After reading Chapters 22, 27, and 33, I feel like I’m looking at the same global system from three different perspectives, and I’m still trying to connect them.
I would say Chapter 22, The Sticky Superpower, definetly changed how I now view American power. I initially thought power was solely about how much a country produces or how large their GDP is but this part of the reading showed me how it is so much more than that. The United States is still very powerful, even though its share of global production and GDP is shrinking. This is because other factors such as control over finance, technology, and in particular the dollar play such a crucial role in today’s society. The U.S. dollar being the world’s main reserve currency gives America a lot of influence automatically. I also didn’t realise how much power the Federal Reserve has when it changes interest rates. These concepts definetly confused me becasue I couldn’t really get my head around how the U.S can be declining yet still hold so much power. At the same time, I’m not completely sure this power will last forever because surely if China keeps growing and creating its own financial systems then won’t that just slowly weaken the U.S. dominance?
In Chapter 27, I came across the similar idea already presented in a chapter from last week’s readings about globalisation and its management. This time it was Stiglitz who argues that globalisation itself isn’t the main problem but it’s how it has been managed, especially by the IMF. His example of developing countries being like “small boats in a rough sea” made the risks of opening financial markets too quickly very clear. I agreed with his point that we need to think about who benefits from globalisation and who carries the risks. It definetly added to my thought processes from when I read this in an earlier chapter as it confused me a little becasue it made me question how do we make globalisation fairer in practice?
Chapter 33 seemed to focus directly on the IMF. I would say I have a very mixed opinion after reading this chapter. It does seem that the IMF is actually good at fixing balance-of-payments crises, which helps stabilise struggling economies but the evidence also shows that IMF programs often slow economic growth and increase inequality. It seems as if the IMF can help in the short term, but often creates more long term problems for growth and fairness. It made me wonder if there’s a better way to stabilise economies without hurting the most vulnerable people. I also didn’t realise just how political the IMF is. It just does not seem fair to me that powerful countries such as the U.S have more influence, and how sometimes governments use IMF rules as an excuse to push through unpopular changes. This also was highlighted in the documentary we watched in class about Jamaica and the exports of Bananas. They do not have access to the American market despite creating 90,000 tonnes of Bananas and I believe that the IMF has something to do with this, probably becasue they owe millions.
Overall, these readings helped me to understand some different elements within globalisation that make impacts such as the IMF but I would say some of it is still complicated to wrap my head around. It seems the IMF is very 50/50 as it creates power and growth but also inequality and tension. It does not seem like a very fair system to me and I’m left asking whether the negative effects are unavoidable or if they come from specific policy choices and political decisions with little that can be done to change this.
1 comment:
I also agree with the fact that globalization isn't a bad thing, but the bad thing bout it is the way countries manage globalization. I think that the IMF had good intention behind it, and in theory it works, but we see that once the IMF is implemented within a country that country instantly "isn't themselves"because they are adopting rules that benefit the world and not the people of those countries. I think the IMF shouldn't be a organization that focuses on the well-being of the world, but it should be something that has a plan for specific countries and actually helps those countries instead of trapping them in debt.
Post a Comment