Hong Kong's Occupy Central Protest

This is the kind of current event that Siglitz would read about and say "case in point: political stability determines economic stability".


http://www.npr.org/blogs/goatsandsoda/2014/09/28/351845664/the-experts-missing-from-the-ebola-response-anthropologists?utm_source=facebook.com&utm_medium=social&utm_campaign=npr&utm_term=nprnews&utm_content=20140928

Reality check is like a slap in the face

I am not going to make a substantial blog post about today's readings, but wanted to copy and paste this part of "It's a Flat World After All" by Fiedman for future reference.

"Americans and Western Europeans would be better off thinking about how you can raise your bar and raise yourselves into doing something better. Americans have consistently led in innovation over the last century. Americans whining -- we have never seen that before.''

There is no harsher truth than these words; quit crying and step up America. 

Stiglitz vs. Wolf: reflecting on few points

I thought I would enlist few points that I wish we discussed more in depth from last week.

1) While Wolf acknowledges that not everyone has equally benefitted from globalization (as opposed to its initial promise), he seems to be tolerant of the disparity between advanced and developing nations. He explains, "most opponents of the market economy compare the worst of today with the best [and]..that may seem fair enough. But it makes as much sense to compare the worst of today with the normal in the past." (Wolf 57). This almost sounds to me that Wolf is convincing his readers, "okay, maybe there have been losers. But look on the bright side; look at how much even the poorest countries have come so far since the dark age." I believe this kind of attitude has danger in itself as it lowers our threshold of what can be considered as improvement. For instance, just because Ethiopia now has several internationally (mostly by UK) funded hospitals in its capital, it does not rule out the reality that majority of population in rural areas are still suffering from curable diseases. Many developing countries have not advanced significantly even in comparison to its own past (i.e. Sierra Leone). Moreover, globalization has probably made it easier for LDCs (less developed countries) to compare their abject situation to the wealth of the northern hemisphere. Amidst the

2) Another point that was briefly brought up during the last week's class (but not discussed to my heart's content) was on China's participation in global economy. It was very interesting that both Wolf and Stiglitz cite China as their case in point for supporting their argument. According to Wolf's point of view, free trade is guaranteed to result in economic growth. China, as he argues, could boost their economy precisely because they opened their market to the international community. On the other hand, Stiglitz argues that success of economic liberalization depends on a set of restrictive and calculated political decisions. His assertion actually relates very nicely to professor Casey's Development Economics class that day (which conveniently was right before IPE). Professor Casey told me that China still pushes for very restrictive policies that limit foreign investment significantly. Although these practices go against the principle of economic liberalization, they have actually helped protect China's economy from the whim of global market. For instance, the Chinese government requires foreign investors go through an arduous process of contracting and further requires a non-negligible portion of their returns re-invested back in China, thus ensuring further growth. The government also strictly prohibits the flow of 'hot, short-term' capital flows into the country in order to prevent sudden withdrawal of capitals at any sign of financial crisis. At this point, it seems to me that Wolf is theoretically centered (maybe too much?), while Stiglitz is more political & practical oriented.

Globalization: sowing the seed of its own destruction?

From the last class, what really stayed with me the most was professor Dickovick's question "is liberal economy sowing the seed of its own destruction?". Analyzing the cycle of global economy since the late 18th century, Wolf asserts that industrialization has necessarily engendered nationalism (manifested in various forms such as universal suffrage and social security). It seems helplessly ironic that the industrialization- probably the most common product of globalization- 'inevitably' brings about the collective sentiment of anti-globalization in nations.

It is certainly fascinating to reflect on the relationship between liberalism and nationalism. Wolf seems to believe that these two ideologies are completely antithetical. In my opinion, however, nationalism can actually be quite compatible with the liberal economy. Take Scotland as an example. Although the current campaign for independence is purely driven by Scottish nationalism, it will be arduous to think that Scotland will completely cut off its tie with the rest of the world (especially with the rest of Europe) even if it does achieve its goal. Rather, they would find themselves mired in increasing number questions starting from whether to use Euro or British Pound (since England will be a foreign nation after their independence) as their new currency.

When we realize that nationalism and liberalism are not polar-opposite of each other, we can also consider the possibility that one might be in fact reinforcing another. In many nations, as Wolf argues, liberalism has resulted in rallying strong opposition against western culture (to be specific, American culture). ISIS and other terrorist organizations whose aim is to fight against Western influence and promote traditional and national culture can be the most eminent example of such phenomenon. I wonder then if can be somewhat rational to argue that global terrorism is a byproduct of globalization (so, liberalization=> terrorism?).

So did Wolf accidentally self-contradict himself in that liberal economy would necessarily beget nationalism by industrializing a nation? We will only find out as we continue reading what he has to say in the later chapters.