Globalization and Capitalism in the Twenty-First Century

Tetsunori Koizumi, Director

What is the driving force behind globalization, behind dramatic and multi-dimensional changes taking place in the world around us? One interpretation of globalization would be to see it as the latest phase of “modernization,” which Karl Polanyi characterized as the “Great Transformation”1. The initial thrust of this Great Transformation, which would cover all aspects of people’s lives, took place in the late eighteenth century when the Industrial Revolution ushered in a revolutionary change in the capitalist mode of production with the adoption of assembly lines in factories, which made it possible to for capitalists to exploit economies of large-scale production, thus prompting them to seek markets globally beyond their domestic markets for their products.

While the Industrial Revolution was no doubt a transformative event in the evolution of modern societies, the invention of capitalism as a mode of organizing economic life goes back much further than the eighteenth century. As Immanuel Wallerstein points out, capitalism was an invention of late-fifteenth-century Europe: “My own view is that the genesis of this historical system is located in late-fifteenth-century Europe, that the system expanded in space over time to cover the entire globe by the late nineteenth century, and that it still today covers the entire globe.”2 Involving, as it does, economic change brought about by powerful transnational corporations from the West under the banner of capitalism, or “global capitalism” as it is called today, globalization can thus be seen as the culmination of the capitalistic expansion of Western nations that goes back, at least, five centuries.

The late fifteenth century, it may be recalled, is also known as the start of the Age of Great Exploration in the history of civilizations. As symbolized by Columbus’ voyage to what would become the New World in 1492, Western nations, headed by Spain first but soon followed by Portugal, England and France, started to explore new territories beyond their national borders to reap economic bounties with the military and technological prowess they possessed at the time compared with nations in other parts of the world. Seen in this historical context, globalization, whether driven by the acquisitive motive of capitalists or the religious zeal of Christian missionaries, can be seen as the triumph of Western civilization that became apparent with the emergence of the United States as the dominant power in world affairs in the second half of the twentieth century.

That globalization in the second half of the twentieth century can be seen as representing the triumph of Western civilization over other civilizations is well summarized in the following words of Arnold Toynbee: “Future historians will say, I think, that the great event of the twentieth century was the impact of the Western civilization upon all the other living societies of the world of that day. They will say of this impact that it was so powerful and so pervasive that it turned the lives of all its victims upside down and inside out—affecting the behavior, outlook, feelings, and beliefs of individual men, women, and children in an intimate way, touching chords in human souls that are not touched by mere external material forces—however ponderous and terrifying.”3

It is to be noted that Toynbee, with his uncommon insight as a historian, expressed these words as early as in 1958 when the word “globalization” was hardly mentioned in intellectual discourses, let alone in daily conversations. Toynbee’s choice of words “upside down and inside out” suggests that the impact of Western civilization and, by implication, of globalization on the lives of people in the rest of the world has been quite extensive and extremely disruptive. Whether they can be characterized as “victims,” globalization for the people living in the non-Western world can be said to have been the change imposed on their lives “from above” by the First World and by supra-national organizations such as the World Bank and the International Monetary Fund, which are seen by them as promoting the interests of the First World. Globalization for these people has also been the change brought into their lives by foreigners and foreign organizations “from outside” beyond their national borders.

Given the nature of globalization as representing the triumph of Western civilization, it is not surprising that anti-globalization movements sprung up in the rest of the world in the last decades of the twentieth century, and are still continuing into the twenty-first century. These movements that mostly reflect the efforts of local and regional communities to regain their autonomy can be seen as representing globalization “from below,” in the sense that they reflect the efforts of lower entities in the traditional hierarchy of political control within the nation-state. They represent globalization “from below,” also in the sense that they are grass-roots movements, with the initiative for opposition and resistance to globalization coming from NGOs, civic groups, and ordinary people in varied walks of social life. Indeed, recent development in UK and US suggest that anti-globalization sentiments, if not movements, are now spreading to the people living in the bastion of Western civilization.

Toynbee’s words, in addition to globalization “from below,” suggest another direction in which anti-globalization can take: globalization “from within.” In the first place, globalization “from within” is a useful—and meaningful—way of interpreting the nature of anti-globalization movements, because civilization as a social system has a topological structure that has the upside-downside dimension as well as the outside-inside dimension. Globalization “from within” is also a useful—and indeed meaningful—way of capturing anti-globalization movements as they represent the effort of the individual to find a stable sense of belonging as a member of a civilization that is being threatened and eroded by dramatic and multi-dimensional changes under globalization. The challenge for capitalism in the twenty-first century is, therefore, whether it can address itself to the individual’s need to find a stable sense of belonging in the world in which the violent clash of civilizations has become, unfortunately, a constant in our lives.

  1. Polanyi, Karl, The Great Transformation: The Political and Economic Origins of Our Time, Boston: Beacon Press, 1957.
  2. Wallerstein, Immanuel, Historical Capitalism with Capitalist Civilization, London: Verso, 1983, p. 19.
  3. Toynbee, Arnold, Civilization on Trial and the World and the West, 1958, p. 278.