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Globalization And International Relations Issues How To View International Trade? Sovereignty and Intervention The Diffusion of Power How To View International Trade? Globalization – The international process that leads to the worldwide integration of market-driven exchanges in goods, services, and capital. Is Economic Globalization (Trade) Beneficial to the Economy? Trade: a way to equalize prices in different places. Trade stimulated by possibility of buying something at low price in one place and selling it for a higher price in another. If goods are more expensive in one market, more supply will flow to higher-priced market. Competition presses prices down until comparable in different market. Free trade can contribute to economic growth. Major Anti-globalization Demonstrations. Washington, D.C. (1994): IMF/World Bank Seattle (1999): WTO ministerial meeting Prague (2000): IMF/World Bank meetings Quebec City (2001): Summit of the Americas Genoa (2001): Groups of Seven Summit Cancun, Mexico (2003): WTO conference The process of globalization promoted by WTO and efforts to stymie globalization represent fundamental puzzles about international political economy. Tension Between Efficiency and Equity. Globalization draws attention to government role in advancing/retarding trade liberalization. Governments routinely must choose between policies that advance efficiency and policies that advance equity. “Efficiency”: Consumers buy the best quality of goods at the lowest price, and producers sell their products at the best price. Governments do not interfere with a free market system. “Efficiency”: Consumers buy the best quality of goods at the lowest price, and producers sell their products at the best price. Governments do not interfere with a free market system. Efficient markets can be cruel. Those who are less competitive suffer. “Efficiency”: Consumers buy the best quality of goods at the lowest price, and producers sell their products at the best price. Governments do not interfere with a free market system. Efficient markets can be cruel. Those who are less competitive suffer. Without a social safety net like unemployment insurance, subsidies, progressive taxation, etc., they might not be able to survive. “Equity”: Governments can regulate markets and limit foreign companies’ access to domestic market to protect domestic farmers or industries. Debate about globalization really is debate about equity. “Equity”: Governments can regulate markets and limit foreign companies’ access to domestic market to protect domestic farmers or industries. Debate about globalization really is debate about equity. Opponents of globalization may accept that free trade promotes efficiency, but they believe free trade heightens inequity between/within countries. “Equity”: Governments can regulate markets and limit foreign companies’ access to domestic market to protect domestic farmers or industries. Debate about globalization really is debate about equity. Opponents of globalization may accept that free trade promotes efficiency, but they believe free trade heightens inequity between/within countries. “The backlash against globalization draws its force from the inequalities in the global trading system.” (Joseph Stiglitz, a winner of the Nobel prize in economics) Inter-country inequality: countries in the world (GDPPPP per capita 1950-2000) Branko Milanovic 0.560 0.540 0.520 0.500 0.480 Gini coefficient World 0.460 0.440 0.420 0.400 0.380 0.360 50 52 54 56 58 60 62 64 66 68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 19 19 19 19 19 19 19 19 19 19 19 19 19 19 19 19 19 19 19 19 19 19 19 19 19 Year Within-country inequality: (person-based Gini from D-S database, 60’s-90’s) Branko Milanovic 40 35 Mean Median Ginis 30 25 20 1960's 1970's 1980's 1990's Inequality People who were living on less than $2 per day in 1998 more than 2.8 billion! During 1990~1998: It increased by 100 million people! (World Bank 2000) The composition of the Four Worlds in 1960 and 1998: (number of countries) Rich Contenders Third Fourth World World 1960 41 22 39 25 1998 29 11 19 78 Does Government have to Intervene? Absence of government intervention is a public good. Tariffs (protections) act as a private good. The benefits of protection are concentrated while the costs are diffuse. The greater private goods, the more likely interest groups and lobbyists exercise influence over political leaders. Difficulty in distinguishing protectionist plots from policies sincerely aimed at protecting consumers, environments, or a poor group. Is Economic Globalization (Trade) Beneficial to Peace? The Liberal Peace: “As the level of trade increases, the probability of interstate conflict will decreases.” Is Economic Globalization (Trade) Beneficial to Peace? The Liberal Peace: “As the level of trade increases, the probability of interstate conflict will decreases.” “The whole world is concentrating much of its thought and energy on attaining the objectives of peace and freedom. These objectives are bound up completely with a third objective – reestablishment of world trade. In fact, the three – peace, freedom, and world trade – are inseparable.” (President Truman, 1947). Neorealist View of Trade Policy States are security maximizers. One is made relatively worse off by cooperating because the other’s gains are larger than are one’s gains. “relative gains” are critical! Trade creates security externality. Relative gains can be converted into extra military spending power imbalance. Jeopardizes security! Asymmetric trade dependence may cause complains. Security externality may exist in theory. Too small to matter much to security in fact. Some states seek security by defense spending while other states seek wealth. The contribution of free trade to peace is still uncertain. Sovereignty and Intervention “Sovereignty”: A government’s absolute control of a territory within its borders in a legal sense. Outsiders should respect their sovereignty and territorial integrity. A growing list of problems or common issues that are beyond sovereign boundaries: climate change, AIDS, refugees, terrorism, human rights, racism, civil wars. “Intervention”: External actions that influence the domestic affairs of another sovereign state. Intervention Types: speeches, broadcasts, economic aid, military advisers, blockade, limited military action, military invasion. Is Intervention justifiable (when the sovereign state doesn’t ask any help)? Two partly contradictory bodies of international law. Charter of the United Nations. Chapter 1, Article 2.7 “Nothing contained in the present Charter shall authorize the United Nations to intervene in matters which are essentially within the domestic jurisdiction of any state or shall require the Members to submit such matters to settlement under the present Charter….” Universal Declaration of Human Rights,General Assembly resolution 217 A (III), Article 22. “Everyone, as a member of society, has the right to social security and is entitled to realization, through national effort and international co-operation and in accordance with the organization and resources of each State, of the economic, social and cultural rights indispensable for his dignity and the free development of his personality.” Article 30. “Nothing in this Declaration may be interpreted as implying for any State, group or person any right to engage in any activity or to perform any act aimed at the destruction of any of the rights and freedoms set forth herein.” Respect sovereignty or Intervene for Justice? Examples. The NATO intervention in Kosovo: Was it illegal because it was not authorized by the U.N. Security Council? Or, was it legal under the evolving body of international humanitarian law? How about the failure of stopping the 1994 Rwanda genocide? In 100 days, at least 800,000 people were killed. “... The world must deeply repent this failure. Rwanda’s tragedy was the world’s tragedy. …Looking back now, we see the signs which then were not recognized. Now we know that what we did was not nearly enough--not enough to save Rwanda from itself, not enough to honor the ideals for which the United Nations exists. We will not deny that, in their greatest hour of need, the world failed the people of Rwanda …” (Kofi Annan, the U.N. Secretary-General) Judging Intervention For the realists, the key value in international politics are “order” and “peace”. Intervention can be justified when it is necessary to maintain the balance of power. For cosmopolitans, the key value is “justice”. Intervention can be justified if it promotes justice of individuals. For state moralists, the key value is “the autonomy of the state and its people”. Intervention is rarely justified. War is justified to defend a state’s territorial integrity or to defend its sovereignty against external aggression. But, external aggression is often ambiguous. (E.g. Israeli attack on Egypt in 1967) A preemptive strike against an impending Egyptian attack? Who was the aggressor? Which view will you buy? • “The norm of nonintervention remains important. Exceptions to nonintervention must be judged on a case-by-case basis by looking at the motives, means, consequences” (J. Nye). • Is an intervention resulted from good intentions? • Were there alternatives? Was intervention a last resort? Were there efforts to protect innocent life? • What about the consequences and the danger of unintended consequences? The Diffusion of Power Information Revolution A diffusion of power away from central governments. Governments can’t keep their financial and political situations inside a black box. Transnational Actors Multinational corporations. Decide what to produce and whether to produce it at home or overseas. Nongovernmental Organizations (NGOs) Transnational private organizations have increased: 26,000 (1990s) 2,000 (1970) 1,000 (1956) 176 (WWI). NGOs can represent broad public interests which might be easily ignored by states. Effects of diffusion of Power? Much more awareness of what is going on in other parts of the globe. Groups are better able to organize on a global basis. Contradictory interests within nations and between transnational actors. More complicated to understand international politics. Information revolution requires us of developing our own ability of judgment on various matters. Need to study political science harder! Why Political Science? Explanation: Political science is to explain why a particular event happens. Prediction: Once we understand why things happen, then we can make better predictions, and prescribe better policies. We need to be objective or scientific. Are you? No absolute objectivity! Various Perspectives exist. Open your mind, Look for information, and Build your own belief and position! Questions?
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