Repost of 9/8 Summary

Christopher Kane (ckane@jeeves.la..utexas.edu)
Fri, 18 Sep 1998 12:41:32 -0500 (CDT)

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In "Globalization and the Myth of the Powerless State," Linda
Weiss argues that contrary to the contemporary wisdom of several authors
she identifies, the world economy is confronting a period of weak
globalization and moving toward strong internationalization. In the
first point of her argument Weiss implies that globalization requires a
virtual disappearance of national differences including production, trade,
and financial management. Weiss suggests that today regional differences
remain substantial, and national institutions remain significant. As a
result Weiss concludes that the world economy is facing
internationalization rather than "true" globalization. The second point
of her argument is that the "state" will not necessarily be weakened by
the process of internationalization, but in many cases individual states
will adapt to retain power and relevance by adopting policies suited to
operating in this new paradigm. Other nation-states are not positioned so
well, and will lose power as a consequence of their incapacity to exploit
the opportunities the new model offers.
Weiss's argument is provocative and well organized, however the
author does not address certain key points. Weiss identifies, but does
not define the concept of globalization as she understands it. Omitting
this definition and others, including internationalization, weakens her
argument. Weiss also uses a narrow definition of the state, again
without concrete definition. Weiss seems to refer to executive power in
policy making, without acknowledging legislative initiative or citizens'
participation in the formulation of such policy, or in driving each
individual nation's economy. Weiss offers a number of relevant examples
of executive initiative in Japan and South Korea, but seems to ignore
legislative and social efficacy entirely. Such considerations are central
to the arguments of Smith, Evans, and Rodrik. Finally, events have
overtaken Weiss' argument in the fall of 1998, when the "Asian Flu," has
proven to be a more serious illness than Weiss believed it to be in late
1997. If Weiss were to update her article by including explicit
definitions of key concepts, address a broader set of economic and
political evidence, and expand her definition of the powers of the state,
we would read, an even better treatment of the complex, and little
understood issue of globalization.

Dani Rodrik's article "Sense and Nonsense in the Globalization
Debate," is a worthwhile companion to the Weiss article. Rodrik
articulates many of the points which Weiss does not cover. While
providing an analysis of the economic factors of globalization in plain
language, Rodrik extends her analysis into the social and political
elements of the spectrum. However, rather than providing a detailed
analysis of the various models Rodrik is more concerned with the "quality
of the globalization debate," and the misunderstandings that prevail among
the general public. Rodrik does not enter the debate on the concept of
globalization, choosing to accept the idea that globalization of the world
economy is occurring, but recognizes that it's effect on individual
nations is limited, contrary to prevailing isolationist positions.
A common misconception embraced by protectionist politicians is
that trade leads to a reduction of wages in the home economy. Rodrik's
data shows no such correlation and points to unionization and
technological innovation as the leading factors which "explain most of the
increase in the wage gap between skilled and unskilled workers," in
industrialized countries . In addition Rodrik analyzes other factors such
as studies that indicate that intra-provincial trade accounts for a higher
percentage of commerce than international trade for many countries,
including the United States and Canada, the world's largest trading
partners as measured by value and volume. Globalization is not as
prevalent as many actors with a stake in the debate would have us believe.
One of the more interesting statements of the article is that
globalization creates tensions which to a certain extent weaken the
government, and could lead to the demise of painless globalization if not
checked by the government. If governments in their quest to retain mobile
capital cut taxes, and reduce social programs to such a degree that their
citizens begin to suffer the consequences, support for trade will erode,
and protectionist pressure will increase, which could lead to negative
consequences rather than the benefits industrialized nations have enjoyed
so far. The Rodrik article compliments the Evans, Weiss, and Schmidt
articles, serving as a clarification of the key issues in the
globalization debate.

* The footnotes were lost in the translation from Word 97, please contact
the authors for more information.

Christopher Kane
ckane@gov.utexas.edu
Teachng Assistant
The University of Texas at Austin
(512)491-5090