Some Thoughts on Globalization

At a meeting of the British-American Business Association (BABA) which I attended in the summer of 2016, one of the panelists made an interesting argument. He argued that the world is now essentially divided between two social groups, namely, globalists on one hand and nativists on the other hand. There is perhaps a third group that we overlook, namely, the hypocrites who pose as globalists but are actually nativists at heart. Although globalization is now at its peak, it also has the potential to rapidly disintegrate and drive different peoples and nations into isolation and autarky with incredible pace and speed.

One of the contemporary factors driving the potential for de-globalization, isolation, and autarky is the coronavirus pandemic. Just in the United States alone, the coronavirus could lead to a loss of about five trillion dollars in real gross domestic product (GDP) over the course of the next two years, according to a recent study conducted by the University of Southern California (USC). Also, according to a March 2021 report from McKinsey and Co., weaker demand, unemployment, and an uptick in political conflict have been the direct results of the coronavirus on a global scale, and these factors cannot be easily overcome. Given that demand is the key impetus for overall economic growth, it is perhaps inevitable that economic growth will be sluggish in the Western world for the foreseeable future.

There is also no clear end date for the coronavirus pandemic. The end goals, however, are mass vaccination and thus ‘herd immunity’ so that there is a gradual transition to ‘normalcy.’ But it is unclear as to how long it will take to achieve these goals, given the array of challenges which stand in the way of achieving these two goals. Thus, coronavirus has the potential to set into stone a trek towards de-globalization and thus autarky and isolation on the part of various peoples and nations. The opening article of a recent issue of The Economist implores the international community to avoid de-globalization, by stating:

“Resilience comes not from autarky but from diverse sources of supply and constant private-sector adaptation to shocks. Over time, global firms will adjust to even long-term threats, including tensions between America and China and the effects of climate change by gradually altering where they make fresh investments. This is a perilous moment for trade. Just as globalization begets openness, so protection and subsidies in one country spread to the next. Globalization is the work of decades. Do not let it run aground.”

As Bill Gates has noted in his newest book titled “How to Avoid a Climate Disaster,” political action is the main route through which we can address the threat of climate change, in addition to the personal choices we can make in order to reduce our individual carbon footprint. In essence, there is a race against time in overcoming the political obstacles and roadblocks that stand in the way of addressing climate change. If we cannot overcome these political obstacles and roadblocks in a timely manner, we will all have to pay a heavy price for our inaction.

In addition to our lackluster efforts towards addressing climate change, the failure of the Western world to properly manage world affairs over the course of the last two decades has also led to a shift in geopolitical momentum towards the East, particularly towards China. As a result, even a number of Western nations such as Britain have adopted a “Global Britain” foreign policy whereby the focus of Britain’s overseas engagements will be oriented towards Asia. Also, the European Union (EU) has forged a monumental trade agreement with China, which in turn facilitates further Eurasian integration. The United States is now in a scramble to gain back some of the momentum lost to China. For one, President Biden’s COVID stimulus package as well as the infrastructure plan that is now in the works has the potential to boost America’s economic growth rate by about 6 percent, which in turn could bring America’s growth rate on par with China’s growth rate over the next couple of years. But political gridlock in Washington may thwart these efforts.

China’s “Belt and Road Initiative” (BRI) is also a testament to China’s commitment towards further globalization of a world economy that fostered interconnection and interdependence on a global scale over the course of almost eight decades since the rise of the United States as a superpower in international politics. But as right-wing sentiment picks up steam and isolationist sentiment become more emboldened in the American body politic, Adam Smith’s vision of a globalized world is now being adopted by the Chinese rather than the Americans. Nevertheless, from a foreign policy standpoint, it is difficult for the United States to avoid a future of globalization. American foreign policy has gone through three distinct stages, namely, isolationism, containment of the former USSR, and global hegemony. The fourth and final stage of American foreign policy is globalization.

But America – by virtue of culture and geography – is essentially shutting itself out of the globalization game that is now being led by China. This shift in focus on globalization from West to East is reflected in the future distribution of global GDP. Asia is projected to wield about 40 percent of global GDP, whereas the United States will see its share of global GDP drop from 20 percent to 15 percent in the coming years.

Also, by virtue of overextension into troublesome parts of the world such as Afghanistan and the Middle East, America now has to restart and reset its engagement with the outside world by first drawing back its far-flung excursions into Afghanistan and the Middle East and then focusing on its historic sphere of influence, namely, the Western Hemisphere. Africa will also have to be on the radar for the United States if it seeks to compete with China in a geopolitical sense. The United States is, however, keeping tabs on what China is doing on a geopolitical level. When China was focused on carving a sphere of influence for itself in the ASEAN region, America also shifted its focus on ASEAN. Now that China has signed a major cooperation and trade deal with Iran, the United States has resumed talks with Iran – albeit in an indirect manner – in order to lure Iran into cooperation and trade with Western nations. But the point of geopolitical focus never remains constant. One day it is ASEAN. The next day it is Iran, and then it will be somewhere else after that.

Economics and geopolitics are not the only things being impacted by globalization. Identity is perhaps the most important issue being impacted by globalization, which is often overlooked. Arguably, globalization has led to the transformation and even the uprooting of traditional and native identities. Globalists now run the world, and everyone else is being left behind. Thus, in order to remain competitive, people have to “reinvent” themselves by acquiring as much knowledge and information as possible about the world we live in. As mentioned in previous articles, human history is now in its fourth and final epoch or stage. Human history began with the nomadic age. Then, it was the agricultural stage. After that, it was the industrial era. Now, we are in the information age.

Thus, everything revolves around information in this day and age. Richard Stengel gives an interesting anecdote to describe how information has become such a powerful force in an age of globalization and technology:

“The Library of Congress was created in 1800 and has 39 million books. That’s a lot of information. Today, the internet generates 100 times that much data every second. Yes, every second. Information is the most important asset of the 21st century. No wonder polls show that people feel bewildered by the proliferation of online news and data.”

Sifting through the avalanche of information that hits us every second on the internet in order to determine what is right or wrong so that we can make informed decisions in our personal lives is the foremost challenge in an information age, aside from the economic, social, and political implications of an information age that has put the entire world in a state of flux. Happiness, prosperity, and even survival now depend on brains rather than brawn. But ultimately, reality is shaped by discourse, and discourse is in turn shaped by a leitmotif that runs through the book or oeuvre that underlies the discourse. Thus the uncertainty but also the subtlety. As the British historian and poet Horace Walpole once wrote: “The world is a tragedy to those who feel, but a comedy to those who think.”

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