Royal D. Alworth, Jr. Memorial Lecture
This annual lecture, named in honor of the late Royal D. Alworth, Jr.'s life and interests and normally delivered during the second semester, is designed to raise public understanding of a significant international topic.
On the April, 25th 2006 Dr. Willie Henderson, Director of the Alworth Institute delivered the Royal D. Alworth, Jr. Memorial Lecture. His topic was Globalization: An Intellectual History. What follows (below) is a synopsis of the key points of the lecture
Globalization: An Intellectual History (summarized version)Henderson pointed out that the notion of ‘globalization’ carries different meanings to different people in different contexts. It can be used so widely and so ambiguously as to be almost meaningless. It is a euphemistic term, both partial in nature and paradoxically multiple. If it were to be restricted to economic globalization it can be taken to mean the globalization of market or market-type economies or to use an even older and more ideological term ‘capitalism’. The advantage of the ‘globalization of capitalism’ is that most people are clear about the relative advantages and disadvantages of capitalist production. It is good at wealth creation and employment generation and at innovation thanks to massive expenditures on research and development. It is less good at generating equality in income distribution or at maintaining consistency and stability in growth rates. The notion that markets are dominant in economic globalization and that state policy is secondary or even irrelevant is one that needs to be considered. This is especially so when we think that successfully exporting economies (the Asian ‘tigers’) and the new Driver Economies (India and China) are countries in which the state has played a positive role in export-led growth in recent years. USAID now talks about ‘transformational development’ in the context of development and democratization.
In the lecture Henderson then set out the history of the development of global integration in three states: the mercantile expansion of the late 17th and 18th centuries (brought to an end by the Napoleonic Wars); the 19th century expansion and integration brought about by steam power and railway investments world-wide (brought to an end by the First World War) and the current period of ‘globalization’ brought about by the conviction of the Allied Governments during and after the second World War of the need to avoid the problems of the 1920s and 1930s when trade collapsed and countries pursued protectionism in an effort to export unemployment. The current era of globalization has its origins in progressive social and political ideas from the 1930s that found their expression in the ‘four freedoms’ set out in the Atlantic Charter. Progressive people in the 1930s discovered the extent of world hunger and the absolute lack of productive capacity in what was then called ‘the colonial world’. Leadership of the modern post-World War II approach was largely with the United States though shared to some extent with Europe. Questions were raised about the content and style of present-day American leadership and its alleged ‘disciplining parent’ approach.
The intellectual basis for free trade, in the writings of Adam Smith (1776); David Hume (1752) and David Ricardo (1817) were reviewed as they still form the basis of which arguments in favor of free trade rest. Smith’s economic agents (‘every man’) were motivated by a natural restlessness that meant that they sought to ‘better their condition’, though governments were necessary to do what markets could not do. Hume pointed out that in exchange relationships more is exchanged than simply goods. Culture and industrial ‘art’ (what we would call technology) are also exchanged, to mutual benefit. Ricardo pointed to the theory of comparative advantage as a basis for mutual benefit. This set of theories tell us that trade is beneficial to both parties. They do not tell us how the benefits will be divided up. They also tell us that not everything will end up being manufactured in China.
The institutions for the governance of the world economy: the International Monetary Fund, the World Bank and the GATT (now reconstituted at the World Trade Organization) agreed by the Allies at Bretton Woods in 1944 must be regarded as a significant diplomatic achievement even if in today’s world they are subject to criticism. They were useful to restore international trade. Today they need to be re-examined to see if their functions are useful in the pursuit of a well-regulated international economy. World trade levels have been restored to almost the same (relative) position there were at the start of the 20th century.
There are now new issues within which the reconstruction and democratization of the international economy needs to be viewed. These include for example: increasing the beneficial effects of trade liberalization; the elimination of corruption through the use of domestic law; the democratization of international institutions and a review of their effectiveness in changed circumstances; the need for sustainability to be build into development initiatives. For leadership to be effective in state transformation and for institutional review it needs to be democratic, open and multilateral if it is to cope with the complexities of the new situation.Turning to other contemporary problems, Henderson outlined the issues in relation to US and China and India (the Asian ‘Driver Economies’). He pointed out that as a result of adjusted state policy in both China and India and the resulting outside investment and the dynamics of Asian economies, poor people were being pulled out of poverty at a faster rate than at anytime or any place in history. Poverty in this context meant absolute poverty. Sub-Saharan Africa had fallen behind and needed states to adopt some kind of ‘developmental state’ approach to try and regain ground. The attitude of the United States towards China was split between the economic elite who welcomed further investment and trade and the political elite who were anxious to delay the emergence of China as a superpower likely to rival the Untied States. Possible limits on Chinese growth were considered against a back ground of regional ethnic and urban-rural imbalances in China.
The extent of ‘economic globalization’ was then considered. It was pointed out that globalization was geographically incomplete and conceptually incomplete. Sub-Saharan Africa had been left behind and although there were signs of an African Renaissance, the sub-continent needed to find new sources of export income. This required the removal trade barriers to agricultural produce (largely the barriers were created by subsidies to developed world farmers). Legal movements in labor were heavily restricted and receiving countries invested heavily in preventing migration. Poor people merely sought to improve their lot in life as Smith assumed in 1776.
Dr. Willie Henderson, Alworth Director and Presenter of the Memorial Lecture
Royal D. Alworth III, Dr. Willie Henderson, and Mrs. Martha Alworth