1.
Analyzing Global Developments: Deng Xiaoping and China's So-Called Economic Miracle
How do China's GDP overall growth rates and per capita growth rates compare with those of Britain during the industrial revolution and hte United States from 1850 to 1989? How do you account for any extreme difference?
Why have Deng Xiaoping and his successors been able to resist demands for democracy and maintain the dominant political position of the Chinese Communist Party?
Based on your reading, compare Gorbachev's perestroika reform movement with Deng's vision for economic and political reform in China.
Do you think the Chinese are likely to maintain high growth rates over the long run, given the experience of Britain and the United States? Explain your answer.
2.
Primary Source 21.3 Why Gender Matters (2000), World Bank
Describe the effect of tuition on girls' school attendance.
Evaluate the relative importance of barriers to girls' education posed by culture on the one hand and poverty on the other.
What effect does expanding educational opportunity for girls have on boys?
CHAPTER 21
Globalization
1970–2000
Copyright © 2021, W. W. Norton & Company
Following the collapse of the three-world order, new global markets and communications networks integrate the world but also create deep inequalities.
New technologies and vast population movements make global culture more homogeneous.
Globalization, supranational organizations (like the World Bank, the European Union, and the United Nations), and religious fundamentalism erode the power of the nation-state.
Global Storyline
What transnational forces eroded the power of the nation-state in the last third of the twentieth century, and how did they do so?
What was the relationship between global migration, new technologies, and the spread of cultural influences during and after the Cold War?
How did globalization and population changes affect the environment, and vice versa?
To what degree did globalization change societies? How similar and different was globalization after the Cold War as compared with earlier forms of globalization?
Focus Questions
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Globalization: the development of integrated worldwide cultural and economic structures
Movement of families, groups, goods, and ideas across boundaries
International financial organizations address world financial issues
Multinational corporations transform local markets into international ones
Discontent, religious revival drive divisions among and within world’s regions
Globalization
The late twentieth century witnessed an acceleration in global connectivity, a process called “globalization,” or the development of integrated worldwide cultural and economic structures.
Four key aspects of globalization are:
Movement. Families, groups, ideas, and goods traversed boundaries that formerly divided national, ethnic, or religious communities.
The prominence of international financial organizations., which addressed world financial issues.
The rise of multinational corporations, which transformed local markets into international ones.
Division. Even as the world became more economically integrated, discontent and religious revival helped drive divisions among and within the world’s regions.
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Old global orders weaken
Empire
Three-world order
Globalization forms a new architecture of power, promoted by the United States
United States also shaped by globalization
Transnational forces challenge the power of the nation-state
Global Integration
Globalization, which began in the 1970s, is still unfolding. This process took shape as previous global orders weakened. By the late twentieth century, European empires were in retreat, and even the three-world order that replaced them had begun to break apart. The collapse of the Soviet Union ushered in a new architecture of power that created a single world marketplace in which capital, commerce, culture, and labor flowed unobstructed.
The United States was undoubtedly a major driver and beneficiary of these changes. Some might see globalization as America’s attempt to reshape the world in its own image. But the United States was also profoundly changed by increased contact with the rest of the world.
In fact, the new transnational forces undermined the power of the nation-state itself. People began to identify less with nation-states and more with subnational or international movements. At the same time, supranational organizations like the European Union and the IMF, as well as increasingly open borders, challenged the nation-state’s autonomy.
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Collapse of Soviet Union ended Cold War
Capitalist First World gave up its last colonial possessions
Formerly colonized Third World’s unique vision of “third way” vanished
World integrated by markets, capital, and technology, rather than forced loyalty to imperial masters or rival superpowers
Removing Obstacles to Globalization
The collapse of the Soviet Union ended the Cold War. At the same time, the First World gave up its last colonial possessions, and regimes dominated by White settler colonists gave way. As this happened, the Third World’s vision of a “third way” also vanished, as a capitalist global order emerged that was integrated by markets instead of loyalties to empires or rival superpowers.
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Mounting costs
The largest peacetime accumulation of arms in world history occurred during the 1970s and 1980s.
Despite efforts at arms control, expensive programs such as “Star Wars” mired both governments in debt.
Both sides faced pressures that strained the Cold War order.
By the 1980s, the Soviet Union was caught in a military stalemate in Afghanistan.
The western public was divided over the nuclear weapons buildup of the 1980s.
Japanese economic strides challenged American and European industries’ ability to provide employment and profits.
Ending the Cold War
The three-world order began to deteriorate in the mid-1970s: the Second World collapsed, First World empires lost their colonial empires, and the Third World’s dream of a third way disappeared.
The Cold War had limited the possibilities for global exchange. Robust exchange existed within rival blocs. But, for many countries, pressures from the superpowers limited their exchanges with other countries. Strong nationalist and religious movements pushed against the Cold War framework. Superpowers attempted to control or inflame these forces at great cost.
Rivalry was enormously costly. The largest peacetime accumulation of arms in world history occurred during the 1970s and 1980s as both superpowers stockpiled conventional and nuclear weapons. Despite some efforts to control the arms race, costly programs put both governments in debt. One such program was Reagan’s “Star Wars” initiative, a plan to use satellites and space missiles to protect the United States from incoming nuclear bombs.
Other pressures strained the Cold War order. In the 1980s, the Soviet Union sent troops to Afghanistan to prop up a new regime, only to be mired in a costly conflict against insurgents backed by the United States. The resulting stalemate damaged the Soviet image both at home and abroad.
In Europe and North America, the population was divided over the nuclear buildup of the 1980s. At the same time, Japanese economic development challenged American and European industries, as unemployment soared.
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Planned economies employed the entire Soviet population but failed to provide sufficient consumer goods or health care on par with the west.
Authoritarian political structures relied on deception and coercion rather than elections and civic activism.
The selection of a Polish pope, John Paul II, inspired massive resistance to communist rule.
Solidarity, an independent union, formed to bring down the socialist state in Poland.
The Soviet Bloc Collapses (1 of 3)
The Soviet bloc eventually collapsed. Soviet governance had built up numerous tensions over the decades. While planned economies guaranteed full employment, they could not provide sufficient consumer goods or health care and benefits that equaled those found in western countries. At the same time, people chafed against authoritarian governments that relied on deception and coercion.
One of the events that sparked the downfall of the Soviet Union was the selection of a Polish pope, John Paul II, in 1978. The pope supported mass strikes at the Lenin Shipyard in Gdańsk. The strikes led to the formation of an independent trade union, Solidarity. Solidarity eventually undertook to end socialism in Poland, rather than reform it. Although the movement was initially repressed, Soviet officials feared it would not go away easily.
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Mikhail Gorbachev, elevated to leadership of the Soviet Communist Party in 1985, implemented perestroika/reconstruction reforms.
Allowed competitive elections for Communist Party posts, relaxed censorship, allowed civic associations, etc.
He also launched major arms control initiatives.
Withdrew troops from Afghanistan and told eastern European leaders they couldn’t count on Moscow’s intervention to prop up regimes
The Soviet Bloc Collapses (2 of 3)
The most consequential factor in the Soviet downfall was the reform program launched by Mikhail Gorbachev, who took power in 1985. The reforms were called perestroika, or “reconstruction,” and were aimed at loosening up political controls and reducing arms buildup. He withdrew troops from Afghanistan and notified eastern European powers that Soviet troops would no longer guarantee their regimes.
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Map 21.1 | Collapse of the Communist Bloc in Europe
Map 21.1 | Collapse of the Communist Bloc in Europe
The Soviet Union’s domination of eastern Europe ended precipitously in 1989. The political map of eastern and central Europe took on a different shape under European integration.
What significant event in many communist countries signaled the collapse of communism?
In what part of eastern and central Europe did the most political instability and conflict occur?
According to your reading, why did the end of communist rule cause the reshuffling of political boundaries in the region?
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Civic groups pressed to eliminate, rather than reform, the system.
Eastern European states declared intention to leave Soviet orbit; some union republics pushed for independence.
Hard-liners staged a failed coup to arrest these developments in 1991.
Boris Yeltsin rallied opposition and faced down hard-liners.
Elites divided up state property, became oligarchs of post-Soviet order
Collapse of communist regimes changed maps of Europe and Asia
Caused ethnic strife and civil war in Yugoslavia
The Soviet Bloc Collapses (3 of 3)
Although Gorbachev’s reforms intended to improve socialism, they contributed to its demise. Civic groups did not advocate for improvements to the system; instead, they called for its elimination. Eastern European states declared their intention to leave the Soviet sphere, and some USSR republics pushed for independence.
Some hard-liners, attempting to hold on to the old order, staged a failed coup in 1991. Boris Yeltsin, the president at the time, rallied opposition and blocked the coup. Eventually, elites divided state property among themselves.
The collapse of communist regimes transformed the maps of Europe and Asia. In some areas, like Yugoslavia, the political vacuum produced ethnic strife and civil war. Many of the new countries in eastern Europe joined the European Union.
The Cold War was relatively brief, but communism exerted a profound influence on countries around the world. Ultimately, however, it was unable to keep up with the demands of global rivalry and the accelerating race for consumption and technology.
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Map 21.2 | The Breakup of the Soviet Union
Map 21.2 | The Breakup of the Soviet Union
The Soviet Union broke apart in 1991. Compare this map with Map 17.5, which illustrates Russian expansion in the nineteenth century.
Which parts of the old Russian Empire remained under Russian rule, and which of its territories established their own states?
In what areas did large migrations accompany the breakup, and for what reasons?
According to your reading, how did the breakup of the Soviet Union change Russia’s status in Europe and Asia?
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Remnants of colonial rule remained in southern Africa where Whites clung to centuries-old notions of their racial superiority over non-Europeans.
The last holdouts
African nationalist demands led to a hurried Portuguese withdrawal from Angola, Guinea-Bissau, and Mozambique in the mid-1970s, ending formal European colonialism in Africa.
International pressure, neighboring African states, and Robert Mugabe’s guerrilla movement brought an end to White rule in Rhodesia, now called Zimbabwe.
Africa and the End of White Rule
Although the immediate postwar period saw the decolonization of most of Africa, the remnants of colonial rule remained in southern Africa. There, Whites continued to espouse an ideology of racial superiority. In the later twentieth century, final decolonization occurred as these regimes gave way to African rule.
The last African territories under direct European rule were Portugal’s colonies in southern and western Africa. Portugal resisted the demands of African nationalist movements into the 1970s. The struggle to cling to its colonial territories exhausted Portugal’s resources, leading it to withdraw from Angola, Guinea-Bissau, and Mozambique. This ended formal colonialism in Africa.
However, White rule persisted elsewhere on the continent. In Rhodesia, a White minority resisted international pressure to cede to African rule. Neighboring African states helped finance a guerrilla movement led by Robert Mugabe, which ultimately brought an end to Rhodesia, now renamed Zimbabwe.
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South Africa was the final outpost of White rule, with a larger, richer, and more entrenched European minority.
Increasing pressure for end to apartheid
International Olympic Committee banned South African athletes from 1970
American students demanded divestment from South Africa investment
Economic sanctions
International pressure calling for the release of Nelson Mandela
Majority rule finally came to South Africa in 1994, with its first democratic election and Nelson Mandela as its first democratically elected president.
Leaders of independent Africa faced immense challenges in building stable political communities: local contests for political power, ethnic and religious rivalries, civil wars, and coups d’état.
South Africa and Nelson Mandela
The final holdout of White rule was South Africa. The White minority there was larger, richer, and more entrenched than in other places.
The apartheid system drew increasing international condemnation, putting pressure on the regime. South African athletes were banned from competing in the Olympics beginning in 1970. American university students led divestment campaigns, demanding that schools withdraw any investments in companies with ties to South Africa. Economic sanctions were applied, and international pressure mounted for the release of Nelson Mandela.
Ultimately, the regime decided that it was no longer possible to resist pressure from outside and from within, and began the process of transitioning to a democratic form of rule. The first democratic elections were held in 1994, which brought Mandela to power.
Despite these political gains, leaders of independent African states faced immense problems. Many new regimes were unstable. Civil and ethnic conflict exploded into civil wars in the 1990s, drawing military leaders into politics.
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Increasingly free movement of capital, commodities, people, and culture
International banking, expanded international trade, population migrations, and technical breakthroughs in communication led to increasing integration and new power arrangements.
Finance and trade
Global finance and deregulated markets
1970s: Governments in the First World eliminated fixed exchange rates.
Primary agents of financial activity were banks
International Monetary Fund became the most influential, especially in dealing with debt crises in the developing world.
Latin American and eastern European nations borrowed billions from First World banks.
When repayment proved difficult, the IMF bailed these governments out on the condition of reducing state management of the national economy.
Tariffs and other barriers to foreign trade crumbled.
Unleashing Globalization
As the end of the Cold War removed obstacles to international integration, the movement of capital, commodities, people, and culture increased dramatically. These movements have existed throughout world history, but never on such a dramatic scale. At the same time, there were deep inequalities in access to the benefits of exchange. Several factors contributed to these new forms of integration and inequality: international banking, expanded international trade, population migrations, and technical breakthroughs in communications.
In the 1970s, there were major transformations in the world’s financial system. In response to America’s budget and debt crisis, Richard Nixon took the dollar off the gold standard, untethering other currencies from the American dollar. This gave international financiers greater freedom from national regulators.
The primary agents of increasing global financial activity were big banks, mostly based in London, New York, and Tokyo. The most influential international financial organization was the International Monetary Fund (IMF), created after World War II to lend funds to states in need.
The IMF became influential in dealing with debt crises in the Third World and the former socialist states, now lumped together as “the developing world.” The IMF offered loans to these cash-strapped governments. In the 1980s, facing a wave of defaults, international banks and the IMF bailed these governments out on condition that they reorganize their finances and reduce state management of the economy.
All across the world, tariffs and other barriers to foreign trade crumbled, while states privatized industries and waves of investment poured into newly reformed economies.
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New technologies and institutions allowed more investors and traders to participate in global finances.
The Internet and online trading accelerated capital mobility.
Globalization increased commercial and financial interdependence.
Accelerated capital mobility created enormous volatility and financial panics when Mexican economy went into paralysis in 1994
United States emerged as world’s largest borrower, much owed to China
Financial integration increased commercial interdependence.
Value of goods and services exchanged increased tenfold from 1973 to 1998
International divisions of labor shifted.
More and more Third World countries became suppliers of manufactured goods, not primarily raw materials.
Economic integration spurred the rise of East Asia’s economic prominence.
Share of world exports doubled in this period
East Asian countries and Japan became major investors abroad.
China began its rapid economic expansion.
Effects of Integrated Networks
New technologies and institutions allowed more investors and traders to participate in global finances. The Internet and online trading were major factors in increasing the movement of capital across borders.
But the new changes also caused problems, exemplified by Mexico’s economic crisis in 1994. Although the United States bailed out the Mexican economy with the largest international loan in history, the United States itself was in fact deeply in debt itself. As the world’s largest borrower, the United States owed much to China, which had a huge trade surplus with the United States.
Financial integration also increased commercial dependence. More than ever before, consumers were buying basic goods imported from other countries. This had always been true of smaller regions, but this pattern increased in the 1980s. As the international division of labor shifted, countries like China, India, and Brazil, with cheap and skilled labor, were able to undersell their competitors.
The most remarkable global shift occurred in East Asia, led initially by Japan. East Asia’s share of world trade doubled during this period, as growing economies like China rapidly expanded. At the same time, East Asian countries became major investors abroad.
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Lower trade barriers and industrialization in developing countries increased the pressures of global competition.
Some regions formed regional trading blocs.
Maastricht Treaty established European Union in 1993
European Union initially a trading and financial bloc, but evolved into a supranational organization
Uniform currency 2002 (euro)
2020, European Union had 27 members, 19 using euro
Trade blocs form in South America and between United States, Mexico, and Canada
International trade increased but became increasingly unequal.
High-tech and knowledge-based goods became ever more important exports from the world’s richest countries.
Poor nations remained locked in the production of low-tech goods and raw materials.
Regional Trade Blocs and Growing Inequalities
As trade barriers lowered and industrialization increased, national economies in poor countries felt the pressures of global competition. One solution to this was the formation of regional trade blocs. This was intended to create larger markets for bloc members to help them stay competitive.
One of the most complete regional integrations was the European Union, formed by the Maastricht Treaty in 1993. It began as an agreement to lower trade barriers and harmonize member-states’ international trade policy, but developed into a political union that encroached on individual state sovereignty. The European Union took a further step toward integration in 2002 with the adoption of a single currency, the euro. However, some states declined to adopt the currency. Trade blocs also formed between South American countries as well as between Canada, the United States, and Mexico.
As international trade exploded, inequality increased. Richer countries increasingly focused on exporting high-tech and knowledge-based goods, locking poorer countries into the production of low-tech goods and raw materials.
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Migration, always a major feature in world history, became more pronounced in the twentieth century.
120 million migrants from Asia, Africa, and Latin America left poor countries for jobs in wealthier countries
Migration
Migration has always been a major feature of world history. In the twentieth century, it became more pronounced. By 2000, there were 120 million migrants from Asia, Africa, and Latin America scattered across 152 countries.
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Flow of migration often followed former paths, particularly of colonization
Often moves are from poorer, rural areas to urban areas
Lagos, Nigeria, grew from 41,000 people in 1900 to 10 million in 2000, with projections of a doubling by 2025.
People moved from less-developed to more-developed countries to seek opportunity.
The United States reversed previously closed borders with major immigration reform in 1965.
2000: 27 million immigrants lived there, nearly 10 percent of population
Mexicans, the single largest group of immigrants from 1970 to 2000
Asians’ numbers also surged, accounting for 40 percent of all immigrants to the United States in the 1990s.
Patterns of Migration
Flows of migration often followed the contours of historical colonial and political ties. Places in North America and Europe that had colonial dependencies often saw an influx of migrants from those places in the twentieth century. Where countries had close diplomatic ties, migration usually followed. This was especially true of Germany and Turkey, Japan and South Korea, and Canada and Hong Kong.
Global migration was often an extension of internal migration patterns from rural areas to urban centers. In Lagos, the capital of Nigeria, migrants swelled the population from 41,000 in 1900 to 10 million in 2000. In general, people moved from less-developed areas, seeking opportunity in more-developed areas.
One of the biggest changes in world migration patterns occurred in the United States. In the early twentieth century, the United States had mostly closed its borders to migration from both the Atlantic and Pacific. In 1965, it enacted a major immigration reform that led to a surge of migrants. The single largest group of immigrants from 1970 to 2000 came from Mexico, whereas Asians accounted for 40 percent of all migrants in the 1990s.
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Many immigrants began as temporary or guest workers.
Economic downturn in 1970s and resulting high unemployment made integration difficult
Integration also difficult in Japan; Japan was reluctant to recruit minorities who might then settle, leading to dire labor shortages
Temporary Migrants
Many migrants intended to move only temporarily. In the 1950s and 1960s, many southern Europeans migrated to northern countries. As southern Europe became increasingly wealthy, these countries themselves became destinations for migrants from the Middle East, Africa, and eastern Europe. The economic downturn in the 1970s often made integration difficult.
Japan also struggled to incorporate immigrants. In need of greater labor supply for its expanding economy, Japan encouraged migrants to come temporarily as “guest workers.” The Japanese government feared that these immigrants might settle permanently, but this reluctance sometimes led to dire labor shortages. Other East Asian countries like Hong Kong, Taiwan, and Malaysia also became hosts for temporary migrants.
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Map 21.3 | World Migration, 1918–1998
Map 21.3 | World Migration, 1918–1998
The world’s population continued to grow and move around in the twentieth century.
• Looking at this map, identify the countries that had the greatest increase in foreign-born people as a percentage of total population.
• Compare the areas of most rapid population growth during the nineteenth century with the parts of the world that, according to this map, had the highest percentage of foreign-born people in the twentieth century. What are the similarities and differences?
• During the twentieth century, which parts of the world were the sending areas, and which were the receiving territories? See also Map 18.1.
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Often, migrants and refugees only partially accommodated, with many fully excluded from host societies
Movement of people heightened national concerns about the ethnic makeup of political communities
Forced migrations a major problem, with refugees fleeing