THECATINTHEHAT
Bluelighter
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Here's a literature review I wrote recently (be gentle, first ever) on globalisation and international poverty. Unfortunately copying it in has fucked with the formatting a bit so none of the quotes are in itallics and I can't be fucked to go through and put the appropriate tags in, I thought I would volunteer it though. Yes, I know the proof reading leaves a little to be desired but I was on a large opiate script when I wrote it. Anyway, some might find it interesting.
A critical literature review examining globalisation and international poverty: The 2013 Rana-Plaza disaster
This literature review will critically examine theories of globalisation in relation to international poverty with particular reference to the Rana-Plaza disaster of 2013. It will be using theories of globalisation to explore patterns of inequality and assess the real-life impact of globalisation on contemporary poverty. Hopefully through comparison of theories and looking at how they present themselves in global events some insight can be gained as to the effect globalisation is having on poverty. In particular it will use the disaster at Rana-Plaza in 2013 as a reference point for critiquing these theories.
The Rana-Plaza disaster was the collapse of a building in Bangladesh that produced garments for a large number of western retailers. This occurred on the 24 April resulting in 1,129 fatalities (Butler S, 2013) and 2,515 casualties making it the deadliest accidental building failure in history. Local inspectors had discovered cracks in the building on the previous day and dubbed it unsafe for occupation but despite these warnings executives at EtherTex (a garment firm operating out of the building) forced workers to return under threat of being docked a month’s wages (Devnath A & Srivastava M, 2013).
The majority of the initial literature available is simple reportage through mainstream news channels such as those cited, and offers little opinion. Whilst some outlets cited, such as The Guardian, have a left of centre political stance, and others such as Bloomberg claim no political bias, the initial coverage offered little in the way of opinion and are mainly fact based reporting that correlate to provide a depiction of the event. However, only days later, discussion through theguardian.com introduced concepts such as ‘modern-day slavery’ (Viederman D, 2013), revealing its bias.
The disaster led to a piece of legislation called ‘The Accord on Fire and Building Safety in Bangladesh’ (henceforth, ‘The Accord’) (bangladeshaccord.com 2014), a legally binding contract ensuring a minimum level of safety across buildings used for garment production in Bangladesh. It was created by the IndustriALL global workers union and is signed by over 150 garment retailers. It could be suggested this contract was created out of a desire for better working conditions for employees in Bangladesh, but one has to question the signatories’ motives for joining. Is it out of genuine moral concern? Or is it recognition that in the global era as consumers are straying away from firms with unethical working practices, it is a cynical move to protect profits?
Globalization is defined in the Oxford English Dictionary (OED) (2014) as ‘the process by which businesses or other organizations develop international influence or start operating on an international scale’. The mechanics it describes can be seen in the work of Marx and Engels (1882) who wrote ‘European immigration fitted North American for a gigantic agricultural production….. it enabled the United States to exploit its tremendous industrial resources with an energy and on a scale that must shortly break the industrial monopoly of Western Europe, and especially of England, existing up to now.’ In the book Global Transformations: Politics, Economics and Culture (Held et al 1999, p.2) it is reckoned ‘Globalization may be thought of initially as the widening, deepening and speeding up of worldwide interconnectedness in all aspects of contemporary social life’. However, these and other definitions all point towards a view in which the flow of people, money, information and cultures are spreading across the world at an increasing speed. Of this there is no doubt, but the causes and repercussions of this are debated and shall be examined later.
Poverty is a harder term to define. The general definition as given in the OED (2014) is: ‘The condition of having little or no wealth or few material possessions’, but the condition is relative to context. Santerelli E & Figini P (2003) describe poverty as being ‘a multidimensional problem, which results from a combination of economic, political and environmental factors, and which comprises several different aspects’ which goes some way towards explaining the difficulty of putting the term in to application in real life. Perhaps the most widely used explanation in recent years has been the ‘dollar a day’ benchmark set out in the World Bank’s World Development Program (1990). The immediate problem with this norm is that the report is now almost 25 years old, and inflation across the globe means that the nominal value of a dollar has decreased.
The New Economics Foundation (NEF) suggests, ‘Updating the poverty line over time is problematic, for example failing to reflect differences in inflation as between rural and urban areas’ in their 2008 report ‘How Poor is Poor?’. It continues to ‘propose a rights-based approach, which combines the use of outcome indicators to provide a moral basis for the definition of poverty’, suggesting that factors such as education, infant mortality rates and a country’s relative purchasing power parity need to be taken in to account to create separate poverty lines for individual countries. The NEF is a leading UK think tank ‘fully independent of any political party’ (neweconomics.org 2014), but this does not mean they do not have a particular agenda or bias. It claims ‘the current economic system is not fit for purpose’ and is set on developing a new system that prevents climate change and protects people across the world. This suggests the NEF may have a wider definition of what poverty is than other organisations, but its humanistic viewpoint would appear to be what is needed in a real world definition of poverty.
What constitutes poverty in real terms is still open to interpretation though, and there is no apparent definitive answer to this question as of now. However a former EtherTex garment worker has testified with a meeting of representatives of the U.S. House (Reba Sikder 2014), that her base wage was $49/month, which under the 1990 dollar a day model would not class her as living in poverty. However, given 24 years of inflation and the adjustments suggested in the NEF report it would suggest that many workers at the Rana-Plaza disaster could be considered to be living in poverty and henceforth this is a useful example of the real life implications of globalisation on poverty.
The aforementioned Global Transformtions by Held et al (published through Polity Press, probably the world’s leading peer-reviewed academic publisher of social sciences) is perhaps the most iconic of works on globalisation, categorising three main theoretical standpoints: Hyperglobalists, Sceptics and Transformationalists. Hyperglobalists contend that people and businesses the world over are increasingly subject of the global marketplace and Multinational Corporations (MNCs) rather than traditional governmental bodies. Sceptics believe that ‘globalization is essentially a myth’, MNCs are still reliant on governing bodies and that the world is being segmented in to three regional economic blocs. Finally the study argues Transformationalists see the current situation as ‘historically unprecedented such that states and societies across the world globe are experiencing a process of profound change’ (1996 p.2), and that this is creating a whole new set of problems and struggles that individuals and businesses the world over are having to learn to adapt to.
Held cites Ohmae (1995) as a key example of a Hyperglobalist who claims ‘traditional nation states have become unnatural, even impossible business units in a global economy’, and this could be supported by the events of Rana-Plaza. ‘The Accord’ that emerged in the wake of the disaster is an example of legal policy created by a non-governmental global union and signed by Multintional Corporations (MNCs) who operate across a range of countries, that that affects 1,600 factories and 2 million employees in the country of Bangladesh (industriall.org 2013). This supports the view that nation states are becoming less powerful, or as Held puts it ‘‘Economic power and political power….. are becoming effectively denationalized and diffused’.
The Hyperglobalist view also introduces the concept of globalisation resulting in ‘winners and losers’. Professor Richard D. Wolff (2013) argues that ‘Globalized capitalist competition destroyed the clothing industries of the former colonizing countries….and relocated them in the former colonies’. He continues to propose that this has resulted in shifting poor working conditions from west to the east at the expense of jobs in western countries and that ‘Such awful conditions are often punctuated by catastrophic tragedies such as Rana-Plaza’; this seems to agree with the idea that globalisation is creating winners and losers. However, he has been referred to as ‘probably America’s most prominent Marxist economist’ (Davidson A, 2012), and such partisan interpretations are reflected in his other texts and a liberal Hyperglobalist may look to ‘The Accord’ and suggest that this process of globalisation is actually introducing increased rights and protection to workers around the world in developing countries.
The Sceptics view the patterns of global trade as not being a new occurrence but a repetition of patterns of the past. Hirst and Thompson’s Globalization in Question (again Polity Press) cites Dunning (1993, pp97-98) as claiming ‘By the end of the fourteenth century it is estimated that there were as many as 150 Italian banking companies operating multinationally’. Instead they say that the world is moving towards a position of three distinct trading blocs: USA, Japan/East Asia and the EU. Whilst there is evidence to support this position in that the USA and EU remain the two dominant economic blocs in terms of GDP, in the time since the book has been written we have seen a move away from the triad model. Andrew Bergman’s model created for CNN (2014) shows China now stands alone as the second largest national economy in the world (fast catching up to the entire EU bloc) and Brazil emerging as the 6th largest. BRIC is an acronym often used to describe Brazil, Russia, India and China due to the similarity in their level of development. Whilst CNN is a mainstream media site that has been accused of having a liberal bias, the sources he uses for the model (IMF & World Economic Outlook) are solid and impartial as one is likely to find so it remains a useful piece of literature. Ironically we see a link here back to the work of Mark and Engels in that a communist country is indeed transgressing the ‘industrial monopoly’ of the West. Whether this is actually resulting in a shift of wealth from the rich to the poor is debateable though as modern China’s model of communism is much different from that imagined by Marx and Engels.
Hirst and Thompson also state that ‘One key effect of the concept of globalisation has been to paralyse radical reforming national strategies’, but ‘The Accord’ suggests this is not the case. The global business community has come together to move in and reform policy in a country where the government is failing its people. They claim ‘the forces of internationalization themselves depend on the regulatory power of national governments’, but it seems globalised entities such as Industriall are now supplanting governments in some situations to create policy. However, the implementation of said policy does rely on government to a certain extent (as discussed later).
One key element of Hirst and Thompson’s view is the concept of uneven Foreign Direct Investment and suggest that it is ‘(MNCs) that are the agents responsible for FDI’ (1996, p.66). They propose that the majority of the world’s FDI occurs between members of their triad bloc model and claim ‘It’s consequences for the living conditions, life expectancy of the world’s poor are obvious. It should not be allowed to go on and we should do something about it urgently as a matter of conscience’ (1996 p.75). The United Nations Conference On Trade and Development World Investment Report (2013) shows that the situation is now more extreme, with the US and China emerging as strongholds of investment, EU members being matched by many other countries, (but still remaining strong as a bloc), and Africa in particular receiving very little. However, this does not mean that that the wealth generated by investment is reaching the poor in these countries, and most is likely benefiting a small number of MNCs. As a document produced by the United Nations this is about as credible a source as it is possible to find and it agrees with the view that FDI is still vastly uneven, thus resulting in poverty in many countries.
The third view presented by Held is that of the Transformationalist, which exists as a sort of halfway house between the Hyperglobalists and the Sceptics and sees them as both being too simplistic in their views’ of globalisation. Anthony Giddens (1990 pp.70-71) makes the point that whilst ‘transnational corporations, may wield immense economic power, and have the capacity to influence political policies in their home bases and elsewhere…all modern states have a more or less successful monopoly of control of the means of violence within their own territories.’ He is signifying that whilst global entities can introduce legislation such as ‘The Accord’, it is redundant unless the nation-state utilises their absolute power to enforce it. This view exists as something of a compromise between sceptics Hirst & Thompson, and the hyperglobalist Ohmae, bringing them together in a real life context. In looking to the future ‘The Accord’ may become a key point in history where we find out whether policy created by global non-governmental entities can be successfully integrated in to a nation-state. Giddens’ work is published through Stanford University Press, one of the most highly regarded academic entities in the world.
The transformationalist outlook is summed up effectively in International Relations of Social Change (p.143) where Jan Scholte writes ‘Change is one of the core facts of social life…..we today face major social ills-of violence, of inequality, of injustice, of anomie-which positive transformations of the social order could alleviate, we also face major shortcomings in mainstream academic investigations of social change’. This writing nicely frames the events surrounding the Rana-Plaza 20 years before it ever happened. It speaks of the inequality and injustice suffered by garment workers who were sent to their death by the greed of a capitalistic firm supplying MNCs, but then continues to comment on how these ills could countered by new global organisations (such as Industriall who created ‘The Accord’).
Common to both Giddens and Scholte and the Transformationalist view as a whole is the notion that the Hyperglobalist view and Sceptic view are too idealistic in their summation of the globalisation process and its impact on the world both now and in the future. If we look to Held he claims that ‘At the heart of the transformationalist thesis is a conviction that, at the dawn of a new millenium, globalization is a central driving force behind the rapid social, political and economic changes that are reshaping modern societies and world order’ (1996 p.7) and writes of their belief in the unknown consequences of the ‘powerful transformative force’ of globalisation.
At the heart of this review has been the concept that globalisation and poverty are linked and that the Rana-Plaza disaster could be a useful focus point to examine the theories that surround globalisation, and this seems to have emerged as a truth. However, whether one is to believe the neo-Marxists who believe that globalisation is simply shifting poverty and horrors such as Rana-Plaza from the western world to developing countries, or take a more liberal view and look at the resulting legislation which led to the improvement of working conditions for the ‘proletariat’ remains unclear. The competing theories sometimes correlate and sometimes disagree in their estimations of the effects of globalisation on poverty. What is certain is that whether it be seen as a modern occurrence, or a repetition of history, it is a powerful force that affects us all. With the advent of social media the world is changing faster than ever, information flowing faster than ever, and the repercussions for this on world poverty could be massive. It is a global tool that could undoubtedly be used to bring the plight of the world’s poor to the attention of those who can change it, but whether they will react and how, will perhaps be the next chapter in the history of globalisation.
References
Allam J & Hossain F. (2013). Bangladesh collapse search over; death toll 1,127. Available: http://news.yahoo.com/bangladesh-collapse-search-over-death-toll-1-127-122554495.html. Last accessed 6 Mar 2014.
bangladeshaccord.com. (2013). Welcome to the Accord. Available: http://www.bangladeshaccord.org/. Last accessed 7 Apr 2014.
Bergman A. (2014). World's largest economies. Available: http://money.cnn.com/news/economy/world_economies_gdp/. Last accessed 5 Mar 2014.
Butler S. (2013). Bangladeshi factory deaths spark action among high-street clothing chains. Available: http://www.theguardian.com/world/2013/jun/23/rana-plaza-factory-disaster-bangladesh-primark. Last accessed 6 Mar 2014.
Davidson A. (2012). It Is Safe to Resume Ignoring the Prophets of Doom ... Right?. Available: http://www.nytimes.com/2012/02/05/magazine/economic-doomsday-predictions.html?_r=0. Last accessed 6 Apr 2014.
Devnath A & Srivastava M. (2013). ‘Suddenly the Floor Wasn’t There,’ Factory Survivor Says. Available: http://www.bloomberg.com/news/2013-04-25/-suddenly-the-floor-wasn-t-there-factory-survivor-says.html. Last accessed 25 Mar 2014.
Dunning, J. H. (1993) Multinational Enterprises and the Global Economy. Wokingham: Addison-Wesley
Held, D., A. McGrew D. Goldblatt and J. Perraton (1999). Global transformations: politics, economics and culture. Cambridge: Polity Press
Hirst P & Thompson G. (1999). Introduction: Globalization - a Necessary Myth?. In: Hirst P & Thompson G Globalization in Question. 2nd ed. Malden: Blackwell Publishing Inc.. p1.
Giddens A (1990). The Consequences of Modernity. Stanford: Polity Press. p.70-71.
industriall-union.org. (2013). Bangladesh Safety Accord Publishes Unprecedented Wealth of Factory Data . Available: http://www.industriall-union.org/ba...ublishes-unprecedented-wealth-of-factory-data. Last accessed 4 Apr 2014.
Marx K & Engels F. (1882). The Communist Manifesto. Available: https://www.marxists.org/archive/marx/works/1848/communist-manifesto/preface.htm#preface-1888. Last accessed 3 Apr 2014.
neweconomics.org. (2014). About nef:What we do. Available: http://www.neweconomics.org/pages/what-we-do. Last accessed 6 Apr 2014.
New Economics Foundation. (2008). How Poor is Poor?. Available: http://s.bsd.net/nefoundation/default/page/file/9190d355dfa2d4f550_kkm6bpg2y.pdf. Last accessed 4 Mar 2014.
Noruzi M R & G. Vargas-Hernandez J. (2010). A literature Review of Global Economy and Globalization Era. Acta Universitatis Danubius. Administratio. 2 (1), 76.
Ohmae, K. (1995) The End of the Nation State, New York: Free Press
Oxford English Dictionary. (2014). globalization. Available: http://www.oed.com/view/Entry/272264?redirectedFrom=globalisation#eid. Last accessed 4 Apr 2014.
Oxford English Dictionary. (2014). poverty. Available: http://www.oed.com/view/Entry/149126?redirectedFrom=poverty#eid. Last accessed 4 Apr 2014.
Scholte J A (1993). International Relations of Social Change. Buckingham: Open University Press. p.143.
Santerelli E & Figini P. (2003). DOES GLOBALIZATION REDUCE POVERTY?. Available: http://amsacta.unibo.it/633/1/459.pdf. Last accessed 3 Apr 2014.
Sikder R. (2014). Testimony of Reba Sikder Former garment worker at Ether Tex factory at Rana Plaza, Dhaka, Bangladesh At a meeting with members of the U.S. House of Representatives. Available: http://democrats.edworkforce.house....es/documents/2.11.14-RebaSikder-Testimony.pdf. Last accessed 4 Apr 2014.
United Nations Conference on Trade and Development. (2013). World investment Report 2013. Available: http://unctad.org/en/PublicationsLibrary/wir2013_en.pdf. Last accessed 7 Apr 2014.
Viederman D. (2013). Supply chains and forced labour after Rana Plaza: lessons learned. Available: http://www.theguardian.com/global-d...-plaza-bangladesh-forced-labour-supply-chains. Last accessed 6 Mar 2014.
Wolff R D . (2013). Economic Development and Rana Plaza. Available: http://mrzine.monthlyreview.org/2013/wolff160513.html. Last accessed 6 Apr 2014.
A critical literature review examining globalisation and international poverty: The 2013 Rana-Plaza disaster
This literature review will critically examine theories of globalisation in relation to international poverty with particular reference to the Rana-Plaza disaster of 2013. It will be using theories of globalisation to explore patterns of inequality and assess the real-life impact of globalisation on contemporary poverty. Hopefully through comparison of theories and looking at how they present themselves in global events some insight can be gained as to the effect globalisation is having on poverty. In particular it will use the disaster at Rana-Plaza in 2013 as a reference point for critiquing these theories.
The Rana-Plaza disaster was the collapse of a building in Bangladesh that produced garments for a large number of western retailers. This occurred on the 24 April resulting in 1,129 fatalities (Butler S, 2013) and 2,515 casualties making it the deadliest accidental building failure in history. Local inspectors had discovered cracks in the building on the previous day and dubbed it unsafe for occupation but despite these warnings executives at EtherTex (a garment firm operating out of the building) forced workers to return under threat of being docked a month’s wages (Devnath A & Srivastava M, 2013).
The majority of the initial literature available is simple reportage through mainstream news channels such as those cited, and offers little opinion. Whilst some outlets cited, such as The Guardian, have a left of centre political stance, and others such as Bloomberg claim no political bias, the initial coverage offered little in the way of opinion and are mainly fact based reporting that correlate to provide a depiction of the event. However, only days later, discussion through theguardian.com introduced concepts such as ‘modern-day slavery’ (Viederman D, 2013), revealing its bias.
The disaster led to a piece of legislation called ‘The Accord on Fire and Building Safety in Bangladesh’ (henceforth, ‘The Accord’) (bangladeshaccord.com 2014), a legally binding contract ensuring a minimum level of safety across buildings used for garment production in Bangladesh. It was created by the IndustriALL global workers union and is signed by over 150 garment retailers. It could be suggested this contract was created out of a desire for better working conditions for employees in Bangladesh, but one has to question the signatories’ motives for joining. Is it out of genuine moral concern? Or is it recognition that in the global era as consumers are straying away from firms with unethical working practices, it is a cynical move to protect profits?
Globalization is defined in the Oxford English Dictionary (OED) (2014) as ‘the process by which businesses or other organizations develop international influence or start operating on an international scale’. The mechanics it describes can be seen in the work of Marx and Engels (1882) who wrote ‘European immigration fitted North American for a gigantic agricultural production….. it enabled the United States to exploit its tremendous industrial resources with an energy and on a scale that must shortly break the industrial monopoly of Western Europe, and especially of England, existing up to now.’ In the book Global Transformations: Politics, Economics and Culture (Held et al 1999, p.2) it is reckoned ‘Globalization may be thought of initially as the widening, deepening and speeding up of worldwide interconnectedness in all aspects of contemporary social life’. However, these and other definitions all point towards a view in which the flow of people, money, information and cultures are spreading across the world at an increasing speed. Of this there is no doubt, but the causes and repercussions of this are debated and shall be examined later.
Poverty is a harder term to define. The general definition as given in the OED (2014) is: ‘The condition of having little or no wealth or few material possessions’, but the condition is relative to context. Santerelli E & Figini P (2003) describe poverty as being ‘a multidimensional problem, which results from a combination of economic, political and environmental factors, and which comprises several different aspects’ which goes some way towards explaining the difficulty of putting the term in to application in real life. Perhaps the most widely used explanation in recent years has been the ‘dollar a day’ benchmark set out in the World Bank’s World Development Program (1990). The immediate problem with this norm is that the report is now almost 25 years old, and inflation across the globe means that the nominal value of a dollar has decreased.
The New Economics Foundation (NEF) suggests, ‘Updating the poverty line over time is problematic, for example failing to reflect differences in inflation as between rural and urban areas’ in their 2008 report ‘How Poor is Poor?’. It continues to ‘propose a rights-based approach, which combines the use of outcome indicators to provide a moral basis for the definition of poverty’, suggesting that factors such as education, infant mortality rates and a country’s relative purchasing power parity need to be taken in to account to create separate poverty lines for individual countries. The NEF is a leading UK think tank ‘fully independent of any political party’ (neweconomics.org 2014), but this does not mean they do not have a particular agenda or bias. It claims ‘the current economic system is not fit for purpose’ and is set on developing a new system that prevents climate change and protects people across the world. This suggests the NEF may have a wider definition of what poverty is than other organisations, but its humanistic viewpoint would appear to be what is needed in a real world definition of poverty.
What constitutes poverty in real terms is still open to interpretation though, and there is no apparent definitive answer to this question as of now. However a former EtherTex garment worker has testified with a meeting of representatives of the U.S. House (Reba Sikder 2014), that her base wage was $49/month, which under the 1990 dollar a day model would not class her as living in poverty. However, given 24 years of inflation and the adjustments suggested in the NEF report it would suggest that many workers at the Rana-Plaza disaster could be considered to be living in poverty and henceforth this is a useful example of the real life implications of globalisation on poverty.
The aforementioned Global Transformtions by Held et al (published through Polity Press, probably the world’s leading peer-reviewed academic publisher of social sciences) is perhaps the most iconic of works on globalisation, categorising three main theoretical standpoints: Hyperglobalists, Sceptics and Transformationalists. Hyperglobalists contend that people and businesses the world over are increasingly subject of the global marketplace and Multinational Corporations (MNCs) rather than traditional governmental bodies. Sceptics believe that ‘globalization is essentially a myth’, MNCs are still reliant on governing bodies and that the world is being segmented in to three regional economic blocs. Finally the study argues Transformationalists see the current situation as ‘historically unprecedented such that states and societies across the world globe are experiencing a process of profound change’ (1996 p.2), and that this is creating a whole new set of problems and struggles that individuals and businesses the world over are having to learn to adapt to.
Held cites Ohmae (1995) as a key example of a Hyperglobalist who claims ‘traditional nation states have become unnatural, even impossible business units in a global economy’, and this could be supported by the events of Rana-Plaza. ‘The Accord’ that emerged in the wake of the disaster is an example of legal policy created by a non-governmental global union and signed by Multintional Corporations (MNCs) who operate across a range of countries, that that affects 1,600 factories and 2 million employees in the country of Bangladesh (industriall.org 2013). This supports the view that nation states are becoming less powerful, or as Held puts it ‘‘Economic power and political power….. are becoming effectively denationalized and diffused’.
The Hyperglobalist view also introduces the concept of globalisation resulting in ‘winners and losers’. Professor Richard D. Wolff (2013) argues that ‘Globalized capitalist competition destroyed the clothing industries of the former colonizing countries….and relocated them in the former colonies’. He continues to propose that this has resulted in shifting poor working conditions from west to the east at the expense of jobs in western countries and that ‘Such awful conditions are often punctuated by catastrophic tragedies such as Rana-Plaza’; this seems to agree with the idea that globalisation is creating winners and losers. However, he has been referred to as ‘probably America’s most prominent Marxist economist’ (Davidson A, 2012), and such partisan interpretations are reflected in his other texts and a liberal Hyperglobalist may look to ‘The Accord’ and suggest that this process of globalisation is actually introducing increased rights and protection to workers around the world in developing countries.
The Sceptics view the patterns of global trade as not being a new occurrence but a repetition of patterns of the past. Hirst and Thompson’s Globalization in Question (again Polity Press) cites Dunning (1993, pp97-98) as claiming ‘By the end of the fourteenth century it is estimated that there were as many as 150 Italian banking companies operating multinationally’. Instead they say that the world is moving towards a position of three distinct trading blocs: USA, Japan/East Asia and the EU. Whilst there is evidence to support this position in that the USA and EU remain the two dominant economic blocs in terms of GDP, in the time since the book has been written we have seen a move away from the triad model. Andrew Bergman’s model created for CNN (2014) shows China now stands alone as the second largest national economy in the world (fast catching up to the entire EU bloc) and Brazil emerging as the 6th largest. BRIC is an acronym often used to describe Brazil, Russia, India and China due to the similarity in their level of development. Whilst CNN is a mainstream media site that has been accused of having a liberal bias, the sources he uses for the model (IMF & World Economic Outlook) are solid and impartial as one is likely to find so it remains a useful piece of literature. Ironically we see a link here back to the work of Mark and Engels in that a communist country is indeed transgressing the ‘industrial monopoly’ of the West. Whether this is actually resulting in a shift of wealth from the rich to the poor is debateable though as modern China’s model of communism is much different from that imagined by Marx and Engels.
Hirst and Thompson also state that ‘One key effect of the concept of globalisation has been to paralyse radical reforming national strategies’, but ‘The Accord’ suggests this is not the case. The global business community has come together to move in and reform policy in a country where the government is failing its people. They claim ‘the forces of internationalization themselves depend on the regulatory power of national governments’, but it seems globalised entities such as Industriall are now supplanting governments in some situations to create policy. However, the implementation of said policy does rely on government to a certain extent (as discussed later).
One key element of Hirst and Thompson’s view is the concept of uneven Foreign Direct Investment and suggest that it is ‘(MNCs) that are the agents responsible for FDI’ (1996, p.66). They propose that the majority of the world’s FDI occurs between members of their triad bloc model and claim ‘It’s consequences for the living conditions, life expectancy of the world’s poor are obvious. It should not be allowed to go on and we should do something about it urgently as a matter of conscience’ (1996 p.75). The United Nations Conference On Trade and Development World Investment Report (2013) shows that the situation is now more extreme, with the US and China emerging as strongholds of investment, EU members being matched by many other countries, (but still remaining strong as a bloc), and Africa in particular receiving very little. However, this does not mean that that the wealth generated by investment is reaching the poor in these countries, and most is likely benefiting a small number of MNCs. As a document produced by the United Nations this is about as credible a source as it is possible to find and it agrees with the view that FDI is still vastly uneven, thus resulting in poverty in many countries.
The third view presented by Held is that of the Transformationalist, which exists as a sort of halfway house between the Hyperglobalists and the Sceptics and sees them as both being too simplistic in their views’ of globalisation. Anthony Giddens (1990 pp.70-71) makes the point that whilst ‘transnational corporations, may wield immense economic power, and have the capacity to influence political policies in their home bases and elsewhere…all modern states have a more or less successful monopoly of control of the means of violence within their own territories.’ He is signifying that whilst global entities can introduce legislation such as ‘The Accord’, it is redundant unless the nation-state utilises their absolute power to enforce it. This view exists as something of a compromise between sceptics Hirst & Thompson, and the hyperglobalist Ohmae, bringing them together in a real life context. In looking to the future ‘The Accord’ may become a key point in history where we find out whether policy created by global non-governmental entities can be successfully integrated in to a nation-state. Giddens’ work is published through Stanford University Press, one of the most highly regarded academic entities in the world.
The transformationalist outlook is summed up effectively in International Relations of Social Change (p.143) where Jan Scholte writes ‘Change is one of the core facts of social life…..we today face major social ills-of violence, of inequality, of injustice, of anomie-which positive transformations of the social order could alleviate, we also face major shortcomings in mainstream academic investigations of social change’. This writing nicely frames the events surrounding the Rana-Plaza 20 years before it ever happened. It speaks of the inequality and injustice suffered by garment workers who were sent to their death by the greed of a capitalistic firm supplying MNCs, but then continues to comment on how these ills could countered by new global organisations (such as Industriall who created ‘The Accord’).
Common to both Giddens and Scholte and the Transformationalist view as a whole is the notion that the Hyperglobalist view and Sceptic view are too idealistic in their summation of the globalisation process and its impact on the world both now and in the future. If we look to Held he claims that ‘At the heart of the transformationalist thesis is a conviction that, at the dawn of a new millenium, globalization is a central driving force behind the rapid social, political and economic changes that are reshaping modern societies and world order’ (1996 p.7) and writes of their belief in the unknown consequences of the ‘powerful transformative force’ of globalisation.
At the heart of this review has been the concept that globalisation and poverty are linked and that the Rana-Plaza disaster could be a useful focus point to examine the theories that surround globalisation, and this seems to have emerged as a truth. However, whether one is to believe the neo-Marxists who believe that globalisation is simply shifting poverty and horrors such as Rana-Plaza from the western world to developing countries, or take a more liberal view and look at the resulting legislation which led to the improvement of working conditions for the ‘proletariat’ remains unclear. The competing theories sometimes correlate and sometimes disagree in their estimations of the effects of globalisation on poverty. What is certain is that whether it be seen as a modern occurrence, or a repetition of history, it is a powerful force that affects us all. With the advent of social media the world is changing faster than ever, information flowing faster than ever, and the repercussions for this on world poverty could be massive. It is a global tool that could undoubtedly be used to bring the plight of the world’s poor to the attention of those who can change it, but whether they will react and how, will perhaps be the next chapter in the history of globalisation.
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