Globalization & (In) Equality

Equality can be divided into three types:

I. Equality of Rights
II. Equality of Opportunities
III. Equality of Results

I. Equality of Rights
As far as equality of rights is concerned, one could argue that globalisation has encouraged the
spread of the liberal model, based on:
- Equality in the eyes of the law
- Freedom of expression, freedom of religion etc.
- Democracy
Equality in the eyes of the law, freedom of expression, freedom of religion etc. were the flagship of
the 19th century liberal revolution. Democracy, on the other hand, was a typical social-democratic
demand. Nowadays, equality of rights as a whole is supported by all major political streams alike.

II. Equality of Opportunities

It involves the promotion of equal life chances for economic success, so that people face a level
playing field in society, free of arbitrary privileges and imposed exclusions. Equality of opportunities is
defended by all major political streams alike, albeit hypocritically so by (neo-) liberals.

III. Equality of Results

It refers to the degree to which society is marked by a narrow vs. wide distribution of income. Only
left-wing political currents promote this type of equality (the socialist-communist project).

The effect of globalisation on these two types of equality is somewhat complex and extremely
controversial. Hence they will be the focus of the following analysis.

The Bases of Inequality

Historically, various kinds of arbitrary privileges have arisen in social relations, including dominance
and subordination on the basis of:
a. class
b. country
c. gender
d. race
e. urban/rural divides
f. age
g. (dis)ability
The different lines of inequality intersect, of course. A person may be structurally subordinated in one
sense but arbitrarily privileged in another.
Thus in assessing an individual's position in respect of social inequality the various hierarchies need to
be considered in combination.
A professional white urban middle-aged able-bodied heterosexual man in the developed world
attracts the most structural advantages.
The Benefits of Equality
Social equality can also have positive effects on human security. That is to say, the existence of social
hierarchies is an obstacle in the attainment of:
- achieving peace
- preserving the environment
- guaranteeing labour protection
- bringing about social cohesion
Conversely, to the extent that people feel insecure, they are less likely to relinquish any unfair social
advantages they might have.

Needless to say, contemporary globalisation does not constitute the original source of structural
inequalities.
However, to the extent that globalisation is becoming increasingly associated with inequality,
opposition against globalisation by disadvantaged groups is likely to strengthen.
As such, we need to investigate how globalisation has really affected inequality.

a. Class Inequality
'Class' here refers to the division of a population in respect of different roles in the production
process.
In contemporary capitalism, people generally contribute to production as:
i. investors
ii. managers
iii. professionals
iv. skilled manual workers
v. workers without formal qualifications
(including homemakers)
This division of labour is further reflected in differences related to customs, dress, language,
residential area etc.

I. Class Inequality: Equality of Opportunities

Class often configures educational opportunities, access to health care and so on, with limited social
mobility in virtually all societies, depending on the degree of equality of opportunities.
On the whole, equality of opportunities is on the decline:
– Many countries have in recent history witnessed a deterioration in publicly provided
education. The alternative of private instruction has generally only been available to
wealthier households.
– Widespread deterioration in public health, public housing, and public transport has
likewise tended to impact more heavily on disadvantaged classes.

II. Class Inequality: Global Equality of Results

Global income equality (equality of results) between households has seen little change during the
period of accelerated globalisation in the second half of the twentieth century:
According to the World Bank's calculations, the global Gini coefficient* rose from 0.63 in 1988 to 0.67
in 1993 before dropping again to 0.63 in 1998. Another investigation detected a fall in the Gini
coefficient from 0.67 in 1980 to 0.57 in 2007. This drop is well-nigh exclusively due to rising living
standards in China and India (which comprise the vast majority of the world’s poor). All studies agree
that the global Gini coefficient has remained greater than all but the very highest country Gini
coefficients.

As such, absolute poverty is also declining. It has been estimated that between 2005 and 2010 the
number of poor people around the world (defined as living on less than $1.25 a day), fell by nearly
half a billion, from over 1.3 billion in 2005 to under 900 million in 2010. Simultaneously a rise in life
expectancy was registered in relation to the start of the 20th century.

However, although the poor are on average indeed becoming richer, the rich are becoming even
richer at a much quicker rate. Moreover (as mentioned above), much of the improvements in living
standards experienced by the global poor were gained in only two countries: India and China.

An interesting statistic:
– As of 2010, the world's 497 billionaires (approximately 0.000008% of the world's
population) were worth $3.5 trillion, or the combined GDP of the 127 poorest
countries.

III. Class Inequality: National Equality of Results

At the national level, however, one study has concluded that 48 out of 73 countries with reliable
information experienced growth of income inequality during the 1980s and 1990s: two-thirds of
countries have seen widening class gaps in the period of neo-liberal globalisation.

The developed world, after a reduction in income inequality during the 3rd quarter of the 20th
century, witnessed a widening wage differential between more trained labour (professionals,
managers, technicians) and less trained labour (people with no more than general secondary
education). This is particularly true in the US, but to a lesser extent in almost all other OECD countries
as well.

Most transition countries (from state socialism to market capitalism) experienced a steep ascent to
wealth for a few and a rapid descent to poverty for many. In Russia, for instance, the richest fifth of
the population saw its proportion of national income rise from 32.7% in 1990 to 48% in 2008. On the
other hand the poorest fifth had its share decline over the same period from 9.8% to 6%.

Huge class inequalities have persisted in much of the developing world in the period of contemporary
globalisation. In Brazil, for example, in 2009, the richest 10% of the population obtained 42.5% of the
national income, while the poorest 10% obtained 1.2%. Major cities in Asia, Africa and Latin America
today often house the ugliest shantytowns in the shadows of the shiniest skyscrapers.

The Link with Globalization

Has the rise in transplanetary links caused the decline in equality of opportunities and equality of
results? The answer is yes, in a number of ways…
First of all, 'free' global markets have by no means been 'open' to all. That is to say, propertied circles,
professionals and certain skilled workers have had far greater opportunities to acquire the means to
participate actively in global capitalism, for example: fax, air travel, internet, off-shore banking and
financial consulting.

Another way that globalisation has generated greater class divisions follows from challenges to the
redistributive state.
Earlier in the 20th century many national governments developed a number of mechanisms to lessen
class stratifications, culminating in the welfare state, which peaked in the third quarter of the 20est
century.

But the expansion of globally mobile capital and liberalised exports has encouraged states to
abandon a number of redistributive policies, while retreating from progressive taxation.

Emergent suprastate frameworks have not filled the regulatory gaps left by states in respect of
countering arbitrary class hierarchies.
On the contrary, global economic institutions like the OECD, the IMF, the Worldbank and the WTO
have been promoting neo-liberal policies since the 1980s.
Regional bodies too have concentrated on market liberalisation, with at best secondary attention to
questions of class justice.

Social movements have not succeeded in mounting effective opposition to growing class gaps:
- The trade union movement experienced substantial drops in membership across most of the
world, in the wake of its failure to ‘deliver the goods’ to its clients. This failure is a result of:
– neo-liberal legislation
– the national nature of trade unions (a decidedly inadequate strategy when a large
proportion of capital is globally mobile)
– declining trade union credibility owing to bureaucratisation, close ties with ruling
circles, and self-aggrandisement of leaders.
Meanwhile new global social movements have tended to give only secondary attention to issues of
class equity, for example: consumer advocates, environmentalists, human rights activists, feminists
etc.

In sum, contemporary globalisation has in various ways encouraged a greater entrenchment of class
inequality.

b. Country Inequalities
Large country inequalities exist between countries in the developed world, the developing world and
East Asia, both in terms of inequality of opportunities and inequality of results.

Obviously, the distinction of such areas in the world involves substantial simplification, as each region
contains considerable diversity:
- the developed world includes many economically marginalised individuals
- the developing world includes many successful entrepreneurs and affluent politicians.
Similarly, a country can contain large internal geographical welfare disparities, for example:
- in India the state of Bihar suffers from far greater poverty than Kerala
- in England widespread wealth in the South-East contrasts with pockets of need in the
North-East
- China's economic boom of recent decades has concentrated on the coastal provinces,
rather than on the interior regions.
Nevertheless, social hierarchy within countries does not negate the fact of a concurrent hierarchy
between countries.

I. Equality of Opportunities
Resource distribution, laws, institutions and inherited prejudices are such that the 'average' person
born into the developing world has had fewer opportunities than the 'average' person born into the
developed world.

That is to say, even when an individual from the developing world and an individual from the
developed world have had equivalent personal means, the resident of the developed world has
generally been able to obtain greater gains form the similar resource base.

II. Equality of Results

There is a general agreement that the absolute income gap between the world's richest and poorest
states is now at historical levels and accelerating.

However, the relative income gap between the OECD countries and the rest of the world is
narrowing, as GDP-growth (as a percentage) is often higher in the developing world than in the
developed world, due to the very low starting point of the former. For instance (the amounts in $
refer to GDP):

Some statistics regarding equality of results:

– In 2009, average annual income in the developed world was $38,139, while the same
figure in the developing world was $2,956.
– A minority of the world's population (17%) consumes most of the world's resources
(80%), leaving almost 5 billion people to live on the remaining 20%.
– Countries in the developing world tend to be limited to secondary participation in
global trade, compared to the much smaller developed world: in 2009 the developing
world (85.5% of the world's population) accounted for only 36% of global exports and
imports. Absolute volumes of merchandise exports from the developing world have
grown substantially since 1980, but most of the countries remain focused on primary
commodities (agriculture and raw materials) whose prices have relatively declined
over this period.
–
The Link with Globalization
So how has globalisation influenced the issue of equality between states? It turns out that its
influence has been negative, in particular due to the overwhelming inequality of opportunities in the
global economic space that is taking shape.
One issue is the uneven access to global spaces:
– At the turn of the century countries with the richest fifth of the world population had
74% of all telephone lines (the infrastructure of which is expensive to build), while the
poorest fifth had a mere 1.5%. The recent spread of mobile telephones has begun to
improve matters.
– Basic radio and television sets have spread to hundreds of millions of people across the
planet, but hundreds of millions of others, mostly in the developing world, still lack
access. The developed world has supplied the vast majority of broadcast material.
– A computer costs the average Liberian 2 years' wages, whereas the average American
can purchase the equipment with one week's income. Regarding the internet:
As of 2011, the entire continent of Africa accounted for a mere 5.6% of internet
users worldwide (just over 4 million). North America, on the other hand, with
less than a third of that population, had 272 million users.
The quality of Internet connections is generally lower in terms of smaller
bandwidths and slower speeds.
Although the dominance of English in cyberspace has subsided considerably, over
80% of the content remains in 10 European and East Asian languages as of
2010.

In addition, the developing world receives disproportionately little FDI:

– The developed world holds approximately 75% of the total accumulated stock of FDI,
and attracts roughly half of new FDI flows.
– FDI to the developing world tends to concentrate in just ten countries.
– The least developed countries attract less than 1% of recent world FDI flows.

The power of so-called 'hard' currencies has conferred enormous privileges on people in their
countries of origin (in terms of currency exchange, international loans etc. etc.), with the U.S,
European and Japanese currencies dominating global transactions.

Credit has also been awarded in a very disproportionate way:

On an individual level, while residents of the developed world have acquired several hundred million
global credit cards, by 2009 only 48 million out of India's 1.2 billion people held such cards (4%). That
is to say, residents of poor countries are less often given loans than residents of rich countries, as
they are perceived to be (on average) less likely to settle their debts afterwards. Alternatively, they
pay a higher interest.

On the national level:

- Again, obviously market forces mainly channel credit to those countries with the greatest
means to repay, while demanding higher charges from less credible countries. In fact, as of
2010 only about 30 governments in the developing world had a credit-rating that gave them
access to global bond markets at all. If a global credit-rating agency downgrades a poor
country, even on the basis of faulty intelligence, the unfortunate victim will have to deal with
increased interest charges on its debts, or have no chance to resort to borrowing whatsoever.
 - Loans given to developing countries often dissipate as a result of corruption.
- International loans are awarded in hard currencies (usually in US$), as otherwise their value
would disappear over time, creating great problems for countries with soft currencies in terms
of repaying their debt.
- International credit has often come with demands for neo-liberal reforms, including mandated
cuts in public spending, which have translated into:
» fewer social programmes
» reduced educational opportunities
» more environmental pollution
thus rarely producing ‘development’.

All this while the debts have to be paid back, with interest: it was estimated in 2007 that for every $1
developing countries received in Overseas Development Aid, more than $5 had to be paid back in
debt repayments due to accumulated interest.

Liberalisation in areas like agriculture and textiles, where the developing world boasts a comparative
advantage, has purposefully been slow:
- In terms of agriculture, developed countries keep spending over $250 billion per annum to
subsidise their farmers, in sharp contrast with Western calls for liberalisation of other sectors
of the economy. Overseas Development Aid is limited to around $9 billion (2009-figures).
- Only in 2005 was the MFA (Multi-Fibre Arrangement) cancelled, which had been restricting
textile exports to the developed world since 1962.

In 2008 barriers to trade in the developed world were estimated to cost the developing countries
fourteen times the value of all development aid. Meanwhile, income gains from WTO liberalisation
generally accrue to the developed world.

Nonetheless, there have been initiatives to improve the trade-conditions of the poor countries.
- Coming from the poor countries themselves, there was:
» the battle in the 70's to establish a New International Economic Order
(NIEO), which failed.
» OPEC’s attempt to try and alter trade relations between the developed
and the developing world by quadrupling oil prices in 1973, which did
not change the overall situation.
- Coming from the rich countries, there has been:
» the GSP (Generalized System of Preferences) in the GATT since the late
60s.
» the EU's ACP-agreement.
Nevertheless, the overall impact of these schemes has remained modest.

The global intellectual property rights regime is a good example of regulation. The TRIPS agreement
of the WTO (Trade-Related Aspects of Intellectual Property), signed under pressure from
pharmaceuticals companies, increased the flow of revenues to the developed world from patents,
copyrights and trademarks, thus further widening the existing gap between rich and poor countries.
TRIPS has put the cost of access to advanced technologies and medicines beyond the reach of many
developing countries.
True, in 2003 a certain improvement came about within the WTO-framework in terms of poor
countries' access to essential medicines, in particular against AIDS, but implementation has been
slow.

Neoliberal policies have discouraged public-sector interventions to counter country inequalities:

- Fiscal constraints (i.e. a reduction in government income due to lower taxation, creating a
need for more intensive local use of whatever funds the government has left) have
encouraged most governments in the developed world to reduce concessionary resource
transfers to the developing world.
- Furthermore, in terms of mentality, neo-liberalism perceives government intervention in the
economy as clearly inefficient (yet certain kinds of state steering have arguably allowed
countries like the so-called 'Asian tigers' to narrow welfare gaps between themselves and the
West).

As such, by 2011 Overseas Development Assistance (ODA) amounted to only 0.32% of the GNP of the
OECD countries: this is one of the lowest figures since such statistics started to be collected in 1950,
and constitutes even a decline in real terms.
Since the 1960s, several agencies in the UN have been contributing via extensive research to raising
the issue of developing-developed world inequality, yet since the 1980s UN agencies have generally
taken a backseat in global economic governance.
The initiative has lain far more with the Bretton Woods institutions, the OECD, the WTO and others
that have operated outside the UN purview.

In view of the above, one could expect social movements to rise up in protests against this inequality.
After all, starting in the 1920s a global anti-colonial coalition powerfully linked activists in the
developed world with their counterparts in the developing world. Yet, this progressive alliance largely
dissipated after formal decolonisation.

New social movements (consumer protection, environmental conservation, and human rights) have
not usually put questions of developing-developed world equity high on their agenda.

According to the neo-liberal interpretation, as globalisation promotes trade and investment flows, it
contributes significantly to economic growth and thereby to lifting people out of (absolute) poverty.
The reason for world poverty is principally located in the failure of countries to integrate fast enough
or deep enough into the world economy.
Globalisation is the principal remedy for eradicating global poverty.

On the other hand, critics argue that the orthodox neo-liberalism interpretation distorts the truth.
Inequality (relative poverty) is worsening while globalisation proceeds – even if indeed absolute
poverty is dwindling slowly: the economic profits associated with globalisation are spread out
unevenly leading to further polarisation within the world order.

This phenomenon finds expression in, amongst others:

– increased numbers of failed states
– transnational terrorism
 – the rise of fundamentalisms
– transnational organised crime
– ethnic/religious conflicts
with clear interrelations among some of the above.

All in all, the division of the world into core and periphery, developed and developing, remains very
much a structural feature of the contemporary global system.
Both inequality of opportunities and results have suffered at the country-level during the period of
accelerated globalisation.

c. Gender Inequalities
The structural dominance of men over women is hardly new to the period of accelerated
globalisation: patriarchy has a long history and became embedded in most social contexts across the
world far before the phenomenon of globalisation.

But has globalisation intensified gender inequality?

I. Gender Inequalities: Equality of Opportunities

Some significant reductions have occurred since 1970 in gender inequality of opportunities with
respect to accessing health and education services. For instance:
– by 2009, the world level of primary school enrolment for girls (89%) was getting close
to that for boys (91%).
– the worldwide rate of girls' enrolment in secondary school rose from 36% in 1990 to
67% in 2009.
However, this rate remains highly uneven in some areas, such as South Asia.
In many parts of the world women have also gained greater access to paid employment, in particular
in the OECD countries.

Nonetheless, gender stratification has persisted in regard to access to global communication. For
example, currently most internet users are men, although gender gaps are closing.

II. Gender Inequalities: Equality of Results

However, these moderate overall improvements have remained far short of providing full equality of
results:
- Even today, most women generally do not receive equal pay with men for the same work.
- In fact, in the former communist countries the position of women has generally deteriorated
in respect of everything related to labour rights, wages and so on.
- Around 70% of the world's poor are female.

The Link with Globalization

Yet what specific role has globalisation played in the continuities and changes of gender hierarchies
in contemporary history?
Opinions are divided on this issue:
Global capitalism has offered women many new job opportunities. For instance,
– female labour has figured prominently in the expanding service economy of global
information, global communications, global retailing and global finance
 – the development of the world textile industry has significantly expanded female
employment in many countries.
Moreover, jobs in global production have often offered women better pay and benefits than other
work.

Nonetheless, men have taken most of the high salaries in management and on the trading floor.
Furthermore, many of these positions have come with highly "flexible" labour conditions.
Globalisation has also offered various dubious "opportunities" to women, especially in poor
countries, including prostitution, internet-pornography, mail-order brides etc. For example, in 2010
there were some 100,000 Filipino 'entertainers', mostly in South Korea, representing just a fraction of
the global total.
Men have constituted the vast majority of directors and producers in the global mass media, thus
limiting women's influence on constructions of gender through global communications.

Globalisation has also perpetuated and sometimes deepened gender hierarchies through neo-
liberalist restructuring of the state:
 True, gender discrimination has recently become a more explicit concern in economic
and social development plans of many countries.
 Yet it is hard to ignore the negative impact of cutting state services specifically for the
female population.
 Programmes of neo-liberalist economic reform only rarely make even a passing
mention of gender issues.
Global movements for gender justice have proliferated and grown in recent decades. For example,
– at the Fourth UN Conference on Women, convened in Beijing in 1995, 30,000 women
attended from around the world.
These movements have had a positive effect on creating awareness among people regarding the
gender issue. However it has failed to drive people to implement concrete corrective steps.
In summary, globalisation has had a mixed impact on gender inequality.

d) Racial Inequalities
Regarding race:
There is growing consensus regarding the benefits of the global human rights regime as an
instrument against racial discrimination. The fall of the apartheid regime in South Africa is an example
of such a contribution.

e) Urban-Rural Inequalities
As for the tension between city and countryside, the country has more usually suffered deprivation
than city dwellers:
True, rapid urbanisation has left around 1 billion people across the planet living in slums as of 2010.
Nonetheless, cities have usually taken the lion's share of the benefits of globalisation, while much
rural poverty has remained relatively unimproved:
– Global communications, global finance, global markets and global organisations have
used metropolitan centres as their primary nodes.
– The cost of global communications remains well out of reach for most of the world's
low income rural people.
Meanwhile global agro-food industries have tended to weaken the often already precarious position
of small-scale cultivators across the planet.

f) Age Inequalities
In terms of age groups:
Children and old people are exposed to diseases, exploitation and malnutrition more than young
adults.
Current globalisation has tended to exclude older generations due to the need for up-to-date
knowledge:
For example, many workers over 40 have found it difficult to readapt their skills in the face
of global economic restructuring. As a result in many areas permanent unemployment
has loomed for substantial numbers of middle-aged people.
In addition, many older persons have found computer technologies daunting, thereby
producing a considerable age bias in cyberspace.
On the other hand, global technology has offered children counterweights in their general
subordination to adults.

Concerning the role of global governance:

- Children’s entitlements have been included in the global human rights regime through the
Convention on the Rights of the Child, adopted by the UN General Assembly in 1989.
However, poor resourcing in terms of limited funds and personnel has so far restricted the
enforceability of the treaty: for example, while the Convention asserts a child's right to be
registered immediately after birth, UNICEF estimates that in 2008 around 36% of births
worldwide went unregistered.
- Thanks largely to UNICEF and the World Health Organisation, child immunisation coverage in
the developing world increased from 15% in 1980 to 85% in 2010, saving millions of lives.
- UNICEF has furthermore promoted various issues such as breast feeding, basic health and
education for children, safe water and sanitation, care and support for mothers etc.
However, outside UNICEF, global governance agencies have rarely highlighted the specific needs of
young people.
Meanwhile no quarter of transworld governance has attended at length to the distinctive problems of
older age groups in globalisation.

g) Disability Inequalities
In terms of disabilities:
- Globalisation has not offered many opportunities to disabled people, although it has helped
(via mass communication and various technologies) to raise awareness.
- However, transworld mobilisations for disabled people have generally attracted limited
followings or media attention.

In conclusion, contemporary globalisation has mostly perpetuated and sometimes even accentuated
different types of inequality, despite a number of notable improvements.