Economic Globalization: The Homogenization of Culture and the Destruction of Public Health

This topic points to a number of issues. I will address: 1) the definition of globalization, focusing on economic globalization; and 2) the effects/risks of globalization, with particular attention to their implications for global public health.

Definition

One definition of globalization is provided by global capitalists and embodied in the meeting of the World Economic Forum in Davos, Switzerland, where capitalists coalesce to share ideas and network about production, investments and economics. The type of globalization supported by these people is referred to by Nobel Prize-winning economist Joseph Stiglitz as “economic globalization” (2007:4) or neoliberalization. These rules were famously enunciated by World Bank economist John Williamson (2000:252-253) as:

• “Fiscal discipline

• A redirection of public expenditure priorities toward fields offering both high economic returns and the potential to improve income distribution, such as primary health care, primary education, and infrastructure

• Tax reform (to lower marginal rates and broaden the tax base)

• Interest rate liberalization

• A competitive exchange rate

• Trade liberalization

• Liberalization of inflows of foreign direct investment

• Privatization

• Deregulation (to abolish barriers to entry and exit)

• Secure property rights”

In this paradigm, cultures are homogenized due to power imbalances, as dominant American (or Western) culture diffuses globally. This form of globalization is not only feasible, but in current operation.

Effects/Risks

The harsh consequences of these policies for poor countries are well documented. Chang points out that “since the 1980s, [Africa] has seen a fall in living standards. This record is a damning indictment of the neo-liberal [sic] orthodoxy, because most of the African economies have been practically run by the IMF and the World Bank over the past quarter century” (2007:28) (italics in original). In a sickening twist that reveals the true motives of globalization, “practically all of today’s developed countries, including Britain and the US, the supposed homes of the free market and free trade, have become rich on the basis of policy recipes that go against the orthodoxy of neo-liberal [sic] economics” (2007:15).

The effects on the supplies and distribution of global pharmaceuticals have been horrendous. The Agreement on Trade Related Aspects of International Property Rights (TRIPS) expands American patent laws worldwide through the World Trade Organization (Delgado 2002:297-298). Using TRIPS, American corporations have been able to force intellectual property laws on developing nations, which increases profits through two primary mechanisms (Zerbe 298-300). First, American corporate patents are extended to poor nations, preventing generic development. Second, local knowledge can be patented, distributed and sold around the world without any remuneration for indigenous people. Unlike the earlier intellectual property regime, “the advanced industrial countries could at last use trade sanctions to legally enforce intellectual property rights” (Stiglitz 2007:117). Now, fines can be leveled on countries or corporations that violate TRIPS rules. TRIPS regulations regarding AIDS and other tropical disease drugs are a particularly insidious form of globalization, with large, rich corporations supported by their governments attempting to sabotage the development of generic life-saving drugs. It is likely that “if the issue of access to AIDS drugs were put to a vote, in either developed or developing countries, the overwhelming majority would never support the position of the pharmaceutical companies or of the” American government (Stiglitz 2007:132).

In her 2001 book, Betrayal of Trust: The Collapse of Global Public Health (2001), Laurie Garrett describes the effects of economic globalization on the people and public health systems of the ex-Soviet countries. After the collapse of the Soviet Union, “overnight millions of workers lost their jobs, and the majority of the people residing in the Eastern Bloc and former Soviet Union fell into poverty – perhaps 25 percent of them were, according to UNICEF, living in acute poverty within eighteen months of the breakup of the Soviet Union” (2001:166). In response, and on the advice of American policymakers, Russia embraced economic globalization, which “can claim credit for the impoverishment of 72 million people in only eight years” (Klein 2007:237-238) (italics in original). An astonishing number of Russians desperately turned to alcohol. “Some estimates were that eighty percent of all Russian men were alcoholics, consuming in 1999 – on average – 600 grams of booze a day, or roughly three liters of vodka every week. The male alcohol poisoning death rate in Russia was about 200 times that of the United States” (Garrett 2001:138) (italics in original). The consequences for the children of Russia were terrifying. “In late 1998 the University of North Carolina conducted a survey that revealed that all – 100 percent – of Russian children suffered iron deficiencies, most having only 3 to 4 percent of minimum daily requirement needs met in their terrible diets” (2001:169) (italics in original). Similarly, “in 1997 the Moscow Human Rights Research Center estimated that there were a million homeless children in Russia; the government said 700,000. No one knew how many more children had parents in homes but were left largely to survive on their own because of their parents’ alcoholism. In Russia a term was coined to describe these kids: the Lost Generation” (2001:140).

The consequences to the United States of embracing neoliberal globalization are being manifested most notably in the current recession. As Smith (2009) notes: “The economic crisis is far too fresh for any government agency or professional organization to have quantified the health consequences. But during previous recessions, researchers linked spikes in unemployment in the United States and Europe to increases in deaths from heart disease, cancer, and psychiatric disorders.” Yet the current recession tells only an incomplete story, for one should not forget the disastrous state of the profit-motivated American health care system, which I detailed in an earlier post.

Tabb (2008) contends that the primary implication of the current recession for American society has been a reexamination of the ideology of economic globalization. Indeed, if, as Krugman (2009) predicts, Keynesianism will return to the fore, this may strengthen American economic hegemony through more stable state capitalism, protectionism and regulation. The outcomes are unpredictable but unlikely to be beneficial to the Third World due to inequalities in economic and political power. Regardless of which direction the future will take the American economy relative to the world, the 2008 financial crisis heralds dramatic changes for globalization and public health both here and abroad.

Bibliography

Chang, Ha-Joon. 2007. Bad Samaritans: The Myth of Free Trade and the Secret History of Capitalism. Bloomsbury.

Delgado, Gian Carlo. 2002. “Biopi®acy and Intellectual Property as the Basis for Biotechnological Development: The Case of Mexico.” International Journal of Politics, Culture and Society 16(2):297-318.

Garrett, Laurie. 2001. Betrayal of Trust: The Collapse of Global Public Health. Hyperion.

Klein, Naomi. 2007. The Shock Doctrine: The Rise of Disaster Capitalism. Metropolitan.

Krugman, Paul. 2009. “How Did Economists Get It So Wrong?” New York Times Magazine. September 6.

Smith, Stephen. 2009. “The Ailing Economy Is Making People Sicker.” Boston Globe. January 25.

Stiglitz, Joseph. 2007. Making Globalization Work. WW Norton.

Tabb, William K. “Four Crises of the Contemporary World Capitalist System.” Monthly Review. October 2008.

Vreeland, James. 2006. The International Monetary Fund: Politics of Conditional Lending. Routledge.

Williamson, John. 2000. “What Should the World Bank Think about the Washington Consensus?” The World Bank Research Observer 15(2):251-264.

Zerbe, Noah. “Contested Ownership: TRIPs, CBD, and Implications for Southern African Biodiversity.” Perspectives on Global Development and Technology 1(3-4):294-321. 2002.