Sunday, September 30, 2001		Books

On The Edge — Living with Global Capitalism
edited by Will Hunton and Anthony Giddens. Vintage, London. Pages xxii + 242. £ 8.99.

THE book under review opens with "Anthony Giddens and Will Hunton in Conversation". It is a 51-page-long dialogue. In the beginning it gives the hope of a free-wheeling intellectual encounter between an unabashed supporter of globalisation and a strong admirer of the American system (Anthony Giddens) and one who is highly sceptical of the steamroller effects of globalisation and deeply critical of the role of USA as its leader (W. Hunton). The two are on the opposite sides of the barricade and face each other menacingly.

However, eventually a reader is disappointed and the encounter ends in a disappointing denouement, a sad climbdown when they both declare that they are on the same side of the fence. Perhaps, they go in for this compromise to justify their co-editorship of the book.

Giddens sees "something new" in globalisation — a worldwide communication revolution, a "weightless" or "new knowledge" economy quite different from the earlier industrial economy. Hunton observes that environment has come under serious threat and globalisation means globalisation of crime, drugs, corruption, tax evasion and the like. The international capital now is much hardened, more mobile and more ruthless and its overriding objective is to serve the interests of property owners and shareholders.

Gidden counters by suggesting that the international capital is not as dangerous and wild as thought by Hunton and it opens new possibilities. He endorses Francis Fukuyama’s thesis in his "End of History" as he finds no alternative to the market economy. Hunton finds Fukuyama missing the point as beneath the technological change rough and tough old capitalist truths are being re-asserted and the people are being exposed to hard brutalities.

In the USA one sees the emergence of the super-rich, conspicuous consumption and extraordinary wealth, on the one hand, and a fall in the real wages of the blue-collar workers, on the other. Giddens dismisses this criticism as too close to old leftism.

In the end, both agree that they are on the same side of the fence, in spite of disagreement on some issues. How the barricade is dismantled, pushing both to the same side is not clear from the clash of their arguments. It is crass pragmatism rather than intellectual integrity that ultimately prevails, perhaps to add to the saleability of the book.

Manuel Castells sees globalisation as a threat to the global prosperity as instability is rooted in the financial market. He finds Silicon Valley like societies as archipelagos of prosperity surrounded by a sea of poverty in the planet. This is not only ethically questionable but, more important, politically and socially unsustainable.

Paul Volcker and George Soros are both worried about the destabilising impact of global financial markets and argue that the East Asian crisis of 1997 emerged from the structure of the financial system rather than from the inherent weaknesses of the economies concerned.

Volcker examines the genesis of the crisis from a fresh angle that sounds quite convincing. Generally, the crisis is blamed on a weak banking system, government subsidies, widespread corruption, crony capitalism and the like — flaws inherent in the economies of the so-called Asian Tigers like South Korea, Taiwan, Thailand, etc.

However, Volcker finds the roots of the crisis in the financial arena dominated by global capital markets than in the structural flaws which have been at the centre of so much attention. He correctly points out that small economies are inherently vulnerable to the volatility of the global capital.

George Soros blames the functioning of the IMF for the crisis. He holds the IMP responsible for the disparity between crisis prevention and intervention and the asymmetry in the treatment of lenders and borrowers.

Jeff Faux and Larry Mishel in their scintillating piece "Inequality and global economy" tellingly quote the World Bank President James Wolfensohn observing that financial markets in the spring of 1999: "At the level of people, the system isn’t working."Promises of globalisation have not been realised. Inequality within and among nations has increased. The rate of growth of the American economy in the 1960s was 6 per cent per year. Then the ratio between the income of the top chief executive officer of the American corporations and the average production worker was 39 to 1. In 1997; after three decades of slower growth this ratio was 254 to 1. The resentment against globalisation is understandable as it leaves many people behind, with riches accumulating at the top.

Vandana Shiva, a contributor from India, is a known critic of globalisation as she finds it a serious threat to the environment and biodiversity. In a world dominated by global capital, resources move from the poor to the rich countries and the pollution moves from the rich to the poor. The Third World has to bear a huge environmental cost. The livelihood of the poor of the world is based on biodiversity and indigenous knowledge. This resource base of the poor has come under a serious threat as the plants and seeds are patented and claimed as inventions of western scientists and corporations (patenting of the basmati rice by an American concern is the latest example).

Since everything becomes tradable, ethical and ecological, limits on commerce are being torn asunder. "As dollars replace life processes in the domain of life," concludes Shiva in a poetic vein, "life itself is extinguished".

Ulrick Beck finds the nation state, class, ethnicity and the traditional family in the decline. The ethic of individual self-fulfilment is the most powerful ethos in modern society. And globalisation is in tune with this ethos. Polly Toynbee talks of global culture and finds "culture panic" as espoused by some ethnocentric groups, uncalled for. There is no danger of cultural contamination as cultural cross-fertilisation is the essence of art.

She finds nothing wrong with the tidal wave of divorce that follows the western cultural influence as it provides an opportunity to women to walk away from a violent, abusive, unequal and unhappy marriage. Is this not feminism run amuck? A woman should have the freedom to break an unhappy marriage. However, the way the marital alliances are broken in some western countries on the flimsiest ground poses a serious threat to the sanity and harmony in society.

Toyanbee is worried over the way multinational corporations are eating up television stations (the range of Murdoch’s operations provides a telling illustration). However, is it not in tune with the process of globalisation? One cannot eat the cake and have it too.

The book under review is one more addition to the volume of literature on globalisation Globalistion brings new possibilities but also new risks, the editors point out. This, in the opinion of this reviewer, is being neither here nor there. The essence of globalisation is not its international range, nor its speed acquired through technological innovations. These two things were present in the international capital even earlier, though on a smaller scale. Its essence lies in the profit motive as an end in itself. And in search of profit, it can be ruthless and the talk of working out a harmonious relationship between the international capital, on the one hand, and environment, ecology and the life chances of the common people, on the other. Given currency by the apologists of the unruly international capital, it is a ruse at its worst, and a pious hope, at its best.