The E-Journal of Solidarity, Sustainability, and Nonviolence

            Vol. 4, No. 12, December 2008
            Luis T. Gutierrez, Editor

Home Page
Current Issue Page 1


Editor's Note: Poverty is making life miserable for millions. Terrorist violence is increasing in geographically random patterns. The planet's ecological balances are in peril. And now, a financial crisis has erupted, starting in Wall Street and spreading to the entire world practically overnight. The invited paper this month, by Ghassan Karam of Pace University, focuses on the interactions between economic development, environmental stewardship, and the pervasive process of globalization. Sustainable development entails development that is socially and ecologically responsible, and can no longer be a local or national undertaking. The "global village" is a fact, and will continue to be so in the foreseeable future. But human behavior and human decisions actually determine whether or not globalization is conducive to social and environmental justice throughout the entire "village." Let us hope that due consideration of the common good prevails in the process of resolving the current financial crisis.

Global Capital and Delocalization

By Ghassan Karam

Published in Ya Libnan, Beirut, Lebanon, 27 November 2008


Ideological celebration of so-called globalization is in reality the swan song of our historical system - Immanuel Wallerstein.

In Epilogue II of War and Peace, which often goes unread, Tolstoy berates modern Historians who “ought to be studying not the manifestations of power but the causes which create power” if they are to provide a “description of the flux of humanity and of peoples”. Alas they act “like a deaf man answering questions no one has put to him.” This serious methodological defect highlighted by Tolstoy over a hundred and fifty years ago is still often committed not only by historians but by many of their colleagues in the social sciences. The results of such flawed cognitive processes dominate the field of Economic Development, Environmental Studies and what passes for analysis in the ubiquitous phenomenon of Globalization to name just three areas.

One illustration of the shortcomings of such models can be seen clearly in the efforts of The Group of Industrialized Countries, G 8 to deal with the ever spiraling level of poverty and deprivation on the African continent. The G 8 decided in 2005 to stem this downward cycle by lending its strong approval to the UK’s “Commission for Africa” plan spearheaded by the then Chancellor of the Exchequer Gordon Brown and the support of the PM Tony Blair in addition to the rather lukewarm support of the US administration. Fundamentally, the plan was based around the idea that a write off of the debt of the countries in question is the prescription for leading these countries out of poverty and dependency. Unfortunately, this scheme of increased money grants has been tried before with dire results. The level of sincerity of the G8 nations is not questioned; their ability to differentiate between “manifestations” and “causes” is. There is no doubt that if an individual/country/institution has a lighter burden of financial liabilities, then they would be better of temporarily. But if the initial conditions that resulted in the debt in the first place have not been removed, then do we have any right to expect a different outcome the next time around? Of course not. Since it is safe to assume that neither countries nor individuals within countries will freely choose to live under inhumane conditions of deprivation, misery and squalor, then such outcomes are imposed on the unlucky recipients by a set of rules that demand such outcomes. Outcomes do not just happen; they are dictated by the prevailing social, economic and political structure; by the mode of production. Outcomes change only if we make changes to the world system.

Environmental studies is another field that is replete with policy suggestions that commit the fallacy that Tolstoy warned against. Despite the clear conclusions of large scale scientific studies that global ecological resources are under severe stress the global community and the United Nations proceed to work on peripheral issues. We have chosen to address symptoms instead of causes when we know that any meaningful relief demands a fundamental change in the conduct of economic, social and political affairs. Anything short of a radical change in the architecture of the world system is a palliative measure that would be doomed to fail and to only aggravate the problem that it was intended to resolve. Whether it is global warming, the ever shrinking rain forest, desertification, endangered ocean fisheries, urbanization , water scarcity, pollution or declining biodiversity, just to name a few of the major environmental issues, it is clear that all of these problems are generated as a result of the global community’s unrestrained obsession with material accumulation. Again the solution is clear and obvious but the global community chooses to concentrate on “manifestations” instead of the real “cause”, economic growth. But to renounce growth and advocate redistribution is an unrealistic expectation from within the confines of the current paradigm that is constructed on the unrealistic assumptions of infinite growth and an economy that is not subject to any form of ecological constraints.

Globalization is yet another area whose analysis lacks distinction between symptom and cause. Recommendations and policy suggestions emphasize the superficial aspects of the phenomenon in question, proceed to describe in great detail its outer appearances, then conclude that globalization’s demands must always be accommodated since the process of globalization is inevitable and even irreversible. No attempt is made to explain the cause of globalization, its ultimate goal or whether that end is worthwhile. Globalization, to this group, is the order of the day, it can never do any harm and it must be unquestionably accommodated. A slight variation of the above admits to the possibility of generating unpleasant outcomes from the globalization process but believes that the structure is amenable to adjustment. It believes that reform could produce globalization with a human face thus creating a win-win solution for all stakeholders. This level of analysis is equally unsatisfactory since it does not delve into a meaningful analysis of the reason globalization arose, what is its reason d'étre and whether it is amenable to reform.

The fall of the Berlin Wall in1989 is the most common benchmark for dating the beginning of the current round of globalization. The logic for such a date is compelling, because it is argued that prior to this date no real globalization would have been possible in a world made up of at least two major antagonistic camps. If globalization, however, is the product of a set of ideas and beliefs about the world, what proof is there that such ideas emerged in 1989? Furthermore, when a reference is made to “a current round of globalization”, by implication previous rounds of this activity must have preceded the current effort.


Globalization in its entire facets, political, social, cultural and economic, is ultimately the result of a unique project due to the nature of capital accumulation on a world scale and the need for capital to dominate and homogenize. As production and consumption become alienated from their local surroundings, then this pursuit of global co-modification will result in de-localization, de-socialization and de-territorialization. Globalization results in less diversity, less control and a loss of identity. None of these unhealthy effects of globalization can be eliminated if globalization is maintained. Change, if it is to come, will only occur when the victims decide to take action in order to vanquish the world system that has produced an environmentally unhealthy ecosystem and a humanly unjust society.

Copyright © Ya Libnan 2008


Ghassan Karam is Professor of Economics at Pace University, Westchester, New York. He teaches microeconomics, macroeconomics, international economics, environmental economics, globalization, economic development, comparative economics, and capital markets. His research projects include the political economy of the Middle East, globalization issues, economic development, and poverty reduction; and he is a frequent public lecturer on these topics. Over the past year or so he has also devoted lots of time and effort to researching the global financial meltdown. Professor Karam invites feedback and can be contacted at

Back to Current Issue Page 1

"In times of change
the learners inherit the world,
while the learned find themselves
beautifully equipped to deal
with a world that no longer exists."

Eric Hoffer (USA, 1902-1983)



Write to the Editor
Send email to Subscribe
Send email to Unsubscribe
Link to the Google Groups Website
Link to the Solidarity & Sustainability Home Page

Copyright © 2008 by Luis T. Gutierrez


Page 2