SOCIAL CHANGES AND POLICY

Social Changes and Policy

Part 1: Social Change in a Globalized World

Introduction

Globalization is a historical process of transnationalization, denationalization, and deterritorialization that encompasses different arenas, such as the economy, society, politics, culture, academia, and so on, with varying intensities and geographical differences. It involves an increase in the scope, volume, and velocity of transactions across national borders, not all of which occur on a worldwide basis. In the next section, we will examine the the social changes that have occurred throughout the world as a result of globalization and ways in which these changes have influenced the society and its members (Friedman 2007, p. 45).

Discussion

History of Globalization

The current round of globalization has its roots, as noted above, in the post-World War II economic system propagated by the United States. This, in turn, drew heavily on the nineteenth-century international economy, which was based on the gold standard, protected by the British Royal Navy, and anchored in the City of London. The Bretton Woods (BW) system, devised in large part by John Maynard Keynes and Harry Dexter White and modeled to some degree on the earlier British-sponsored system, sought to address the trade, currency, and fiscal crises associated with the Great Depression, which were believed to have contributed to the war. The four major BW institutions were the International Bank of Reconstruction and Development (IBRD, aka, the World Bank), the International Monetary Fund (IMF), the dollar-based gold exchange currency system, and the later established General Agreement on Trade and Tariffs (GATT). Their forms and functions were premised on the existence of relatively autonomous, state-regulated national economies, subject only to a limited set of meta-regulations. During its fully-operational lifetime, the BW system was a great success, helping to spur European reconstruction and high rates of economic growth and prosperity in Europe, Japan, and the United States (Takashi & Ian 2008, p. 76).

Nonetheless, by the 1960s, the currency component of the BW system was coming under growing strain, as international dollar liquidity exceeded demand (the Triffin dilemma) and U.S. trade deficits appeared and grew, fostered by American spending on the Vietnam War and growing imports due to lower tariffs negotiated under the GATT. The oil price hikes and inflation of the 1970s, accompanied by rapidly increasing wages and declining rates of profit, motivated a turn to neoliberalism, on the one hand, and gradual liberalization of capital movements, on the other. During the early 1980s, a double global recession, engineered by the U.S. Federal Reserve to squeeze inflation out of the U.S. economy, set in motion incentives to restructure U.S. and global production and further integrate the world economy through a purely dollar-based currency standard (Heuveline 2003, p. 45).

Conceptualizing Globalization

Globalization is better understood, therefore, as simultaneously an idealist set of beliefs; a behavioral set of principles, rules, and activities; and a material set of outcomes and infrastructures. Globalization is a form of idealism through reification of a complex process that, it is said, will make the world richer and happier, and it is rationalized ...