• Began 500 years ago:– previously, world regions were relatively isolated– 2 stages

• 1500s – 1950s– European expansion– Global trade networks

• 1950s - today – Development of global market

The History of Global Trade

The History of Global Trade1500s – 1950s: • European domination– many small countries

• Extremely outnumbered…how’d they do it– Highly developed military technology– Guns, iron weapons, armor, horses• Vs. stone tools in Africa & the Americas

• Advancements in ship design– Naval warfare– Maritime mercantile empires

The History of Global TradeConquest of the Americas:• 1492

– Columbus some gold, plantations, ranches• 1519

– Spanish land on Mexican coast• 1521 The Aztec empire falls– Wealth of gold and silver

• 1532- The Incan empire falls– Peruvian wealth goes to Spain

• 1600– Spanish conquer every major Native American state

The History of Global TradeSpread European:• Technology • Crops and livestock• economic systems– mines, plantations, fur trade, etc.

• political systems– dissolved tribes and chiefdoms

• religious systems– missionaries, churches not temples

• Diseases!!!

The History of Global TradeOld World Diseases:• Malaria, smallpox, syphilis, measles, influenza, etc…• Killed Millions of Native Americans– Estimates as high as 95% of native pop.– Mexico alone ~ 20,000,000

Why so devastating?• Lacked immunities to new pathogens• Created labor shortage– African Slave Trade

The History of Global TradeSub-Saharan Africa-• 1445– Portugal begins trade networks in Gold Coast– Gold, Ivory, Slaves

• 1488– Cape of Good Hope, S. Africa– Vital for Asian trade networks

• Slave trade becomes a lucrative market– Extermination of American labor force – Greater demand for slaves– Global market integration– Competition with other colonial powers

The History of Global TradeSub-Saharan Africa- The slave trade

• Started raiding villages to keep up with demand– At least 10,000,000 Africans sent to the Americas

• Slaves for guns program– Psychological manipulation– hunter or the hunted

The History of Global Trade

Europe meets their match- - - Asia• Late 15th century Asia reached by sea• Asian advantage– naval warfare– Surpassed in population size, development, technology

• Economically self-sufficient– Limited interest in trade– Export a lot, import a little

• Little impact on economic, political, religious, and social institutions

Era of the industrialist ~1750 and 1850 • The industrial revolution in England:– Protestant work ethic– Growth in population• Increase supply of capital (tied to gold)• Increase in demand for goods (foreign & domestic)

– Trade supported by nation-state• Rise of the merchant class

– Increase in efficiency• Technological inventions (steam engine)• New/faster communication- railroad, telegraph

• Revealed level of global economic integration– failure of banks in Germany & Austria– domino effect across the globe

• Revealed problems of perpetual growth– needs ready supply of raw materials– needs increased in demand for goods– Ways to invest profits and capital

• The Solution? - Imperialism

Economic Depression (1873-1895)

• policy of exerting control or authority over foreign entities – direct territorial conquest, settlement, or… – Indirect influence or control of politics &/or economy

• Imperialism – Expanded markets– Increased investment opportunities– Ensured supply of raw materials & markets

• Motivated by Gold, Glory, and Gospel– Legitimized by ethnocentrism & ideology of superiority

Imperialism

Age of imperialism

• Cecil Rhodes– Quintessential imperialist– Colonized “Rhodesia”– Modern day Zambia & Zimbabwe

• Founded De Beers diamond company:• Prior to 1870 diamonds were rare• 1870, many tons discovered in Orange River of S. Africa– At one time controlled ~ 90% of the world’s diamonds– British financiers threatened by new supply– formed De Beers Consolidated Mine to limit supply

Age of imperialism• Merger = artificial scarcity– Kept prices high– repercussions for Sierra Leone

• Supply only half the equation– keeping demand high– engagement rings “created” by De Beers

• “A diamond is forever” (1947)– effective advertising

• De Beers currently controls ~ 60%

Rise of the Corporation: Beginning of Neo-colonialism

• Pre-1950s– European colonial powers monopolized markets

• 1950-today• End of colonialism & political barriers to trade– Before WWII- ~60 countries, currently ~200 independent nations

• International finance– source of lending for developing countries– limitations on use of loans

• Neocolonialism:– dominance of strong nations over weak– not direct political control– economic & cultural influence

corporate profits

• Stable political climate– Stable global currency

• Few or no government restrictions– Few restraints on int’l trade– Freedom to employ people at the lowest possible wage– No/few benefits (healthcare, retirement, etc.)– Unrestricted access to natural resources

Corporate Libertarianism• Free markets – unrestrained by governments

• The government provides infrastructure – advance commerce – enforce the rule of law

• property rights and contracts

• Privatization– functions & assets move– from governments to private sector

Ideology of corporate libertarianism

• Economic globalization• Free flow of goods & money anywhere in world– Achieved by removing trade barriers – spurs competition – increases economic efficiency – creates jobs– lowers consumer prices– increases customer choice– increases economic growth

Corporations• 1886 - 14th amendment– Supreme Court ruled private corporation as a natural

person.• Rights of Natural Person– rights as individuals– Can use wealth to dominate public thought & discourse– Lobby government in their interests– Lobby for legislation that favors the accumulation of wealth– Can conflict with interests of the consumers– Often conflicts with interests of the laborers

• Lobby– to reduce liability for injury/death • (700,000 deaths 1888-1908)

– against min wage laws– against limiting # of hours a person could work– against minimum age requirements for workers

• Driven by profit– enormous economic & political power– Non-democratic institutions (anonymity of investors)– No constituency, only accountable to shareholders

Corporations

Constructing the laborer?• Privatization of land – abolish communal ownership– Land could now be owned

• Take away the means of production – land, raw materials, tools, even knowledge

• Institute taxes• Create debt• Create fear• Create consumerism