Globalization Essay

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Today’s dominant account about economic globalization in media and policy circles, as well as in much economic analysis, emphasizes hypermobility, global communications, the neutralization of place and distance, and the growth of a new professional transnational class. But this emphasis on abstract capabilities of systems and on the demand for highly educated workers leaves out many significant aspects of globalization. Globalization—economic, cultural, political— localizes in multiple concrete settings, and it does so through a broad range of venues and actors. Viewed this way, many more components to globalization exist than those that prevail in the dominant account. It is not only the powerful who are actors in these processes of globalization.

Global and Subnational Scalings

Two distinct sets of dynamics constitute globalization. One set involves the formation of explicitly global institutions and processes, such as the World Trade Organization, global financial markets, and the War Crimes Tribunals. These vary greatly in their aims, from narrow self-interest to enhancing the common good. They operate at the scale usually associated with the term globalization. For many, globalization is about these types of conditions and institutions.

But there is a second set of processes that does not necessarily scale at the global level as such, but rather takes place deep inside territories and institutional domains that have largely been constructed in national terms in much, though by no means all, of the world. This largely subnational and translocal form of globalization has received less attention from mainstream scholarship and is far less likely to be conceptualized or recognized as part of globalization; one important exception is the rapidly growing scholarship on world cities and global cities. What makes these processes part of globalization even though localized in national, indeed subnational, settings such as cities is that they involve transboundary networks and domains connecting or articulating multiple local or “national” processes and actors. These include transnational immigrant households and communities; cross-border networks of activists in specific localized struggles with an explicit or implicit global agenda, as is the case with many human rights and environmental organizations; and, generally, cross-border cultural, economic, and political circuits constitutive of the multiple globalizations seen today.

Thus, global processes get constituted at various scales, ranging from supranational and global to sub-national and local, and there are many globalizations, from economic to cultural. Many of the globally scaled dynamics, such as the global capital market, actually are partly embedded in subnational scales and move between globally scaled levels (such as electronic financial networks) and locally embedded conditions (such as the actual on-the-ground financial centers). Many localized entities, such as immigrant communities, can be part of transnational circuits and thereby part of globalization; these are a kind of horizontal globalization rather than the vertical forms represented by the International Monetary Fund (IMF), for instance.

In this more complex understanding of globalization, it is then possible to see how the global can also involve subnational places and the many local conditions, processes, and actors this brings with it. Thus the global economic system is partly embedded in specific types of places and partly constituted through highly specialized cross-border networks connecting the 40 or so major business and financial centers (global cities) in the world today (from cities such as New York and London to Sao Paulo, Shanghai, and Johannesburg). Recapturing the geography of places involved in globalization allows us to recapture people, workers, communities, and more specifically, the many different work cultures, besides the corporate culture, involved in the work of globalization.

It is important to note that globalization is also enabling liberating activities and practices, for example, specific aspects of the human rights and environmental movements as well as particular activities of the anti-globalization network. Globalization also enables the formation of countergeographies of globalization, some exploitative and others emancipatory. The focus of this entry is on the problematic aspects of globalization, which also means a greater emphasis on the global economy.

Recovering Places and Workers in the Global Economy

Hypermobility and the neutralizing of place have indeed taken place. But they are only half of the story. The other half is the territorial centralization of top-level management, control operations, and the most advanced specialized services in a network of global cities. National and global markets, as well as globally integrated operations, require central places where the most complex tasks required by the global economy get done. Further, information industries require a vast physical infrastructure containing strategic nodes with hyperconcentration of facilities. Finally, even the most advanced information industries have a work process involving many different types of workplaces and workers.

The capabilities for global operation, coordination, and control contained in the new information technologies and in the power of transnational corporations need to be produced. By focusing on the production of these capabilities, a neglected dimension is added to the familiar issue of the power of large corporations and the new technologies. The emphasis shifts to the practices that constitute what is called economic globalization and global control: the work of producing and reproducing the organization and management of a global production system and a global marketplace for finance.

A focus on practices draws the categories of place and work process into the analysis of economic globalization. These are two categories easily overlooked in accounts centered on the hypermobility of capital and the power of transnational. Developing categories such as place and work process does not negate the importance of hypermobility and power. Rather, it brings to the fore the fact that many of the resources necessary for global economic activities are not hypermobile and are, indeed, deeply embedded in place, notably places such as global cities and export processing zones. Global processes are structured by local constraints, including the composition of the workforce, work cultures, and political cultures and processes within nation-states.

Once this production process is brought into the analysis, secretaries are seen as part of it and so are the cleaners of the buildings where the professionals do their work and the buildings where they live. An economic configuration very different from that suggested by the concept of information economy emerges. The material conditions, production sites, and place-boundedness, which are also part of globalization and the information economy, are recovered.

The Other Workers in the Advanced Corporate Economy

One of the localizations of the dynamics of globalization is the process of economic restructuring in global cities which has generated a large growth in the demand for low-wage workers and jobs that offer few advancement possibilities. This has occurred amid an explosion in the wealth and power concentrated in these cities—that is to say, in conditions where there is also a visible expansion of very high income jobs.

In the day-to-day work of the leading sectors in global cities, a large share of the jobs involved are lowly paid and manual, many held by immigrant women. Even the most advanced professionals require clerical, cleaning, and repair workers for their state-of-the-art offices, and they require truckers to bring not only the software but also the toilet paper. Although these types of workers and jobs are never represented as part of the global economy, they are in fact part of the infrastructure of jobs involved in running and implementing the global economic system, including such an advanced form of it as international finance.

High-level corporate services, from accounting to decision-making expertise, are not usually analyzed in terms of their work process. Such services are usually seen as a type of output, that is, high-level technical knowledge. Thus insufficient attention has gone to the actual array of jobs, from high-paying to low-paying, involved in the production of these services. A focus on the work process brings to the fore the labor question. Information outputs must be produced, and the buildings that hold the workers must be built and cleaned. The rapid growth of the financial industry and of highly specialized services generates not only high-level technical and administrative jobs but also low-wage unskilled jobs. In New York and other cities, between 30 and 50 percent of the workers in the leading sectors are low-wage workers.

Further, the similarly state-of-the-art lifestyles of the professionals in these sectors have created a whole new demand for a range of household workers, particularly maids and nannies. The presence of a highly dynamic sector with a polarized income distribution has its own impact on the creation of low-wage jobs through the sphere of consumption (or, more generally, social reproduction). The rapid growth of industries with strong concentrations of high- and low-income jobs has assumed distinct forms in the consumption structure which, in turn, has a feedback effect on the organization of work and the types of jobs being created. The expansion of the high-income workforce, in conjunction with the emergence of new lifestyles, has led to a process of high-income gentrification that rests, in the last analysis, on the availability of a vast supply of low-wage workers. High-price restaurants, luxury housing, luxury hotels, gourmet shops, boutiques, French hand laundries, and special cleaning services are all more labor-intensive than their lower-price equivalents. This has reintroduced—to an extent not seen in a very long time—the whole notion of the “serving classes” in contemporary high-income households. The immigrant woman serving the white middle-class professional woman has replaced the traditional image of the black female servant serving the white master. All these trends give these cities an increasingly sharp tendency toward social polarization.

The Globalizing of Survival Circuits

Crucial to the formation of a global supply of caretakers and other kinds of low-wage workers in demand in global cities is the fact of systemic links between the growth of global survival circuits and negative economic conditions in countries of origin that have been amplified by economic globalization. Among these conditions are a growth in unemployment, the closure of a large number of typically small and medium-sized enterprises oriented to national rather than export markets, and large, often increasing, government debt. (Although these economies are frequently grouped under the label “developing,” they are in some cases struggling, stagnant, or even shrinking.)

Globalized survival circuits have grown in number and diversity at a time when major dynamics linked to economic globalization have had significant impacts on developing economies, including the so-called middle-income countries of Latin America. These countries have had to implement a bundle of new policies and accommodate new conditions associated with globalization: structural adjustment programs (SAPs), the opening up of these economies to foreign firms, the elimination of multiple state subsidies, and, it would seem almost inevitably, financial crises and the prevailing types of programmatic solutions put forth by the IMF. It is now clear that in most of the countries involved, not only in Latin America but also in countries such as South Korea or Thailand, these conditions have created enormous costs for certain sectors of the economy and of the population and have not fundamentally reduced government debt among those that implemented these programs in the 1980s nor those that did so in the 1990s. In addition, a growing number of middle-income countries are also caught in this debt trap. The actual structure of these debts, their servicing, and how they fit into debtor countries’ economies suggest that it is not likely that most of these countries will, under current conditions, be able to pay this debt in full. SAPs seem to have made this even more likely by demanding economic reforms that have added to unemployment and the bankruptcy of many smaller, national market-oriented firms.

Ratios of debt service to gross national product (GNP) in many of the so-called HIPC countries (hyper-indebted poor countries) exceed sustainable limits; many are far more extreme than what were considered unmanageable levels in the Latin American debt crisis of the 1980s. Debt-to-GNP ratios are especially high in Africa, where they stood at 123 percent, compared with 42 percent in Latin America and 28 percent in Asia. It is these features of the current situation that suggest that most of these countries will not get out of their indebtedness through such current strategies as SAPs. Indeed it would seem that the latter have in many cases had the effect of raising the debt dependence of countries. Further, together with various other dynamics, SAPs have contributed to an increase in unemployment and in poverty. For over 15 years the major global lenders resisted recognizing the impossibility of debt repayment by most of the 41 HIPCs. But in January 2006, they finally recognized that the 18 poorest of these countries needed to have their debts cancelled, and eventually probably many of the remaining 23 will also have their debts cancelled.

One way of articulating this in substantive terms is to posit that (a) the shrinking employment opportunities in many of these countries, (b) the shrinking opportunities for more traditional forms of profit making in these same countries, as they increasingly open up to foreign firms in a widening range of economic sectors and are pressured to develop export industries, and (c) the fall in revenues for the governments in many of these countries, partly linked to these conditions and to the burden of debt servicing, have all contributed to raising the importance of alternative ways of making a living, making a profit, and securing government revenue. The IMF asks HIPCs to pay 20 to 25 percent of their export earnings toward debt service. In contrast, in 1953 the Allies cancelled 80 percent of Germany’s war debt and only insisted on 3 to 5 percent of export earnings debt service. These more general terms have also been evident in recent history when Central Europe emerged from under communism.

All of these conditions have emerged as factors in the lives of a growing number of men and women in Latin America, Asia, and Africa. A key aspect here is that through their work and remittances, migrants enhance the government revenue of deeply indebted countries; in 2006 total remittances sent back home through the banking system (thus this figure does not cover other ways of getting money back home) were US$230 billion, according to the World Bank. The work of migrating is itself a source of profit for those who trade in people—it offers new profit-making possibilities to “entrepreneurs” (though increasingly it is murderous criminal syndicates who control the trade) who have seen other opportunities vanish as a consequence of global firms and markets entering their countries, or a chance to longtime criminals who can now operate their illegal trade globally. In 2006 criminal syndicates are estimated to have earned US$20 billion from trafficking in people.

These survival circuits are often complex, involving multiple locations and sets of actors constituting increasingly global chains of traders and “workers.” There is an emergent and distinct gendering at work in the globalizing of these survival circuits. Both in the global city and in these survival circuits, women emerge as crucial actors for new and expanding types of economies. It is through these supposedly rather valueless economic actors that key components of these new economies have been built.

Globalization plays a specific role here in a double sense, contributing to the formation of links between sending and receiving countries and enabling local and regional practices to become global in scale. On the one hand, the particular dynamics that come together in the global city produce a strong demand for these types of workers, while the dynamics that mobilize women into these survival circuits produce an expanding supply of workers who can be pushed, or are sold, into those types ofjobs. On the other hand, the technical infrastructure and transnationalism that underlie some of the key globalized industries are also making it possible for other types of actors to deploy their activities at global scales, whether money laundering or people trafficking.

In brief, the major processes covered in this entry involve both the richest and the poorest countries, and the most powerful actors (whether institutions such as the IMF or criminal syndicates) and the most vulnerable (such as immigrant women trafficked from poor countries to rich global cities). This is just one window into the negatives. There is much more, including dynamics that enable the weak and the poor.

Bibliography:

  1. Sassen, Saskia. 2001. The Global City: New York, London, Tokyo. 2nd ed. Princeton, NJ: Princeton University Press.
  2. Sassen, Saskia. 2006. Territory, Authority, Rights: From Medieval to Global Assemblages. Princeton, NJ: Princeton University Press.

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