GLOBALIZATION AND THE CHALLENGES OF THE NEW CENTURY: A READER.
Edited by Patrick O'Meara, Howard D. Mehlinger and Matthew Krain.
Indiana University Press; 576 pages; $49.95 ($19.95 paperback) and £34 (£13.50 paperback)
IF YOU want to catch up on some of the best articles written about globalisation since the topic became fashionable several years ago, this reader is the place to start. Meant for students, it pulls together pieces from such different sources as Atlantic Monthly and the Harvard Business Review. It ranges from Samuel Huntingdon's influential essay in Foreign Affairs,“The Clash of Civilisations” (1993), to an article on “The Promise of Genetics” from the Futurist in 1997. Organised by topic (including conflict and security; democracy; economic integration) the book is pleasingly eclectic. For a radical perspective, you can read, for instance, the manifesto of the Tupac Amaru Revolutionary Movement of Peru. The book also has a brief guide to globalisation resources on the web.
THE MYSTERY OF CAPITAL. By Hernando de Soto. Basic Books; 276 pages; $27.50. Bantam Press; £15
GLOBALISATION, say its critics, leaves the poor behind. Without capital, you cannot gain from integration. And the poor have next to no capital. In this fascinating book, Hernando de Soto, an expert from Peru on informal economies, agrees and disagrees. Poverty is not due to lack of capital as such, he argues, but to lack of usable capital. The poor in backward countries have assets. But these often take “dead” or defective forms: for instance, houses on land without clear title, which cannot be used as collateral for loans. From his grass-roots research, Mr de Soto estimates that the value of property held, but not legally owned, by poor people in developing and former communist countries is almost $10 trillion—more than 20 times the direct foreign investment these countries have had since 1989.
Unlike the rich world, with its comprehensive networks that track and protect property (contracts, titles, deeds, public record keepers and so forth), poor countries must often rely also on informal systems that work “extralegally”. To become usable as economic capital, extralegal assets must be absorbed into the formal system, as they were, for example, in 19th-century America. It will not be easy. But after reading this book, it is hard not to feel hopeful about the potential waiting to be tapped in poor countries.
RUNAWAY WORLD: HOW GLOBALIZATION IS RESHAPING OUR LIVES. By Anthony Giddens. Routledge; 128 pages; $17.95. Profile; £6.99 (paperback)
THIS thoughtful essay is about modernity as such, not just the economic sort. Each of its five parts—on globalisation, risk, tradition, family and democracy—is an intellectual nugget. The world is no riskier than it used to be, Mr Giddens believes; but contemporary risks—ecological calamity or financial meltdown, for example—tend to be man-made. Modernity means progress; but abandoning traditions also brings addictions and compulsions, as well as fundamentalism, a form of beleaguered tradition.
On democracy, Mr Giddens notes that, though it is spreading to new lands, it is meeting with signs of disillusion in older ones: fewer people vote; more and more claim not to care about politics; interest in non-governmental solutions is on the rise. Democracy, Mr Giddens argues, needs to be “democratised”. By this he means devolving power, fostering “civic culture” and making transnational bodies such as the European Union more open and accountable. Mr Giddens covers so much in so few pages that his conclusions can often sound contentious or trite. But the issues he raises are always thought-provoking.
GLOBAL FORTUNE: THE STUMBLE AND RISE OF WORLD CAPITALISM. Edited by Ian Vasquez. Cato Institute; 295 pages; $18.95 ($9.95 paperback)
THIS collection is less an analysis than a celebration of global economic integration. Published by the Cato Institute, America's leading libertarian think-tank, “Global Fortune” contains essays by writers from four continents. They argue bracingly that market economics offers the best hope for world prosperity. The problem, they think, is not too much integration, but too little faith in liberal institutions.
For Mario Vargas Llosa, a Peruvian novelist and right-wing politician, globalisation offers opportunities to expand pluralism, legality and liberty. Deepak Lal, a top development economist, sees no necessary link between democracy and development. But he offers a robust demolition of the argument that there is a “third way” between capitalism and socialism.
Other authors argue that countries recently hit by crisis—in East Asia, for instance—were afflicted not by global forces but by the wrong kind of government intervention. The book takes a similar line with the world financial system: problems arise not from market failure but from meddling in markets by, for example, the IMF. These essays do not allow for nuance and not all of them are convincing. But they offer robust replies to many of the cruder anti-globalisation arguments.
GLOBAL FINANCEAT RISK: THE CASEFOR INTERNATIONAL REGULATION. By John Eatwell and Lance Taylor. The New Press; 258 pages; $22.95 and £16.95
AN OPPOSITE plea, for more not less international financial regulation, is made by John Eatwell of Cambridge University and Lance Taylor of New York's New School for Social Research. Based on a study for the Ford Foundation, “Global Finance at Risk” argues that integration, for all its benefits, has weakened national financial regulation without providing a satisfactory alternative.
In a world of floating currencies, they argue, financial markets are not self-regulating, pointing to derivative-related collapses and to currency crises in developing countries. To the charge that their idea for a World Financial Authority is Utopian, they reply, perhaps so, but insist it is still worth identifying the regulatory tasks which they claim “need to be done by somebody”.
This article appeared in the Books and arts section of the print edition