This is the risk countries take by entering the world economy.
China is an emerging economic power in the world. This has come about due to the enormous market there -- almost two billion people -- and their gradual movement into the global economy. China, Malaysia, and Singapore are all entering the last stage of economic development and much of their success has been a result of foreign direct investment. "Foreign direct investment has played an important role in many -- but not all -- of the most successful development stories in countries such as Singapore and Malaysia, and even China," (Stiglitz 67). Advocates of the world economy suggest that the third world nations in sub-Saharan Africa and Central America follow these examples.
However, the relative "success" of the second world nations has come about through cooperation with tyrannical governments and the exploitation of the working class. By making a small minority wealthy, these foreign investors have created a consumer market in the upper classes of these countries. This may make success apparent on the surface, but it also has the result of increasing the gap within these nations between the rich and the poor. It should be noted that the United States faces a similar problem: the class divide is currently increasing. Whether such advancement should be regarded as a success or a failure really depends upon the social status of the individual in these second world nations.
Over the last hundred years the whole world has learned what Europe and North America learned in the nineteenth century -- that capitalism can create both wealth and inequality," (Downing 40). The response in the now developed parts of the world was mass labor movements and governmental regulations. However, globalization has both degraded the accomplishments of labor in Europe and North America, as well as reintroduced the old problems to the developing nations of the world. If the gap between the wealthy and the impoverished is to be solved on a global scale it is likely that it will require the same methods that worked on the national scale. "Only gradually have they [multinational corporations] come to recognize the lessons that they learned all too slowly at home. Providing better working conditions may actually enhance worker productivity, and lower overall costs -- or at least not raise costs very much," (Stiglitz 68-69). Domestic companies recognized these facts only through labor organization and governmental regulation. It would appear that, on a global scale, the degradation of the working class and increase in poverty needs to be addressed with global organization of labor, and some form of global government.
However, at this point in world history, the closest thing we have to a globalized government is the United States' government. Accordingly, as many critics have argued, the United States needs to drastically alter the way in which it has conducted business and diplomacy worldwide to weather the storms promised by globalization. A particularly insightful book is Johnson Chalmers' Blowback.
He argues, "World politics in the twenty-first century will in all likelihood be driven primarily by blowback from the second half of the twentieth century -- that is, from the unintended consequences of the Cold War and the crucial American decision to maintain a Cold War posture in a post-Cold War world," (Johnson x). Obviously, this proclamation can be very easily applied to the terrorist attacks of September 11, 2001; as a result, Blowback has re-emerged in recent years as a popular analysis of American foreign policy for those seeking the answer to the question posed by President Bush: "Why do they hate us?" (Johnson ix). Johnson indicates that we should be troubled by the inadequacy of Bush's answer -- namely, that they hate our freedoms -- and that this hints at something very dubious about the motivations and practice of U.S. foreign policy. To Johnson, it is unfortunate that the assertion of practically all politicians that we are "the greatest nation on earth," is simply accepted...
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