Globalization Issues

25 Pages 6310 Words

In 1979 I described the interdependence of states as low but increasing. It has increased, but only to about the 1910 level if measured by trade or capital flows as a percentage of GNP; lower if measured by the mobility of labor, and lower still if measured by the mutual military dependence of states. Yet one feels that the world has become a smaller one. International travel has become faster, easier, and cheaper; music, art, cuisines, and cinema have all become cosmopolitan in the world's major centers and beyond. The Peony Pavilion was produced in its entirety for the first time in 400 years, and it was presented not in Shanghai or Beijing, but in New York. Communication is almost instantaneous, and more than words can be transmitted, which makes the reduced mobility of labor of less consequence. High-technology jobs can be brought to the workers instead of the workers to the jobs; foreigners can become part of American design teams without leaving their homelands. Before World War I, the close interdependence of states was thought of as heralding an era of peace among nations and democracy and prosperity within them. Associating interdependence, peace, democracy, and prosperity is nothing new. In his much translated and widely read book, The Great Illusion (1933), Norman Angell summed up the texts of generations of classical and neoclassical economists and drew from them the dramatic conclusion that wars would no longer be fought because they would not pay. World War I instead produced the great disillusion, which reduced political optimism to a level that remained low almost until the end of the Cold War. I say "almost" because beginning in the 1970s a new optimism, strikingly similar in content to the old, began to resurface. Interdependence was again associated with peace and peace increasingly with democracy, which began to spread wonderfully to Latin America, to Asia, and with the Soviet Union's collapse, to Eastern Europe. Fra...