Its the economy stupid:

An interdisciplinary study of the relationship between globalization and social movements

Michelle Diane Copyright 12/2011

2 Its the economy stupid

There is nothing complex about how or why globalization fuels public dissention; it decimates small economies and ravages the cultures of the least westernized. That has been the reality of capitalist expansion throughout its incarnations, first as colonialism, then imperialism and now, modern globalization. History bears out that insight and modern sociologists, political scientists and a Nobel Prize winning economist agree that capitalistic globalization is again propelling us toward the human tragedy and mass rebellion born of riches wrought from the bloodied backs of the impoverished. Globalization is, if not the catalyst, the primary exacerbation of both potentially overwhelming cultural tides and a rapidly burgeoning gap between the wealthy and the masses. In many third-world societies this has resulted in greedy, dictatorial leadership inflicting crushing social and economic injustice on the populace; in westernized nations, like the US, it has fueled polemic government posturing that has caused mass economic and cultural stagnation and regression. Increasingly everyday people are taking to the streets in open rebellion against the inequitable distribution of resources that plagues western and third world countries alike. Clarity that economic inequity is the root fuel of civil disobedience and realization that just distribution of resources is the logical solution is, however, an over simplification. Attainment of the logical solution to the rise of unrest in the wake of globalization is a vastly complex problem; in addition to crafting a new approach to wealth, it must incorporate a new definition and implementation of community and motivate vigorous political restructuring without decent into anarchy or regression into national isolationism. History echoes resounding warnings of the violent upheaval, which similar circumstances have repeatedly bred, and provides clues to the components of lasting resolution. Mass protest movements are a sociological reaction to economic and political policies deemed unresponsive, totalitarian and undermining the comfortable survival of its people. Sustainable equity is achievable only when political and economic policies are a reaction to the sociological requirements of the masses. In fourteen hundred and ninety two, Columbus sailed the ocean blue, as did the Portuguese, English, French, Spanish and Dutch. Columbus landed in the Americas; his counterparts besieged the coasts of sub-Saharan Africa. The toll on the indigenous peoples on both continents was astronomical; nearly 420 later, neither population has recovered. We celebrate Columbus discovery as though the land were uninhabited prior to his arrival, when, in fact, more than 12 million Native Americans populated what is now the United States. They suffered the destruction of their way of life, the theft of their land and resources

3 Its the economy stupid

and genocide in numbers that rival Hitlers holocaust. By 1892, the Native American population had shrunk to less than 240 thousand. (Trabich, 1997) According to the 2010 census, there are 3,753,858 Native Americans currently populating the United States; their death rate is the nations highest and nearly 25 percent live below the poverty line. Clearly, globalization did not work to the economic benefit Native Americans. (U.S. Census, 2010) Africans fared no better. The capitalistic globalization of the fifteenth through nineteenth centuries, called colonization, tore as many as 50 million Africans from their homeland and forced them into slavery in Europe and the Americas. Of the estimated 16 million shipped to the Americas, as many as 45 percent died during the Middle Passage or while in coastal confinement. Millions more Africans suffered like fate as the Native Americans; their fight for enfranchisement in the land of their birth is still not completely won. (Franklin, 1994) There is not one African nation on Business Insiders list of The ten richest countries in the world (Johnson, 2011). The nations have changed as has the label, but the effects of capitalist globalization remain devastating. One of the worlds fastest growing economies, China, is experiencing internal discontent and struggling to maintain governmental structure in the face of economic inequality. From 2000 to 2005, per-capita incomes of the bottom 10 percent of urban households in China rose 26 percent while those at the top saw gains of 133 percent (Davis, 2010, p. 163). In Mexico growth is slower, but the ramifications mirror Chinas experience. In 2004, those in the top tenth percentile earned 4.7 times more than those in the bottom tenth (Davis, 2010, p. 163) Joseph Stiglitz, Nobel Prize winning economist and Chair of the Council of Economic Advisors under Bill Clinton, called for a radical rethinking of the International Monetary Funds (IMF) economic model, motives and policies in his 2002 book, Globalization and its discontents. The IMFs neo-liberal policies, and its apparent interest in prioritizing the interests of rich countries, have, according to Stiglitz, stifled economic development, promoted global inequality, undermined democracy and made the world financial system and the financial systems of individual countries more susceptible to financial crises. (Koechlin, 2006) Vassar economist Timothy Koechlin, who wrote that Stiglitzs assessment was both flawed and unoriginal, admitted that Globalization and its discontents provided the antiglobalization movement in all its myriad forms with enhanced credibility. Koechlin asserted that Stiglitzs fierce attack against the IMF would, based on credentials alone, alter the terms of the

4 Its the economy stupid

debate over globalization. Clearly, Koechlin was wrong as the financial crisis Stiglitz warned of happened in 2008 and continues to plague nations around the world three years later. The governments of Egypt and Libya have collapsed under public dissent and the Syrian army is murdering civilians in the governments frantic attempt to retain control. The US has polarized into Tea Partiers and Occupiers; both factions agree the government is no longer responsive to the needs of the people. The IMF retains its laissez-faire, neo-liberal approach to economic globalization. Neo-liberalism is rooted in a conviction that unfettered markets provide the best possible outcome in nearly every circumstance; and a similarly deep conviction that government intervention often distorts and stifles growth. And so, along with free trade, neo-liberals advocate privatization of state enterprises, open capital markets, unregulated direct foreign investment, and reductions in state spending and regulation of virtually every kind. At the core of neo-liberalism is the simple (and simplistic) belief that, ultimately, liberalization promotes growth, and growth is the source of economic well-being. (Koechlin, 2006) In the face of the IMFs free trade equals free lunch status quo many nations including Greece, Italy and the US have been forced to resort to bail outs to keep their economies afloat. The US has seen its credit rating downgraded and the European Union (EU) is on the verge of disintegration. Anti-globalization economists Duncan Green and Matthew Griffin also point to Stiglitzs analysis in articulating the core message of the diverse and seemingly inconsistent factions of worldwide civil disobedience. Civil society concerns stem from the realization that while globalization has led to benefits for some, it has not led to benefits for all. The benefits appear to have gone to those who already have the most, while many of the poorest have failed to benefit fully and some have even been made poorer. For example, trade liberalization has meant that many small farmers in developing countries have been hit by import surges of heavily subsidized food imports from the United States and EU. Equity and redistribution are increasingly recognized as the missing link between globalization and poverty reduction. (Griffin, 2002) Stiglitz asserts that IMF policies not only represent bad economics but bad politics as well.

5 Its the economy stupid

In Transnational structures and protest: linking theories and assessing evidence, Gregory M. Maney proposes that: A countrys position in the capitalist world-economy is positively related to wider access to its political institutions. (Maney, 2002) Maney explains that wealth is transferred from periphery and semi periphery states to core states, that core states have privileged institutional access and that wealth distribution is defensive, used strategically to mitigate the possibilities of social conflict. This implies tacit agreement with Stiglitzs assessment that grossly inadequate economic policies are intentional, manipulative and a threat to the lifestyles and freedom of all but the rich. Maney refutes the theory that there is little likelihood of protest movements emerging in periphery states, as their governments are typically exclusionary and repressive. Violent protests, which have erupted in closed systems like Egypt, Libya and Syria since 2008 seem to indicate that while perhaps fear increases tolerance, it is in the periphery were the seed are planted and the roots of pubic uprising are nurtured and take hold. This is evidenced by the global expansion of protest movements from repressive (periphery) regimes to core administrations like those in the US and UK. He further disagrees that the pressure of downward mobility from the core coupled with the upward striving from the periphery make the semi periphery most logical group for mass eruption. Maney holds that it is not the absence of resources or administrative capacity that explains the relationship between world-system position and political exclusion, but the repressive capacities of peripheral states themselves that fuels the protest. While the afore mentioned movements can be viewed as empirical proof of his position, the protest movements which have raged in Europe and are now Occupying spread to the US seem to indicate t the pressure cooker theory also has merit. The growing movements in western countries in fact appears directly related to the shrinkage of middleclass income and lifestyle. Maneys assumptions mirror those of the IMF and he goes on to attempt refutation of the proposition that, Increasing economic dependency promotes political exclusion, but must acquiesce that the evidence is faulty after controlling for income inequality. He goes on to agree that shifting political alliances promote protest and that the weaker periphery is routinely manipulated/oppressed to and for the benefit of the core. His positions leave the impression that political thought has become convoluted, if not retarded, in effort to merge the Washington Consensus with irrefutable reality. In conclusion, Public Policy professor James DeFilippis asserts, In order for the antiglobalization protests to become a social movement capable of transforming the global political economy, they need to connect much more closely to local scale politics and conflicts. (2001) Economics, political science even history provide irrefutable evidence that the economy, or more accurately economic inequality, is the source and fuel of protests movements globally.

6 Its the economy stupid

The indication is that nothing short of an IMF scale redistribution of both wealth and access will secure long-term mitigation of the burgeoning public dissatisfaction. DeFillippis assertion is the obvious solution, but offers no insight into how; the mechanics of change are blaringly missing from all the disciplinary approaches. DeFillippis laments that the US protest movement has lost both its radical and participatory zeal and deteriorated into non-confrontational asset development agencies, but allows the embers of re-radicalization are not beyond ignition. A prophecy, which, much like those of Green and Stiglitz seems to have been eerily accurate; red and blue, right and left, Americans are clearly discontent with the negative impacts on the economy that can be directly traced to the laissez-faire, neo-liberal policy control of the IMF and are taking to the streets in protest. Though three of the four disciplines offer no clear course to resolution, perhaps history does. It has typically required public rebellion to effect significant change in government policy and action; the French, Russian and American revolutions as well as the anti-apartheid/civil rights movements in South Africa and the United States all stand as proof of the assertion. Libya, Egypt, Syria and Occupy seem proof that modern movements are forming and operating in that historical knowledge and tradition. If it is true that history unheeded is likely to be repeated, than the likely resolution of increasing social unrest globally will come from the people themselves. It will come in the form of mass refusal to further tolerate the widening gaps between the haves and have-nots and in demands for political and cultural sovereignty. The rebalancing of power will occur likely, as it always has, forced into being by ordinary people who refused to be pawns of economically controlled political interests any longer.

7 Its the economy stupid

Works Cited

Davis, B. J. (2010). Globalization promotes income inequality. In D. &. Haugen, Globalization (pp. 159 - 166). Farmington Hill, MI: Greenhaven Press. DeFilippis, J. (2001). Our resistance must be as local: Place, scale and the anti-globalization. City , 5 (3), 363 -373. Franklin, A. A. (1994). From slavery to freedom. New York: McGraw-Hill, Inc. Griffin, D. G. (2002). Globalization and its discontents. International Affairs , 78 (1), 49. Johnson, A. R. (2011, 9 25). The 10 Richest Countries In The World. Retrieved 11 20, 2011, from Business Insider: http://www.businessinsider.com/worlds-richest-countries-2011-9?op=1 Koechlin, T. (2006). Stiglitz and his discontent. Review of Political Economy , Volume 18 (Number 2), 253264. Maney, G. M. (2002). Transnational structures and protest: linking theories and assessing evidence. In J. S. Johnson, Globalization and Resistance: Transnational Dimensions of Social Movements (pp. 31 -50). Lanham: Rowman and Littlefield Publishers, Inc. Parenti, M. (2010). Globalization undermines democracy. In D. H. Mach, Globalization (pp. 37 49). Farmington Hills, MI: Greenhaven. Trabich, L. (1997, 6). Native American genocide still haunts United States. Retrieved 11 20, 2011, from An end to intolerance: http://www.iearn.org/hgp/aeti/aeti-1997/nativeamericans.html U.S. Census. (2010, 7 1). Population Estimates. Retrieved 11 20, 2011, from U.S. Census Bureau: http://www.census.gov/popest/intercensal/national/nat2010.html