The Dynamics of Globalization and its Impact on Society in the 21st Century

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The Dynamics of Globalization and its Impact on
Societyin the 21st Century
Berch Berberoglu Department of Sociology Universit
y of Nevada, Reno U.S.A. Prepared for
presentation at Kocaeli University March 25, 2008
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Prof. Dr. Berch Berberoglu is Chairman of
the Sociology Department and Director of Graduate
Studies in Sociology at the University of Nevada,
Reno, USA. He received his Ph.D. from the
University of Oregon in 1977. He has been
teaching and conducting research at the
University of Nevada, Reno for the past 30 years.
His areas of specialization include
inter-national political economy, globalization,
development, political sociology, class analysis,
and comparative-historical sociology. Prof. Dr.
Berberoglu has written and edited 26 books and
many articles. His most recent books include
Labor and Capital in the Age of Globalization
(2002), Globalization of Capital and the
Nation-State (2003), Nationalism and Ethnic
Conflict Class, State, and Nation in the Age of
Globalization (2004) and Globalization and Change
(2005). His latest book is The State and
Revolution in the Twentieth Century Major Social
Transformations of Our Time, which was published
in 2007. He is currently editing a new book
titled Globalization, the State, and the Rise of
Nationalism in Turkey, which will be published by
Istanbul Bilgi University Press this year.
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Books on Globalization and Development
by Berch Berberoglu
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Books on Globalization, Development, and the
Third Worldby Berch Berberoglu
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GLOBALIZATIONSome Basic Questions

• What is globalization and what are its dynamics?
• What are its social, economic, political,
  cultural, and ideological characteristics?
• What are the contradictions of globalization and
  its social consequences?
• What is the relationship between the various
• institutional agents of globalization?
• What is the relationship between the
  transnational corporations and the state?

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• What are the economic and political consequences
  of neo-liberal globalization?
• What are the major societal problems created by
  this process and how are people affected by it?
• What role does the state play in this, and how
  does it respond to its manifestations?
• How can globalization and its contradictions be
  explained in class terms?
• How are people around the world responding to the
  consequences of neo-liberal globalization?

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What is Globalization?
Globalization is the most advanced and
accelerated stage of worldwide economic expansion
facilitated by transnational capital in the late
20th and early 21st century.
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Nature of Globalization

• Globalization involves a multitude of spheres
  within which it operates.
• These are economic, social, political,
  ideological, cultural, and environmental,
  to mention the most central.
• All of these spheres function within the
  frame-work of the prevailing social-economic
  system and have immense political implications.

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Logic of Neoliberal Globalization

• Neoliberal Globalization, much as during earlier
  stages of global economic expansion, is driven
  by
• the logic of profit
• for the private accumulation of capital
• through the use of low-wage labor, raw
  materials,
• and new markets abroad.
• This is the logic of what is commonly called
  neoliberal or capitalist globalization

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Globalization Its Particular Characteristics

• Economic
• Social
• Political / Military

Ideological Cultural Environmental
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Economic
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Economic

• export of capital by transnational corporations
• control of labor, resources, and markets
• profit-making on a global scale
• accumulation of capital in private hands globally

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• Table 1 The Growth of U.S. Private Investment
  Abroad, 1950-2005
• (in
  billions of dollars)
• ________________________________________________
  ________
• 
  Value of Assets
• ________________________________________
  _________
• 
  
  
• Year Total
  Long-Term Direct
• ________________________________________________
  ________
• 1950 19.0
  17.5
  11.8
• 1955 29.1
  26.8 19.4
• 1960 49.4
  44.4 31.8
• 1965 81.1
  70.9 49.3
• 1970 118.8
  104.2 75.5
• 1975 237.6
  174.9 124.2
• 1980 516.6
  298.1 215.4
• 1985 821.8
  346.8 232.7
• 1990 1,920.0
  959.3 616.7

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• increasing income and wealth inequality worldwide
  between labor and capital
• domination of the global economy by transnational
  capital for greater profits

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• Table 2 U.S. Corporate Profits Financial
  and Non-Financial Industries, 1970-2005
• (in billions of current )
• _________________________________________________
  ____________________________
• Domestic Industries
• ___________________________________________
  
  
• 
  Total Corporate Non-
• Year Profits Total
  Financial financial
• ___________________________________________
  __________________________________
• 
  
• 1970 74.4 67.3 15.4 52.0
• 1975 135.0 120.4 20.2 100.2
• 1980 211.4 175.9 34.0 141.9
• 1985 257.5 219.4 45.9 173.5
• 1990 396.6 320.5 94.4 226.1
• 1995 656.0 563.2 162.2 401.0
• 2000 759.3 613.6 203.8 409.8
• 2005 1,365.9
  1,161.3 335.1 826.1
• _________________________________________________
  ____________________________

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Social
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• Social
• transformation of peripheral societies to
  market-oriented ones integrated into the global
  economy
• restructuring of the international division of
  labor through transfer of manufacturing to
  low-wage third world countries
• women workers constituting bulk of low-wage labor
  in third world export processing zones, and
  increasingly elsewhere in the periphery

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• global domination of transnational capital over
  wage-labor in all aspects of social life
• conflict in the social and economic spheres lead
  to political conflict between labor and capital
  on a world scale

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Political
Military
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Political / Military

• transnational corporate control
• and influence over national
• states has led to the erosion of democratic
  governance
• support of right-wing authoritarian regimes in
  the periphery has led to bureaucratic corruption
  and violation of human rights
• the leading state of the global economy
  (currently the USA) now dominates the new world
  order and dictates its terms over all other
  states as a political-military superpower

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• this has led to rivalry and political-diplomatic
  crises between the major powers that may lead to
  political instability and world war, as has
  occurred in the past
• and the cost of maintaining a global
  political-military empire has been enormous,
  leading to the virtual bankruptcy of the U.S.
  state

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• Table 3 U.S. Military Spending, Federal
  Deficit, and Interest Paid
• on Debt, 1970-2006 (in
  billions of current )
• __________________________________________________
  __________
  
• 
  Gross Annual Net
• Military
  Federal Budget Interest
  
• Year Spending Debt
  Deficits Paid
• __________________________________________________
  __________
• 1970 81.7 380.9 -2.8
  14.4
• 1975 86.5 541.9 -53.2
  23.2
• 1980 134.0 909.0 -73.8
  52.5
• 1985 252.7 1,817.4 -212.3
  129.5
• 1990 299.3 3,206.3 -221.0
  184.3

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Ideological
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• Ideological
• neoliberal globalization propagates the
  superiority of a private economy that promotes
  privatization and private profits
• it celebrates private ownership and criticizes
  the public sphere as inefficient and undesirable
• these ideas are a reflection of the class
  interests of capital and are propagated by the
  corporate media and the state to legitimize the
  rule of capital over labor

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• as the legitimacy of global profit-making comes
  under attack, however, the ideology of neoliberal
  globalization is beginning to face opposition
  from popular forces
• These oppositional forces are advocating an
  alternative to the current neoliberal global
  political-economic order which they feel must be
  replaced with one that is equitable and just

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• Cultural
• In the cultural sphere, the globalization of
  capital fosters cultural domination (i.e.,
  cultural imperialism)
• it involves the imposition of cultural values on
  other societies to integrate them into the global
  political-economic system
• the dominant values promoted by this form of
  globalization become the new values adopted by
  societies around the world

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• such values are easily trans-lated into
  consumerism, private accumulation, and other
  individualistic practices that are opposed to
  cooperation and community-based social values
• the globalization of capital is able in this way
  to promote the spread of its values and culture
  across the globe to legitimize its
  political-economic system on a worldwide basis

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• Environmental
• the destruction of the ecosystem and the living
  space through pollution, contamination, and
  disposal of hazardous chemicals to increase
  profits has led to a global ecological crisis
• the deterioration of the quality of air, water,
  and soil has long-range consequences that are
  irreversible

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• in their drive to maximize profits, the
  transnational corporations have turned much of
  the world into a dumping ground
• the destruction of the environment through this
  process has placed the future of our planet into
  great risk

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Impact of Globalization on Labor

• In the Third World
• source of cheap labor for the transnationals
  (workers earn as little as 3 a day in Mexico,
  the Philippines, and other third world countries)
• high rates of exploitation of labor and immense
  profits for the transnationals
• sweatshop conditions in the global garment and
  electronics industries with long hours of work

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• poor working conditions, high accident rates and
  health hazards by exposure to toxic chemicals
• marginalization of labor through mass migration
  to urban areas, leading to widespread
  unemployment and poverty
• anti-union, anti-democratic laws and human rights
  abuses by repressive states that are subservient
  to the neoliberal imperial state

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Impact of Neoliberal Globalization on Labor

• in the Advanced Capitalist countries
• decline in domestic industrial production, due to
  transfer of manufacturing to cheap labor areas
  in the third world
• immense dislocations in the national economies of
  advanced capitalist states
• the massive expansion of capital worldwide has
  resulted in hundreds of plant closings

CLOSED
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• higher unemployment and under-employment, and
  shift in jobs to the low-wage service sector
• decline in union membership, due to loss of
  unionized jobs
• decline in wages of millions of workers and a
  drop in income and living standards
• further polarization in income and wealth between
  labor and capital, has led to class inequalities

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• Table 4 Distribution of Wealth in the United
  States, 2001, by Type of
• Asset (in percentages)
• __________________________________________________
  __________
• Investment Assets Top 1 Top 10 Bottom
  90
• __________________________________________________
  __________
• Stocks and mutual funds 44.1 84.5
  15.5
• Financial securities 58.0 88.6
  11.3
• Trusts 46.3 86.7 13.3
• Business equity 57.3 89.6
  10.4
• Non-home real estate 34.9
  78.5 21.5
• __________________________________________________
  _________
• Total for group 47.8 85.5 14.5

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• The contradictions of the global political
  economy have led to renewed conflict between
  labor and capital
• the greater control and exploitation of labor
  has further intensified class conflict on a world
  scale
• the global hegemony of capital over labor
  and the state has led to increasing worker
  resistance
• this, in turn, has brought together forces that
  have similar interests in confronting global
  capital (i.e., international labor solidarity)

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• The politicization of labors response to
  neoliberal globalization has resulted in
• increasing number of strikes, demonstrations, and
  protests
• formation of new political organizations of labor
• promotion of class politics to confront capital
  and the state
• organizing efforts by labor unions to mobilize
  workers across national boundaries
• a broader global unity of working people is
  becoming labors response to neoliberal
  globalization

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• Conclusion
• As the restructuring of the global economy
  moves ahead with increasing speed, and as
  conditions deteriorate for working people
  throughout the world, the potential for a renewed
  labor activism and struggle increases.
• This struggle, which becomes political over
  time, evolves into a struggle between labor and
  capital at global proportions.

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• Therein lies the possibility of a renewed
  global solidarity of labor that leads to new
  forms of struggle and resistance against
  neoliberal globalization on a worldwide basis.

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• And in this sense, we can identify at least one
  positive outcome of the neoliberal globalization
  process.
• And that is, neoliberal globalization creates
  the conditions and social forces for its own
  eventual transformation

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• THE END

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• Appendix A
• Origins and Development of Globalization

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• Appendix B
• Globalization and Class Relations
• On a World Scale

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• Personal web page
• www.unr.edu/cla/soc/berchb.htm
• E-mail address
• berchb_at_unr.edu

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• Globalization, the State, and the Rise of
  Nationalism in Turkey
• Neoliberalism, Islamic Politics, and
• Nationalist Response
• Edited by
• Berch Berberoglu
• University of Nevada, Reno
• Istanbul Bilgi University Press