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This chapter is from the book

The Rise of Globalization

Business leaders, government officials, and academics have been bombarding Americans, Europeans, and East Asians for a decade with statements about the job creation and other benefits brought about by globalization. With good reason. During the past thirty years, three fundamental trends have led to the celebration of globalization.

First, the democracies that came out on the winning side of World War II embraced the notion of free trade as one of the most important building blocks of modern economies. The logic was that free trade would facilitate creation of a middle class in Third-World countries, while in advanced economies the export of goods and services would enrich companies and whole nations. Success has crowned the approach. Free trade is essentially the ruling mantra of the day, with a history going back several hundred years before gaining momentum in the second half of the twentieth century. The establishment and operation of the United Nations, many rounds of economic trade agreements, and most recently, the creation of the World Trade Organization (WTO) provided institutional support for the movement. Large regional trading blocks in Europe with the Common Market and in the New World with the North American Free Trade Agreement (NAFTA) are generally considered to be successful milestones on the road to free trade.

Second, the vast improvements in telecommunications, the processing and movement of data (thanks to computers), and more effective transportation systems (most notably, commercial air traffic) created an infrastructure that reduced the limitations of distance. The telephone is widely available in all societies and is effectively ubiquitous in advanced economies, where phones exist in over 90 percent of all households and nearly 100 percent of all businesses. In some societies, cell phones are used by over 60 percent of the population. Satellites and the Internet have made it possible for businesses to operate more globally with integrated operating processes and in many markets around the world in ways not possible in 1950, let alone in 1900. The result is that commercial activities are increasingly conducted with fewer borders, with cheap, fast communications and with more and more nations basking in the sunshine of free trade. Never in the history of humankind have global trade and communication been so easy or so extensive.

The third trend involves the spread of two related concepts and sets of actions. The first has been the creation and expanded use of international agencies that transcend borders. The United Nations is the most obvious example, but there are important others, such as the Common Market and the International Monetary Fund, all creations in the second half of the twentieth century. These organizations made it possible to establish global standards of behavior, law, and economic practices. That is why, for example, a mass murderer can be arrested in Bosnia, tried before an international court in The Hague, then imprisoned in Holland. The second related part of the trend has been the slowly developing set of legal and moral benchmarks for behavior that are appearing across the world, mostly in advanced Western societies. For example, the global trend toward eliminating the death penalty is putting pressure on countries that still impose it, such as the United States and China. Another involves the less publicized movement toward implementing laws that protect property and personal possessions from seizure and clumsy legal bureaucratic behavior. This has been most in evidence in what were the Iron Curtain countries, in Latin America, and now in parts of Asia, although too slowly in sub-Saharan Africa and in what was the Soviet Union.

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