|
| |
Perspectives on Globalization: A Roundtable Discussion
From: Fathom
| By:
Lisa AndersonMeghnad DesaiJohn J. MearsheimerFelix RohatynLeslie Sklair |
EDITOR'S INTRODUCTION |
The following is a transcript of a panel discussion held at Columbia University on February 1, 2001. In this exchange, John J. Mearsheimer, Felix Rohatyn, Leslie Sklair, and Meghnad Desai discuss the implications and future of globalization with moderator Lisa Anderson. The participants begin by debating the definition of this loaded term, and whether it is new or not, positive or negative. After discussing the risks and costs involved with globalization, the discussion turns to future prospects. |
 Lisa Anderson, moderator: Greetings. I'm Lisa Anderson, dean of the School of International and Public Affairs at Columbia University. We are here for Fathom today, with an audience of Columbia students and faculty, to hear from several distinguished scholars and practitioners about their views of the economic and political forces of change that we call globalization. |
The panelists define "globalization" and debate whether it is a new development or whether the world was globalized before World War I.
|
From the rapid deregulation of financial markets around the world to the spread of new technologies and the information revolution, the international system seems to be transforming before our very eyes. Multinational corporations no longer have a single national sales or labor market. Things, people and ideas flow around the world with what seems to be unprecedented ease and rapidity. We seem to know--maybe even care--more about each other than ever before. Is this true? Is it good? Is it sustainable? To explore questions like these, we are fortunate today to have a panel of diverse, strong, well-informed and, I hope, divergent views. Our guests are Ambassador Felix Rohatyn, who just finished his tour as the American ambassador in France. A former partner at Lazard Frhres in New York, the ambassador is known not only for his investment banking skills but also--and this is important to us in New York--because he is one of the architects of the financial rescue of New York City in 1975. Leslie Sklair, who teaches at the London School of Economics and Political Science and is director of the doctoral program in sociology there, is also joining us. His latest book, The Transnational Capitalist Class, is a study of the impact of globalization on large multinational corporations. Professor John Mearsheimer is the R. Wendell Harrison Distinguished Service Professor at the University of Chicago. He's a prolific political scientist, probably best known for his famous Atlantic Monthly article "Why We Will Soon Miss the Cold War." And, finally, Meghnad Desai is professor of economics at the London School of Economics and Political Science. A member of the House of Lords, he is the director of the Center for the Study of Global Governance at the LSE. |
Let's start with you, Ambassador Rohatyn. Let me ask you to start by telling us what you mean when you talk about globalization. |
 Felix Rohatyn: It depends whom I'm talking to, most of the time. But what it means to me is, essentially, the integration of capital markets, the spread of technology and ideas around the world, and partly the spread of democracy around the world. It's a phenomenon that was accelerated by the fall of the Berlin Wall. But in the country where I am the ambassador, globalization can mean anything from McDonald's to Halloween to CNN to Coca-Cola--because it is viewed there as a completely American phenomenon, if not an American policy, which, from their point of view, in some ways threatens the structure of their society and their way of thinking and their priorities. To me, globalization is a certain set of realities created by information technology changing very rapidly, capital markets integrating, and ideas integrating more and more after the fall of the Berlin Wall. I think it's a little bit like modern art. It's what you want to see in something that's hanging on the wall, and it's different for different people. To me, the big problem with globalization is that it is viewed as an American policy aimed at changing people's behavior and spreading American hegemony around the world. To some extent it's true, but in many ways it is a caricature. |
Anderson: What does it look like in England? |
 Leslie Sklair: Well, I couldn't tell you what it looks like in England. I can tell you what I think about globalization. To me, there are two very different meanings to the term "globalization." One is the popular--and, I say, rather vague--notion that "globalization" is a buzzword that can help to describe pretty well everything about the modern world, from the centers of the global cities like London and New York and Tokyo down to the corner shop in a small village which sells global products, global brands. That's interesting, and it engages people, but as a researcher myself in the vast field of globalization I like to try to narrow it down a little, and when I'm going to be talking today, by globalization I'm going to mean capitalist globalization. Because it seems to me once you detach the discussion of globalization from the capitalist system worldwide, then you inevitably start to get confused and vague. |
I'll just say one more thing. I'd like to take up your point about Americanization. It seems to me that this is another instance in the long line of the avoidance of talking about capitalism; that when many people talk about Americanization--for example, the French don't want American movies, Hollywood movies pushing out their own local movies in the cinemas in Paris and so on--it's very convenient to blame the Americans. But my work on the global corporations suggests that it's not just an American phenomenon. Looking at globalization in a more focused, research-oriented fashion, I think it's more useful to connect it with capitalism and with those major forces that are driving capitalism on a global scale, the transnational corporations, and that's what I'll be talking about a bit later on, if I get the opportunity. |
Anderson: Well, I hope so. You seem to be agreeing? |
 Meghnad Desai: I also think of it as capitalism, but it's a new phase of capitalism, and the most confusing thing is that globalization in the present phase is a return to the nineteenth-century phase of the world economy. All of the twentieth century was a departure from that sort of experience. We find it hard to understand globalization, because we still think in terms of national economies, individual states, and we very much think still in Cold War terms, where countries dominate. But it's very important that, although this is a spiral and not a circle, we come back to the nineteenth century in a spiral. Our habits of thinking, which grew up in the twentieth century, give so much importance to the state that we cannot imagine a capitalist system where the state is not going to play a major role. And that's very hard to understand. To me, the most important thing about globalization, capitalism, is that this is a first phase of capitalism in which there is not a single rival ideology which can challenge capitalism. It is here, and it is not going to go away. |
Anderson: Professor Mearsheimer, do you think that's right? |
 John J. Mearsheimer: Let me say a few words about what I think globalization is and is not. I actually don't think there's a lot of disagreement about what globalization is. I think the disagreement has to do with, number one, whether you think globalization is a new phenomenon or not, and number two, what you think the consequences of globalization are, good or bad. With regard to globalization, it seems to me there are two strands of it. One is the economic strand, which says that you've had a tremendous acceleration in economic flows across borders, focusing in good part on trade but mainly on money--goods and money to go across borders at unprecedented rates, so the argument goes. That's the economic strand. The other strand focuses on ideas, and here the claim is that norms and values are being purveyed across borders at unprecedented speed, which some would argue has profound consequences for nationalism and for the nation-state. Again, the two big questions are: Number one, is this anything new? Because, as many of you know, a lot of people argue that we saw this same situation before World War I, and this is not unprecedented. The second question is: What are the consequences of globalization? The first issue when you talk about consequences is prosperity. Is this going to make us all more prosperous? Many people would argue that you're going to have a distinction between haves and have-nots, between or among countries as well as within countries, and that prosperity is not something that's going to be garnered by all. Others argue that as a result of this system, which is quite unregulated, there is going to be a big crash somewhere, and when we hit that wall it's really going to be messy. So prosperity is one issue. The second issue is what it means for the prospects of peace in the world, because a lot of this has to do with liberal economic interdependence theories. Many people believe that this growing prosperity will lead to greater peace. There are people, of course, who tend to be on the other side of this issue, and, not surprisingly, I find myself there. |
The third argument, and I'll stop after this, was referred to by Professor Desai: the future of the state. There are many people who believe that the state or the nation-state, which has been the principal organizing political concept in the world at least since 1848, is on its deathbed. We're soon going to have some new set of political arrangements in the world. I respectfully disagree with Professor Desai, and look forward to talking about this over the course of the debate. In sum, I think the key issues are whether you think globalization is just more of what we saw before 1914 or something fundamentally new, and what its consequences are for prosperity, peace and the future of the state. |
Anderson: Does it seem fundamentally new to you? |
Sklair: Yes, it does. And there's one thing that none of us has mentioned yet, and that is the mass media. I take the point that you're making, that the aspects that we now call globalization are not entirely new. And I don't think you have to stop with the nineteenth century. I mean, you can go back to the ancient Greeks and the Romans and you can go back to the invention of cosmopolitanism to see some aspects of what we call globalization, worldwide, all through history. But there are one or two very important differences, I think, which makes it worthwhile to at least try to again do research on globalization in the modern era and to see how it differs from what people identify as globalization pre-Second World War, let's say. One is the unprecedented rise of the transnational corporations, not just manufacturing corporations but also financial corporations. We forget that banks and financial institutions are also transnational corporations. Although we first saw international companies probably in the seventeenth century, perhaps even a little bit before, there has been a quality of change. My research has very much been looking at how the transnational corporations have themselves been pushing this globalization agenda. Secondly, and I think this is very important, we have to look at the role of a particular group of transnational corporations, and those are, of course, the transnational corporations that run the global mass media. There it's quite interesting, because I think we can bring in a rather old-fashioned technological thesis about the way in which changes in technology can drive changes in society and culture. Of course, without the invention of the electronic technology which underpins our modern mass media, things would be very different today. So I think in these two respects there is something new about globalization, and it makes it worthwhile to look at it as a "modern phenomenon" of the late twentieth century and our new century. |
Desai: I have a problem with that. It is that every generation in the last 200 years has started to live on the edge of modern technology. You read about it back then. Everybody was like this. Changes were unprecedentedly fast. When the printing press with popular newspapers became possible and profitable, the yellow-press barons were thought to be people that actually manipulated national destinies. What I found interesting about modern communication is how liberating, how enlarging it is. Because the kinds of things it can make possible--like demonstrations in Seattle or Prague--happen because it gives people across the world the means to combine, to network, to exchange information, and this is the first time, especially with the Internet, that government control over information technology is much weaker than it was previously. So, while I agree that there is mass media and so on, every stage of mass media from Gutenberg onward has expanded horizons. This one is particularly interesting, because it may yet defeat censorship. And that to me is extremely important, because by and large it is things like control of information which make nondemocratic forms viable. |
Mearsheimer: But there's a counterargument, which is that this technology gives the state the capability to monitor people much more closely than was the case in the past. |
Rohatyn: I would argue that globalization affects the role of the state, and this, as Professor Desai mentioned, is one of the things that actually frightens governments--like the French government, which is a government that is used to being able to control things. Globalization, as I see it, especially in terms of capital, technology, ideas, etc., runs practically completely outside of the realm of government control. At the same time, as you mentioned, there are some really bad aspects to globalization. I mean, it isn't all peaches and cream in terms of the proliferation of weapons, in terms of disease, in terms of huge differentials of wealth and income that are being created here. The question in my mind is what the appropriate role of the state is in a world and in economies where the markets clearly are going to dominate but where the state has to provide some protection, whether it's in terms of a social safety net or whether it is, as of today in Europe, you have a panic about mad-cow disease, which is clearly a global issue. There has to be some balancing out of the state and the market in a way that doesn't kill the productivity of the market and at the same time protects people from the excesses of the marketplace. |
Desai: What I find interesting here is that the more we get into globalization, the more we idealize the period before globalization took place. You talk as if inequality had just been discovered in the world, as if there were no poor and rich nations and so on. Two things about that. First of all, the industrialization of the Third World has taken a big leap forward thanks to globalization. The fact that a crisis in an Asian country can shake Wall Street would have been unthinkable in the 1950s and 1960s. And it's globalization which has done that. Secondly, I think that it's not that the state cannot do anything. The certain kinds of things the state used to do--run large deficits, devalue currency, maybe run economic enterprises--those sorts of things cannot be done without incurring a big cost. So states have to be self-disciplined and use the public fisc intelligently in the interest of their citizens, rather than pursuing some chimera of control or socialism in one country or whatever it is. That is in a sense welcome. The state has been disciplined, and that's not a bad thing. |
Sklair: I think we should start naming names and identifying ancients here. I think that the language we use, the discourse of globalization, is extremely important. Here we're now, as it were, boxed into a corner, discussing the state and the market. Well, I refuse to discuss the state and the market. I want to talk about transnational corporations and the people that own and control them all around the world, not the market, which seems like a sort of anonymous, ethereal, uncontrollable force. And I don't want to talk about the state, either, because, again, the state seems like something way out there. I want to talk about one of my favorite terms that I introduced, "globalizing bureaucrats and politicians," because I think every state is a site of struggle. Within the French state, so-called, for example, I'm sure there must be those politicians and bureaucrats who see the advantage of free trade even though it means a few Hollywood movies on the Champs-Elysies--that is worth paying the price--whereas there are others who want to protect the domestic market, the inward-looking bureaucrats and politicians. In all countries, I think, there is a struggle going on between, let's call them the inward-looking politicians and bureaucrats and the globalizing politicians and bureaucrats. You see it in Britain, you see it here, you see it everywhere. |
The panelists disagree about whether globalization is a negative or positive phenomenon.
|
I first started to get interested in this question by studying foreign investment in the Third World and looking at export processing zones in Mexico, in Egypt, in China, in Ireland in the 1960s, '70s and so on. At that time there were very strict regulations, keeping basically strict foreign investment regimes, keeping transnational corporations out. Nowadays the whole of China, the whole of Mexico, the whole of Ireland, the whole of Europe, pretty well, and the whole of Egypt is an export-processing zone. |
Desai: That's not a bad thing. |
Sklair: Did I say it was a bad thing? |
Desai: A lot of people somehow feel that the fact that foreign capital is doing various things is somehow disturbing. But when I was a student in the 1950s we had this pessimism thesis, that the Third World would never develop along the capitalist way because the First World wouldn't allow the Third World to develop. Now you have a very different situation, in which capital from First World transnational corporations gets out there and invests in cheap skilled labor in poor countries, and that is how industrialization takes place. My worry is that the rich countries are resisting globalization, because this is the first time in 200 years that rich countries face real competition from poor countries. They avoided it so far, but to me the riots in Seattle are basically rich countries defending their privileges. |
Rohatyn: Well, I disagree with that completely. |
Desai: Let's have a bit of a fight. |
Rohatyn: I think that the rich countries, actually, have been the hugest beneficiaries of globalization. I think those are the facts, but at the same time developing countries have very much benefited from globalization, and at the same time there are some negative aspects to globalization which have to be dealt with. My concern is that what's been built up--whether it's in Seattle, or in Prague, or the Nader vote, or what happened in Nice at the intra-European conference the other day, when there were 60,000 people in the streets and they had to use tear gas--is strong, how should I say, controversy about globalization. And if we don't deal with the difficult aspects of globalization or begin to build cushions against the next time there is a big downturn economically, then globalization, and all of the progress that's been made because of globalization, is going to be blamed for everything. When I speak about markets, I'm speaking about Jack Welsh; I'm not speaking about some anonymous creature. Because it's essentially the private sector that has been driving this. But the private sector at some point also has to be brought in to deal with some of the problems that are created here. I mean, globalization is not a complete cure for all the ills in the world. It is big progress, in my judgment. |
Mearsheimer: What if somewhere down the road we have a major economic crisis? Given how tightly wound the economies of the world are, and your point about how a crisis that starts in a small state in Asia can ripple all around the world, what will happen if we have a major crisis in the future? It's very clear we have no ability to predict when those crises will come. No one foresaw the Asian economic crisis, right? It's also quite clear that we don't have good tools for shutting those crises down or solving them once they happen. What if a major crisis starts somewhere and ripples all around the system and does really serious damage to this global economy that we've created? |
Desai: I think what happened, somewhere after the Second World War, for about 30 years, because cycles were very mild, we forgot that cycles are endemic to capitalism. There will always be crises. Lots and lots of them. We all remember the Great Depression, and now it's like we're waiting for Godot. We figure we're not going to have another crisis. Remarkably, the Great Depression happened precisely when trade flows and capital flows were disrupted and the world was deglobalized, not when the world was globalized. Throughout the nineteenth century, there never was a big financial crisis. In 1929 or 1930, the crisis was because countries started adopting protectionist policies. Banking credit got disrupted because Americans withdrew credit from Europe. We have forgotten that capitalism has lived by cycles for so long. And it'll go on living like that. It is not a perfect system. It has negatives, but you can't get the good without the bad. |
Rohatyn: I don't think it's a negative system. I think it's a very positive system, but with big risks. I think we've actually handled the financial crises very well in light of the size of these things. These crises are created essentially by credit problems, by runaway credit systems and by banking systems that are out of control. I think we've learned to some extent to deal with it. I'm much more concerned with what happens when you have three quarters of the world living in poverty and 20 percent of the world getting enormously wealthy. Unless we can try to do something--and I'm not being dreamy about creating a Marshall Plan for the Third World--but I do believe that at some level differentials of wealth for people who can see on television what's happening, that's going to be a very big problem. I think we ought to use the benefits of globalization to try to do that, and probably to do that we need some changes in the international financial system that involve the transnational corporations as well as the international financial institutions. |
Sklair: Well, I'd just like to dissociate myself from this apparently slowly emerging consensus that the system is positive, that there are just a few small nudges you need to do to keep it right. What are we talking about here? We're talking about a potential catastrophe which seems to be the result of capitalist globalization. |
Again, I want to change the discourse, change the language a little bit. We're starting to talk a bit about rich countries and poor countries. This to me is the old language of internationalization, the old language of American imperialism, of British imperialism or what have you. The extraordinary thing, the really extraordinary thing, that appears to have happened in the last 10 to 20 years--it's pretty recent--is that whereas from the 1950s onwards, globally and within countries, the gap between the rich and the poor seemed to be slightly narrowing, what seems to have occurred--and UNDP (United Nations Development Program) figures, World Bank figures and the Penn State figures and so on seem to show this--is that now the gap between the rich and the poor, not necessarily between countries but within countries all over the world, is widening again. So what we're having is--if you pardon me injecting a slightly controversial concept into the discussion--what we could call a class polarization crisis. And you see it in the streets of every city in the world; you see it in the countryside of every country in the world. The rich are getting richer, and there are probably more of them, and then there's a great mass in the middle, and then the poor, the people at the bottom of the barrel, who seem to be getting poorer. Now, this was not what capitalist globalization promised. If you look at the neoliberal revolution--which comes not just from the University of Chicago, by the way, but from my own august institution, with Friedrich Hayek, of mixed memory, who suggested that this unshackling of the global economy would lead to prosperity for all--well, this just does not seem to have happened. So, rather than talk about the good bits of globalization and the bad bits of globalization, I suggest we get realistic and we acknowledge the undoubted fact that globalization is very good for the rich and very bad for the poor. That's the issue, it seems to me. And capitalism will not solve it. |
Desai: Think of two facts that may sound contradictory but can be reconciled. Inequality is growing, but poverty is going down. People find it really difficult to think like that, because people don't realize that while inequality may grow, the whole level moves such that people who used to be classified as poor are no longer poor. There are much richer people. In Asia today--especially East Asia, in China, for example--by various calculations, the poor are between 10 and 15 percent of the population. In India today, poverty has come down somewhere in the region of 25 percent. That is, out of 2 billion people, let us say that 75 to 80 percent are no longer being classified as poor. Now you may say, oh, there are fantastically rich people, but across the Third World--with the exception of sub-Saharan Africa, but in Asia especially, where most people live--the last 20 years of growth has made more people get out of poverty than at any time in history. Today, by the World Bank definition, which you may or may not like, the maximum amount of people in poverty is about 20 percent. Make it 25 percent. In 1800, it would be 80 percent. In 1950 it would have been 50 percent. The point is that the rich are getting richer but the poor are not necessarily getting poorer, and countries which enjoyed an inflow of foreign capital in Asia have successfully demonstrated that, despite growing inequality, you can cure poverty, and people find it very difficult to understand this simple fact. |
Rohatyn: I'd like to talk for a moment. Why is it that rich people are getting richer, and how is wealth being created today as opposed to 50 years ago? |
Rohatyn: No, it's not only that. It's the interplay of invention, of technological invention and the financial markets, because the financial markets take a dollar of earnings from a technology company and give it a value of $200 or $300 or $400. So the people who are getting hugely rich are people who have created huge wealth for a lot of other people, which is quite different from the Morgans and the Fricks and the Carnegies of 100 years ago. And I can't agree with the notion that that is a bad thing. I can agree with a notion that we have to be able to try to spread that across the board as much as we can, doing it through having most employees participating in the capital of their companies, especially in the technology world, and enabling them to do that. But the modern economy is an intellectual meritocracy, and the way to deal with poverty is through education and participation and wealth creating enterprises, in my judgment. |
Anderson: Let me turn the conversation a little bit. Professor Mearsheimer, I want you to take this question first. We've been talking about the beneficiaries of globalization. Who bears the costs? What are the costs? |
The panelists discuss the costs of globalization. Which sectors of society benefit? What is the future of the state?
|
Mearsheimer: Who bears the cost? I basically disagree with Professor Sklair that the poor are getting poorer and that we're on the verge of a revolution. I think that what you want to do is discriminate between absolute and relative wealth. I think, absolutely, everyone is getting wealthier, which is the point that you [Professor Desai] were making. But in terms of relative wealth there's no question there's a widening of the gap. So I don't see a situation where, if this were to continue, there would be a particular group that bore especially negative consequences. The question I have is: What are the consequences of all this for the state? Is it going to weaken to the point where it's no longer an effective political entity? I think not. Also, is war much less likely because we're getting rich now? Furthermore, what happens if we do have a significant economic crisis down the road, we don't foresee it, and we don't have the instruments to deal with it? Maybe it won't just be a slight downturn. These are the sorts of issues that I worry about. I don't see the problem that you describe. I think that Seattle at this point in time is a blip on the screen. I think, however, that if we hit the wall then we're in real trouble. |
Desai: One way to think of who loses is to find out who is resisting globalization. And there the loss of blue-collar jobs in rich countries has been a very serious phenomenon. Well-paid blue-collar jobs for relatively unskilled workers used to be a solid foundation of many trade unions and many political parties. They have just gone. A large number of the real muscle, physically and sort of literally, in Seattle was the AFL-CIO. The French filmmakers are going to lose in globalization. Why? Because the Indian filmmakers don't need protection, because they make interesting films. The French make films you can subsidize, but not even the French want to see them. Obviously you need protection. For example, the rich countries spend £300 billion protecting their agriculture. Three hundred billion pounds and agriculture in all the rich countries represents less than 10 percent of the population. Right? And if protection is rife in rich countries, rich countries are scared of real competition. |
Rohatyn: In certain sectors. |
Desai: I wanted to say one more thing about Professor Mearsheimer's talk about the politics. I think what's interesting about globalization is how people talk about localization and globalization. Wars are becoming very local. Extremely violent. They become civil wars. They become kind of contraband wars, and while the big confrontation of bigger nations has stopped, there is one thing we should never forget. The last phase of globalization ended in a world war. And it ended in a world war because the rich countries of that time could not agree on a division of the spoils. It was not the world from below which caused the First World War. It was imperial powers who could not agree on the division of spoils. I worry, for example, that the US and the European Union are still fighting about trade globalization day after day. You know, the rich are really scared about globalization. I really do believe that. |
Rohatyn: I would make one point about that, Professor Desai, since I believe that the state plays less and less of a role today. And God knows I see the trade problems between Europe and the United States; I spent three and a half years talking about bananas in France. I tell you, we're no further along than we were three and a half years ago, but I have become an expert on bananas--which neither we nor the Europeans produce, by the way. That's another interesting point about this thing. But I believe that what's happened in terms of protecting us from these kinds of reactions is the integration of European enterprises with US enterprises. I mean, we have now about 5 million Americans who work for European companies and about the same thing going the other way. The French movie business, which you mentioned perfectly accurately, I think--I make no judgments on French films, I was just complimenting Indian films, naturally. Because I'm still the ambassador for 30 days, so . . . Anyway, a French company has now acquired a major American film studio. I think that's a big plus, because now they're going to see what it takes to sell French films in the United States, which they always thought was our keeping their films out, or vice versa. I believe that the integration among private industry is an enormous new fabric that creates communities of interest that are very large. And I do come back to the idea that what the role of the state has to be in globalization is to attenuate the bad parts of it, including the issue of war, proliferation of weapons, proliferation of chemical and biological and other things of that kind. The trade in people that's coming out of the East into Europe is something really awful that we ought to look at. |
Mearsheimer: The idea that states have always had total sovereignty and total control over the domain that they operate in is not the case. There have always been limits on sovereignty, so this is nothing new. But the one area of the world that you can point to, or most people point to, where the state appears to be more or less in retreat is in Western Europe, with the success of the European Union. But even if you look at what's happening there, the state appears to be alive and well. There was a big controversy, as you [Ambassador Rohatyn] surely know better than I, between the French and the Germans this past summer, when Joscka Fischer, the German foreign minister, said that what he wanted Europe to do was to start moving toward a United States of Europe. The French said that under no circumstances are we moving toward a United States of Europe. We will have a united Europe of states. Chirac made it very clear that the French state was alive and well. Again, Europe is the best case for those who believe that globalization is weakening the state. |
Rohatyn: But I'm not arguing against the state. I'm arguing that I don't believe that the state actually can do a great deal, nor should it do a great deal, in trying to control economic flows. I do believe the states should and can do a great deal in protecting people from other things that are global, like disease, like weapons, like the slave trade, all kinds of terrible things that are happening in the world today and where the activity created by globalization creates things that are very noxious. I think that's where the state really has a role. |
Desai: I think the state is different today than it was in the nineteenth century. In the nineteenth century, the state did not promise to look after its citizens. It was not a very democratic state; except for America, franchise was restricted in a number of countries. Today, especially during the twentieth century, the state has kind of promised to look after its citizens' welfare. For a while it controlled the economy, but now it cannot control the economy; the people look to the states, as you were saying, to tackle mad-cow disease or AIDS or any of those things. The state has some limits on its power, but its responsibility has stayed the same. |
Mearsheimer: Yes, but because the state has greater responsibilities toward civil society today and must create safety nets, and because civil societies are taking a buffeting from globalization (most of it positive), shouldn't the state today and in the future be even greater than it has been in the past, certainly compared to the nineteenth century? Doesn't that contradict your basic point, that the state is withering away? |
Desai: No, no. What I was saying was that the state will not be able to do certain things in the economy like run deficits, like devalue currencies, like pursue monetary policy which is inflationary. If the state disciplines itself economically, then it will have some resources to look after its citizens. But what I'm saying is that these states are asking their citizens: What bits of the welfare state can we privatize? And they're doing that because the resources are there but the responsibilities are getting larger and larger. It's not that the state is going to wither away, but it's certainly going to become one of the major players, not the only big player in this field. |
Mearsheimer: And who are the other players? |
Desai: Well, there will be corporations, for example, when corporations start in the services, in health services and educational services. We will have a major private-sector input into schools and colleges and hospitals around the world. The Europeans have just discovered this, and they're going to be very much shocked by it, because many of them have thought that there are certain kinds of things that only the public sector can do, things that the private sector cannot do. As one of the consequences of globalization (and, once again, in the nineteenth century they did not have this idea), we're coming back to those ideas. Of course there will be resistance, there will be new suggestions, but we've got to understand that a state, even if it wanted to do various things, will not be able to sustain the competition coming in from the private sector. It's a different world. |
Rohatyn: I'd like to make a political point for a moment, if I may. I think we are held responsible, we the United States, in lots of parts of the world for globalization. I mean, the notion that globalization and Americanization are one and the same thing is a prevalent notion. What I find ironic is that even though we are obviously very powerful, we are nowhere near as powerful as might be required to control a global economy; and at a time when it looks as if we're doing that, we need more and more alliances and a greater amount of involvement with organizations like the UN in order to keep this whole thing from spinning out of control. At the same time, politics in this country is more and more against this, so we are going to some kind of a crossroads here, which I don't think is very pleasant in terms of what appears to be this overwhelming power that we have. I think there is a real need to work through international institutions and through alliances to deal with these issues that are very difficult. I'm sorry, I interrupted. |
Anderson: I want to return to that, but you had an observation about the state, I think. |
Sklair: Well, I have an observation which just repeats my previous observation, that talking about the state is to some extent a way of avoiding this problem. What do you mean by the state, gentlemen? Do you mean the US government, or do you mean the minister of finance in Zaire? I mean, these are two statelike structures, but they're very different. So I go back to what I was saying and try to develop it and connect it to what you originally asked in this phase of the discussion, and that was: Who really suffers from globalization? Because I think it's a very important question. I think we're all agreed that who really benefits--and it's almost a tautology--are the people who get rich out of it. I mean, I presume that we're not invited here to talk about spiritual benefits. That should come in another Forum, perhaps. |
Rohatyn: I think you're being too cynical. |
Sklair: Maybe I'm being too cynical. It's not difficult being too cynical, holding the views I hold. |
I mean, we're talking--I'm not, but I think some of my colleagues here are--about the state as if it were relatively autonomous. As if it were a group of people who didn't have any other connections. In most states in the world, in most governments and most government agencies, there's a revolving door between--increasingly in the Third World but for a long time in the First World--the private sector, between the corporate sector and so-called public service. And what seems to have been emerging in this age of globalization in the past 20 or 30 years--and I still stick to my view that it is relatively new--is a sort of one-dimensionality of the way in which governments increasingly are reflecting the corporate worldview. This is of course the worldview of global capitalism. The best illustration of this is in a rather odd concept that I'd like to label the culture ideology of consumerism. Capitalism as we know it, and as Marx said in the nineteenth century, is the most progressive economic machine known in history. It's the most productive machine, so what capitalism has done is it's been able to produce tremendous quantities of goods and services. Of course Marx had his own ideas about the consequence of that, but that still remains true. |
And the role of the mass media has been to sell these goods and services all over the world, not just in the rich countries. It has been a hard and tough job to persuade people, generally speaking, to buy much more than they need. And pretty well every one of us in this room, I presume, has many more clothes than we really need. Certainly many more leisure accoutrements than we really need. We eat far more than we really need. Talking for myself, we definitely drink far more than we really need, and for those of you who are risk takers, you smoke much more than you need as well. So in order to keep the system going, people have to consume over their basic needs at whatever higher level we fix for basic needs. In my view, governments and the corporate sector have colluded in the age of globalization in order to keep this system going. |
This of course leads us to the next issue--which I'll just throw in like a little hand grenade into the pond and stop talking there, and that is the issue that none of us has yet raised but which is really important--and that is, of course, the ecological crisis. The crisis of the environment seems to have come very much alongside globalization. And that's something I think we need to talk about as well. |
Anderson: There were a couple hand grenades in there. Which one would you like to-- |
Desai: For over 200 years, people have been saying that capital will go down because people don't have enough wants. Well, if we only did what we need, we'd still be hunters and gatherers. The whole society progresses because we always go beyond what we need. |
Sklair: The Imelda Marcos defense. |
Desai: There's a sort of theory that consumption wants are so limited that eventually there will be a crisis over all production. Cycles happen, but you go on. I'm grateful for a certain kind of consumerism like the Internet or the mobile telephone or the airplane--which, thank God, has made me come here. And another thing: the poor out there would love to have more than they need, because they have waited too long surviving on what they need. I think I'm not very worried about consumerism. What is interesting about the perspective that the ambassador was putting forward is that, in a strange way, people have now realized that life is somewhat more risky because of globalization, and they want the state to protect them against these sorts of risks. And the state is no more prepared for this new role, like protection against mad-cow disease, and all sorts of new pressures have been put on it. Obviously, there was collusion between states, between governments and corporations, and that will happen again and again. But even before it was like that; there were these crises. And the ecological thing is very interesting, because you've had big ecological problems before globalization. Eastern Europe and the Soviet Union are good examples of what can happen. You only have to go to Lake Baikal. But to me what is more interesting is that, for example, at the Montreal convention we were able to get an agreement on chlorofluorocarbons, and yesterday in Johannesburg an agreement was signed about certain chemicals. At least you're beginning to make possible that states are realizing that certain kinds of global cooperation are absolutely vital if we are going to get anywhere on control of this. And I think that will only happen if individual country governments can sink their nationalisms and actually decide to cooperate. The most difficult thing is to forget about nationalisms. |
Anderson: Is that going to happen? |
Mearsheimer: Well, just on the subject of nationalism, which is a tangential point, if you look at what forces caused nationalism to rise over time, it's quite clear that the communications revolution played a very important role. Because if you're a white person living in Europe in 1430, you have no idea that there are black people living in Africa or Indians on the North American continent. What the communications revolution did was give people a very powerful sense of otherness. The question you have to ask yourself today is whether the greater cultural exchanges across borders are likely to cause others around the globe to imitate the United States. Do they end up speaking English, watching our movies, and so forth and so on? I think most Americans believe that is what's going to happen. This is sort of cultural imperialism, which is of course the great fear of the French and which is not new, as is evident in the writings of distant French intellectuals like Jean Jacques Servan-Schrieber. I would argue that what is likely to happen is that people around the world are going to become more aware of their own cultures and offer increasing resistance to American cultural imperialism. They're going to become acutely aware that they're different and they're going to want to maintain their differences. So I don't foresee a great deal of imitation taking place in the realm of national identity. |
The idea that you're going to have this global culture is popular at places like Columbia University and the University of Chicago, because basically these universities are huge vacuum cleaners that suck the best brains out of other countries, bring them here, give them degrees and then hire them as professors. They become part of the American scene. We're brilliant at that. That's why we're such a great country. Immigration is wonderful. When white people stop making babies, you bring in people of color, you promote them, and they do very well. I'm all for it, 100 percent. But I think if you look at what's happening in places like Chicago and Columbia and you try to generalize from those examples it's not going to get you very far. I think that the national identities of people outside the United States are going to remain firmly intact. Nationalism is going to remain a very powerful force in the world, and I think the French are a perfect case in point of this phenomenon. That's one of the reasons why I think the state is alive and well. Nationalism, as most of you know, is inextricably bound up with the whole concept of a state. Nations want their own states. All you have to do is look at the Palestinians today. What are they struggling like crazy for? A state. They want their own state more than anything else in the world. |
Rohatyn: They may want a state, but they may no longer be able to afford a state. The problem culturally about the state and America being the model for a high-growth, high-income modern society is the fact that it requires other countries in order to be competitive--not to imitate it, exactly, but to go in that direction. The contradiction-- |
Rohatyn: Yeah, but that has social implications. From the point of view of France--which is a country where 50 percent of the gross national product is taken by the state, as opposed to 30 percent here--that is ultimately a contradiction that is probably too great not to require change. Now, I'm not saying it'll go from 50 to 30, but it has implications in the amount of social protection you get, how you deal with the environment, how you deal with infrastructure, all kinds of things which clearly have value. That's where the contradiction comes into place. |
Desai: One interesting division we are having right now in Britain is that there is this very strong emphasis on national identity. America always was full of a heterogenous population, but European nationalism was brought up on some view of a homogeneity of population, language and culture. Now, with a diaspora, with multicultural societies growing up, the issue is that they need a national identity, but what is this national identity that you're going to have? I mean, that there are black British or Asian British or white British, and on one hand they're splitting into Scotland, Wales, Northern Ireland, separate nationalisms. So, in a sense, the diaspora and globalization are saying nationalism itself has to be rethought on some kind of multicultural dimension. It will create a fantastic right-wing reaction, as it has in Germany and Austria. People don't like this multiculturalism, and on the other hand you've got to come to terms with the fact that diversity is the essence, and we all have multiple identities. |
Anderson: I'd like to return us to a question that Ambassador Rohatyn raised, the question of managing this sort of world. Talking about the strength of the state or its prescriptive withering away and so forth, the question is: Are states necessary for the international institutions that we anticipate will help us manage this, or will some other mechanism do it? Or will it be, as Tom Friedman suggested, that no one is in charge, that it's unmanageable? |
The discussion turns to the future. Will the notion--and the reality--of globalization still be with us in 2020?
|
Sklair: That view, I think, is both fatalistic and profoundly immoral. |
Desai: But it may be true. |
Sklair: It could be true, but let's hope it isn't. I mean, the point of researching these questions is to find out to what extent they are true, and to try to identify the institutions and the agents who are directing these processes. This connects very much with what you were saying a minute ago about the relationship between nationalism and the state. Sure, the state is absolutely necessary, and as globalization increases then the state has a more and more focused and specific role to maintain this fiction of national identity. I think we all have expressed in one way or another that in this age of globalization, where with the possibility of almost unlimited travel--if of course you have the funds to do it--and virtual travel via the Internet and movies and consuming imported goods and all the rest of it, people do have different identities. Not just ethnic identities--and this is the important thing which connects with the question that you've asked--but other sorts of identities, for example, political identities, occupational identities. I mean, all of us are university teachers who ... Well, sorry. |
Rohatyn: Being ambassador is almost worse. |
Sklair: You would be if you had your own free choice in this matter, I'm sure. Well, our identities are very much connected with our cosmopolitan disciplinary brothers and sisters, as it were. You have sexual identities. You have identities of people who like one sort of music globally as opposed to other sorts of music, or food, and the rest of it. We're living in a world where there are these two very contrasting forces between the forces of the nation-state which are trying to homogenize. I don't think it's politicization that's responsible for homogenization. It's much more nation-states who are jealous of what they already have and these separate identities. Now, how does this all connect? I'll go back to what I said before: it connects for me, at least very specifically, in terms of this cultural ideology of consumerism. Because the one thing you can say about identities, whatever they are, is that they are good potential selling points. That is, let's say I'm interested in jazz and bebop, which I am. I mean, that's both an aesthetic interest and a whole industry. It's a big industry out here. Wherever you are. Let's say you're interested in country dancing, which I'm sure you are, Meghnad. Again, it's a whole global interest. |
Desai: It depends on which country. |
Sklair: So when we talk about homogenizing heterogeneity and the well-known view that we've all talked about, it's the Americanization of everything, I think, that's complete nonsense. It's the commercialization and commodification of everything. And here the nation-state has a specific role to play, because the nation-state is like a global brand. Italian furniture. French dresses, I presume. Or wine or cheese. The US must have its own brands, too. But this is my point. The one thing that makes it comprehensible in terms of our argument is that it feeds off and feeds into this global corporate consumerist capitalism that I've been going on about. It seems to me that's the only way you can make sense of this, as opposed to abstract philosophical discussions about all the other aspects. |
Desai: Let me come back to manageability. Can you manage? And I can think of one analogy. In the 1950s, in economics we had this thing called the turnpike theorem--the idea of the economy, it was like driving a car. You go down the turnpike, everything is maximum growth. You're in control. Today I think it's more like sailing a ship on the high seas. There are controls that you have, there is machinery, and you need skill to steer the ship. You have to take it with the tide and the wind, you have to know where the rocks are, the lighthouse and so on. But it doesn't mean you can go wherever you like. You have to resort to rational thinking and appreciate the constraints that are there in order to be able to get to your objective. Which was never thought to be the case in the older models of state control or manageability. |
Rohatyn: There are things we can manage and that we're beginning to manage. One of them is education. If there is one requirement created by the global economy, it's a higher level of education. And the public sector here is really bad. Our public schools are really lousy, but in the private sector you have companies that are beginning to pay lifetime education for their employees and send them to any graduate school they want at the company's own expense. I think those are things that are going to go on, and the issue of globalization has to be dealt with partly by lifetime education, social safety nets, things of that kind. Now, that doesn't mean we do it all over the world, but if countries individually can deal with these things, the state, regardless of how strong or weak, can encourage this sort of thing. |
Mearsheimer: I have one point to make to Professor Desai, and that concerns his point that managing the world economy today is a lot like going across the ocean in a ship. The problem that we face, however, is that we do not have good tools for diagnosing or foreseeing what the problems are that may hit us as we cross the ocean and we might not know exactly how to deal with them. I think the Asian economic crisis is a case in point. There's no question, as the ambassador pointed out, that we did a good job of handling it last time, but as you well know there are a lot of people who say, "There but for the grace of God"-- |
Rohatyn: Listen, I've predicted eight crises in the last five years, and only two happened, so . . . But you make a serious point. A lot of this is unpredictable. First of all, the variables are too great. What you have to do is, first of all, to navigate with a certain level of margin of error, like you do when you're driving, and, second, to have, because of the previous experience, enough countermeasures potentially in place so that you can keep these things from getting so totally out of control. And that's why you have the IMF (International Monetary Fund). I don't say that they're perfect, but we're beginning to understand these crises a little bit. I think the remedies very often are wrong, and they create somewhat greater problems sometimes. But that's neither here nor there. I do think we have made a lot of improvement in dealing with these things. |
Anderson: Let me pose to you, all four of you, a final question as we begin to think about this issue of prediction. Let's imagine that we reassemble here in 2020 to think about the durability and legacy of globalization. What do you think we're going to be thinking and talking about? Mr. Ambassador? |
Rohatyn: I haven't a clue what we're going to talk about. Truly I don't, because I have no idea where the world is going to be. I don't know what the world is going to look like five years from now, because of globalization, because we don't know what the role of the state is going to be. We don't know what is going to happen in China, in Russia, in the Balkans, in the Middle East. We have to deal with these things as best we can, but, forgive me for saying so, it's a singularly professorial notion that we can predict these things or that we have mechanisms to do it or that we even have the brains to do it. I think we have to be ready for surprises. I think you have to manage for the downside. You don't manage for the upside. You manage to keep a crisis from becoming catastrophic, and you have to have political leaders--I know I'm venturing into a really sensitive area--who can lead. That's all I'm going to say. |
Anderson: OK. It was a professorial question? |
Sklair: Yes, well, Chou En-lai, the foreign minister of the People's Republic of China, I think, was asked by a visiting French delegation once: What do you think about the French Revolution? And he said--he scratched his head, very wise man, Chou--and he said, "It's a bit early to tell." So I'd have been happier if you'd said 2120, which suggests that maybe by that time they would have cracked this problem that we all have to die so soon, and they could keep us going. So let me just suggest some predictions on what we might be talking about. |
First of all, although we may still have nation-states, or states, they won't be nearly so important, and we won't spend--or waste, in my point of view--a lot of our time talking about them. What there will be is a new flowering of non-state institutions. Now, I was a wee bit unhappy to see the dismissive attitude toward the events in Seattle, Prague, Washington, Nice. OK, I'm a nonviolent person, and I don't like to see people trying to beat up other people in the streets, but if you look at how these events were organized, you will come to the undoubted conclusion that there is a global movement of opposition growing against capitalist globalization, against this increasing class polarization in which the rich are getting richer, and it depends on how we define poor, but there are too many poor people in the world who seem to be getting poorer. Montreal was a little leap forward--one step forward, two steps back, and so on--in terms of coping with the environmental crisis. These thing are not being taken seriously enough by governments, they're not being taken seriously by those international institutions on which government representatives sit, like the UN, like the International Monetary Fund, like the World Bank or the WTO (World Trade Organization). So, if I can be rather lyrical and utopian for just one moment, the people will take matters into their own hands, with a growing level of interpopular organizations. Let's just talk for one second about the globalization of human rights, not just the right not to be tortured and so on but the right to have a decent standard of living. This will be taken up by people's organizations around the world. It already is, and in there the Internet has proved to be a real dialectic at the end of the twentieth century, because it both increases phenomenally the profits that are made by capitalists and also increases the potential for people to start connecting through the world. So maybe the next big historical clash will be between people's organizations and governments who stay in power even in the most advanced countries in the world by nefarious means. And I won't go any further than that. |
Desai: Well, 20 years ago nobody talked about globalization, and 20 years from now nobody will talk about globalization. Because it will be a perfectly ordinary event. It will not be a surprise to anybody. It will be life, ordinary life. We will take a lot of things for granted. And I'm not as optimistic as Leslie is, that there will be this great upsurge of the masses. Again, to go back to historical examples before the First World War, there was the international socialist movement and the nationalist upsurges, but basically they didn't actually rise and do very much. I think capitalism will still be here. If the big countries do not really panic too much and go back to protectionist policies, and if their leadership will continue along this path, we will not be talking about world poverty much--much less than we are right now. I think we'll have absorbed the experience and it will become part of our existence and there will not be any great shock. It will be non-news. |
Mearsheimer: I would say to Ambassador Rohatyn that academics are actually very wary about predicting much of anything, because the body of theories that we have are, to be very blunt, remarkably weak, as many of these students surely understand. And that's even true in economics, which is often held up as the paradigmatic discipline in the social sciences. Professor Desai can tell all of you, I am sure, that his ability to predict events is not terrific. But, nevertheless, I'll make a couple of predictions, because I probably won't be around in 20 years to see whether I'm right or wrong. I don't have much to say on what the world economy will look like in the year 2020. But I would say that I think the state will remain very powerful and will be the central political institution in world politics in the decades ahead. I think that's in large part because nationalism is and will remain a very powerful force, and because there's really no good substitute for the states on the horizon. We've been talking about multinational corporations dominating the states since I was a graduate student in the mid-1970s, and although I understand multinational corporations matter a lot, I don't see multinational corporations trumping the state. Although I think there is something to be said for people power, I think most of that people power is directed toward individual governments. If people in particular states get good and angry, they usually go to their government; they act as an interest group to get their government to do certain things to facilitate what they think is in their best interest. So I think the state system will remain firmly intact. |
I think that probably--and I underline the word "probably"--the two most important changes to come in the year 2020 are, first, that China will be a much bigger factor in our discussion than it is now. China has roughly five times the population of the United States, and it's going to have five times the population of the United States for the foreseeable future. If China continues to modernize economically and turns into a giant Hong Kong, I think that the military and economic consequences are going to be staggering, and we're going to spend a lot of time talking about that. |
The second change I foresee is that the United States, regardless of what happens to China, is likely to have less influence on the world stage in the year 2020 than it does now. The principal reason for that is that the United States over the past 10 years has done a remarkable job of maintaining the Cold War order despite the fact that the Cold War has gone away (and I give the Clinton administration great credit here). To be more specific, we still maintain 100,000 troops in Europe, 100,000 troops in Asia, and we still basically have intact the situation where Japan, Germany and to a lesser extent France and Britain report to us when it comes to dealing with important national security issues. This is especially true if you think about Japan and Germany. These are countries that do not provide for their own security. They still depend on the United States to provide them with security. The question you have to ask yourself is whether that situation is sustainable over the long term. I do not believe it is. I think slowly but steadily, over time, Japan will become more independent. |
I'm not making the argument here that we're going back to the imperial Japan of the 1930s, or, in the German case, that we're going back to the Second Reich or the Third Reich. That is not my argument. My point is that these countries are likely to become more independent of the United States. Our military presence in Europe and Asia is also likely to shrink, and therefore I think our influence in those regions is likely to shrink. I'm not arguing that we're going back to the 1930s, when we were isolationist and had very little to do with other continents. But I think that the situation we have here in the year 2000, where the United States is incredibly powerful in the world, both from an economic and political-military point of view, is likely to change. On the other hand, as I said, I think that China is likely to continue to modernize and become something of an 800-pound gorilla in the international system, and therefore will be a much more important aspect of these discussions in the year 2020 than it is now. It may even be the case that India fits into that category, because it is modernizing as well. Finally, all of these future discussions will take place in the context of the state system, which I believe, contrary to some of my fellow panelists, is alive and well. |
Rohatyn: Just to make a last point on the future, recently there was a meeting of high-level technology-industry executives and defense executives trying to talk about what was going to happen 15, 20 years from now. And the people they invited whom they wanted to listen to were science-fiction writers, because everything that had been written in science fiction 20 years ago happened, and therefore they were just trying to get way ahead of the curve on some of these things. |
Anderson: Well, thank you, gentlemen. I think the professors will take this as a point of what we should be putting on our syllabus. Thank you for that glimpse into the future and for your very provocative insights on the present. For Fathom, I'm Lisa Anderson. |
|
| |
