Global Society Exam 2

Who benefits from free trade? Who is hurt by free trade? L5 S.15

BENEFIT 1.)Corporations, as they are guaranteed access to global resources, labor supplies, and consumers. 2.)Consumers who enjoy lower prices for goods and services. 3.)Wealthy nations who can impose sometimes unfair trading policies on poor countries. E.G. the WTO requires developing countries to remove all subsidies for agriculture but allows EU and U.S. subsidies to continue because they were in place before the WTO agreement. Free trade may continue to contribute to economic growth by speeding up production and consumption. HURT 1.)Small farmers and businesspeople who cannot compete with large corporations. An example, are Mexican peasants, who after the signing of NAFTA found they could not compete with imported agricultural goods. 2.)Laborers who, because of the terms of many free trade agreements, are denied effective labor representation, are forced to compete with laborers in other countries who must accept lower wages. 3.)Citizens who are exposed to unregulated products and environmental hazards.

How did structural adjustment programs affect Jamaicans, according to the film Life and Debt?

-Bad -never get out -short term loans

What are market externalities? L6 S.3

-"Market externalities" refer to the specific consequences of the workings of the market. -Some of these consequences are positive; others are negative. E.G. Robbins and Dowty describe the policies Walmart implements in order to ensure low prices for its goods. In order to ensure low prices, Walmart may e.g. pressure its suppliers to be efficient and produce commodities at lower costs. The result in the U.S. has been the shutting down of hundreds of factories, the loss of thousands of jobs as companies shift operations to countries with cheaper labor costs. -The negative consequences, thus, include issues such as loss of jobs, poverty, hunger, disease, environmental destruction, and ethnic conflict - all examples of market externalities.

States L5 S.4/6

-(definition) political entities with identifiable components (Robbins and Dowty) -Require taxes, registration for social security, citizenship -relatively recent entities which emerged in the 1640s -They points to constituents of the state such as federal buildings (e.g. the White House, a federal courthouse), federal bureaucracies (Congress, the IRS). -So state may refer specifically to government and government-related/run institutions.

Nation-state L5 S.5

-A territorially defined political system based on the government-citizenship relationship that emerged in 19th century Europe. -Within nation states, governments possess the legal and moral right to exercise sole jurisdiction over a particular territory and its citizens. -The nation-state determines an official language(s), a system of law, manages a currency system, uses a bureaucracy to order elements of society, and fosters loyalties to abstract entities like "Canada," "the United States, "Argentina" "China" Nigeria" " and so on. -The preceding imply that the nation-state is sovereign. That is, it enjoys independent, autonomous rule. No external entity can dictate what it does. -But the idea of the nation-state - people sharing some territory with boundaries, united by a common culture or tradition/language/race, is, as we pointed out before a relatively new phenomenon (product of the 19th century). -Although a fairly new idea, for many people, nationality is a critical part of their personality. [E.G. Ask someone to explain their habits, they might say "I'm American" "I'm British," "I'm Jamaican" - as if that explained everything. Also, people identify with their nationality so much that criticism (especially from an 'outsider' ) is likely met with resentment.

a)According to Robbins, who engages in manufacturing consent? In what ways, and why? L5 S.12

-All governments, says Robbins, and corporations, including the U.S., have used spin to justify military action, and to "manufacture" agreement among citizens that going to war is in some national interest. (Examples: When the U.S. went to war against Spain in 1898, the U.S. government claimed that the Spanish were responsible for the explosion that destroyed the battleship Maine in Havana Harbor. Much more recently, state Robbins and Dowty, the media were used to garner support for the war against Iraq under the guise that Saddam Hussein and his regime was linked to bin Laden and the Taliban leaders and that they had in their possession weapons of mass destruction. As we know, no such weapons were ever found. Many suspected there was never any truth behind this claim. Robbins states that there is plenty of evidence that even before the attacks on 9/11, the U.S. administration wanted to invade Iraq because of US oil interests there. The attacks became, in a sense, the convenient excuse.] See next slide. Spin is not unique to government. Corporations, public interest interest groups, and religious leaders all use "spin" to depict the world in ways that are in their own interests.

b)Green revolution II L6 S.17

-An additional concern is the potential for "green revolution II" - or the application of genetic engineering to agricultural production. -Genetically engineering crops are controversial as many claim they have not been rigorously tested and since we don't yet know what effects the crops may have on the environment or on people who eat them. Agribusiness (e.g. Monsanto Corporation) insist that these crops will help us feed the hungry. Robbins and Dowty say their claims are, at best, disingenuous (insincere). Also, say Robbins and Dowty, in some cases genetically engineered crops simply try to correct the damage done by capitalist agriculture. E.G. Golden rice - genetically engineered variety of vitamin A, is used to make up for polished rice, and herbs that would grow in wheat fields if they were not sprayed with herbicides. -This has become a very controversial issue, partly because corporations in the U.S. are not required to indicate whether their products contain genetically modified ingredients or not. Here's some information about the debate.

Identify (name) and describe the functions of the Bretton Woods institutions. L4 S.29-31

-BUT, there are still some problems for the merchant adventurer in the early 20th century. -Political and business leaders realized that corporations could not, by themselves, ensure the smooth running of the global economy. The worldwide economic Depression of the 1930s and the economic disruption caused by two world wars illustrated that fact. -The fact that every country had its own currency, and the fact that it could rise and fall in value relative to others, created barriers to trade. -Tariffs and import or export laws inhibited the free flow of goods and capital. -More importantly, there was the problem of bringing the ideology of corporate libertarianism, and the culture of capitalism in general, to the periphery, especially given the challenge of socialism and the increasing demands of colonized countries for independence. -The solution to these problems was to emerge from the meeting in 1944 at a New Hampshire resort hotel. -The meeting was called to rebuild war-ravaged economies and to outline a global economic agenda for the last half of the 20th century. Out of that meeting came a plan for the formation of: -The International Monetary Fund (IMF), International Bank for Reconstruction and Development or World Bank (WB) and, GATT - General Agreement on Tariffs and Trade (precursor to World Trade Organization - WTO). -International Monetary Fund -- loans to countries with balance of payment difficulties or put differently, to meet short-term financial needs and to stabilize currency exchanges between countries International Bank for Reconstruction and Development or World Bank (WB) /loans for infrastructure (build roads, bridges, dams). Originally created to rebuild Europe after the devastation of WWII but the only European country to receive a loan was Holland. The World Bank subsequently turned its attention to the periphery, lending funds to foster economic development with mixed results, as we will see. -General Agreement on Tariffs and Trade - established to regulate and promote free trade. But because governments in many countries, including the U.S. objected to the idea of an international agency with the power to dictate government trade policy, the creation of such an agency did not occur until the World Trade Organization (WTO) was finally established in 1995. WTO can react to claims by member nations that other nations are using unfair trade policies to give businesses in their countries and unfair advantage

Principles on which corporate libertarianism is based. L4 S.22

-Corporations use this power to define the ideology or ethos of the emerging culture of capitalism. This cultural and economic ideology is known as neoclassical, neoliberal, libertarian economics, market capitalism, market liberalism and is advocated by three groups of spokespersons: economic rationalists, market liberals, and members of the corporate class. -Their support of these principles created "corporate libertarianism" (term coined by David Korten) which places the rights and freedoms of corporations above the rights and freedoms of individuals. The corporation comes to exist as a separate entity with its own internal logic and rules. -Principles and assumptions of this ideology- 1.)Sustained economic growth - measured by gross national product (GNP), is the path to human progress 2.)Free markets, unrestrained by government, generally result in the most efficient and socially optimal allocation of resources 3.)Economic globalization, achieved by removing barriers to the free flow of goods and money anywhere in the world, spurs competition, increases economic efficiency, creates jobs, lowers consumer prices, increases consumer choice, increases economic growth, and is generally beneficial to almost everyone. 4.)Privatization, which moves functions and assets from governments to the private sector, improves efficiency. 5.)The primary responsibility of government is to provide the infrastructure necessary to advance commerce and enforce the rule of law with respect to property rights and contracts. -There are many who are critical of corporate libertarianism. But, a I mentioned before, from the standpoint of overall economic growth, most agree that it has been successful on a global scale. That is, most observers agree that it has led to tremendous economic growth globally.

1.)What do Edward S. Herman and Noam Chomsky mean by "manufacturing consent?" L5 S.12

-Edward S. Herman and Noam Chomsky coined the term "manufacturing consent" to refer to efforts made by governments and corporations to manipulate the manner in which policies and events are represented by the mass media, and, consequently, interpreted by citizens. A synonym for manufacturing consent is "spin."

Consequences of the role played by food in a capitalist economy L6 S.18

-In this capitalist economy, people across the world are more dependent on wage labor for access to food and are, therefore, more vulnerable to hunger if employment opportunities decrease, wages fall, or food prices increase. Other problems (consequences of the role of food in a capitalist economy): 1.)Food production is determined by the number of people who have the means to pay for it (market), not necessarily by global need for it. 2.)There aren't enough people with enough income to pay for all the food that could be produced, and so-called overproduction would result in lower prices and decreased profitability. 3.)Thus, in many countries, food production is discouraged. 4.)Also, land that could be used to grow food is generally dedicated to non-food crops (tobacco, cotton, e.g.) or marginally nutritious crops (sugar, coffee, tea) for which there IS a market. 5.)Finally, the kind of food that is produced is determined by the demands of those who have the money to pay for it. E.G., meat is notoriously inefficient as a food source, but as long as people in wealthy countries demand it, it will be produced even though the grain, land, and water needed to produce it would feed far more people if they were devoted to vegetable crops. [So people in Mexico go hungry because land is reserved for the production of beef. Few Mexicans can afford that beef, but it brings high profits to the U.S.

What, according to Robbins and Dowty, really caused the 2007 crash? L4 S.38-39

-Investments on house, stop of money

How was the nation-state constructed? (Creating the other, national bureaucratic structure, genocide and violence. Note details and examples.) L5 S.8/9/10/11 ABOVE

-Language: E.G. At the start of the 19th century, most people in France still lived in their own worlds. Few would have referred to themselves as "French." About one-fourth of the population did not speak French. [Peasants spoke a patois. French was, for them, a foreign language.] -State officials viewed linguistic diversity as a threat to both administrative and ideological unity - that is, a threat to a shared notion of oneness. Thus, in the 1880s, the French language began to infiltrate the countryside - a process more or less completed by 1914. -Culture also become more homogenous. Many local customs disappeared, while some (like the beret) became national cultural symbols. Dress and food preferences became standardized. -Another change facilitating national unity was growth in patriotism, facilitated in part by growth in literacy (people gained access to newspapers and journals, and increased their knowledge of national affairs and interests). Before the end of the 19th century, French residents had no uniform conception of patriotism. But the Franco-Prussian war in 1870-1871 was a significant unifying event for most residents of France. 2. Most significant, though, were drastic changes in the infrastructure and bureaucracy of France: building of new roads and railroads that connected people from different regions. Railroads helped homogenize tastes. E.G. wine did not become a desired drink nationally/culturally until after the first half of the 19th century. Fashion also "traveled" from the city to the countryside. 3. The ultimate source of acculturation according to social thinker, Max Weber, however, was schooling. -At the beginning of the 19th century the population was largely illiterate. Some teachers could not even read. Children who did read could not understand or give an account of what they had read. State officials determined that education was necessary as a "guarantee of order and social stability." -One said "To instruct a people is to condition them to condition them to understand and appreciate the beneficence of the government." State officials believed there was a strong link between education, nation building, national identity, and economic expansion. -Education was used to build national unity through instruction about national and patriotic sentiments, the benefits of the state and why taxes and military service were necessary, the appearance of maps of France in classrooms, and history - which was viewed as essential for exalting patriotism. -Violence is one of the main tools of nation-building. Some anthropological scholars share the view that the modern nation-state is essentially an agent of genocide and ethnocide (suppression and destruction of minority cultures). This may seem like a harsh accusation, says Robbins, but there is ample evidence that states have sought to create nations by eliminating or terrorizing into submission those in its borders who refuse to assimilate or demand recognition of their status as a distinct ethnic or national group.

Why, according to Robbins, did states take steps to turn themselves into nations? L5 S.7

-Political: Downfall of the monarchy and absolute rule, political leaders faced a crisis of political legitimacy. They needed to identify a basis on which they could claim control of the state apparatus that had become critical for the emergence and success of the "national economy." -Economic: That is, how to promote economic integration of all who were within their states' borders. States controlled areas populated by people who were geographically dispersed, spoke different languages, used different currencies, had different standards and measures, and were hostile to state officials. Tastes in commodities also varied. So what appealed to residents in one area might not appeal to people in another area of the same state. As for nationality, few residents of the British Isles, and few of the state of France, would identify as Britons/French respectively. -Solution: turn states into nations - groups of people who shared a common culture, language, and heritage, belonged together (or thought they did), worked together, and shopped together. The belief was that if members of a state could see themselves as one culture or one "people" - state leaders could claim to represent one people and integrate them into the national economy.]

What does it mean to state that the nation-state enjoys "sovereignty?" L5 S.8

-Robbins and Dowty point to several means by which the nation-state was constructed. One such means was the creation of the "other." That is, making "us/them" distinctions between those who belong to the nation and those who don't. -They can do whatever they want -Outsiders, they assert, can be used in symbolic ways to build national unity. E.G. a certain scholar suggested that the making of the British nation from its culturally and linguistically diverse populations would have been impossible without a shared religion. Thus, it was British Protestantism that allowed the English, Scots, and Welsh to overcome their cultural differences and to identify themselves as a "nation." However, that would not have been so effective, had their religion not also distinguished them from their arch rival, Catholic France. -In founding a colonial empire, Britons created another group of "Others" from whom they could distinguish themselves. Those "Others" would have been residents of conquered states. -So, one of the most effective ways to construct a nation is to create some "Other" against whom members of the nation-state can distinguish themselves. That Other doesn't have to be a country; it may be a category of persons constructed out of arbitrary criteria (e.g. race). So a group may insist that only people of a certain skin color or religion or who speak a particular language, can be citizens of their nation. -War, religion, and the creation of colonies in which people were subjugated gave Britons a sense of their collective identity as a a people.

1.)Green revolution L6 S.15

-The answer lies largely in the "green revolution." The "green revolution" began with research conducted in Mexico by American scientists in the 1940s and 1950s with the goal of developing higher yielding strains of corn and wheat suitable for Mexican agriculture. Soon farmers all over the world began to use specially produced strains of crops (wheat, corn, rice, e.g.) called "high-yielding varieties" (HYVs). These new seeds were highly productive as a result their increased capacity for using fertilizer and water. While old varieties did not necessarily increase in yield as a result of increased use of fertilizers and water, it vastly increased the yields of new varieties. Thus, more and more farmers around the world adopted the new varieties. -Petrochemical industry and fertilizer plants, wanting to expand their markets, encouraged the use of these industries (of course.) Thus, research efforts to develop HYV plants were expanded to India, the Philippines, and Taiwan, encouraged by the U.S. Agency for International Development (USAID) and the Rockefeller Foundation.

What did the corporate charter do in the 1500s? [Bear in mind the context within which it emerged and the "problem" it solved.] Lecture 4 slide (20)-21

-The corporate charter originated in the 1500s -when debts accumulated by an individual were inherited by her/his descendants. As a result, someone could be jailed for the debts of his father, mother, brother, or sister. If someone invested in a trading voyage and the goods were lost at sea, you and your descendants were responsible for the losses incurred. So, as written, the law made people reluctant to make risky investments. -The corporate charter solved this problem: It represented a grant, from the crown (king or queen), that limited an investor's liability for losses to the amount of the investment. Individual citizens did not have this right. -People became suspicious about corporations soon after they emerged. E.G. 18th century philosopher, Adam Smith, in The Wealth of Nations, claimed that corporations operated to evade the laws of the market by artificially inflating prices and controlling trade. American colonists shared Smith's suspicions and limited charters to a specific number of years. If a charter were not renewed, the corporation was dissolved. But American courts gradually began to remove these restrictions. At the end of the Civil War, corporations used their huge profits from the war, along with the subsequent political confusion and corruption, to buy legislation that gave them huge grants and money. -Corporations gradually gained control of state legislatures (Delaware, New Jersey) lobbying for and buying legislation that granted charters in perpetuity, limited the liabilities of corporate owners and managers, and gained the right of corporations to operate in any way not specifically prohibited by law. (E.G. the courts limited liability for accidents that harmed workers in the 19th century, after 700,000 workers-roughly 100 per day- were killed in industrial accidents (Robbins 2014).

Neo-caloric revolution L6 S.14

-The culmination of the development of capitalist agriculture which is technologically intensive and substitutes nonhuman energy for human energy -Ernest Schusky -major characteristic of the neocaloric revolution has been the vast increase in nonhuman energy devoted to food production via fertilizers, pesticides, herbicides and machinery. -Two scholars (David Pimentel and Marcia Pimentel) studied the output (that is how much is produced in kilocalories) compared to the amount of human and non-human energy invested in order to produce the crop in swidden agriculture, plow agriculture, and modern capital-intensive agriculture. Their findings showed that with every change in the mode of producing food, input-output ratio (amount of kilocalories expended to how many were produced) dropped. So the input-output ratio was 1:11 under swidden agriculture, but had fallen to 1:3.5 under capital-intensive agriculture.

What reasons are usually given for the 2007 crash? L4 S.37

-The debt problems of both poor and wealthy countries remind us that, as a merchant adventurer, you must expect periodic financial crisis, often related to debt. It is debt, e.g. that played a major role in the financial crisis of 2007- 2008. -In the summer of 2007, the world began to enter what some have called the "second great contraction" (Reinhart and Rogoff 2009), the first being the global economic depression of the 1930s. -Common explanation: burst of the housing bubble in the U.S. [low interest rates and cash inflows from overseas prompted a house-buying spree. Home prices soared. Also, several "subprime mortgages" - loans to people who did not have the financial resources to pay their mortgages, who defaulted on their loans. Banks stopped lending, the housing market collapsed, causing a crash of home values and wiping out of trillions of dollars of wealth. -Explanations tend to focus on human greed, homebuyers buying more than the could afford, and banks lending more than they should have.

In which centuries did states begin to take an active role in protecting/promoting trade? How so? L5 S.6

-The state, say Robbins and Dowty, has probably always been involved in its subjects' economic life in one way or another. -But it is not until the 16th and 17th centuries that states began to take a truly active role in promoting and protecting trade in Europe and Japan. . -Why? Because of the realization that the state's wealth depended on the success of its manufacturers and traders. -Thus the state began to protect manufacturers and traders by: -Imposing tariffs on goods from other states -Using military force to open markets in peripheral areas -Granting trading monopolies to firms within their borders -The state was also involved in the consumption of goods (by purchase or by using its military or bargaining power to open up foreign markets to its merchants. In fact, one of the most lucrative sources of manufacturers' profits was (and still is) the sale to governments of weapons, and other goods and services (food, clothing, transportation) that they need to maintain the military and other government services. -And the state organized, entitled, and directed financial institutions (e.g. banks) which ensured the ready availability of capital.

What's a "credit default swap"? L4 S.38

-They provide a length explanation that takes us back to the Exxon-Valdez oil spill of March 1989 and Exxon's request that JP Morgan lend $5 billion to cover possible penalties to the company. The bank was willing to provide the loan as Exxon was one of its best customers. The bank was, however, concerned about a requirement of international regulatory agencies, that banks keep in reserve a portion of what is owed to protect them against default. Money held in reserve does not bring in interest or fees - so it's money that is not working. And banks are concerned with how they can put money that they hold in reserve to work. -J.P. Morgan's solution was to turn the European Bank for Reconstruction and Finance (EBRF) to request that they insure the loan for a fee. Thus, should Exxon default on its loan, the EBRF would cover the loan. The EBRF agreed, JP Morgan requested the the reserve requirement be reduced on the Exxon loan, since it was insured. The regulators agreed and JP Morgan was able to off-load the credit risk from the Exxon loan. This new financial instrument was called a "credit default swap." -Credit default swap (or CDS for short) is a kind of investment where you pay someone so they will pay you if a certain company gives up on paying its bonds, or defaults.

Endemic hunger L6 S.20-21

-daily insufficiency in food -Little attention -often goes unrecognized by governments because it would be an admission of their failure to provide adequately for their citizens. Hunger also goes unrecognized by the hungry because its symptoms are assumed to be signs of a medical problem. -Using starvation in Brazil in the 1980s, Robbins and Dowty demonstrate how social, economic and cultural factors together produce hunger in the midst of plenty. Brazil, not a poor country, is at present among the top 10-15 economies in the world. Largely as a result of economic and industrial development since WWII, a large portion of Brazil's population has become wealthy. Still, 40% of Brazilians live in poverty. Hunger and poverty in the 1980s was particularly severe in northeastern Brazil. How did this come to be the case?

According to the documentary shown in class, Life and Debt, what structural adjustment policies were imposed on the island-nation? L4 S.35

-devaluation of local currencies - reducing government spending on welfare, health, education -Take out trade barriers, open market for everyone -globalization

a)In hunting and gathering groups; L6 S.7

-gathering wild plants -nuts, roots, berries, and grains—and hunting large and small game. They enjoyed a relatively high quality of life: working only about 20 hours per week, having plenty and nutritious food, enjoying a life span and health standards that were apparently better than later groups.

Nation (and example) L5 S.4

-groups of people who believe they have a common culture, history, language, etc. -A nation may reside in many states. They consider themselves to be one nation (or people) that resides in different states. Kurds in Iraq, Turkey, Iran, Syria -Kurds (Nation in many states) -A nation may reside in a state. An example of such would be Japan. Another might be Norway. (one cultural nation in one political territory or state.) -Robbins and Dowty point out, if we asked someone what constituted a nation, they may point to the flag. Other than being patriotic, they likely could not think of any other requirements of a nation -existed for 5000 to 7000 years

c)Under industrial capitalism (capital-intensive agriculture) L6 S.10/11/12

-growing importance of world trade in the 16th through 18th centuries (i.e. 1500s through the 1700s) and the gradual increase in the number of people living in cities and not engaged in food production. These changes (expanding trade and urbanization) produced significant changes in agricultural production: 1.)Food became a commodity that could be produced, bought, and sold for profit. HUGE change. 2.)The growth of trade and the number of people engaged in nonagricultural production created competition for labor between agricultural and nonagricultural industries. 3.)The growth of the nonagricultural workforce created more vulnerability among those who depended on others for food. [It was no longer the case that the availability of food depended only on a farmer's ability to produce it. Food availability now also depended on people's wages, food prices, and the infrastructure for delivery, storage and marketing of food products.] 4.)The increasing role of food as a capitalist commodity resulted in the increased intervention of the state in food production. (E.G. the state began to regulate food prices: if they were too high people might starve and industrial wages would need to increase; if they were too low, agricultural producers might not bring their food to market. It had to impose import tariffs and quotas to increase the availability of food and protect local food producers.) 5.)Most importantly, the amount of human energy and labor required for food production decreased, while the amount of nonhuman energy via new technologies (tractors, reapers, water delivery systems) increased.

b)In agricultural and pastoral groups; L6 S.8/9

-scholars believe that likely in response to increasing population densities, groups may have begun to search in larger areas for food, making it more efficient to domesticate and cultivate their own food. Thus, there was a gradual shift from gathering and hunting to agricultural and pastoral societies . That is, humans began planting their own crops (e.g. wheat, barley, rye, rice) and raising their own animals (sheep, goats, pigs, camels, cattle) - beginning in Mesopotamia about 10,000 years ago until 5000 years ago during what is known at the Neolithic era or the Stone Age. At that time, animals served as a farmer's reservoir (fed with excess grains in good times then killed and eaten when grain became scarce.) -Swidden agriculture involves: -Clearing a plot of land by cutting down vegetation, spreading it over the area to be used for planting, and then burning it. -Planting seeds, cultivating them (growing them into plants), then harvesting them. -After 1 to 3 years the plot is abandoned, allowed to lie fallow for ten years or more, while another area is cut and burned. Leaving the land to lie fallow allows time for trees and bushes to regrow so the land may be used again. -Swidden agriculture is land intensive: uses only natural rainfall and solar energy and requires about 25 hours per week of labor. Tools: an ax or machete, a hoe or digging stick. Multiple foodstuffs and medicinal plants are planted. -Swidden agriculture is still practiced in much of the periphery. -Some time later (maybe about 2000 years ago) populations in major areas in China, Mesopotamia, Egypt, India began to engage in more labor intensive irrigation and plow agriculture. This type of agriculture eliminates the fallow period, permitting continual production on available land, and at times, harvesting of two or three crops a year.

Four essentials for food production L6 S.6

1.)Land 2.)Labor 3.)Water 4.)Energy

a)Problems caused by the green revolution L6 S.16

1.)New plants required greater inputs of fertilizer and water, which led to added energy costs. Farmers cut back on fertilizer and water use, resulting in yields that were similar to those before the adoption of new crops. Thus, farmers returned to their previous crops and methods. 2.)The OPEC oil embargo in 1973 raised oil prices. Since fertilizers, irrigation, etc., were dependent on oil, costs rose even higher. 3.)Greater use of chemical pesticides was required. Mono-crop agriculture is more vulnerable to disease. Pesticide use is, therefore, crucial. Also, crops are subject to threats from insects and animal pests at all stages of production (field, storage, transportation, processing) - so pesticide costs rise even further. 4.)New fertilizers and irrigation favor the growth of weeds; therefore, herbicides must also be used, further increasing the expense. -So food production has transitioned from subsistence farming that was land intensive, to a form of agriculture that is highly land, water, and energy intensive - and a major outcome of that change, is that small farmers have been put at a disadvantage because of the difficulty of raising the capital needed to finance the modern technological approach. The result in the U.S. and elsewhere is the concentration of agricultural wealth in fewer hands and a constant reduction in the number of small family farms.

How can states link capitalist policies (like free trade) to the nation-state? L5 S.14

1.)They can agree among themselves to remove barriers to free trade. These agreements are what we know as free trade agreements. [Examples? North American Free Trade Agreement between Canada, the United States, and Mexico, the new United States, Mexico, Canada Trade Agreement, the U.S. free trade agreement with Australia established in 2005, the Asian-Pacific Economic Cooperation Forum (APEC) - a free trade agreement that includes about 21 countries such as diverse as Australia, Indonesia, Japan, South Korea, Papua New Guinea, Chile, to name a few.) 2.)Barriers to trade can also be removed through the actions of multilateral organizations such as the IMF or the World Bank. As you already know, if a country is in debt to the IMF and must renegotiate the repayment of the loan, the IMF will insist that the country does everything it can to promote foreign investment in the country including, removing barriers to trade. Jamaica, for example, was told by the IMF (you learned a bit about the arrangement between Ja. and the IMF in the portion of the documentary Life and Debt shown in class) to open the country to foreign corporations that wished to do business there. Result: virtual destruction of Jamaican agriculture as its farmers could not produce, and sell produce in their own country as cheaply as could American agribusiness. 3.)Barriers to trade may be (again you know this) removed through membership in the WTO. E.G. Japan, because of public concerns about pesticide residues in foods, required testing whenever a poisonous chemical was used to fumigate imported fruits/nuts. But since Japan's safety standards were higher than those set by the WTO, the US complained to the WTO that this regulation constituted a barrier to trade, and the WTO ruling body agreed.

What are the three tasks of the modern state? L5 S.6

1.)To secure obedience and gain a monopoly on force with legitimate violence; 2.)To exercise control over economic life to ensure the orderly circulation of goods, and take a share of the national income to pay for its expenditure, luxury, administration, or wars; 3.)To participate in spiritual or religious life and derive additional strength by using religious values or establishing a state religion.

Four misconceptions about world hunger L6 S.5

1.)World hunger is the result of insufficient food production. Robbins and Dowty insist that this assumption is incorrect. There is enough food in the world to feed 120 percent of the world's population (if the diet is vegetarian). And even in countries where people are starving, there is either more than enough food for everyone or there is the capacity to produce it. 2.)Famine is the most common reason for hunger. Again, Robbins and Dowty deny that this assumption is true. Famines tend to receive lots of press coverage, but endemic hunger -daily insufficiency in food— is far more common. 3.)Famine is caused by food insufficiency. No. Famine usually results from other factors (e.g. 1974 famine in Bangladesh was caused by massive unemployment which resulted from flooded farmland and by high food prices that were brought on by fear of food shortages. So people starved to death because they could not afford to buy food and had no land on which to grow their own.) 4.)Hunger is caused by overpopulation. Not so. There is no evidence that more food could not be produced and delivered if people had the means to pay for it. Overpopulation and food availability may play some role in world hunger, but the relationship between the two is far more complex than it appears.

What are structural adjustment programs/policies? (definition and examples) L4. S.35

A word on structural adjustment programs: The World Bank and IMF, in fact, both imposed structural adjustment programs as conditions for these proposed remedies/loans These programs usually involved reducing government spending on welfare, health, education; privatization of state-owned industries, devaluation of local currencies. The policies were unpopular with citizens (cost of living usually rose for citizens), but governments seldom refuse these requests because otherwise they might not receive the needed loans.

What factors led to the debt crisis of the 1980s? Which institution was blamed for the debt crisis? L4 S.32-33

Answer)-The first factor was the changing meaning of money. Answer)-The second factor leading to the 1980s debt crisis was the amount of money in loans by the World Bank to peripheral countries. Answer)-All 3 institutions were blamed, WB/WTO/IMF -Debt also stimulate(s) greater need for economic growth to maintain interest rates - return on investments. -Also means: there is more money to be lent; and much of that money was lent to peripheral countries. -Problem: interest rates were adjustable; and debts began to accumulate beyond what countries could repay. -3 factors- 1.)The change in the meaning of money (last 1/3 of the 20th century) - divorced from the value of gold/precious metal 2.)The amount of money lent by the World Bank to Third World/peripheral/developing countries 3.)The oil boom of the early 1970s and the pressure for financial institutions to invest that money

Questionable assumptions on which those the above principles are based. (slide 23)

Korten argued, though, that those principles are based on assumptions that are at the very least, questionable: 1.)Humans are motivated by self interest, as evidenced by the quest for financial gain (ie, humans are naturally motivated primarily by greed). 2.)Anything that yields the greatest financial return (highest profit) to the individual or the firm, is the action that is most beneficial to society. (The drive to acquire is the highest expression of what it means to be human.) 3.)Competition is more rational than cooperative behavior. So societies should be build around competitive motive (relentless greed and acquisition leads to socially optimal outcomes.) 4.)Human progress is best measured by increases in the value of commodities, and increasingly higher levels of consumer spending advance the well-being of society by stimulating greater economic output. (It's in the best interest of human societies to encourage, honor, and reward the preceding values.)