POLS 374 Foundations of Global Politics

1. POLS 374 Foundations of Global Politics Lectures 9-10: Globalization and Production October 24 and 31, 2006

2. Globalization and Production • Chapter: Main Points • The relationship between capitalism and globalization is reciprocal. That is, capitalist development drives globalization, but globalization also drives capitalism • This reciprocal relationship, in general, has created the basis for the development of a new form of capitalism, which the author refers to as hypercapitalism

3. Globalization and Production Hypercapitalism • Hypercapitalism, to repeat, is an extreme form of capitalism. Extreme in terms of reach and embeddedness in society

4. Globalization and Production Hypercapitalism: Commodification • In terms of reach, hypercapitalism stretches to virtually every corner of the world today, including to such supposedly isolated spots as North Korea

5. Globalization and Production Hypercapitalism: Commodification • Capitalism in North Korea? To see a video on the Kaesong Industrial Complex: Click on either picture

6. Globalization and Production Hypercapitalism--Embeddedness • The expansion of capitalism has also entailed greater and greater embeddedness, not only in economic matters, but also in our consciousness • Today, people throughout the world increasingly associate capitalism with democracy, freedom, progress, and with the fulfillment of human potential

7. Globalization and Production Expanded Commodification • Author breaks down the process of commodification into several areas: • primary and industrial capital • consumer capital • finance capital • information and communications capital • genetic and atomic capital • care capital

8. Globalization and Production Expanded Commodification • Primary and industrial capital—e.g., agricultural products, mining, heavy manufacturing (steel, chemicals, shipbuilding), construction, oil and gas • These used to be the core of any major economy, but they have been steadily declining in relative importance

9. Globalization and Production Expanded Commodification: Consumer Capital • Consumer capital: Refers to surplus accumulation that is realized in the context of hedonistic consumption

10. Globalization and Production Expanded Commodification: Consumer Capital • An Example of Consumer Capital: The Diet Industry

11. Globalization and Production Expanded Commodification: Consumer Capital • Key Point: Consumer capital and globalization are intimately related • For instance, once a new desire is created in one part of the globe it quickly spreads to other parts of the globe: • Commodities become largely de-nationalized in a globalized world, which spurs even greater accumulation

12. Globalization and Production Expanded Commodification: Consumer Capital • Denationalized Products: Athletic Shoes

13. Globalization and Production Expanded Commodification:Finance capital • Key point: In the past, “finance” was primarily a medium of exchange • It still is today, but it is also a commodity in that people use the trading and selling of money itself to accumulate a surplus

14. Globalization and Production Expanded Commodification:Finance capital • Another Example: Real Estate • In real estate, an increasing number of people buy houses not to live in them, but to profit from “flipping them” • This is made even easier by the fact that banks have come out with new types of loans “products” (stated-income, ARMs, “principal only” loans) that make it possible for even relatively poor people to buy multiple properties • For an interesting case, click here

15. Globalization and Production Expanded Commodification:Other forms • Information and communications capital (ICC) • Genetic and atomic capital (e.g., biotechnology and nanotechnology) • Care capital

16. Globalization and Production Expanded Commodification • Summary: globalization has played an important role in widening the range of capitalism and reorienting the relative weights of accumulation away from “merchandise” (commercial and industrial capital) toward “intangibles” (finance, information, communications, genetic and nano capital). To this extent the “real” economy has acquired a different reality.

17. Globalization and Production Altered Organization • Globalization and hypercapitalism are characterized by significant shifts in organization; these shifts are most clearly emphasized in the following areas: • Proliferation of offshore centers • Emergence of global companies • Dramatic increase in mergers and acquisitions • Rise in concentration

18. Globalization and Production Altered Organization • Offshore Gambling Sites: Recently offshore gambling has become a major enterprise. Consider the following site: • http://www.gambling-internet.org/

19. Globalization and Production Altered Organization • Global Companies • List of Largest Global Companies:http://money.cnn.com/magazines/fortune/global500/2006/ • Compare to economic size of countri es http://www.answers.com/topic/list-of-countries-by-gdp-nominal