What is Globalization?

Simply put, globalization is the movement of goods across national borders. But globalization really can't be defined in simple terms or labeled either good or bad. First, it's not just products, it's also capital or investments that cross borders such as American retirement funds invested in overseas companies or Japanese companies buying American corporations. It represents trade and the economy but is related to so much more. A nation's economy is tied into it's technology, history, culture, and politics. While you would think having free trade across the world would be a truly positive thing, there is a dark side as well.

Globalization is not just a modern concept. Trade across countries and continents has been going on for thousands of years, think: the Silk Road across Central Asia during the middle ages, Christopher Columbus discovering America in 1492, the Boston Tea Party in 1773. What we think of as modern globalization has developed in the years since World War II when international borders started opening up and in the early 1980's when the advancements in information technology allowed computers to interact globally. [1] While this was a huge benefit for richer nations, poorer nations (and individuals) without access to this technology were overlooked.

There are many other pros and cons to globalization:

"Cultural theorists write with infectious enthusiasm about globalization as a process that is increasing international dialogue, empowering minorities, and building progressive society. Political economists, on the other hand, write about globalization as a capitalist victory that is dispossessing democracies, imposing policy homogenization, and weakening progressive movement rooted in working class and popular political organization." [2]

These two differing views can be explained as well as supported by looking at individual occurrences and skewing your perception one way or the other. In 1993 the US-Canada Free-Trade Agreement (FTA which preceded NAFTA) [3], allowed thousands of companies to build factories in Northern Mexico and exported goods to the US and across the world. Economically, this was great for Mexico. Millions of workers found jobs and within six years they were trading from $40 billion US to $280 billion US. The down side to this was in the US, many companies were moving or threatening to move to Mexico because of the lower wages and benefits they could pay. Consequently jobs were lost and US wages were negotiated downwards. [4]

Politically, NAFTA (the North American Free Trade Agreement) was a hotbed issue in the US where 60% of democrats voted against, republicans ended up passing it and Bill Clinton, while initially being on the fence ended up supporting it whole heartedly. In Mexico, on the very day that NAFTA went into effect, Zapatista rebels launched an uprising and the leading Presidential candidate was assassinated. Foreign investors began to flee. Worried that the Mexican economy was about to collapse and they would default on their debts, Bill Clinton, who had just recently been elected President, agreed to a bailout of 50 billion dollars. [4] The bailout worked and Mexico paid back the loan but this set a dangerous precedent. Good news for greedy investors who recognized the new policy as a means to make money and not have to pay it back.

Socially, this globalization of Mexico split the country. Jobs were scarce in Southern Mexico so millions of people migrated North to where the factories were. While the factory workers were making money, the wages they were working for were so low, they still were living in poverty.

Does globalization work for the poor or just the ones who have money? Noam Chomsky defined globalization in this little ditty apparently coined from a Canadian Economist:

"The poor complain they always do but that's just idle chatter. Our system brings rewards to all at least to all that matter." [5]

There are many views on the benefits or detriments of globalization. The single theme that seems to persist throughout is the ones with money and power benefit the most.

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[1] KEVIN H. O’ROURKE and JEFFREY G. WILLIAMSON. When did globalisation begin?. European Review of Economic History, 6 (2002), pp 23-50. Internet Pdf.

[2] Edited by Curran, James and Park, Myung-Jin. De-Westernizing Media Studies. USA and Canada: Routledge, 2000. Print.

[3] Brownfield, Molly. “NAFTA”. J. Michael Goodson Law Library. (2011), pp1-5. Internet Pdf.

[4] Commanding Heights. PBS. 2003. Television.

[5] What is Globalization? - Noam Chomsky. YouTube. March 26, 2007. Internet.