Is Neo-liberalism and Globalization leading towards development impasse?

THE UNDERDEVELOPED WORLD AND THE DEVELOPMENT IMPASSE.

With the reference to neo-liberal approach to development, I shall be arguing against Globalization as I see it as a contributory factor towards the development impasse. My argument is from the fact that Globalization affects the social-structure of societies around the world and it led to marginalization, hardships and social exclusion for large numbers of people particularly in the underdeveloped counties. Global economic growth is increasingly failing to translate into new and better jobs that lead to a reduction in poverty. Neo-liberalism favors privatization of state enterprises, and which opens up new investment for transnational corporations. All of these happen in a way that put the poor and vulnerable people to be at risk of getting poorer, just because of the limited access to resources. Morales-Gomez in his criticism on globalization and the dominance of what he called neo-liberal market doctrine stated that, ‘rather than improving the quality of life for the majority of people, [these] approaches have only worsened it. Development should be seen as a process of systematic transformation of the conditions of existence of the majority of people in a beneficial manner to enhance their attainment of individual and collective well-being.’ (1999:69) While globalization coupled with neo-liberalism cause’s loss of some jobs and reduction in government support social services in the developed, underdeveloped or developing countries, globalization and neo-liberalism lead to poverty and death of the people who cannot afford basic needs.

NEO-LIBERAL APPROACH

Neo-liberal approach to development is an economic theory which opposes state’s intervention in the economy and believes in the free market system. Neo-liberalism erodes the autonomy of the nation-state and removing its ability to protect its citizens by means of economic management and welfare policies. It is associated with privatization, even the assets that are known as the basic needs are privatized and it let the poorest with no access to better living. As I chose to argue against globalization, I continue to criticize the dominance of this system as I argue to speak in the name of victims who are powerless to change the circumstances of their lives. Poor people suffer from this approach as they need the state support to get the basic needs as mentioned in the Bill of Right. Even the Universal Declaration of Human Rights states that "everyone has the right to a standard of living adequate for the health and well-being of himself and of his family, including food, clothing, housing and medical care and necessary social services." However, in the face of the growing globalization of economic and political affairs, for most of humanity today, these rights have become increasingly inaccessible. In this case, the services that were owned by the government are sold to private companies and after that nothing else but profit.

Therefore, this kind of approach to development is basically for the benefit of the elites who are not depending on the government’s support for their survival.Those who benefiting from this system of globalization are quite okay with neo-liberal approach to development as they agree that we should let ourselves be guided by market led development and that there is little we can do to stop the flow of economic globalization. So, neo-liberalism can be understood as the policy approach towards globalization as it prescribes that globalization is an economic process that should be managed with marketization through privatization, liberalization and deregulation. Such approach jeopardizes the freedom of the people and democracy of the nation-state. The neo-liberal approach has more or less ignored issues of social inequality, ecological integrity and democracy as it most concerns about global economic growth through it macro-economic policies. At the same time the transnational corporations and global institutions enhance exploitation of natural resources in the developing countries and creating demands for protection and sustainable utilization of local natural resources in the developing world.

GLOBALIZATION

Most of the authors define globalization in different ways and they also split and divide this term in different ways. One of the writers like Jan Aart Scholte argued about five broad definitions of globalization that can be found in the literature. He mentioned those definitions from globalization as internalization up to globalization as deterritorialization. So I will limit my discussion within this term of ‘globalization as liberalization’, in order to support my arguments. In this term of ‘globalization as liberalization’, Scholte defines globalization as ‘refers to a process of removing government-imposed restrictions on movements between countries in order to create an “open”, “borderless” world economy’ (2000:16) So, as globalization is mentioned to be very broad, there are other way we can find it to be having helpful features in making our lives easier.However some authors have created different images of globalization. For example Anthony Giddens has defined it as, ‘the intensification of worldwide social relations which link distant localities in such a way that local happenings are shaped by events happening many miles away and vice versa. (Giddens 1990:64) While David Held et al defines globalization as a ‘process (or set of processes) which embodies a transformation in the spatial organization of social relations and transactions-assessed in terms of their extensity, intensity, velocity and impact – generating transcontinental or inter – regional flows and networks of activity.’ (1999:16)

These definitions show the broadness of the system of globalization, so I understand that the there must be much emphases on globalization and liberalization as well as it impact, as I understand it as leading towards the development impasse. This approach has the basic weakness like it optimistic assumptions concerning the links between trade liberalization, growth and poverty reduction. For the moment, it needs emphasizing, once more, that it is actually only an assumption that trade openness leads to economic growth. There is a failure to specify the exact relationship between trade and growth; it ignores the impact of liberalized trade on countries at different stages of development, based on different structures of production.

THE IMPACT OF GLOBALIZATION

This system is all about the exploitation of the underdeveloped countries by the developed one. The high competition in global market only benefits the rich countries, and this system create unevenness flow of economy as it eventually concentrate to the developed countries. Furthermore, the claim that free markets and limited government are a necessary part of [improving lives] simply ignores the ways in which all ‘developed’ countries have protected themselves from foreign competition (Chang, 2002). This is not shocking, and it is this point that lies at the centre of the critique of neo-liberalism and globalization policies. Wealth does not necessarily move from money-abundant to money-scarce areas, but instead concentrates in established areas of growth.Accordingly, the poor countries are subjected to exploitation, and the other problem faced by them is very often marginalization. This is not only because of bad policies by developing states, but is also a product of the way the existing globalization operates.

Most of the developing countries are exploited through being part of the global trade, but without profit because it this process that makes the leakage of that little capital of the developing countries. The approach of neo-liberalism and globalization is a strategic attack of the rich countries to continue with subordinating the developing countries like they did in times of colonization. In the hands of the rich countries, world trade is already an instrument of domination, which under neo-liberal globalisation will become an increasingly useful element to accelerate and sharpen inequalities. I view this system of the globalization of the economy as the way of suppressing the developing countries to be underdeveloped for ever. Driessen the author of the book Eco-imperialism: Green Power, Black Death, interviewed by Executive Intelligence Review said that,They show incredible disregard for the rights, aspirations, and even lives of the world's poorest people. They constantly hammer on the supposed risks of using chemicals, fossil fuels, and biotechnology—and never mention the far greater risks that those technologies would reduce, or the lives they can save. And they have tax-exempt status, and get literally billions of dollars a year from foundations, and even government agencies, to promote their agendas and lies, despite their lethal consequences.

Their disregard for the poor, especially dark-skinned people in developing countries, is frightening. They've never apologized once for the deaths their anti-DDT policies have caused, never even admitted they were wrong, never offered any form of aid or compensation to victims or their families, and certainly they've never been held accountable. During the World Trade Organization conference in Cancun a few years ago, the head of a major Mexican environmental group told a friend of mine: "We don't care at all about the poor. We don't want them to become rich or middle class, because then they will become consumers and that means you have to take more resources out of the ground to meet their demands, and that's bad for the Earth. It's better to keep them poor."http://www.africanexecutive.com/modules/magazine/articles.php?article=2207&magazine=117 Globalisation has been held tight by the patterns of neo-liberalism; thus, in it impact it is not development that goes global but poverty; it is not respect for the nation states autonomy but the violation of that respect.

INEQUALITY

The most serious assessment of globalization is the accusation that it promotes inequality, it driving down wages while enriching millionaire corporate executives। Within many countries, globalization has enhanced the wealth of business owners and managers while providing proportionately less wage growth for ordinary workers. Globalization creates losers as well as winners, and brings about risks as well as providing opportunities.Globalization is creating pressures that tend to increase inequality. This inequality matters especially within developing countries, where people are more likely to see in it signs of injustice and unequal opportunity. In developing countries inequality is usually economically negative and it interacts with underdeveloped markets. Inequality among and within nations is widened, even the assets and incomes are more concentrated. In this system of globalization, earnings shares have fallen while profit shares have risen. Thus globalization has encouraged difference, both in the wealthiest countries as well as the developing world.

Globalization has increasing inequality even between rural and urban population.The global markets reward more fully those countries and individuals with most productive assets and by so doing it widening the gap between the rich and the poor. In the globalization system, negative effects raise new costs for the vulnerable and multiple the risks faced by the already weak and disadvantaged. In the global economy, existing rules tend to benefit most those countries and individuals who already have economic power; it is natural that the richer and more powerful manage to influence the design and implementation of global rules, even those rules meant to constrain them, to their own advantage.

EXTERNAL DEBT

The external debt is not the product of globalization, but it has the minor impacts that led to weakening the countries of the South and put these countries at risk of being subordinated. The ongoing outcomes of colonialism and the negative consequences of globalization have influence in the mistreatment of the southern countries through it debt. Southern countries need the chance to set up and stabilize their national economies before they were burdened with debt that regress their development process, but the Northern countries uses this chance to impose disempowering approaches to continue with lick the leaking wealth of the South. The external debt in the countries of the South has hindered the development and created social, economic and political insecurity in developing countries.

The underdeveloped nation’s external debt is amazing not only because it is big but also due to its shocking mechanism of suppression, exploitative and the misleading formula offered by the developed countries to cope with it. The misleading effort of the developed countries to relieve the poor countries from the external debt issues is the other mechanism behind the underdeveloped to do whatever is said by the rich countries, with the hope that it can bring about change. However the richer countries are aiming at keeping the poor countries under their control. The problem of the debt cannot be solved in this way because it a political matter, and it solution needs to be political. Most of the African countries appear to have been most unfavorably affected by processes of globalization. By 1990s, national debts in African countries became the heaviest among developing countries, as measured in relation to exports of goods and GDP. The structural adjustment programmes controlled by the International Monetary Fund and the World Bank in fact created more difficulties, regardless of their good intentions. These countries have been most seriously affected by widespread poverty and economic declination. Globalization has thus failed to generate positive outcomes in developing countries like Africa; rather, it tends to marginalize them.

GLOBAL INSTABILITY

There is doubt that the world cannot achieve sustainable development in a situation of this severe global instability. Sustainable development and environmental protection are powerful instruments for the creation of a safer world, and when they are recognized as such, international efforts to support sustainability will immediately strengthen. Globalization process is failing to make it promises like the Millenium Development Goals (MDGs). So most of the researches doubt the success through analyzing the economic growth rates of today’s developing countries and compare them to the rates that would be needed to reach the MDGs. They conclude that to meet the MDGs, developing countries would have to grow extremely rapidly, out-performing even the historical rates of progress of the rich countries today.

EROSION OF SOVEREIGNTY

The new generation of global survival problems has revealed the fundamental limitations of the Nation-State as well as the weakening of national sovereignty. Sovereignty has been further weakened by the economic dependence and interdependence of States. The erosion of local power is worsened by restrictions on golden shares which make it difficult for governments to keep some control over privatized concerns.

RECOMMENDATION

The victims of injustice, particularly though not exclusively in the South, and their allies everywhere must change their future for themselves as the rich are not going to do it for them. The global justice movement, especially the scholars that count themselves part of it, can help by continuing to expose the policies that lead inexorably to poverty, and show why they do not and cannot work. Faced with well-financed neo-liberal propaganda, progressive researchers and teachers must impose their own legitimacy. It is also possible, though not always effective, to demonstrate why justice is in the interests of everyone, even of the masters of mankind.

CONCLUSSION

As the globalization process has been engineered by corporate elites, and serves their interests, they have successfully transmitted the impression that globalization is not only inevitable but has been a great success. This is misleading. The globalization of recent decades was never a democratic choice by the peoples of the world, the process has been business driven, by business strategies and diplomacies, for business ends. Governments have helped, by additional policy actions, and by larger actions that were often taken in secret, without national debate and discussion of where the entire process was taking the community.This undemocratic process, carried out within a democratic frontage, is consistent with the distribution of benefits and costs of globalization, and the fact that globalization has been a tool serving elite interests.

Globalization has also steadily weakened democracy, somewhat as a result of unintended effects. However also because the containment of labor costs and scaling down of the welfare state has required the business minority to establish firm control of the state and remove its capacity to respond to the demands of the majority. The mix of deliberate and unplanned elements in globalization's antidemocratic force can be seen in each aspect of the attack process. The favored neo-liberal ideology pushes the idea that the market can do it all, that government is a burden and threat, and that deregulation and privatization are essentially good and inevitable. It pushes severe individualism and the value of personal responsibility, which is highly advantageous to corporate power, leaving bargaining between large firms and isolated individuals which is unfair.

REFERENCES

Scholte, J. A. (2000) Globalization: A critical introduction, London: Palgrave.
Morales-Gómez, D. A. (1999) Transnational social policies: the new development challenges of globalization, London: Earthscan Publication Ltd.
www.un.org/Overview/rights.html
Giddens, A. (1990) Consensus and Controversy, London Falmer.
Held, D. et al (1998) Global Transformation: Politics, Economics and Culture, Cambridge: Polity Press.
Driessen, P. Eco-Imperialism: Green Power, Black Deathhttp://www.africanexecutive.com/modules/magazine/articles.php?article=2207&magazine=117
Loose extracts: CHANG 2002

All Out of Control

Sometimes you can think you have no chance of getting what you want. Generally we don't get what we want at our desired time, but if you believe in yourself, sooner or later, you get what you want or atleast more.

One of the days at Durban Berea Station the other lady sitting alone with his eyes on the phone. Even a three year old child could see that the lady is totally out of this planet. I'm just few metres away looking right on her eyes I figured that she's in big trouble. I came to her trying politely and to be more than a gentleman. I asked the matter. She cries! "If love is sweet good why it hurt, nobody here at all coz it's no one even cares just how hard I fall" The lady said she thinks of him till she cries. She said she can't live any longer without him.It all out of love, I figured that the stress, pain and grief brought her the philosophical insight that life is ultimately meaningless and there is no reason to continue living. I told her one thing that there is no love left in this world, we are all left to deal on our own. Everybody have problems, even me I have so many things going wrong and I can't make sense of it in my mind.

I can give someone strength and hope but I know I'm the one who is not strong. But when life has turned its back on me, I take a look back and discover my strength. I'm a soldier, the lady in a train station make me realize the unfaithfulness of people. Even me I was kicked out of a relationship that I was told it eternal, I used to sit alone in my room thinking of my sorrow. She broke my heart but I'm still crying out her name no matter what she's doing I'm going to need her as an enemy or as a friend. Just to show some other people that, she the best storyteller I ever met! Just give another person a half of your heart and a half for you to recover from any stresses and shocks.

Xolani.