Week 6 Analysis (Global Transformations-Held)

Understanding trade and global financial institutions is a great resource for those of us who want to understand War/Terrorism/Militarism. So often, what is at stake is financial/monetary. So, it was important to get a small taste of happenings of global finance, both its history and its future, as Ch. 3, 4 of Global Transformations deal with. All countries are now involved in international trade, some to a greater extent than others, but all do it. Trade has shaped and impacted this very world we live in. Certain fruits, for instance, never go out of season here in the U.S. because we can import them from around the globe, now we can have Watermelons year round. “Trade globalization involves more than simply the exchange of goods and services between separate economies since it suggests the emergence of worldwide markets for traded goods and services… it assumes the existence of a trading system in which trade activity between any two countries may affect trade relations between the rest” (149-50). Like Ch. 1, 2 suggested, we are now so interconnected within this global framework that the decisions or unforeseen circumstances within a certain region have a large impact on another. It will be interesting to see what the effects of all the recent natural disasters will do to the global trade market, not including the subtraction of billions of dollars in government aid. Today the world trading system is defined both by an intensive network of trading relations embracing virtually all economies and by evolving global markets for many goods and some services. The shift towards global markets has been facilitated by the existence of worldwide transport and communication infrastructures, the promotion of global trade liberalization through the institutionalization of a world trade system, and the internationalization of production. (176) The areas that draw concern for me are the possible and maybe inevitable shift away from a welfare politic. “Since trade in principle produces a net welfare gain for a country, the gainers could compensate the losers and still be better off. In this light it is not a surprising that more open economies generally have more extensive welfare states. Nevertheless, the growth of trade and changes in the structure have placed increasing strains in the welfare role of SAICS. Although there is no systematic evidence that welfare provision harms trade performance, employers, in the tradable industries in particular, resist increases in their social security contributions, pressing for REDUCTIONS on grounds of GLOBAL CONPETITIVENESS…Thus Global trade has had contradictory impacts in so far as it has increased the demand on the welfare state while undermining the political basis for finding it. JUST WHEN WORKING PEOPLE MOST NEED THE NATION STATE AS A BUFFER FROM THE WORLD ECONOMY, IT IS ABANDONING THEM.(183-4) “Global financial markets are conceived as central to inducing a convergence of political and social agendas among governments of varies ideological persuasions to ‘market friendly’ policies: a general commitment to price stability; low public debts and indeed expenditure, especially on social goods; low direct taxation; privatization and labour market deregulation. These developments argued to be unfavorable to organized labor, public sector employees, welfare state beneficiaries, and other traditional interest groups of the left”(232). I guess when I read this, it seems to me to be pure capitalist. When the market decides that a certain sector is obsolete it diffuses it and moves forward. These people who lose their jobs due to exporting labor and manufacturing will have to become more specialized into something else, thereby moving the structure of the market forward. It seems to be the ideal Regan Trickle Down Theory, so when the rich get richer, the poor get more too. This seems inherently wrong, but maybe there is a great theorist who can foresee this working out for those marginalized by this structure. When I have discussed the effects of War/Militarism/Terrorism it has been in view that in order to change the macro structures of our society we must look at the microstructures. In readily embracing everything Global we might in turn be overlooking the welfare of the people. This can ead to civil unrest, like we see in France right now.