The Hiccups Of Globalization

In the 1990s, with the United States having become the new global hegemon, and technological advances facilitating communication between countries, the advent of globalization emerged. Globalization refers to the free movement of people, goods, and services across borders which results in expanded markets for producers and cheap commodities for consumers. Neoliberalism was the ideological foundation of this economic framework, championing governmental deregulation in a market-oriented system. Of course, this was all made possible by a predominantly capitalist global economy, where private commerce in the pursuit of profit sought new markets. What the denotations of these words fail to illustrate are the detrimental effects they had and continue to have on the people and countries of lesser economic power. With the exponential growth of the labor market, workers themselves have become commodities and occupational longevity is rare with an ever-present cheaper location for profit-driven transnationals. Smaller countries rely heavily on business from stronger ones to support their economies, undermining the autarky of these states. Despite advocates of globalization praising the accessibility of products made all over the world, this interconnectedness and international commerce have further increased the dependency on a select few economic powers. Ultimately, globalized neoliberal capitalism has brought about a severe lack of economic stability for developing countries on both the national and individual levels.

Under a new world order that saw labor markets expand to global proportions, low-skilled jobs were extremely volatile. Author William M. Adler detailed in his book, Mollie’s Job, the intertwined livelihoods of Mollie James and Balbina Granados, factory workers in the US and Mexico, respectively. Balbina, in search of work, left her small town for the city of Matamoros where Molly’s former employer, MagneTek, set up a factory. Adler visited Balbina, 8 years later, and found that her work situation had changed dramatically. MagneTek was on the move again, now to a city where wages were lower and so production was more cost-effective. Although perhaps Balbina could afford to follow MagneTek by relocating to the company’s new center of production, she recognized the lack of job security she had, concerned “if they were to move again? [...] Maybe to Juárez or Tijuana? What then? Do I chase my job all over the world?” Adler illustrated, in the inclusion of this powerful statement from Balbina, the ultimate truth that the unpredictable nature of this work has served no worker. Molly’s past was Balbina’s future, destined to be repeated by the Jasmines of today. For reference, Jasmine was a garment worker in Bangladesh whose job security was also nonexistent. With more automation, companies were able to hire cheap laborers with little skill or qualification from all across the world. In this unending “race to the bottom,” transnational corporations made work transitory, and for laborers there existed no longevity or security.

Furthermore, as a result of the international interconnectedness that was created through globalization, developing countries became dependent on economically dominant nations, further damaging the financial stability and prosperity of these emerging states. In the Zapatista manifesto, the EZLN amplified the voices of citizens in developing countries everywhere, having stressed that neoliberals in powerful nations disrupted the existing political, economic, and cultural institutions: “The big capitalists put their money into another country or they lend it money, but on the condition that they [would] obey what they tell them to do. And they also [inserted] their ideas, with the capitalist culture which is the culture of merchandise, of profits, of the market.” Gavin O’Toole, an expert in Latin American politics and author of a book detailing Mexican nationalism, wrote that the independence and sovereignty of Mexico were placed into jeopardy by its reliance on the United States. The US became Mexico’s largest market, accounting for 80% of Mexican exports, and US corporations became Mexico’s largest foreign employers. Without its business, the local Mexican economy would have crumbled. Lots of people would have lost their jobs, the Mexican government would have lost tax revenue, and the GDP would have fallen significantly, ultimately resulting in even less foreign investment. In this neoliberal, import-export-dependent system, developing countries all over the world were supported by more powerful nations that outsourced labor and production to these countries that had cheaper means of production and fewer environmental and safety regulations, accommodating the hegemonies and undermining the autonomy of the state.

With that being said, globalization has had its virtues, such as matching supply and demand and raising the overall standard of living. There is something to be said for an economic system that connected people across the globe, allowing cheap commodities designed in one country to efficiently find their way to consumers in another, all while creating labor and jobs in a third country. However, it is an illusion that this system benefits poorer countries. US President Bill Clinton inadvertently illustrated the financial damage done to developing countries in his 1993 speech regarding NAFTA: “In 1987, Mexico exported $5.7 billion more of products to the United States than they purchased from us. We had a trade deficit. Because of the free market [...] and because our people [became] more export-oriented, that $5.7 billion trade deficit has been turned into a $5.4 billion trade surplus for the United States.” He made it clear that through the enactment of neoliberal policy in Mexico, the US has benefited as this trade surplus for an already comfortable nation was generated. Not to say that globalization is a zero-sum game, but what was a $5.4 billion surplus for Americans was a $5.4 billion deficit for Mexicans. Globalization did not present a pathway for developing countries to enter the ranks of the developed, but instead further harmed, isolated, and hegemonized economically underdeveloped nations.

At its core, globalized neoliberal capitalism has made economic stability even more tenuous for nations that require it the most. The mobility of capital and technology has made low-skilled workers replaceable, and dependence on wealthier nations has undermined the sovereignty of developing countries. While some argue that international goods and services have been made accessible by globalization, immense trade deficits have been generated that further stratify states on an economic basis. Fundamentally, the further concentration of economic resources in the hands of a few may in the long term harm the global economy more than it helps it. However, globalization can become an institution that positively transforms the lives of people everywhere, with the implementation of international regulations that pertain to floor prices for agricultural goods or hourly minimum wages for example. Allowed to run rampant, globalized neoliberal capitalism widens the gap between the powerful and the not, but if managed correctly, it could truly level the playing field and allow progress for all people, everywhere.