

ere

negotiating.

he

gov-

ernment

hat ucceeded

haksin's

as

put

he

U.S.-Thai

TAon

hold,

nd movements

eek-

ing

o

top

TAs lsewhere

ave

een

nspired

by

he

uccess

f he

Thaiefforts.

The retreat

rom

eoliberal

lobalization

Globalization

in

Retreat

New

Labor

Forum

1

1

3



7/8

is mostmarked

n

LatinAmerica.

ong

ex-

ploited

y foreignnergy iants,

olivia,

n-

derPresidentvo

Morales,

asnationalizedts

energy

esources.

estorKirchnerf

Argen-

tina

ave

n

example

fhow

developing

oun-

try

overnments

an facedownfinance

capital

whenhe forced

orthernond-

holders o

accept

nly

5 cents f

very

dollar

Argentina

wed them.

Hugo

Chavezhas

aunched

n

ambitious

lan

for

egionalntegration,

heBolivarian lter-

native or

he Americas

ALBA),

based on

genuine

conomic

ooperation

nstead

ffree

trade,

ith

ittle r no

participation

y

north-

ern

TNCs,

nd

driven

y

what

havezhimself

describess a

logic eyond

apitalism.

GLOBALIZATION

IN

PERSPECTIVE

today's

vantage

point,

globalization

appears

o have

been not a

new,

higher

phase

n

the

development

f

capitalism

ut

responseo theunderlyingtructuralrisis f

this

ystem

f

production.

ifteen

ears

ince

itwas

rumpeted

s

thewave f he

uture,

lo-

balization

eems ohave

een

ess brave ew

phase

f

the

apitalist

dventurehan

des-

perate

ffort

y

lobal apital

o

scape

he

tag-

nation

nd

disequilibria

vertaking

he

global

economy

n

the

1970s nd

1980s.

t was the

corporate

esponse

o

the risis f

profitability

that temmedromhecrisis foverproduc-

tion

nd

overaccumulationhat

ollowed

he

long

ost-war

oom

hat

nded n

the

ate ev-

enties.A

key

part

f

the

hat

esponse

was

a

fundamental

estructuring

hat

nded

that

post-war

lass

ompromise

n

the

West,

pro-

cess

hat

olled

ack

tate

nterventionist

oli-

cies

nd he

hard-won

ights

f abor.

owever,

peoples

ttention

as

deflected

rom

his eal-

ity

nthe

arly

990s

y

he

ollapse

f he en-

tralized

ocialist

egimes

nEastern

urope

nd

Russia.

It used o be

simply

ssumed hat

lobal-

ization

was

irreversible,

nd

that hose

who

questioned

its inexorable

character

were

Globalization

s a

spent

force.

woolly-headed

omantics.

oday,

owever,

re-

cisely

ecause f he

contradictionshat ave

been

spawned

y

ts

underlying

ynamic

f

capitalist

veraccumulation,

any,

ikeNobel

laureate

oseph

tiglitz,

re

aying

hat

lobal-

ization s

n

danger

f

being

eversed. his

s,

however,

ot

good

thing

or

many

n

iberal

and

progressive

ircles,

hofeel hat he ask

at hand s to

humanize

lobalization.

ike

Stiglitz,hey

elieve

hat

lobalization

an

be

made to work or

umanity

nd that t

must

be

savedfrom heneoliberals

hohave

pro-

moted t.

It

s,

however,

oo ate.

Globalization

s

a

spent

orce hat as evoked

remendouseac-

tions hat ontinue

o

grow

n

trength.oday

multiplying

conomic nd

political

onflicts

resemble,

f

nything,

he

eriod

ollowing

he

endof

what istorians

efero s the

irstra f

globalization,

hich

xtendedrom 815 o

he

eruption

f

WorldWar in

1914.

The

urgent

task s not

o

engage

n

the utile

ask f teer-

ing

orporate-driven

lobalization

n

a

social

democratic

irection

y

reforming

he

WTO

and

MF,

nd

promoting

corporate

ocialre-

sponsibility,

ut

o

manage

ts

etreato that

t

doesnot

bring

bout he

ame haos nd

run-

away

onflicts

hatmarkedts

demise n

that

earlier

ra.

114-

New

Labor

Forum

W.

Bello



8/8

The role f

organized

abor n theNorth

is not

to

promote

benign lobalization

ut

to workwith

ther

orces,

articularly

n the

South,

o

transcend

t,

hat

s,

o

create

truly

equitable

nternational

rder f

ndependent

national ocietieswheredomesticnd local

economies

will be revived

long

with the

transformation

f class relations

nd the

achievement

f a

healthy

alance

between

community

nd

the environment.

he

great

Hungarian

hinker

arl

Polanyi

alked

bout

capitalism

eing

process

f

disembedding

themarket

rom

ts ocial

matrix,

nd eventu-

ally making

t

the force hatdrives

ociety.

Globalization as beenthe limactic

oint

n

this

rocess

f

disembedding

hemarket. ur

task s to re-embed he market

n

society,

o

discipline

nd subordinate t to the over-

arching oals

of

ustice,equality,

nd

sol-

idarity.

Globalization

in Retreat

New Labor

Forum

1

1

5

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