The Economic and Political Effects of Globalization

Paper Summary:

This paper explains that proponents of globalization consider government intervention, in the form of economic regulation of the market and state ownership of strategic industries, as obstacles to market liberalization; the Australian government has been strongly influenced by neo-liberalism economic theory, resulting in government deregulation of the market. The author points out that, although its supporters argue otherwise, globalization is not a natural occurrence but rather the result of deliberate political and economic policy implemented by government. The paper stresses that globalization threatens democracy and the relevance of the nation state, results in fewer but larger corporations, rationalizes the downsizing of labor forces, de-skills the work force and replaces the democratic ideal of majority rule with that of minority reap.

From the Paper:

"Globalization is promoted by the owners and controllers of capital; the captains of industry and commerce, management of multi national corporations, financial institutions and investment funds. It is this group that are advocates of market liberalization and market deregulation and privatization, as they consider such policies allow them the freedom to reduce costs by the efficient allocation of resources in order to maximize profit. Supporters of globalization are proponents of neo-liberalism economics. They believe that the market, free of tempering controls, is the best mechanism for the regulation of economic activity and the attainment of increased general living standards. Tariffs are viewed as a hindrance to trade and thus economic growth."

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