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Appendix 13
Bibliography 14 - 15
Executive Summary
The globalization dynamics led to the shifting balance in the roles of the state, the market, and the civil society, both in individual nations and in the international political economy. Apparently, this process has altered power relationships, cultures, and the environment. It has shifted the power relationships between government, civil society and business. This paper explores the impact of globalization in terms of power. It shows that the processes and agents of globalization have shifted the dynamics and inter relationships of power into new forms through examples from the two super powers in the global arena - China and the United States. This study also intends to illustrate the impending powers of global actors in the larger contexts of globalization, particularly in the area of international trading and governance. This research mainly used the qualitative design of research.
Hence, it can be said that in a globalized world, the rigid boundaries between political and economic sectors do not hold anymore (2011, p. 2). Instead of subscribing to the democratic approach, this paper recommends a creation of a new model of democratic politics that is capable of combining both corporate political management and the general control of the overlapping public and private sector.
Introduction
Globalization, as used in this paper, shall refer to the expansion of the integrated and inter dependent networks or channels which are inherent in the phenomenal movement of goods, knowledge, products, services, people, capital, among others, across national boundaries (Scherer & Palazzo, 2011, p. 16). Their rapid movement in a global range accentuated the large unequal political and material situations in which the world's diverse populations are based. It also enhanced a stronger demand for greater political and economic equality and a wider sense of economic, political, and moral interdependence (2011, p. 16). These dynamics have led to the shifting balance in the roles of the state, the market, and the civil society, both in individual nations and in the international political economy (2011, p. 16). Apparently, this process has been impacting many peoples, organizations, governments, and international institutions worldwide. As Collier and Dollar (2002) put it, “globalization is not just an economic phenomenon; it alters power relationships, cultures, and the environment.” It shifts the power relationships between government, civil society and business.
This paper shall explore the impact of globalization in terms of power. It shall evidence that the processes and agents of globalization have shifted the dynamics and inter relationships of power into new forms. It will particularly take examples from the two super powers in the global arena - China and the United States in order to highlight the greater effects of globalization along the power lines mentioned above. At present, the United States still reigns as the most powerful and economically successful country in the world (Scherer & Palazzo, 2011, p. 15). Meanwhile, China has remarkably following it up along its military and economic might.
This study is intended to illustrate the impending powers of global actors in the larger contexts of globalization, particularly in the area of international trading and governance. Hence, it shall be limited to the alterations in the positions or status of the actors exemplified (can be a multinational company, a civil group or a political institution) in the countries mentioned. It shall not explore the other significant examples from other countries nor will it expound on the general economic impacts of globalization, its cultural and environmental effects, among others.
Methodology
This paper will principally rely on the qualitative research design. It shall utilize the descriptive research method which is usually concerned with explaiining the inherent conditions of the current research question (Babbie, 2005). It shall combine the descriptive and exploratory research approach with an attempt to highlight the shift of powers through examples from the two super powers of the new global order, the United States and China. This general approach will synthesize secondary resources such as academic journals, document analysis, review of data from government and institutional reports, among others.
The researcher shall use the empirical tools to illustrate how the different civil, business and governmental agencies in China and in the United States have shifted their power relationships and dynamics. Hence, this paper shall first gather direct explanation of the problem being solved. Both primary observations and analysis of secondary sources shall let the researcher to scrutinize the different elements and factors involved in this paper so that a more precise research process if accomplished.
Results and Findings
There are various indicators of powers which go beyond states, governments, civil society, and business. In this paper, we shall identify the changes in the balance of power through the aspects such as: the sources of power, formal and informal power structures, political powers as formal or informal, business powers as national or transnational, and civil society strengths.
China is the most prominent example of the huge benefits of globalization as its high GDP growth concretely shows. Its 2013 GDP was 9.24 trillion (World Bank Data, 2015). Chinese corporations are expanding and they are rapidly industrializing and building China as an economic superpower. (Yue, 2012, p. 1). Because of globalization, China enjoys a greater access to the global market and its cheap labor made it the best production site for multinational companies (2012, p. 1). With its accession into the WTO, China became the “factory of the world” (2012, p. 1). China’s economic powers also translate to its greater social and political dominion over its East Asian neighbors.
Likewise, globalization has opened up greater, foreign markets for the United States. In effect, this helps American companies sell their goods al over the world (Lindsay, 2003, p. 1). There has been a remarkable increase of multinational companies and their global presence is hard to ignore. Through this, the U.S. maintains its economic dominance.  The United States’ GDP in 2013 was 16.77 trillion (World Bank Data, 2015). Prior to globalization and even after it, the United States remains the top superpower of the world in all aspects of military, political, social and economic might.
In terms of political powers, China is reinstating its state authorities with respect to its attractiveness to the global corporations. To illustrate, China presents its inherent nation-state power over multinational company Audi when Audi AG entered the Chinese auto market. China stipulates that foreign multinationals like Audi enter their markets by a local joint venture with a smaller Chinese car company (Denison, Adkins, & Guidroz, 2011, p. 1). China’s laws and commercial policies dictate a local joint venture. Hence, the Volkswagen Company has alied with the local Chinese car industry beginning in 1978 (Volkswagen China Group Website, 2013, p. 1).  Its initial partnership with a local Chinese car company was in 1984. This was with the Shanghai Volkswagen Automotive Co., Ltd. (2013, p. 1). The next partnership was created in 1991 via the FAW-Volkswagen Automotive Company Ltd. (2013, p. 1). These two domestic homegrown car companies are the principal alliance of Volkswagen in the very promising car market in China.
In a similar display of political power, the United States utilized the principles and norms of international institutions and the rules and procedures by which they work to delimit other states (Kay, 2004, p. 18). The 2003 Iraq war showed that the powerful state like the U.S. might not be dictated by the larger, international institution like the United Nations. With its local interests and agenda, the U.S. tried to seek legitimacy for a pre-emptive war with the United Nations. The invasion of Iraq showed that a super power is far greater than an international institution and soft power balancing (2004, p. 18).
In terms of business powers, the U.S. government's support for the U.S. car industry in the last financial meltdown illustrates how commercial power is greater than a state power. The U.S. government paved the way for the U.S. auto makers to make a good recovery. The $700 aid improved the American car industry primarily by salvaging its major players (Schwartz, 2011, p. 1). In essence, the U.S. government saved its “Big Three” auto makers from bankruptcy, the loans let them manage their financial and human resources and productions centers to produce more environmental friendly and compact car models (2011, p. 2). Hence, this shows that the industrial impact of the largest auto makers in the U.S. is of paramount importance to its state. The U.S. empowered Chrysler and General Motor to clear its industrial functions and promote their electric cars as the other car giant, Ford, utilized it to hasten it research and development on hybrid and battery-operated cars (2011, p. 1). The aid also allowed Ford to enhance its smaller car manufacturing, among others (2011, p. 2).
Interestingly, China and its gamut of child labor problems such as those with Nike, Gap, Apple, among others, exhibit the commercial power which both its multinational partners and its local businesses enjoy. Similarly, China illustrates its commercial powers by its encompassing importance in all regional trade organizations. It is a very important trading partner. While China maintains free trade agreements with 10 ASEAN countries, it does not engage into a monetary integration among its neighbors (Kappel, 2010, p. 4). China utilizes the cooperation within the CAFTA (China-ASEAN Free Trade Area) for its own trade advantage, which is the low exchange rate and high trade surplus.
Discussion
With the shifting power bases in the realms of economics that trickle down to commercial, political and socio-civic realms, it can be said that through globalization, some business organizations have assume a state-like role (Nolan, 2001, p. 22). Many business entities and multinational corporations fulfill the role of protecting, letting, and implementing the rights of the citizens, which have been initially being played by the states and its distinct agencies (2001, p. 22).
Interestingly, states come to the aid of its largest industries as illustrated by the United States’ bailout of the U.S. auto industry. It can be explained in terms of the drastic actions which are needed to restore American economic and financial independence. Initially, the U.S. should begin its road towards recovery by rebuilding its own industries. The U.S. industries must initially employ American workers. Hence, it was wise for the U.S. President to salvage its most important industry and to make regulations that are more attractive for other exporting economies to rival with their own industries in its own markets.
Corporate activities such as the now popularly known as corporate social responsibilities (taking care of the environment, employing the local community, protecting the integrity of labor, etc.) usually occur in cases where the state and its instruments fail, such as when the state neglects to sustain its environment or when the state has not yet administered fundamental citizenship rights, or when it is mainly aberrant of its roles.
Hence, a more serious consideration such as child labor and the growing preferences for more ecological goods and services by the global consumers are resolved by the companies and manufacturers themselves. The extra stress and hurdles make business companies to unanimously use business techniques with a larger focus on their ecological impact. As it is, environmental ethic has become a new approach that shows the ecological stewardship and responsibility depicting the new business cycle and value chain (Vachon & Klassen, 2006, p. 798). This signifies new ecological standards of business operations which was not enforced by the state but by the different commercial systems and networks as new business supply chains worldwide (2006, p. 780).
With globalization, the roles of the states are confined to their sovereign powers to administer the laws but the more influential roles are being taken by their economic actors. The global economy is not even regulated by a single international body which is tasked to provide global public goods (2001, p. 23). Global governance, defined as the process of determining and applying global rules and supplying global public goods, is a poly-centric and multi-lateral process wherein the significance of the major actors shift according to their growing importance vis a vis global forces (2001, p. 23). Hence, governments, international institutions, civil societies, business entities all contribute their specified learning and resources.
Different from state governance wherein monopoly on the use of force and the power to apply regulations upon private actors inside the national territory is permissible, global statehood relies on the voluntary actions and sublime enforcement systems (Scherer & Palazzo, 2011, p. 2). A major line of thought is the concept of global citizenship and corporate social responsibility (CSR). These concepts principally combine the characteristics inherent to the new political actors of the global world.
As shown above, the military might is secondary to the economic might. Hence, in a global community, the power of the states to control economic behavior and to define the boundaries for market exchange is weak. For instance, no one is barred from buying a fake China product even when there are sanctions involved or threats of penalties.
In terms of supervising the widening regulatory gaps, system mechanisms have been put in place on the global, national, and local levels by both public and private entities which attempt to balance the lack of governmental control (2011, p. 2). In contrast with the order in the nation state administration, these new initiatives usually depend on network-like systems (2011, p. 2). These new forms of political management, if this can be called as such, function beyond the state in order to remake the political order and establish new forms of economic controls (2011, p. 3). Hence, with the renewed involvement of the private actors, social movements and the increasing activities of international organizations, a new type of transnational regulation is developed.
Conclusion and Recommendations
As a conclusion, it is clear that the United States and China showcase a pertinent case for the shifting patterns of power within the business, political, civil, and international communities.
Consequently, the economic forces of globalization have effectively aligned the United States and China within common grounds. China has also become a supporter of globalization and an Asian promoter of liberal trade and investment as compared to the more rigid and less cooperative economies like India, Japan and Brazil. China’s remarkable economic success is profoundly affecting its neighbors. Other developing economies are motivated to join free trade and be more export oriented in terms of its products and services. They have witnessed through China the fruits of a more open economy.
Likewise, China’s success has also positively affected its neighbors. For instance, China’s previous growth stirred Japan’s economy and salvaged major Asian neighbors from economic recession (Kay, 2004, p. 12). China’s economic potential has signified a renewed market for the United States. Hence, we can also conclude that the effects of globalization are very symbiotic and mutually advantageous.
The emergence of China as a main promoter of globalization and economic steadiness brings us to a more sophisticated geopolitical situation. With regards to free trade and investment and on several economic issues such as GMO crops, China’s position has been clear. Its military interests and disposition is also evident. Likewise, China is shown as an ally of all other major nations in fighting terrorism and global crime. However, the world is yet to realize the other specific and country specific interests of the Chinese state, which might be beyond the descriptions of the power and shifts or balance of powers.
Hence, it can be said that in a globalized world, the rigid boundaries between political and economic sectors do not hold anymore (2011, p. 2). Instead of subscribing to the democratic approach, this paper recommends a creation of a new model of democratic politics that is capable of combining both corporate political management and the general control of the overlapping public and private sector (2011, p. 2).
Appendix
Source: http://wattsupwiththat.com/2015/03/13/charting-the-outcome-of-the-obama-china-climate-deal-by-2030/
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