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The Techno-World and Globalization

About the Author

Bruce Cumings
Bruce Cumings, chair of the history department at the University of Chicago, is the author, most recently, of North...

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For the past few years "globalization" has been the mantra of Wall Street, idyllic snowy gatherings in Davos and, of course, the Clinton Administration. But this term hides as much as it illuminates; it is often a euphemism for Americanization, just as the "multinational" corporation began as, and often remains today, an American or Japanese or German corporation operating in other countries. The endless, unseemly touting of globalization muffles attention to new circuits of power in the same old places, ones that have grown apace with the upheavals of the microchip. Why upheavals? Because one settled industry after another has been undone by Information Age technology. This is most obvious in the quick obsolescence of the hugely expensive trunk lines, switching stations and home telephone trappings of the big telephone companies. Fiber optics allows many times more messages than old copper wires, as we have seen; digital switches are so capacious that a single smaller country can be handled with one switch; cellular circuits boom throughout the world and enable a country like China to leapfrog over the cost of putting a wired telephone in every home. The massive deregulation of recent years is both a consequence and a cause of these upheavals, but it has been a key element in freeing up the new technologies.

The new information technologies make feasible enormous new networks of power, centralizing control and management in several urban nodes (New York, Los Angeles, London, Tokyo). A key reason for the renaissance of New York City as a financial and cultural capital in the nineties was its concentration of service industries (accounting, law, finance, advertising, stock markets); services are the largest sector in the American economy now. Susan Strange has shown that the top six accounting firms in the world are all Anglo-American; together they audit fully 494 of the Fortune 500 firms, yielding a combined income of $30 billion a year. Nine of the top fifteen public telephone operators are based in the United States, with five more in Europe and only one in Japan (state-owned Nippon Telephone and Telegraph). Thus North America and Europe accounted for 75 percent of all telecom revenues in 1993.

As Saskia Sassen of the University of Chicago has argued, this process does not weaken national governments and make of our era one in which transnational corporations rule, because only states can legislate the rules of globalization. This is evident in the coordination of the United States, Britain and the European Union in legislating the domain and the rules for new international zones like the European Union and NAFTA (united markets for transnational business), thus to support and propel globalization. American standards of all kinds are the new standards of globalization: Practices that are grouped under the august social fiction known as "the rule of law" are organizing the globe in their image, through the growth of transnational legal regimes based on Western practices of property rights, contracts and transparency--the highly developed legal framework for the conduct of world capitalism, and something on which every transnational corporation depends.

The champions of the Internet and cyberspace pride themselves on the democratic and egalitarian openness of their transparent electronic sphere. But power also abhors a vacuum. Corporations are hierarchical organizations in competitive environments that make transparency anathema; they are opaque, making secret and often unaccountable decisions, with phalanxes of highly paid lawyers to protect them; meanwhile, they demand transparency of everyone else in their environment--especially consumers (who can feel like they have visited a proctologist just by applying for a mortgage), but also entire nations subjected to the prying eyes of the IMF and the World Bank.

This same centralization of power estranges and isolates poorer regions of the world, which often lack even the most basic technology of our age, electricity. When President Clinton visited a remote village in Africa in 1998 and urged that the local school connect to the World Wide Web, he did not appear to notice that the school had no electricity. Using the Web I can find satellite photos of this village, learn the ethnicity of its inhabitants and count the number of homes with running water. But the villagers cannot see me or the World Bank employees who catalogue such information. And because knowledge is power, they are less free than before the advent of the computer. Instead of homogenizing these Africans, turning them into the Americans they no doubt would like to be (given the alternatives), "the technological annulment of temporal/spatial distances," in Zygmunt Bauman's words, tends to polarize us and them. A deepening spatial segregation between rich and poor, both within countries and in the world as a whole, defines our era, and enhances central power just as it peripheralizes those left behind, creating new polarizations of wealth and poverty that have only increased in the past two decades. One of the most striking elements in the recent economic boom in the United States is that household income has increased slowly and incrementally while wealth has grown geometrically (especially in stock holdings); household income was basically stagnant from 1975 to 1995, even if it has increased gradually in the past five years. Such a process, of course, yields a massive transfer of wealth from the poor and middle classes to the top decile of the population.

While some argue that such data prove that American economic decline continues, it is far better evidence of the power of the owners of capital and expertise. Corporations are mobile, while residential communities are not; professionals who are technically competent and well paid move faster than ever, and are festooned with portable devices to keep them in touch with some center (portable computers, cell phones, beepers and pagers), while those in nonprofessional jobs, rooted to a place, lose out. The growing service sector, now hitched to the microchip, also polarizes income between a handful of very high paying positions and a mass of low-paying and often part-time jobs.

This creates an enormous problem for the (Keynesian) demand-promotion so essential to maintaining American-style shop-till-you-drop consumption, because you can't maintain a Lucean middle-class lifestyle on stagnant wages. Much more important, however, is the pressure brought to bear by neoliberal efficiencies on existing social arrangements that were the ubiquitous products of the post-World War II settlements in all the industrial countries (the welfare state in the United States, the social market in Germany, the cradle-to-grave permanent employment and welfare of postwar Japan), and that put a floor under poverty and did so much to create huge middle classes. This pressure has now set off a major oppositional movement to neoliberalism and globalization in Western Europe--and in Seattle and DC--with intellectuals coming to see the US challenge as a civilizational confrontation, a matter of life and death: how to protect hard-fought gains for the working and middle classes against an untrammeled "ecumenical gospel" of neoliberalism pioneered by Thatcher and Reagan, but made into his own by the domestic and foreign economic policies of Bill Clinton.

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