Nayan Chanda Interview (2007): Conversations with History; Institute of International Studies, UC Berkeley

How Traders, Preachers, Adventurers, and Warriors Shaped Globalization: Conversation with Nayan Chanda, Director of Publications, Yale Center for the Study of Globalization; May 16, 2007, by Harry Kreisler

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Modern Globalization

You said that you started this at the time of the new millennium, so the question arises, in what ways is globalization today distinctive, even though it emerges from this history that we've been talking about?

[There are] three main differences. The difference number one, of course, is that technological changes have made the transactions of goods and ideas much, much faster and more voluminous. Earlier in a camel caravan, a camel could carry about 50 kilograms, and you have a caravan of 40 camels and that's the sum total of goods you were carrying from one country to another. And now on a container ship, the biggest container ship can carry 20-mile-long trucks -- that much of goods can be carried in one ship. So, the result is the absolute collapse in cost of transportation. Speed, of course, has immensely increased, and then communication, which was communication based on human beings carrying information to now digital information which is instantaneous. So, this speed and volume of transactions made it much more visible, and that's why we actually need a name for it.

[Visibility is the second difference.] The word "globalization" came into the dictionary in 1961, and it was not by accident that that was the year when American communication satellites were circling the globe and connecting the globe in real time. So, the communication revolution, transportation revolution, has made globalization much speedier, voluminous, and more visible.

The third aspect is the imbalance. Earlier the transactions involved a really small number of people and it affected a small number of people, but with the rise of modern capitalistic multinationals using huge resources to transfer goods, sell goods, the balance between those who are supplying and those receiving is very skewed, and that imbalance makes people very wary as to [the sense that] we are not in control of our lives. Those who are bringing these goods and ideas, they are more powerful than we are.

So, you're making an important point which I want to draw out, which is that as a consequence of the distinctive nature of globalization today there is a consciousness about this process, even if we don't know its history (which is a problem you're helping us deal with), that has very real political implications for the enterprise. It's not just that we're doing it, [but that] more and more people know we're doing it.

Exactly. That is the most important difference in the past and present, that global awareness. In fact, I tell the story of this electrician in New Haven who came to our house to fix some non-working lights and he asked me what did I do at Yale and I said I worked in the Center for the Study of Globalization. He was shocked, as if I had confessed to being a charter member of a Colombian drug cartel. He said, "God help you!" I said, "Why should I need that help?" He said, "Isn't it true that globalization destroys the rain forest?, and I said, "Yeah, maybe it does, but the closest I have been to Amazon was to order some books!" But I don't think I convinced him.

The fact is, this electrician in New Haven is a globalized citizen. He's concerned about rain forests in Amazon. Why is that? Which other electrician fifty years ago would have been worried about the Amazon? And that, I think, is a big difference, that the visibility of globalization has made people more aware of the global interconnections, and as a result happier, or sadder, or worried, but there is no doubt that people do realize that the life of human beings on this planet are interconnected.

In your history one gets the sense that a problem emerging in the face of globalization is the inequalities that are a consequence, but also a precursor, of the globalization process. The way human virtues driving these individual actors interface with this reality of inequality can exacerbate the process. It did in history. It created inequalities that sometimes endured for long periods of time. Talk a little about that, because that is a core issue that emerges now. I guess what I'm asking for is a general statement about the record of the interface between inequality and these processes.

Connections with foreigners, whether in the forms of trade goods, or religion, or simply migrants coming into a country, has always provoked resistance throughout history, and resistance has been manifested in many different ways. For instance, the Roman Empire was trading heavily with India. So, Arab traders would come to India and get spices and silk, Chinese silk would be transited through India, and take it to the Roman Empire. The Roman Empire was paying for this in gold coin, so there is the outflow of gold from Roman Empire to India which was causing concern in the Roman Senate. Emperor Tiberius issued a statement in which he denounced this luxurious living of people which was causing the Roman Empire to drain wealth. But the fact remains, the historians point out, that the Roman Empire actually was collecting one-third of the values tax for all the imports. So, the Roman coffer was being enriched by the importation of these luxurious goods. So, overall was Rome a loser or a winner? Again, from this process it remains to be seen, but the fact remains that a tax was imposed by government throughout history to stop, to some extent restrict, the import and also gain revenue for the government.

People opposed arrival of missionaries of all types. They were killed, they were excluded, and in fact, two of the world's biggest adventurers, Ferdinand Magellan and Captain James Cook, both were killed by people they wanted to connect with. So, that was the extreme form of resistance. And then there are periods when the British forced Indian farmers to grow indigo, because that was the big export item, and when the price of indigo collapsed these people suffered their livelihood, and so they revolted against the British. It is known as the "blue mutiny" because of the color of indigo. There was revolt by the Chinese-Javanese rubber plantation and coffee plantation workers because of the, again, collapsing price of the world market led them to be laid off. They rioted and the Dutch killed tons of people. So, this has been going on throughout history, of the results of this global interconnection in terms of taxing, in terms of revolt, in terms of massacre. So, history is very rich with these kinds of episodes.

So, although your book is called Bound Together, I guess the other part of this is driven apart over time, and at the heart of this is the extent to which these global processes can create a nationalist response, an ethnic response, as these situations get bad, as you've just described, they come to identify with the local group that's being exploited, and many times political leaders want to gain political power by enhancing these feelings of driving the outsiders away, and so on. Talk a little about that, because it's a contradiction in all of this because we see that globalization does increase people's identity with the local.

Yes. This is, in fact, a classic reaction to the threat to the identity. So, in case of, for instance, Indonesia in the 1820s to 1840s, the Wahabbist Islam finally arrived in Indonesia, and that gave them the ideological tool to oppose the Dutch Christians. So, opposition to the Dutch colonial rule took the form of a religious revolt by the Muslims. In the case of China, you had several sectarian revolts against the Westerners. And in the case of Vietnam, a Vietnamese monarch killed Jesuit missionaries, saying, "These are a threat to our national identity," and that allowed the French to retaliate by eventually occupying Vietnam, setting up a colonial empire.

Again and again, religious, political groups and individuals have taken the leadership of this resistance to foreign influence and exploitation and led the struggle against it. This is the irony of the situation. On the one hand, nationalism is being nurtured by the flow from outside. For instance in India, the British made English the medium of instruction, allowing Indians to read books which gave them ideas about political freedom or democracy, and even their own history, the British archeologists and historians discovered much of India's past and/or history books, which gave the Indians pride in their own national identity. So, it is a kind of dialectical process in which the foreign influences, globalizing influences, help formulate national identity which then revolts against the foreign influence.

A key issue in moving globalization forward is the problem of management of globalization, of creating institutions, international ones, multilateral ones, that can get us over some of these bumps. We seem to be in a race between the negative forces, nationalism, the way consciousness about the process turns groups into protesters, which is not a bad thing but which if not managed globally through international institutions and multilateral institutions will create a backlash. How do you see this playing out over time, and what will make for institutions that enable us to better manage this process in the face of globalization and rising consciousness about the negatives of the process?

This is the key question of the future. We are inexorably more and more integrated, and that integration is causing friction and questions of identity and resistance. And yet, there is not enough awareness or effort to create institutions which can smooth things over, which have a global structure. Now in the past, whenever problems arose eventually they got resolved. For instance, the introduction of telegraph in the mid-nineteenth century -- suddenly time was instantaneous, so you are sitting in Washington and you're sending a cable to London and that cable reaches within a few hours but there it may be the middle of the night. You have no idea what time it is there. So, the telegraph and railway line made it necessary to have a time zone, so in the 1890s a universal time conference was held in Washington which decided to divide the world in twenty-four time zones. So, that was one of the earliest global governance issues, how to manage time. They agreed that this is how the time zones would be divided. Telegraphic communication protocols were established, a universal postal union, shipping rules.

Again and again, the world community have come together to resolve issues which are of immediate tactical consideration. So, unless things are of an immediate nature and of the type that can be tackled through tactical measures, it becomes more difficult. For instance, the SARS episode, the crisis of the virus SARS which spread from south China to Hong Kong and then to the world, was a replay of previous epidemics, black death, Spanish flu, but what was different this time was that there was an organization called WHO which didn't exist during the Spanish flu. So, WHO took control and said, "This is a very dangerous epidemic, it can be stopped only by stopping transportation between Point A and Point B." So, flights were grounded, and because of the existence of WHO labs throughout the world collected samples, they did research, and the DNA of the SARS was decoded. So, it is possible to resolve issues through global cooperation, but what's needed is that ability and willingness, and political willingness, to actually sacrifice some of your sovereignty for the greater good. When the SARS episode happened countries surrendered their sovereignty by accepting the WHO call to ground flights, even if it hurt their economy.

When you look at issues such as economic inequality, when you look at issues such as agricultural products from the developing world, having to confront the barriers and the subsidies that developed countries have put in place to create political coalitions to govern, then you have a shocking result that becomes a thorny issue, that is at a higher level of difficulty than either telegraph or a case of a worldwide potential for an epidemic. Talk a little about that and how you see that playing out. In your last chapters you cite many statistics -- just looking here, you say, "In 2001 to 2002 American farmers of cotton received $3.9 billion for 25,000 farmers," and then during the same period, or a similar period, 1999 to '01, eight African cotton states lost $330 million to export trade. How is this going to be worked through, so to speak?

This is the point I mentioned, the political will, because it's ultimately this political will, because 25,000 American cotton farmers getting $3.9 billion subsidy is fine, I have no problem if they get subsidy, the U.S. government gives them subsidy, but that subsidy should be given in a way that doesn't disturb the world price. Because by lowering the price of cotton in the world, you are basically putting out of business African cotton farmers who only grow cotton. Their land doesn't grow anything else, and so, they are growing cotton but they cannot sell it. So, it is a disaster for them. If you tell the African countries to remove their tariff against industrial goods which then Americans can sell there, but then you say, "You cannot sell your cotton because we are giving subsidy to our farmers," that is potentially unfair, and this kind of problem -- Europeans give a billion-dollar subsidy to Greek farmers who grow cotton. This is the kind of subsidy which politicians give in order to get re-elected.

Politicians have a timeframe of four to six years when they want to get re-elected. They're not looking at the world situation as a whole, neither are they looking at thirty, forty years down the line, what will be the consequence of this kind of policy for farmers around the world. So, we need people -- we need statesmen, not politicians -- we need people who appreciate how closely interconnected we are and whatever we do has impact on other people. We cannot be so selfish, so narrow minded that we carry policies which have disastrous effect outside our country.

So, it's these human and social forces that are pushing us together, but those positive forces are going to have to be directed toward those political centers of power which look for the shortcut for the immediate solution and come up with solutions like these subsidies to cotton farmers in the United States, that exacerbate that forward movement.

Absolutely. If one takes a long-term view, a broader view, you realize that it's ultimately self-defeating, because if it is not made into a policy to help improve the lives of other countries, people, increase their market share, your own industry ultimately will shrink because market share is not growing, not more people are coming to the market to buy your goods. Because of your narrow-minded, short-sighted policy, you are closing up on itself and markets are shrinking.

Now in this process of education the U.S. is going to play a critical role. American citizens have to be educated about the complexity of these processes and their historical origins. The U.S. presumably has to play an important role in recognizing these global problems. How do you see that playing out? We seem to have gone through a period of American provincialism, American nationalism.

Yes. This is, of course, a very, very deep-seated problem, because politicians work for their re-election and politicians have to be accountable and reflective of the opinions of their constituencies. If the constituents are unaware of the impact of what they do on the world, and if they do not see these close linkages, they are not going to ask their politician to do anything other than help them. I think it is, in some ways, a Catch-22. You have to educate the electorate in order to [influence] the politicians, and politicians have a role to educate the electorate as well, because they're much better placed to understand what is happening in the world. It is their responsibility, to some extent, along with the media, to convince the constituents that they have to make perhaps a little sacrifice now in order for bigger gain in the future.

Your present position is editor of Yale Global Online. Tell us about what that is (you could even give us the URL), and how it hopes to contribute to this process of education.

Yale Global Online is an online magazine to explore many aspects of globalization and promote debate and discussion, and this online magazine -- the URL is Yale Global Online was launched in November, 2002, and in the last five years it has gained a huge, huge [following]. Now we get 1 - 1.2 million hits per week and we publish three original articles every week. The articles are on aspects of globalization, written by experts but written in an accessible way so that an average educated reader can understand the message of the story. Those articles are all archived on our site permanently, so they can be accessed anytime, anywhere, and it's all free.

We have, also, some video interviews which are video streamed, as well as articles taken from other sites which deal with globalization, and we have permission to reproduce them. So, we write a short blurb explaining the context of the article, the importance of the article, for understanding globalization, and then give the article. So, those kinds of articles we now have over three thousand on our site which are all indexed and can be researched and found very easily. So, this online magazine is actually our very modest effort to educated people, to provoke discussion. Only through discussion and debate can one clarify one's own understanding, and because we have no political agenda, we are not for globalization or against globalization, we see this as a historical process which has to be understood, and a lot of its kinks need to be ironed out, a lot of its problems have to be addressed. And so, only by presenting the facts and issues of globalization in an objective way, we can perhaps help to understand this process better.

One final question. How would you advise students to prepare for a world which will be even more globalized as time passes?

The most important thing is to open one's mind, and look at the world. Look at what is happening in other parts of the world. Look at what's happening to your own peer group. What are the students in China, India, Brazil, Mexico trying to do, what is their ambition? What is their fear, what is their desire? Understand the world to see how you fit in. In this fast-changing world, to fit in, you have to be inquisitive and open minded, because there is no specialty that is going to last forever. You'll be going through many job changes, but only your curiosity, ability to understand, analyze the world will help you to live through this.

Nayan, I want to thank you. I'm going to show your book again, which our audience will want to read to get a sense of how the forces of globalization are changing our world. I want to thank you very much for coming back to Berkeley, and also for writing your book.

Thank you, Harry.

And thank you very much for joining us for this Conversation with History.

© Copyright 2007, Regents of the University of California

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