Read this article on how the concept of modernity was centered in Western Europe. How did industrialization and the socioeconomic stratification it created lead to revolution? What linkages can you make between the concept of modernity and the ideologies we studied in the previous section: Tocqueville, Marx, Brinton, Johnson, and Anderson?
Just as North America's wealth is increasingly concentrated among its richest citizens while the middle class slowly disappears, global inequality involves the concentration of resources in certain nations, significantly affecting the opportunities of individuals in poorer and less powerful countries. But before we delve into the complexities of global inequality, let us consider how the three major sociological perspectives might contribute to our understanding of it.
The functionalist perspective is a macroanalytical view that focuses on the way that all aspects of society are integral to the continued health and viability of the whole. A functionalist might focus on why we have global inequality and what social purposes it serves. This view might assert, for example, that we have global inequality because some nations are better than others at adapting to new technologies and profiting from a globalized economy, and that when core nation companies locate in peripheral nations, they expand the local economy and benefit the workers. Many models of modernization and development are functionalist, suggesting that societies with modern cultural values and beliefs are able to achieve economic development while traditional cultural values and beliefs hinder development. Cultures are either functional or dysfunctional for the economic development of societies.
Critical sociology focuses on the creation and reproduction of inequality. A critical sociologist would likely address the systematic inequality created when core nations exploit the resources of peripheral nations. For example, how many Canadian companies move operations offshore to take advantage of overseas workers who lack the constitutional protection and guaranteed minimum wages that exist in Canada? Doing so allows them to maximize profits, but at what cost?
The symbolic interaction perspective studies the day-to-day impact of global inequality, the meanings individuals attach to global stratification, and the subjective nature of poverty. Someone applying this view to global inequality might focus on understanding the difference between what someone living in a core nation defines as poverty (relative poverty, defined as being unable to live the lifestyle of the average person in your country) and what someone living in a peripheral nation defines as poverty (absolute poverty, defined as being barely able, or unable, to afford basic necessities, such as food).
While stratification in Canada refers to the unequal distribution of resources among individuals, global stratification refers to this unequal distribution among nations. There are two dimensions to this stratification: gaps between nations and gaps within nations. When it comes to global inequality, both economic inequality and social inequality may concentrate the burden of poverty among certain segments of the Earth's population. As the table below illustrates, people's life expectancy depends heavily on where they happen to be born.
Table 10.1. Statistics such as infant mortality rates and life expectancy vary greatly by country of origin. (Central Intelligence Agency 2011)
| Country | Infant Mortality Rate | Life Expectancy |
|---|---|---|
| Canada | 4.9 deaths per 1,000 live births | 81 years |
| Mexico | 17.2 deaths per 1,000 live births | 76 years |
| Democratic Republic of Congo | 78.4 deaths per 1,000 live births | 55 years |
Most of us are accustomed to thinking of global stratification as economic inequality. For example, we can compare China's average worker's wage to Canada's average wage. Social inequality, however, is just as harmful as economic discrepancies. Prejudice and discrimination - whether against a certain race, ethnicity, religion, or the like - can create and aggravate conditions of economic equality, both within and between nations. Think about the inequity that existed for decades within the nation of South Africa. Apartheid, one of the most extreme cases of institutionalized and legal racism, created a social inequality that earned it the world's condemnation. When looking at inequity between nations, think also about the disregard of the crisis in Darfur by most Western nations. Since few citizens of Western nations identified with the impoverished, non-white victims of the genocide, there has been little push to provide aid.
Gender inequity is another global concern. Consider the controversy surrounding female genital mutilation. Nations that practise this female circumcision procedure defend it as a longstanding cultural tradition in certain tribes and argue that the West should not interfere. Western nations, however, decry the practice and are working to stop it.
Inequalities based on sexual orientation and gender identity exist around the globe. According to Amnesty International, a number of types of crimes are committed against individuals who do not conform to traditional gender roles or sexual orientations (however those are culturally defined). From culturally sanctioned rape to state-sanctioned executions, the abuses are serious. These legalized and culturally accepted forms of prejudice and discrimination exist everywhere - from the United States to Somalia to Tibet - restricting the freedom of individuals and often putting their lives at risk.
A major concern when discussing global inequality is how to avoid an ethnocentric bias implying that less developed nations want to be like those who have attained postindustrial global power. Terms such as "developing" (nonindustrialized) and "developed" (industrialized) imply that nonindustrialized countries are somehow inferior, and must improve to participate successfully in the global economy, a label indicating that all aspects of the economy cross national borders. We must take care in how we delineate different countries. Over time, terminology has shifted to make way for a more inclusive view of the world.
Cold War terminology was developed during the Cold War era (1945–1980) when the world was divided between capitalist and communist economic systems (and their respective geopolitical aspirations). Familiar and still used by many, it involves classifying countries into first world, second world, and third world nations based on respective economic development and standards of living. When this nomenclature was developed, capitalistic democracies such as the United States, Canada, and Japan were considered part of the first world. The poorest, most undeveloped countries were referred to as the third world and included most of sub-Saharan Africa, Latin America, and Asia. The second world was the socialist world or Soviet bloc: industrially developed but organized according to a state socialist or communist model of political economy. Later, sociologist Manual Castells added the term fourth world to refer to stigmatized minority groups that were denied a political voice all over the globe (indigenous minority populations, prisoners, and the homeless, for example).
Also during the Cold War, global inequality was described in terms of economic development. Along with developing and developed nations, the terms "less-developed nation" and "underdeveloped nation" were used. Modernization theory suggested that societies moved through natural stages of development as they progressed toward becoming developed societies (i.e., stable, democratic, market oriented, and capitalist). The economist Walt Rustow provided a very influential schema of development when he described the linear sequence of developmental stages: traditional society (agrarian based with low productivity); pre-take off society (state formation and shift to industrial production, expansion of markets, and generation of surplus); take-off (rapid self-sustained economic growth and reinvestment of capital in the economy); maturity (a modern industrialized economy, highly capitalized and technologically advanced); the age of high mass-consumption (shift from basic goods to "durable" goods (TVs, cars, refrigerators, etc.), and luxury goods, general prosperity, egalitarianism). Like most versions of modernization theory, Rustow's schema describes a linear process of development culminating in the formation of democratic, capitalist societies. It was clearly in line with Cold War ideology, but it also echoed widely held beliefs about the idea of social progress as an evolutionary process.
However, as "natural" as these stages of development were taken to be, they required creation, securing, protection, and support. This was the era when the idea of geopolitical noblesse oblige (first-world responsibility) took root, suggesting that the so-called developed nations should provide foreign aid to the less-developed and underdeveloped nations in order to raise their standard of living.
Wallerstein's world systems approach uses an economic and political basis to understand global inequality. Development and underdevelopment were not stages in a natural process of gradual modernization, but the product of power relations and colonialism. He conceived the global economy as a complex historical system supporting an economic hierarchy that placed some nations in positions of power with numerous resources and other nations in a state of economic subordination. Those that were in a state of subordination faced significant obstacles to mobilization.
Core nations are dominant capitalist countries, highly industrialized, technological, and urbanized. For example, Wallerstein contends that the United States is an economic powerhouse that can support or deny support to important economic legislation with far-reaching implications, thus exerting control over every aspect of the global economy and exploiting both semi-peripheral and peripheral nations. The free trade agreements such as the North American Free Trade Agreement (NAFTA) are examples of how a core nation can leverage its power to gain the most advantageous position in the matter of global trade.
Peripheral nations have very little industrialization; what they do have often represents the outdated castoffs of core nations, the factories and means of production owned by core nations, or the resources exploited by core nations. They typically have unstable government and inadequate social programs, and they are economically dependent on core nations for jobs and aid. There are abundant examples of countries in this category. Check the label of your jeans or sweatshirt and see where it was made. Chances are it was a peripheral nation such as Guatemala, Bangladesh, Malaysia, or Colombia. You can be sure the workers in these factories, which are owned or leased by global core nation companies, are not enjoying the same privileges and rights as Canadian workers.
Semi-peripheral nations are in-between nations, not powerful enough to dictate policy but nevertheless acting as a major source for raw material. They are an expanding middle-class marketplace for core nations, while also exploiting peripheral nations. Mexico is an example, providing abundant cheap agricultural labour to the United States and Canada, and supplying goods to the North American market at a rate dictated by U.S. and Canadian consumers without the constitutional protections offered to U.S. or Canadian workers.
While there is often criticism of the World Bank, both for its policies and its method of calculating data, it is still a common source for global economic data. When using the World Bank categorization to classify economies, the measure of GNI, or gross national income, provides a picture of the overall economic health of a nation. Gross national income equals all goods and services plus net income earned outside the country by nationals and corporations headquartered in the country doing business out of the country, measured in U.S. dollars. In other words, the GNI of a country includes not only the value of goods and services inside the country, but also the value of income earned outside the country if it is earned by foreign nationals or foreign businesses. That means that multinational corporations that might earn billions in offices and factories around the globe are considered part of a core nation's GNI if they have headquarters in the core nations. Along with tracking the economy, the World Bank tracks demographics and environmental health to provide a complete picture of whether a nation is high income, middle income, or low income.
The World Bank defines high-income nations as having a GNI of at least $12,276 per capita. It separates out the OECD (Organisation for Economic and Co-operative Development) countries, a group of 34 nations whose governments work together to promote economic growth and sustainability. According to the Work Bank, in 2010, the average GNI of a high-income nation belonging to the OECD was $40,136 per capita; on average, 77 percent of the population in these nations was urban. Some of these countries include Canada, the United States, Germany, and the United Kingdom. In 2010, the average GNI of a high-income nation that did not belong to the OECD was $23,839 per capita and 83 percent was urban. Examples of these countries include Saudi Arabia and Qatar.
There are two major issues facing high-income countries: capital flight and deindustrialization. Capital flight refers to the movement (flight) of capital from one nation to another, as when General Motors, Ford, and Chrysler close Canadian factories in Ontario and open factories in Mexico. Deindustrialization, a related issue, occurs as a consequence of capital flight, as no new companies open to replace jobs lost to foreign nations. As expected, global companies move their industrial processes to the places where they can get the most production with the least cost, including the costs for building infrastructure, training workers, shipping goods, and, of course, paying employee wages. This means that as emerging economies create their own industrial zones, global companies see the opportunity for existing infrastructure and much lower costs. Those opportunities lead to businesses closing the factories that provide jobs to the middle-class within core nations and moving their industrial production to peripheral and semi-peripheral nations.
Figure 10.2. This old General Motors plant in Oshawa, Ontario, is a victim of auto industry outsourcing.
As mentioned above, capital flight describes jobs and infrastructure moving from one nation to another. Look at the manufacturing industries in Ontario. Ontario has been the traditional centre of manufacturing in Canada since the 19th century. At the turn of the 21st century, 18 percent of Ontario's labour market was made up of manufacturing jobs in industries like automobile manufacturing, food processing, and steel production. At the end of 2013, only 11 percent of the labour force worked in manufacturing. Between 2000 and 2013, 290,000 manufacturing jobs were lost. Often the culprit is portrayed as the high value of the Canadian dollar compared to the American dollar. Because of the high value of Canada's oil exports, international investors have driven up the value of the Canadian dollar in a process referred to as Dutch disease, the relationship between an increase in the development of natural resources and a decline in manufacturing. Canadian-manufactured products are too expensive as a result. However, this is just another way of describing the general process of capital flight to locations that have cheaper manufacturing costs and cheaper labour. Since the introduction of the North American free trade agreements (the Free Trade Agreement (FTA) in 1988 and the North American Free Trade Agreement (NAFTA) in 1994), the ending of the tariff system that protected branch plant manufacturing in Canada has enabled U.S. companies to shift production to low-wage regions south of the border and in Mexico.
Capital flight also occurs when services (as opposed to manufacturing) are relocated. Chances are if you have called the tech support line for your cell phone or internet provider, you have spoken to someone halfway across the globe. This professional might tell you her name is Susan or Joan, but her accent makes it clear that her real name might be Parvati or Indira. It might be the middle of the night in that country, yet these service providers pick up the line saying, "good morning," as though they are in the next town over. They know everything about your phone or your modem, often using a remote server to log in to your home computer to accomplish what is needed. These are the workers of the 21st century. They are not on factory floors or in traditional sweatshops; they are educated, speak at least two languages, and usually have significant technology skills. They are skilled workers, but they are paid a fraction of what similar workers are paid in Canada. For Canadian and multinational companies, the equation makes sense. India and other semi-peripheral countries have emerging infrastructures and education systems to fill their needs, without core nation costs.
As services are relocated, so are jobs. In Canada, unemployment is high. Many university-educated people are unable to find work, and those with only a high school diploma are in even worse shape. We have, as a country, outsourced ourselves out of jobs, and not just menial jobs, but white-collar work as well. But before we complain too bitterly, we must look at the culture of consumerism that Canadians embrace. A flat screen television that might have cost $1,000 a few years ago is now $350. That cost saving has to come from somewhere. When Canadians seek the lowest possible price, shop at big box stores for the biggest discount they can get, and generally ignore other factors in exchange for low cost, they are building the market for outsourcing. And as the demand is built, the market will ensure it is met, even at the expense of the people who wanted that television in the first place.
Figure 10.3. Is this international call centre the wave of the future?
The World Bank defines lower middle income countries as having a GNI that ranges from $1,006 to $3,975 per capita and upper middle income countries as having a GNI ranging from $3,976 to $12,275 per capita. In 2010, the average GNI of an upper middle income nation was $5,886 per capita with a population that was 57 percent urban. Brazil, Thailand, China, and Namibia are examples of middle-income nations.
Perhaps the most pressing issue for middle-income nations is the problem of debt accumulation. As the name suggests, debt accumulation is the buildup of external debt, when countries borrow money from other nations to fund their expansion or growth goals. As the uncertainties of the global economy make repaying these debts, or even paying the interest on them, more challenging, nations can find themselves in trouble. Once global markets have reduced the value of a country's goods, it can be very difficult to manage the debt burden. Such issues have plagued middle-income countries in Latin America and the Caribbean, as well as East Asian and Pacific nations. By way of example, even in the European Union, which is composed of more core nations than semi-peripheral nations, the semi-peripheral nations of Italy, Portugal, and Greece face increasing debt burdens. The economic downturns in these countries are threatening the economy of the entire European Union.
The World Bank defines low-income countries as nations having a GNI of $1,005 per capita or less in 2010. In 2010, the average GNI of a low-income nation was $528 and the average population was 796,261,360, with 28 percent located in urban areas. For example, Myanmar, Ethiopia, and Somalia are considered low-income countries. Low-income economies are primarily found in Asia and Africa, where most of the world's population lives. There are two major challenges that these countries face: women are disproportionately affected by poverty (in a trend toward a global feminization of poverty) and much of the population lives in absolute poverty. In some ways, the term global feminization of poverty says it all: around the world, women are bearing a disproportionate percentage of the burden of poverty. This means more women live in poor conditions, receive inadequate health care, bear the brunt of malnutrition and inadequate drinking water, and so on. Throughout the 1990s, data indicated that while overall poverty rates were rising, especially in peripheral nations, the rates of impoverishment increased nearly 20 percent more for women than for men. Why is this happening? While there are myriad variables affecting women's poverty, research specializing in this issue identifies three causes:
In short, this means that within an impoverished household, women are more likely to go hungry than men; in agricultural aid programs, women are less likely to receive help than men; and often, women are left taking care of families with no male counterpart.