The folliwng's been edited by me - it is another person's work altogether.
Globalization is like Poe’s maelstrom. A black void, rather. No one can escape it.
And we don’t know how it ends.
What we do know is that it has nothing to do with an “invisible hand.” It has to do with maximization of profit; a huge concentration of capital; and the unrestricted power of monopolies. German cross‐cultural scholar Horst Kurnitzky tells us globalization has configured “a new world, in which wealth and poverty, with no control by markets or the flux of cash, coexist with no form of social equality.” So it’s not globalization per se, but greed (that classic Christian sin…) and high concentration of capital that are responsible, in Kurnitzky’s formulation, for “the uniformization and cultural and real impoverishment of the world.”
Wallerstein defines our economy, also known as the capitalist world economy, as “a historic system which has combined an axial division of labour integrated by means of a world market less than perfect in its autonomy, combined with an interstate system composed of presumed sovereign States, a geoculture that has legitimized a scientific ethos as the basis of economic transformations and the extraction of profit, and liberal reformism as the way to contain popular discontent with the continuous socioeconomic polarization caused by capitalist development.”
Inevitably, the stage is set for conflict if not mayhem. Wallerstein identifies for the next decades three geopolitical faults we will have to confront. Out of which, the most relevant as on date stands out as -
“The struggle among the Triad—U.S., E.U. and Japan—over which will be the main stage of accumulation of capital in the next decades.” The third pole of the
Triad– Japan, for Wallerstein—should rather be considered as “East Asia,” with an emphasis on China.
Wallerstein reminds us that the concept of Triad became popular in the 1970s — with its first institutional expression via the Trilateral Commission, which was “a political effort to reduce the emerging tensions between the three members of the Triad” (Chinese gangs happened to become globally popular at the same time). This has happened after what Wallerstein describes as “a phase A of the Kondratiev cycle from 1940‐1945 to 1967‐1973”: euphoria over the fabulous expansion of the world economy, Baby Boom heaven, Elvis, the Beatles, a beautiful house, a beautiful kitchen full of appliances and a red convertible. The next 30 years were “a phase B in the Kondratiev cycle,” where speculation became the name of the game, unemployment exploded and there was “an acute acceleration of economic polarization at the global level as well as inside States.”
In the early 1920s Nikolai Dmitrievich Kondratiev was the very talented director of the Moscow Institute of Economic Investigations. In 1922 he coined his legendary theory of the “long waves” which not only explains but also previews the sweeping flow of History. Kondratiev ended his days in misery in a Stalinist gulag in Siberia. But his reputation as an economic guru survived him. Nowadays everyone from right to left to all points centre invoke Kondratiev to justify the capitalism system forever surfing History in a succession of “long waves.”
Trotsky was one who didn’t fall for it—as Alan Woods impeccably summarized in a post on www.trotsky.net. Trotsky always mocked robotic Marxists who rhapsodized about “the final crisis of capitalism.” But he also could not agree with the Kondratiev assumption that the “unseen hand of the market” would always intervene to restore the equilibrium of capitalism between one wave and the next.
Trotsky accepted there were economic oscillations. But he denied they were cyclical. Trotsky did see History as a series of phases; but all of these phases had different booms and busts, related to different, specific causes. In a famous speech at the Third Congress of the Comintern in 1922, Trotsky stressed how “capitalism establishes [an]equilibrium, disturbs it, then re‐establishes it only to break it again, at the same time as it extends the limits of its dominion… Capitalism possesses a dynamic equilibrium which is always in a process of breakdown and recovery.”
The way Wallerstein himself examines what’s been happening inside the Triad seems to privilege Trotsky’s intuition over Kondratiev’s. Wallerstein’s point is that for the members of the Triad, roughly Europe got the better out of the 1970s, Japan out of the 1980s and the U.S. out of the 1990s. “Under the supposition that this long phase B of the Kondratiev cycle will reach its end,” Wallerstein wonders which pole of the Triad will jump ahead. That is, which will better survive the current Wrecker’s Ball. The winning player will be the one who sets his priorities in terms of investment in research and development, and thus on innovation; and who best organizes “the ability of the superior strata to control the access to consumable wealth.” Les jeux sont faits. If this was Vegas, one might suspect that the house was betting on East Asia.
Imbalance and inequality are the names of the game. Trade in goods and services are a virtual monopoly of the Triad—North America, the E.U. and North Asia. This has increased the tension—bordering on open war—between the U.S. and the E.U. on, for instance, civil aerospace, agriculture subsidies or genetically modified organisms. So the Triad does not operate like a unified cartel: there is fierce internal competition. The Triad concentrates no less than 70% of the wealth of the planet.
Africa is on the other end of the spectrum. Africa’s exports were 4% of the global total in the early 1980s; they had fallen to 1.5% by 2003. And then there’s trade as a weapon; if a country falls foul of the great powers, a commercial embargo—shut up and don’t trade!—is the weapon of choice (even though other countries always manage to sneak around them). The East to West financial market flux—Tokyo, Frankfurt, Paris, London, Wall Street—is a given. As for the human flux as well as the info flux of ideas, they should be increasing in all directions—but the flow still privileges the Triad. “The end of geography” and, in theory, political borders should have led—according to globalization cheerleaders—to a new configuration of the world population and a better division of wealth. Reality proves otherwise.
Flux is not a congregation of random electrons. Flux needs controlling engines — thus the criss‐crossing networks and companies articulated with the finance, insurance, innovation, counselling, publicity and security industries. Only megalopolises can function as the ideal providers for all these industries. And this of course increases their seduction appeal. Since 2005 more than 3 billion people— half of the global population—are urban. So the globalization flow is leading to increased concentration, not dispersion. The real world centres of economic and political power are networked cities monopolizing economic, financial and political flux.
We can identify 3 main nodes—all of them interlinked, of course.
Node 1—New York/Boston/Philadelphia/Washington, linked to “secondary” L.A., Mexico City and Sao Paulo.
Node 2—London/Paris/Frankfurt/Milan, linked to “secondary” Moscow, Dubai, Lagos and Johannesburg.
Node 3—Tokyo/Osaka—linked to “secondary” Shanghai, Hong Kong, Singapore and Sydney.
R&D remains strictly a Triad affair. Less than 1% of patents come from outside the Triad. There is of course the odd foreign hub of technology and research like Bangalore. But as multinational corporations increase the amount of patents they register in the U.S. from overseas branches that gives a false impression of globalization of innovation. Technological innovation in a tectronic‐mad world originates from less than 20 countries—accounting for 15% of the global population. Although China and India are mounting challenges to the Triad’s R&D supremacy, for now the Triad (including Australia, South Korea, Taiwan, and Israel) still “reigns,” in Ezra Pound’s words.
The North maintains this structure by means of its monopoly of advanced productive processes, control over the world financial institutions, dominance over knowledge and information media at a global level, and what is most important, by means of military power.” Essentially, the North still brandishes an Iron Fist even though sometimes enveloped by a sexy, red velvet glove.
So the mantra that everyone equally profits from globalization is a myth. Further fragmentation flows through internal borders—like between coastal China and the countryside; south India and the rest of the country; Mexico and the southern Indian states; or southeast Brazil and the rest of the country. Niches prevail—like Silicon Valley, with 2 million people and a GNP bigger than Chile’s. The internet may represent the most glaring metaphor of inequality. By 2005, 1 billion people were connected—less than 15% of the world’s population, a figure that confronted with 3 billion people barely surviving on less than US$ 2 a day, and 5 out of 6 billion people living on only 20% of global GDP, spells out that the world economy can function just fine serving only 20% of the world’s population, that is, virtually the ones who are connected. As for the others, the harsh conclusion is inevitable: they are expendable. Forever.
