American Foreign Policy and the Role of Capitalism and
Globalization
BY,
RACHELE M. HENDRICKS-STURRUP, M.S., M.A.
Table of Contents
Abstract .......................................................................................................................................... 3
Introduction ................................................................................................................................... 4
The Birth of Globalization…………………………………………………………………..…... 6
The Benefits of Globalization…………………………………………………………….……... 8
The Costs of Globalization…………………………………………………………………….. 10
Neoliberal Globalization………………………………………………………………………. 14
The Anti-Globalization Movement…………………………………………………………… 15
Globalization and US Foreign Policies and National Security……………………………… 16
Conclusion………………………………………………………………….…………….…….. 18
References……………………………………………………………………………………………. 20
2
Abstract
Globalization is a recent economic phenomenon that directly influences individuals’ freedom,
opportunity and resources needed to freely move across the world to engage in and profit from
transnational commerce. Several legal scholars and analysts have focused heavily on the costs
and benefits of globalization. A number of its lauded benefits include decreased global poverty,
increased political cooperation, cultural familiarity, war prevention, standard setting for human
civil rights, and the extension of personal financial freedom across the world versus being
concentrated mainly in developed nations. On the other side of the globalization coin however,
a great deal of concerns have escalated in both the socio-economic sector and the environmental
sector. Anti-globalization activists heavily accuse
globalization of 1) generating an ever-
increasing global wealth gap, 2) fostering the decline of the working class in developed nations
such as the US, 3) exposing the natural environment to hazardous substances and operations
that compromise public health and land/air stability, 4) an
ever increasing culture of
consumerism, and 5) unfair political practices that favor the needs of developed nations over the
needs of historically depressed, exploited, and developing nations. The US has been deemed the
mother of capitalism and globalization. When American corporations fused with other large
foreign companies, a new global superpower was birthed, gaining and retaining its irreversible
life through the industrial production of myriad products ubiquitously found and consumed
across the globe. The neoliberal political view supports the notion of globalism and free-market
capitalism. Following the 9/11 events that took America by storm, former President Bush
announced his administration’s commitment to global marketing and free trade, citing them as key
priorities to our nation’s security. Given globalization’s irreversible presence, it is imperative
that US foreign policies align strategically with global economic needs and welfare, however
achieving this objective is a major challenge for several US and global entities, including the US
Federal Government and the World Trade Organization (WTO). This article seeks to examine
the level in which globalization and capitalism influence future, post-9/11 American foreign
policy.
3
Introduction
The term “globalization” has one definition, but many connotations. For instance, MerriamWebster dictionary defines globalization as “the development of an increasingly integrated global
economy marked especially by free trade, free flow of capital, and the tapping of cheaper foreign
labor markets”, with the first known use of the term being relatively new since 1951.1 The term
“globalization” is directly related to and often used synonymously with the term “free trade”,
which is defined as “trade based on the unrestricted international exchange of goods with tariffs
used only as a source of revenue”.2 Leslie Sklair, a Professor Emeritus in Sociology at the London
School of Economics and Political Science, explains that globalization can be generically
defined through the following trifecta: 1) a consequence of technological transformation in the
means of communication (the “Informational Age”), 2) this technological transformation has
fostered the growth of new forms of cosmopolitanism where national and international relations
are conceptualized as relations between the local and the global, and 3) this technological
transformation has also fostered the creation of transnational “social spaces”.3
Capitalist globalization, or global capitalism, is an extension of globalization that refers to the
practice of placing the international exchange of goods and services into the hands of individuals
or corporations instead of governments (in this text, the term globalization is loosely used to
denote capitalist globalization).4 It is currently the dominant force in the global economic
system.
Capitalist globalization has provided individuals and corporations with freedom,
opportunity and resources needed to traverse the world and engage in and profit from
transnational commerce. Trailing this freedom of transnational commerce is decreased global
poverty and increased financial freedom, and also increased g l o b a l political cooperation,
amongst other stated benefits.
4
Anti-globalization activists have accused globalization of committing a number of injustices that
range between generating an ever-increasing global wealth gap to fostering a world-wide culture
of consumerism that inflicts harm against public health and the natural environment. For
instance, Sklair elaborates on the problem of cultural consumerism: “the cultural-ideological
project of global capitalism is to persuade people to consume above their biological needs in
order to perpetuate the accumulation of capital for private profit; in other words, to ensure that the
global capitalist system endures.” I paraphrase Sklair’s words by saying that those first-handedly
involved in perpetuating this consumerist culture are corporate executives, bureaucrats, politicians,
globalization professionals, the media, and other entities of the like.3
The US historically led and currently leads capitalist globalization march across both developed
and developing nations worldwide. Many politicians within the US and abroad agree that
globalization and trans-national free trade are irreversible and necessary towards sustaining worldwide diplomacy and political cooperation, global economic stability, and decreased global poverty.
As a direct result, globalization efforts and anti-globalization efforts, together, influence
American foreign policies and the viable momentum of world-wide, 21st century
capitalism. The tragic events that spurred on September 11th 2001 lead to an overall heightened
awareness of the need for effective US foreign policies that run parallel to and embody the costs
and benefits of globalization and its potential for establishing, or hindering, global
economic/political stability.
5
The Birth of Globalization
When asked what may have directly contributed to the “big bang” birth of globalization, there
appears to unanimously agreed culprit: technology. To be specific, the internet (or the worldwide web, have you may) has played a pivotal role in the success of the globalization. The
internet allows information to be exchanged immediately, in real time and across the world. Those
living in countries fortunate enough to allow their citizens access to the internet and trans-national
free trade, such as the US and Europe, especially benefit. The world-wide web is not the only
form of technology that has facilitated painless trans-national commerce; other forms of
technology such as commercial/private airplanes, high-speed trains, and automobiles have
significantly increased the ease in providing goods quickly across national and natural borders
(such as oceans, lakes, etc.).
Essentially, the evolution of globalization that has inevitably occurred over the past few hundred
years, and it is the direct result of individuals having the freedom, opportunity, and
a ff o r d ab l e a cc e s s t o resources needed to freely move across the world and engage in such
profitable endeavors. Academic Lauren Langman worded this succinctly: “Today, the majority of
products and services are financed, produced, or distributed by large transnational corporations
(TNCs) whose ‘global reach’ and global brands now extend to most of the populated world.”5
Further, American corporations, being the leaders of the globalization movement, fused with
foreign companies, thus giving birth to large multinational corporations that produce products
ubiquitously found and used across the globe.6
Invigorating globalization are financially advantageous circumstances and standards of
developing nations: 1) the availability of cheaper labor, and 2 ) relatively less stringent
environmental regulations and standards. Global capitalist corporations have a solid goal of
6
maximizing profits and reducing operational expenses. These factors have questioned the
legitimacy of globalization, but nonetheless have undeniably contributed to the birth and
expansion of globalization.7 Take for instance China’s recent industrial boom since their
accession to the WTO in 2000. The relatively low safety standards required of China’s industrial
operations and the high availability of their extremely inexpensive working populace have made
globalization not only possible, but also sustainable. China is not unaccompanied in this feature;
other developing countries such as Korea and Peru also contribute to the sustainability of
globalization because of their similar anthropological circumstances as China.8
7
The Benefits of Globalization
Several authors and academics have lauded capitalist globalization and free trade mainly because
of their positive impacts on the working class in countries outside of the US and other developed
nations; capitalist globalization has extended personal financial freedom to individuals previously
plagued by poverty and oppression in developing nations. For example, Michigan State University
Law Professor James Chen defends globalization and free trade in his written manuscript on
globalization and the concept of pax mercatoria (a spiritual blend of lex mercatoria, pax
britannica and pax Americana). Chen states that free trade is a global servant that potentially
enhances the real national product of all nations, increases living standards globally, and promotes
a mutually profitable division of labor. It is believed that global servitude subsequently leads to
increased political cooperation as a lesser occurrence of war between foreign nations, and Chen
highlights this is his article: “In the public sphere, pax mercatoria represents the peace dividend
that develops when free trade makes nations too busy and too rich to fight.”
9
Capitalist
globalization and free trade are also praised for their ability to promote cultural
familiarity and an increased awareness of basic human rights. As stated in the previous section,
globalization has been largely successful with the help of technology. Inevitably, the ability to
travel to, communicate, and engage in business endeavors with other countries freely and
expeditiously reduces xenophobia between nations that are or once were otherwise culturally
unfamiliar amongst one another.
Globalization has led to an increased awareness of basic human and environmental rights. Several
protests have occurred globally against global corporations over fair labor standards and
wages from South America to Asia, therefore capitalist globalization and free trade have
indeed increased the awareness and demand for basic human rights globally.10 In Chen’s
perspective, globalization further advances democracy and creates a more transparent
8
government and swifter discipline of rogue governments and abuse by local tyrants. Chen’s
perspective therefore resonates to audiences actively engaged in national and international human
rights.
9
The Costs of Globalization
Running parallel to the benefits of globalization are its costs (or otherwise negative aspects).
The costs include 1) increases in the wealth gap, or the decline of the middle- and workingclasses in developed nations, 2) exploiting workers to low, unsustainable wages, 3) increases in
environmental
and
public
health
hazards,
4)
an
increasing
cultural
of
excessive
consumerism, and 5) unfair political practices against less-diverse trade markets in developing
nations. These costs are considered to be the downfalls of globalization, and are the driving force
behind today’s anti-globalization movement (which we will also discuss in a later section).
Globalization and free trade have been accused heavily of generating an increasing wealth gap
between the upper- and the working-class. Simply put, the rich are becoming richer, and the poor
are becoming poorer. Academic Gino Gancia sought to examine and validate this accusation.
Gancia reported that among b ot h developed and devel opi ng countries, a surge in wage
inequality indeed exists, and it is partially due to the fact that the “skill premium,” or the
difference
between high-skill/high-
educated and low-skill/low-educated workers, has
drastically widened. Gancia’s findings conclusively suggest that since globalization offers a
large and diverse variety of products globally, skilled workers benefit because they have the
ability to “find different market niches by inventing new differentiated varieties”; ability is
more important in large markets. Skilled workers conclusively benefit relatively more from
globalization. It is important to understand and consider however, that obtaining such high-skill
training and education is costly; increases in college premiums needed to access instruction in
order to acquire such skills have also contributed heavily to the increasing wealth gap.11
Capitalist globalization and free trade are also accused of exploiting workers to low,
unsustainable wages in order to sustain and maximize profits. On this topic, Sklair concluded that
10
since capitalism is so profit-driven, it is in itself incapable of providing financial stability for the
majority of the wage-earning population. This is largely due to “national capitalism,” working
communities are restricted to working class structures3. Sklair and many of those against
capitalist globalization therefore believe that it is extremely important that we seek and identify
other alternatives to capitalist globalization.
The globe is currently faced battling an explosion of environmental and public health problems,
and capitalist globalization is its epicenter. The natural environment, consumers, laborers and
workers, and the general public alike are constantly exposed to healt/safety hazards stemming
from industrial operations and unsafe products courtesy of capitalist operations. For example,
companies within developed countries have released millions of tons of carbon dioxide (a
major greenhouse gas) and methane into the atmosphere since the Industrial Revolution.
Although more developed nations have taken strides to improve their energy regimes, businesses
within developing nations, as a result of their relatively low environmental protection
standards, continue to employ the use of less expensive, inefficient coal-burning machinery to
generate energy for their operations. Industries mainly responsible for such hazardous emissions
are coal, cement, natural gas, and oil industries.12
An ever-increasing culture of excessive consumerism and spending has emerged since the birth of
globalization. This culture is spread mainly by transnational corporations, and it is arguably used
as a promotion strategy to generate and maximize profits. For example, Sklair offers an
interesting perspective on the culture of consumerism; “(…) most iconic architecture of the
global era is also best analysed as a form of hegemonic architecture, serving the interests of
the transnational capitalist class through the creation of consumerist space or, more accurately,
through the attempt to turn more or less all public spaces into consumerist space.”13 Sklair
11
emphasizes the idea that the hegemony, consisting of mainly transnational corporations, obtains
every visual space possible to promote their products through an ideology that is congruent
with popular culture, fashion and sports. Langman also touched of the culture of consumerism,
and identified it as an adverse consequence of globalization that transcends national boundaries.5
Globalization is also accused of fostering unfair political practices against less-diverse markets in
developing nations. One major example is what took place in the 1990’s during a major
dispute between the US (Chiquita Brands) and the EU. Described by academic Ibrahim
Gassama as the “banana war,” the European banana program, which was established in 1993 at
the Lomé Convention by the European Union Council Regulation, produced a series of trade
and economic cooperation agreements between the EU and nearly 70 countries within the
Atlantic, Caribbean, and Pacific (ACP). “The regulation integrated various preferential trade
agreements, remnants of European colonialism, which facilitated banana imports into several
European nations. One of the stated aims was to assist banana producers operating out of certain
former European colonies” (pgs. 3-4). The US disagreed with this regulation and accused the EU
of denying the US full access to European banana markets, and also of protecting European
shipping and marketing interests operating out of these Atlantic, Caribbean and Pacific producer
countries. The US stated that this EU regime violated provisions held within the GATT, the WTO
Agreements on Import Licensing Procedures, Agriculture, and the General Agreement on Trade
Services (GATS). Eastern Caribbean countries such as Jamaica and St. Lucia felt especially
vulnerable in the dispute process since banana sales to Europe accounted for the vast majority of
their total exports. As a result of this dilemma, the WTO was forced to exercise its new dispute
resolution process. Procedural and substantive biases within the dispute resolution process only
marginalized the interests of the affected developing countries. Essentially, in this case the devil
was in the details; “these developing country participants lacked the experience as well as the well
12
as the material and technical resources to participate fully in the lengthy, highly specialized and
stylized process that dispute resolution in the WTO era has now become”. By year 2001, after a
series of appeals from both the complainants and the defendants, the WTO eventually ruled in
favor of the US/Chiquita Brands and the ACP countries received pressure to seek and find longterm solutions to the imposed disadvantage. Gassama covers the two key strategies that
defenders of globalization use to preserve the current economic order: 1) “the entrenchment of
power disparities through increased legalization and judicialization of trading relationships and
2) waging a relentless war against memory by denying or devaluing consideration of past
injustices that have continuing consequences and obligations.” 14
13
Neoliberal Globalization
Moore et al. precisely define neoliberal globalization as “the new power of owners of large,
multinational corporations that benefit from economic policies associated with innovation, trade
liberalization, reduced government spending on entitlements and decreased state restrictions on
labor, health, and environmental hazards of production globalized neoliberal capitalism.”15
Neoliberal globalization originates from the political provisions of neoliberalism, which is a liberal
belief that “de-emphasizes traditional liberal doctrines in order to seek progress by more pragmatic
methods.”16 Free-market capitalism stands on the shoulders of neoliberalism, and those in full
support of capitalist neoliberal globalization are typically, as we have discussed, the hegemonies,
in whole or in part, that directly benefit financially from its practice. This is not to dismiss the
purported benefits that follow the practice of capitalist neoliberal globalization (decreased war,
increased political cooperation, etc.); the purpose of this section is to holistically define neoliberal
globalization and the forces enabling it, supporting it, and protecting it.
The ideals of free trade extend to the very root of American history; the U.S. Constitution was
written as an outspoken commitment to free trade. Chen touched on this contentious idea, citing
that “the free trade regime established by the Constitution reduces the influence of protectionists
groups…, thus promoting both economic growth and accountable government.”9 The ideals
and purported benefits of free trade thus go hand-in-hand with and support the mechanism
behind globalization. It is important to also understand however, that since neoliberal globalization
spills over into issues of human and environmental hazard exposure, and also since national
governments allow free market capitalism to exist transnationally, national governments thus
have the duty and obligation to protect both human and environmental rights.
14
The Anti-Globalization Movement
Academic Adam Warden elaborates on the birth of the anti-globalization movement, and defines
the common theme behind it as “the desire for an alternative to the corporate-dominated world
system and a redirection of integration toward a more democratic spirit.”6 The momentum infused
into the anti-globalization movement is strong opposition to the living and working conditions
globalization subjects upon its employees. The previous section highlighted this as one of the
costs of globalization. Several protests have occurred within the past twenty years against the
World Trade Organization (WTO) as an effort to combat against the globalization machine. For
example, protests occurred during WTO meetings held in November 1999 in Seattle, in April
2000 in Washington D.C., and in September 2000 in Prague. During the Seattle protests in
November 1999, each day the protesters challenged the WTO with different topics of concern.
For example, on November 29th, the protesters focused on the environment and health. On
November 30th, labor and human rights were addressed. The diplomatic nature of the 1999
Seattle protest ultimately lead to the failure of the WTO meeting in Seattle to discuss new world
trade negotiations.
Like the globalization movement, the anti-globalization movement also benefitted largely from
technology. For instance, Langman noted that Internetworked Social Movements (ISMs) have
now become the primary forms of resistance against globalized neoliberal capitalism, corporate
power and unequal privilege. Warden quoted Peter Fitzgerald where he stated “The Internet made
it possible for a relatively small number of activists to have a greater impact in part because
electronic communications bypass the editing that occurs in the traditional media and the filtering
that naturally occurs when relying upon third parties such as international nongovernmental
organizations.”6 Fitzgerald’s statement highlights perhaps one of the most important factors behind
the success of the anti-globalization movement.
15
Globalization and US Foreign Policies and National Security
As previously noted two of the major purported benefits to globalization are decreased warfare and
increased political cooperation and diplomacy. For example, Chen proposed the pax mercatoria
theory, where countries become too powerful and rich, or too busy to fight amongst one another.
I extend this theory to when countries’ markets become too dependent on one another to fight.
Heavy dialogue on foreign policy and national security has evolved within and outside the US
since the September 11th terrorist attacks on the World Trade Center in New York and the Pentagon
in Virginia. Academic Catherine Scott notes that “Trans- national terrorist groups have been
described in ways that resonate with the decentralized, flexible, and information- savvy company
that operates smoothly in the newest phase of globalization.”17 Also, in the immediate aftermath
of the September 11th attacks, critics emphasized the “dark side of globalization”, criticizing
globalist claims that globalization is natural, and necessary, and a means to survival and
prosperity18. During that time, the national security measures in the new realm of globalized
markets were under increased skepticism, especially due to the fact that history displays similar
calamitous events where the force of globalization was resisted (i.e. the 1914 assassination of the
Austrian Archduke Franz Ferdinand in Sarajevo).19 It is therefore vital that foreign policy and
national security measures align with what empowers and sustains globalization.
The approaches to US foreign policy and national security by our latest US leaders former
President George Bush and President Barack Obama have been heavily scrutinized by the media,
the public, and also by other foreign nations and leaders. This was, and currently is, largely due to
the massive expectation of a multilateralist transition in foreign policy upon the presidential shift
from George Bush to Barack Obama.20 Foreign policy approaches by both US presidents
struggled (and continue to struggle) to overcome the enormous hurdle of combating those
16
countries who choose to ignore or contest American leadership rather than embrace it, and this is
heavily inhibits the desired multilateralist agenda. According to President Obama, President Bush
failed to recognize during his presidential term just how much globalization has recreated politics
around the world, and that terrorism is just one of the new problems among myriad new
problems. Both presidents nonetheless, believed that countries both needed and wanted US
leadership in this new global era.21
Academic David Skidmore elaborated on the inherent obstacles faced by our US presidents
in their efforts to promote their foreign policy agendas in our new global era: Bush adopted a more
unilateralist approach, while Barack Obama adopted a cautious approach towards the role of
multilateralism. Both presidents have failed in their attempts, which is mainly a result of
structural constraints domestically and abroad obstructing the US’s ability to engage with
international institutions. For instance, Skidmore notes that the foreign countries, no longer being
as dependent upon America for their security, now insist that “the United States abide by
institutional rules and procedures on an equal basis: no more hegemonic prerogatives.”20 Clearly,
the implications of a new global era cascade much further anticipated by our US leaders; US
leaders must understand that in order to achieve successful US foreign policy, US leaders must
embrace the fact that US leadership is not as warranted as assumed.
17
Conclusion
Globalization is a superpower in itself whose power extends beyond its originator or creator: the
US. From an imperialist perspective, the ideals of free trade originally embedded in the US
Constitution are now shared globally, beyond US boundaries, and this transnational extension
was necessary for the birth and survival of capitalism. This has allowed (as globalists state and
believe) other developed and developing nations to be successful financially, and is lauded as a
result. Since capitalist globalization has succeeded in it attempts, US leaders must understand the
degree in which the capitalist globalization movement has empowered foreign nations, and that
this empowerment has resulted perhaps in the unanimous desire for the US to “step down” from
their plinth as global leader and become instead an equal almighty in the new global era. This
must be thoroughly understood and addressed by our next presidential leader.
18
References
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2
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3
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4
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6
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7
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8
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9
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10
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11
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12
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13
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14
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20
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21
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21