View Full Version : Globalization

12th Jul 2016, 14:58
Another buzz-word, very popular these days.
However, no one really knows just exactly what it means.
What it does not mean is a World Government.

It is a trading term and relates directly to better and better transportation methods of moving goods, more economically, in larger volumes, further.

Trade started with one simple precept: One area had something surplus to their requirements that someone elsewhere wanted to acquire and there were means to deliver the goods back and forth.

Technology limited the distance these goods could travel, now the goods can travel globally, quickly (see:Panamax, post-Panamax, B747F, UPS etc.). However the foundation of trade remains that first you need something someone else wants to buy from you. If you have it, you trade. You don't have to be super-sized or politically blended to do it.

12th Jul 2016, 15:03
Wot he said.

Also, there is some wisdom in the saying "the bigger they are, the harder they fall"...

12th Jul 2016, 18:38
True as far as it goes.

The issue, of course, is that "labor" (OK - "labour" ;) ) has become one of the things that can be "surplus" in one place and "needed" somewhere else. So either the labor moves (immigration/emmigration) or the need is moved ("exporting" jobs).

It's one situation for Apple to build computers in the U.S with U.S. labor, and "trade" them for indigenous Chinese or Indonesian (or British or German) products

- and quite a different situation for Apple to build its products in China or Indonesia with Indonesian or Chinese labor, and "trade" them back into the U.S. to consumers here.

I'm not familiar enough with UK business to know which UK companies, if any, "outsource" the manufacture of their own "British" products in other countries. But the proverbial "Polish plumber" is just the flip side - someone who immigrates because the "market" for their labor is better in the UK than in Poland.

If one champions free markets, that has to include those who are marketing their labor. An immigration ban is no different than prohibiting the importation of Polish products - a restraint on free trade. It's all government-enforced "Buy British!"

The British Empire was a form of semi-world government (as were the other European-centered empires - the British just did it more extensively). 120 years ago, Indians and Indonesians no doubt chafed under being ruled from London or Amsterdam, just as Brits today chafe under rule from Brussels.

Was it required? It was maybe more profitable, for the British. Not sure, given the expense of administration and troops to enforce it - but then, the huge British Navy and Army were probably effective "jobs programs" for the second sons and other classes.

12th Jul 2016, 19:18
..............Not sure, given the expense of administration and troops to enforce it - but then, the huge British Navy and Army were probably effective "jobs programs" for the second sons and other classes.
A fallacy. In 1883 the British army had 124,000 troops, all professional soldiers. The Empire was semi-autonomous, India was garrisoned by fewer than 30,000 British soldiers, supported by a large Sepoy army. In 1963 there were over 160,000 in the army. Spending on defense budget in the years of the Empire was around 2.5%, not much greater than today.

13th Jul 2016, 12:22
Economist Thomas Friedman writes about the history of Globalisation. He came at it from three angles in my view: As an economist, philosophically, and anthropologically. He opens with:

In 1492 Christopher Columbus set sail for India, going west. He had the Nina, the Pinta and the Santa Maria. He never did find India, but he called the people he met "Indians" and came home and reported to his king and queen: "The world is round." I set off for India 512 years later. I knew just which direction I was going. I went east. I had Lufthansa business class, and I came home and reported only to my wife and only in a whisper: "The world is flat."

Friedman continues by defining his 'eras'.

1492-1800 - Globalization of Countries I
(I) shrank the world from a size large to a size medium, and the dynamic force in that era was countries globalizing for resources and imperial conquest.
1800 - 2000 - Globalization of Countries and Companies II
(II) shrank the world from a size medium to a size small, and it was spearheaded by companies globalizing for markets and labor.
2000 - Present - Globalization of People III
(III) is shrinking the world from a size small to a size tiny and flattening the playing field at the same time.

He goes on to say:
And while the dynamic force in Globalization 1.0 was countries globalizing and the dynamic force in Globalization 2.0 was companies globalizing, the dynamic force in Globalization 3.0 -- the thing that gives it its unique character -- is individuals and small groups globalizing.

Article is about 13 pages and comes at the idea from a unique perspective that I had not thought about before and for many things we are annoyed by or take for granted regarding globalization, Friedman gives insight.

It's a Flat World After All - NY Times (http://www.nytimes.com/2005/04/03/magazine/its-a-flat-world-after-all.html)

14th Jul 2016, 08:34
It's a Flat World After All - NY Times (http://www.nytimes.com/2005/04/03/magazine/its-a-flat-world-after-all.html)
Calling Friedman an economist is overly kind. He's a journalist/writer.

Friedman is OK, though it's usually best to take his stuff with a pinch of salt. The article is vintage 2005, which IIRC is when his book "the world is flat" came out. You might say he was shilling his own stuff. Interesting thought at the end.

We need to get going immediately. It takes 15 years to train a good engineer, because, ladies and gentlemen, this really is rocket science. So parents, throw away the Game Boy, turn off the television and get your kids to work. There is no sugar-coating this: in a flat world, every individual is going to have to run a little faster if he or she wants to advance his or her standard of living. When I was growing up, my parents used to say to me, "Tom, finish your dinner -- people in China are starving." But after sailing to the edges of the flat world for a year, I am now telling my own daughters, "Girls, finish your homework -- people in China and India are starving for your jobs."

I repeat, this is not a test. This is the beginning of a crisis that won't remain quiet for long. And as the Stanford economist Paul Romer so rightly says, "A crisis is a terrible thing to waste." That last bit seems to have become an imperative for politicians.

14th Jul 2016, 09:16
That last bit seems to have become an imperative for politicians.

Around 20 years ago my boss*** was a rather unpleasant chap, that I both disliked intensely, but held a certain admiration for at the same time.

His guiding principle was that in order to make a change you need a crisis, and if one doesn't present itself naturally, then you have to create one. He would do this by means I personally considered evil, in terms of the long term harm he caused to people's lives, nevertheless there was no doubting that fact that this principle both worked well, from his perspective, and made him very wealthy.

*** For the curious, he was this bloke: https://en.wikipedia.org/wiki/John_Chisholm_(executive)

15th Jul 2016, 04:35
And for big, bad global corporations, the East India Company takes some beating ...

15th Jul 2016, 12:47
Globalisation didn't start with Columbus. He wasn't even the first European to land in America (actually, even he didn't). The Noggies had quite certainly been there long before him.

I'm often surprised when watching documentaries about Bronze Age discoveries that they were trading across vast distances. Trade stretched from Northern Europe to China in the Bronze Age. There was even a cross-Channel freight service!

15th Jul 2016, 23:01
But they didn't have unions to sabotage things back then..............