CAPITAL RULES: THE CONSTRUCTION OF GLOBAL FINANCE. By Rawi Abdelal. Cambridge, Mass.: Harvard Univ. Press. 2007. Pp. xi, 304. $49.95.
IN DEFENSE OF GLOBALIZATION. By Jagdish Bhagwati. New York: Oxford Univ. Press. With new afterword, 2007. Pp. xiii, 330. $16.95.
TERRITORY, AUTHORITY, RIGHTS: FROM MEDIEVAL TO GLOBAL ASSEMBLAGES. By Saskia Sassen. Princeton, N.J.: Princeton Univ. Press. 2006. Pp. xiv, 493. $37.95.
MAKING GLOBALIZATION WORK. By Joseph E. Stiglitz. New York: W.W. Norton & Co. 2006. Pp. xxv, 358. $16.95
Already by the end of the Cold War, the old struggle between right and left over the governance of the economy and the redistribution of wealth within the advanced liberal democracies had yielded to a new pro-market consensus. The center-left embraced many of the center-right critiques of the postwar regulatory and welfare state as inefficient, wasteful, and dependency- inducing, and sought to pursue traditional progressive values through a more economically liberal (in the sense of pro—free market) approach to governance of the economy. The discontents with these tendencies, mostly from the traditional left but not entirely, coalesced as a new counterculture, the antiglobalization movement. And there thus arose a great and intense debate about whether globalization was good or bad, inevitable or resistible, in relation to the ideal of the sovereign, progressive, democratic nation-state.
This debate, I argue, is over, above all because the antiglobalizers have themselves gone global. In various sites of global law and policymaking, including those at the interstices of the global and local, they actually have found processes and institutions through which, unlike the case with the state in many instances, they can air their criticisms and express their values as global values. There is no longer an antiglobalization “side” in the debate, coherently representing the position that the territorial nation-state should remain the locus of control over economic activity and should retain a monopoly on legitimate governance. Today the protesters who march against globalization are not marching in favor of the state. Instead, they are mostly advocating a set of values and causes that transcend state boundaries and that require global action.
Each of the works under review here contributes in a distinctive and significant way to understanding the end of the globalization debate. Jagdish Bhagwati, in In Defense of Globalization, displays a number of aspects in which the globalization debate has ended. While explicitly framing his argument as a defense of globalization, Bhagwati ends up arguing forcefully against several crucial elements of globalization, including the liberalization of short-term capital controls and the harmonization of intellectual property rights in the WTO. At the same time, he defends equally forcefully other elements, especially trade liberalization. Ultimately, Bhagwati’s analysis reveals that the real debate has shifted to the complex effects of different aspects of globalization.
Joseph Stiglitz and Saskia Sassen are theorists who decisively move our understanding beyond that of the old globalization debate. While Bhagwati usually displays an optimistic faith that political and economic rationality can ensure the achievement of “globalization with a human face,” Stiglitz is mindful of the puzzles and limits of rationality in economics and policy, and thus sees a need for innovative solutions that may challenge conventional economic wisdom. The very title of Stiglitz’s book, Making Globalization Work, takes us beyond the usual framing of the debate as globalization versus antiglobalization. Stiglitz illustrates how many of the problems with global economic liberalism identified by the antiglobalizers – such as environmental commons issues, the democratic deficit, and weak and corrupt states – require solutions at the global level through innovative mechanisms of global governance.
Sassen, in Territory, Authority, Rights, explains how the state itself has been transformed, in part by globalization itself, such that it is intrinsically more hospitable to pro-globalization forces. In this sense, one can no longer conceive of the state as the adversary of globalization or the repository of a legitimate counter-perspective. At the same time, Sassen also shows how activists representing values often understood as “antiglobalization” move between the local and the global, often operating through global networks and interpenetrating global sites of power, decision, and deliberation.
Rawi Abdelal supplies a valuable historical perspective. He explains that the liberalization of capital markets emerged not from a conspiracy of global financiers or the hegemony of Wall Street, but from a turn towards liberal economics by the French Socialists under Franí§ois Mitterrand. The shift was based in part on the view that resisting global markets was impossible or too costly – one could not effectively operate the progressive social democratic state against the forces of globalization.