WHAT IS THE IMPACT OF GLOBALIZATION ON POLITICS?

What’s the impact of globalization on politics? Many commentators pronounce on this complex and multi-faceted topic with great confidence, but an overview of the literature suggests that we are still struggling to understand it. An obvious characteristic of globalization is that money, goods and manufacturing have become far more mobile than they once were, with the result that corporations are freer than ever to move, and finance to invest, wherever they choose.
Therefore, national governments are less able to control the activities of mobile businesses than in the past, while corporations and finance are in a better position to dictate to national governments. They do this by relocating their activities to – and buying the currencies of – states whose policies they approve and abandoning, or threatening to abandon, the rest.
So what are the political implications of this fundamental shift in the balance of power between international business and governments? Susan Strange argues that the state is in retreat. Michael Hardt and Antonio Negri invoke a very different conceptual framework to conclude, somewhat similarly, that sovereignty is migrating away from the state. Noreena Hertz and George Monbiot warn of the commanding power of corporations over the state, but Paul Doremus and his colleagues emphasize the continuing importance of the state and political culture. (See citations below.)

Yet another perspective comes from Thomas L. Friedman, who, in the lucid, discursive, but conceptually loose style characteristic of excellent journalism, sees the politics of globalization as consisting of a tension between the struggle for prosperity – which requires an embrace of globalization – and the struggle to preserve community values. Taken together, all of these arguments present us with both direct contradictions between various commentators and important differences among ideological allies.
Globalization is also associated, a bit more loosely, with the “hollowing-out of the state”, invoked by Bob Jessop and many imitators and acolytes. In this view of political change, the national state is not so much being subordinated or sidelined as acting on its own, in response to complex stimuli, to reduce the scope of its control over society through privatization, contracting out of government work, creation of semi-independent government agencies, and delegation to other levels of government. Ian Holliday, for his part, denies that these changes add up to an actual reduction in the capacity of the national state. (All the authors I mention in this entry are cited below.)
If we take all these accounts together, we are left with a great deal of puzzlement and little real clarity. Where to turn? In my most recent round of tussles with the politics of globalization – I’m teaching a course entitled Globalization and Community Democracy next year – I’ve found Ulrich Beck’s Power in the Global Age particularly helpful. He deals with the problem of the influence of globalization on politics by setting up a dichotomy between the era preceding the current one, and the one now dawning. He characterizes the first era quite simply as the first modernity, a time in which we all more or less played by the rules of national sovereignty: the writ of national governments ran within their boundaries and there they could do as they pleased. Within those boundaries, corporate and civil society were subject to the authority of the national state.
In the current era, the second modernity, the power represented by national sovereignty can be evaded thanks to the 21st Century’s freer flow of money, ideas, goods and people. By this point, you may well be asking, “So, what’s new?” The novelty of Beck’s argument is that he does not fall into the trap of arguing that the second modernity simply supersedes the first – which would lead to the conclusion that national sovereignty is a thing of the past. Rather, he sees the advent of the second modernity signalling the beginning a “meta-game” of power, in which national power continues to play an important role, and the rules of national sovereignty remain operative, while, at the same time, the players are now able to play by the free-wheeling rules of the second modernity if they choose.
He points out that so far, the primary player in the meta-game has been corporate capital, and notes that capital and its political allies would like us to think that that is all there is to globalization – that globalization puts us all in the position of being forced to accept the hegemony of capital. Or, in his words, “The neo-liberal agenda is an attempt to capture the momentary historical gains of globally and politically mobile capital and fix them institutionally.” (p. 5) The notion that national sovereignty is a thing of the past is implicit or explicit in the arguments of such commentators as Strange, Monbiot, Hertz, and Hardt and Negri.
But, in Beck’s conceptual universe, anyone – not only capital and finance, but civil society, and even national states themselves – can play the meta-game. At this point, I take leave of Beck’s argument, not only because I do not altogether buy it, but also because he may not wish to have my ruminations attributed to him. In my version of Beck’s argument – which may not differ greatly from his, at least initially – the first modernity includes, not only national sovereignty, but also a conventional division of powers among levels of government, with municipal government subordinate to senior governments.
The national government is in a position to defend local communities from a variety of economic exigencies through such measures as tariffs to protect local industries from international competition, as well as a more or less unlimited ability to provide regulatory and financial support to industries, regions and communities in the form of such measures as subsidies to agriculture and industry and regional development programs. In turn, industry, communities, and regional governments are severely constrained by the national state’s rules. (We must be careful not to overstate this point, because globalization as such is not a new phenomenon. Business and politics have operated at a global scale at least since the beginning of the colonial era, and one could make out a reasonable case that Ghengis Khan was a globalizer. What is new, and has led to the second modernity, is the extent to which and the speed with which goods, people, money and ideas can move.)
In the second modernity, the national state is still a going concern, wields great power and commands vast resources, but the rule book of national sovereignty no longer necessarily governs what the players may and may not do. However, it is not only corporations and finance that can ignore it. Our imaginations are the only limit.
National governments can extend their sovereignty, internationally through such measures as the land mines treaty, the International Criminal Court, and the Kyoto Accord. With sovereignty no longer unbreachable, tyrants can be deprived of a restful sleep, as Augusto Pinochet, the former Chilean dictator discovered when he was arrested in London, and as a succession of former leaders learned upon being brought to trial for genocide before the ICC.
As well, national governments have for some time been extending their sovereignty locally. Already in 1990, a colleague, Robert Fenton, and I pointed out that the Canadian government had moved away from programs that were national in scope to such measures as urban development corporations, and tri-level government agreements, in which particular communities were targeted by programs unique to them. This trend has continued, as I have shown in a 2006 article, and the Canadian government has not been alone in promoting it. (Both articles are cited below.)
But the second modernity is not only for corporations and national governments. Speed and ease of communication, together with the growing legitimacy of action that operates outside the nation-state system, opens up new possibilities for municipal governments, labour unions, consumer groups and any number of other grassroots organizations that can benefit from international networking and action.
It is well understood that these possibilities exist, but it seems likely that there are further possibilities for far more effective action than we have seen so far. The global reach of major corporations is their obvious strength, but also a weakness, in that the brands that represent them are highly vulnerable to bad publicity. This opens possibilities for organizations that seek better working conditions for workers or fairer terms of trade for producers. Some work has been done along these lines, for example by the Clean Clothes campaign, but much grassroots anti-globalization activity has amounted to little more than ineffectual railing against big names. Really effective action requires the specific identification of bad employers and other instances of exploitative practices, not just targeting high-profile brand names, like Nike or Starbucks.
If labour unions can break free of old habits of thought and ossified organizational structures, they as well can exploit the vulnerability of global brands and they can also find more effective ways to organize internationally, so that workers in one part of the world can support their more vulnerable fellow workers elsewhere.
Likewise, many municipal governments have developed their own foreign policies, in the form of twinning arrangements with cities around the world to promote mutual economic development, to name only one example. Ease of worldwide communication, and the diminution of cultural barriers that comes from more communication has also opened, literally, a world of new possibilities for the venerable International Association of Local Authorities.
In short, Beck’s concept of the meta-game opens the way to a much more satisfactory account of the politics of globalization than we can gain from either panegyrics to the wonders of globalization or conspiratorial accounts of corporate dominance. Beck’s formulation tells us that we are witnessing neither the demise of the nation-state, nor its total subordination to international capital. The nation-state is still there, it still wields power, it commands massive resources, and the political games that are played by nation-state rules are still enormously significant.
At the same time, Beck’s account of the political arena of the second modernity challenges communities, neighbourhoods, cities, interest groups, labour unions – anyone who can get her hands on a computer with an internet connection – to think about how they might be better represented outside of the state-system rules. The nation-state is no longer the only game in town, as it were, and the sooner the rest of the world catches up with corporations and financial organizations that know how to play the other game, the sooner a measure of balance will be restored to politics.
If we accept Beck’s conception, it becomes clear that the meta-game that began with the advent of the second modernity is in its early stages. Small wonder we are still struggling to understand the politics of globalization. We are far from knowing where it will take us.
There is a great deal to read on this subject. Here are a few readings I recommend.
Ulrich Beck, Power in the Global Age. Cambridge: Polity, 2005. (For a very good, concise summary of Beck’s main arguments, take a look at Geoffrey Fox’s blog, Literature & Society.)
Noreena Hertz, The Silent Takeover: Global Capitalism and the Death of Democracy. London: Arrow Books, 2002.
George Monbiot, Captive State: The Corporate Takeover of Britain. London: Pan, 2001.
Susan Strange, The Retreat of the State: The Diffusion of Power in the World Economy. Cambridge: Cambridge University Press, 1996.
Michael Hardt and Antonio Negri, Empire. Cambridge: Harvard University Press, 2000.
Paul N. Doremus, William W. Keller, Louis W. Pauly and Simon Reich, The Myth of the Global Corporation. Princeton: Princeton University Press, 1999.
Thomas L. Friedman, The Lexus and the Olive Tree: Understanding Globalization. New York: Harper Collins, 2000.
Bob Jessop, “Towards a Schumpeterian Workfare State? Preliminary Remarks on Post-Fordist Political Economy.” Studies in Political Economy 40: 7–39 (1993).
Neil Brenner, New State Spaces: Urban Governance and the Rescaling of Statehood. New York: Oxford University Press, 2004.
Ian Holliday, “Is the British State Hollowing Out?” The Political Quarterly 71 (2) (2000), 167–176.
Christopher Leo, “Deep Federalism: Respecting Community Difference in National Policy.” Canadian Journal of Political Science 39 (3) 2006, 481-506.
Christopher Leo and Robert Fenton, “‘Mediated Enforcement’ and the Evolution of the State: Development Corporations in Canadian City Centres”. International Journal of Urban and Regional Research, 14 (2) 1990, 185-206.

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