Effects of Economic Crisis on Global Culture
Global Culture
As a result of globalization, the McDonaldization theory claims that the culture of the United States has influence that flows from the country to the rest of the world to form a global culture. In other words, the emergent global culture is simply the exportation of the American culture to the rest of the world. According to Zwingle (1999), the process is not that easy. Global culture emerged because goods became easier to move around the world, which led to people moving around the world as well.
Consequently, ideas move making it possible for cultures to change into one global culture. The results of a global culture can be seen in the languages spoken around the world. It has been estimated that the numbers of living languages are decreasing significantly and by the 22nd century, half of the languages still being spoken today, will be lost (Davis, 1999). However, as the number of languages spoken increasingly decreases, the top 10 indigenous languages have become the languages of half of the worlds population. Instances where people around the world cannot understand each other by using any of these languages have become rare. People from the West can talk to the people of the East in some form of English, more or less. People can travel anywhere in the world and still find some ways to communicate with the locals and be understood through a certain language either learned by the traveler or the native. In fact, it is being observed that English is quickly becoming the most commonly taught second language for the emerging global culture, while other languages such as Spanish, French, and Mandarin Chinese are quickly catching up. This is a clear trend that there is a shift to the direction of fewer languages with greater geographic coverage, hence, forming a global culture (Bird Stevens, 2003).
Aside from the languages, a global culture can be evidenced by the presence of products known and consumed by the whole world. The most obvious example of this is the Coca-Cola products. It is a world-renowned brand, and everyone knows Coca-Cola. In fact, according to Coca Cola (2002), the income it derived within the United States was only 30, and the rest comes from the different parts of the world. Another brand is Nestle. It proclaimed itself to be the Food Company of the World, and somehow, this is true. Almost every single country carries Nestle products (Nestle, 2003). The products are consumed all over the world. Same goes with Toyota. However, the Toyota Company did not originate in North America or even other Western European countries, it came from Japan. Still, it is presented on almost every market in the world (Toyota, 2003). All these products, whether from the United States or not, reflect how the world has become smaller, where everyone finds the same products to fuss over and where peoples tastes have become streamlined. There are no more unique cultural tastes when it comes to soft drinks, ice creams or cars, so to speak.
Of course, an emerging global culture cannot be concluded just from having the similarities in tastes for food, drinks or cars. What is more significant is that the world seems to be moving towards a single worldview. This is largely what the media corporations are doing, such as the CNN, Wall Street Journal and many others. All these media outlets often spread common messages throughout the world. Even if they are attune to local needs and interests, and they regionalized themselves, the messages they send throughout the world often contain a single central voice. Same holds true for the worlds entertainment sources. Hollywood blockbusters are often well-received not only in America, but all over the world, and they dominate the theaters and video outlets more compared to the local films. In short, it could be seen here that even if diversity is not being restricted, the world is becoming more unified in various ways and becoming a homogeneous entity (Bird Stevens, 2003). The global culture reflects people all over the world sharing commonalities in their daily experiences, from what they speak, wear, drink, eat, drive to what they believe in. Through shared experiences, a common culture is learned worldwide. However, the explanation of how the global culture emerged cannot be dependent on these factors only. With mere exposure to the same things that are shown with the increased access to television, radio and other channels, a person does not immediately acquire a global culture (Bird Stevens, 2003).
For example, even though an individual understands the Chinese culture and he or she is Filipino, this does not make him or her adopt the Chinese culture, no matter how desensitized he or she is with Chinese products, the Chinese language, Chinese movies and television shows and many other things. However, with the global culture, everyone seems to have acquired a penchant for English, Hollywood movies, American foods and others. This seems to suggest that some cultural attributes are more attachable than others, and some people are more prone to believe in certain cultures and adopt them rather than others. In other words, members of the global culture have attachments to certain individuals which is a matter of choice. It is up to a person to choose to be attached to certain members of the global culture and therefore become members of the global culture as well. Those, who are not willing to do so, will not be members of the global culture. The notion of the global culture comes from having shared experiences with other people from other parts of the globe and then deciding to adapt to these common experiences (Bird Stevens, 2003).
According to Osland (1995), the expatriates could be said to be the real members of the global culture. The global culture gives the expatriates a common lens through which they can understand the world, and have a common set of values, norms and attitudes. Each expatriate understands what other expatriates feel, because they all share similar experiences of being an outsider, and then trying to adjust and fit in. Even though she focused on expatriates, the global culture is not limited to those who have moved from their origins (Bird Stevens, 2003).
It is a myth to say that those who adapted to the global culture rejected their national cultures. In fact, they still behave within the cultural milieu they were born and raised in. However, people who have adapted to the global culture have certain common characteristics. These are being educated, well-informed and definitely knowledgeable about the world and the international affairs. These people are connected more than others. They possess the means to travel and communicate with other people from different parts of the world. If they possess the means to travel occasionally they physically interact with people of other race or culture, or they have the means to be connected via the net and virtually interact with everyone in the whole world. It can be both.
The people are naturally self-confident as well. They are equipped with the experiences of conducting themselves properly in the global world, and they already experience being successful at these endeavors so they feel self-assured. Since they feel that they have seen the world and others have not, and know the challenges and rewards from these experiences, they feel that they have the capability to overcome more challenges and obstacles that they will meet in their lives. They are also more pragmatic. They do not pay attention to theories, even though they know their importance. They rather accomplish things by acting immediately and find novel ways to solve problems. Because they are more aware of what is happening in the world and they have elevated self-confidence, they do not view the differences between their culture and the others as obstacles to be intimidated about. These individuals tend to adhere to the democratic and participatory principles. They expect other people to be this way too. People who embrace the global culture tend to be more individualistic yet they are inclusive too. They know their identities more and they can act comfortably alone. However, all the actions they take are more geared towards the good of the more people rather than just a few. What is more, they rather include other people in their initiatives rather than exclude. They are flexible and open, and often trust people in the onset when initiating relationships because their experiences and knowledge of the world make them more tolerant to people from all walks of life (Bird Stevens, 2003).
The global culture is seen as threatening to native culture (Harrison and Huntington , 2000). As the global culture grows bigger, many feel that the national culture is bound to disappear, such as the languages that are disappearing. A national culture is composed of a group of peoples sets of deeply held values and beliefs, with regard to what is good and proper in the world. For these people, this is the worldview. However, when this is threatened strongly from the outside, the only option they have is to adjust to the threats or collapse. Furthermore, the very fabric holding the national culture is being threatened by the tension between members and non-members of the global class. There is tension between the two groups because those who are not members of the global culture feel alienated from the larger world, yet they do not want to be incorporated in the larger world at all, which members of the global culture cannot understand them. Because the non-members of the global world do not possess the knowledge and experiences of those who are members, they do not receive global influences easily. Instead, they fear global influences and see these as alien and interfering. The global culture threatens national culture because it is overwhelming the national culture. Movements toward globalization are pushing national cultures away toward the periphery of irrelevance. Some critics claim that it would not be possible that one day, all people will be saluting to one flag and that nation states would be of no importance. In fact, as early as now, the increasing fragmentation of states and societies is already suggesting that the national culture is quickly decaying and making way for the global culture (Bird Stevens, 2003).
Effects of Financial Crisis on Global Culture
From 2007 to 2009, the world was wracked with the biggest economic downturn ever have experienced in scale. It started in the United States, where the failure of the small-prime mortgage market essentially led to the failure of the whole economic system. As increased economic interdependence among countries and the spread of global culture promote the spirit of cooperation and solidarity among states on the international stage, the crisis taking place in the United States quickly spread to other countries. Risk tolerance worldwide plummeted and the crisis spread to other global countries having global impact on various countries such as China and Japan. In the first quarter of the year 2009, Japans GDP suffered a 4 decrease while China, although was able to keep its year-on-year growth of 6.1, was already the first to respond with a major stimulus program to achieve this feat. Nonetheless, the target of 8 GDP growth was missed and the 10.6 rate achieved a year earlier was not seen any more (Petri Plummer, 2009).
The global financial crisis is what everyone is now contending with, although the worst was over. People left and right were and still are losing their jobs, their houses, their savings, and their lives because of the crisis (NY Times, 2007). The financial crisis that started from the worlds superpower had transferred from one country to another, and now in every corner of the world everyone is affected. The trigger for this credit crunch was the increasing defaults among the US holders of subprime mortgages starting from the last quarter of 2006 and towards the early 2007, which led to the failure of several large mortgage brokers from February to March 2007. This is no sudden matter, the credit crunch came as the climax of a long period of gravity-defying global imbalances and asset bubbles. Fear of recession had prompted the US Federal Reserve to keep interest rates low in 2001 up until the year 2006, and this in turn led to cheap and easy loans. The worlds financiers and business leaders looked to the US householders, the consumers of last resort, to maintain the global boom. With a wrong move, since very similar to Asian Financial Crisis, all these bubbles were set to burst at one point. However, sightings of these dire circumstances were only observed in the late summer. The first bank to report a problem was Deutsche Bank, when it was forced to bail out two property-based funds in July. At first the solution thought was to ask three of the Wall Streets largest banks Merrill Lynch, Morgan Stanley and the Bank of America to set a fund so that a clear value for threatened assets can be established. However, this did not work (NY Times, 2007).
The end of 2007 noticed no change in the credit crunch situation, in fact, it got worse. The central banks all over the world are now trying their best to pump in money and stimulate liquidity. It has worked temporarily but was quick to go back to the ugly financial situation. Moreover, the banks are still unwilling to lend each other, and soon all the banks were in the same murky pools of bankruptcy and paralysis. A major credit crunch followed immediately (Summers, 2008). The consequences of the crunch led to deteriorating economic conditions, and hastened the United States toward an economic recession that was comparable to the Great Depression.
The consequences of the global financial crisis were severe because the effects did not correspond to one country but rippled throughout the world. A collapse of the US sub-prime mortgage market and the reversal of the housing boom in other industrialized economies have had a ripple effect around the world (Shah, 2009). This led to the surfacing of several other weaknesses in the global financing system wherein products or instruments that were used financially were discovered to be quite complex and twisted, and when unraveled led to the further deterioration of the system. Banks started lending with higher interest rates and people who were enjoying their affordable mortgages started to get shocked at the turn of events. Some were not even ready. They began to find their mortgages harder to pay, or even impossible, yet they could not do anything about it because remortgaging could become more expensive. Recent home buyers started to feel regrets in their decisions to buy the house because the values of their homes are likely to fall and this means they are going to be left with a property which value is in negative equity. Other sectors, because of the credit crunch and higher costs of borrowing, started to impose job cuts. The natural tendency of consumers to cut back on their expenses would aggravate the situation even more as the businesses will struggle to survive from decreasing sales and profits. This would also lead to further job losses as companies close down or reduce their labor expenses (Shah, 2009).
The effects of the crisis were so severe ( and still are) that after the failure and buyouts of major institutions the Bush administration decided to offer a 700 billion bailout plan to revive the US financial system. It was not widely accepted at first, and even caused a lot of controversies. The public deemed that this bailout would only benefit the culprits while the ordinary people would be left to pay for their mistakes and misjudgments. Despite the hostile reception of the US people regarding the bailout, the whole world was still shocked that the US House of Representatives actually sided with the people and initially rejected the package. It was eventually passed but already add-ons to the bill to get the additional congressmen and women to accept the plan (Shah, 2009). The 700 billion bailout plan did not really change things much because even with its presence, banks were still reluctant to lend. As a result, the US as another attempt to revive the economy, announced another 800 billion stimulus package at the end of November, in which 600bn is marked to buy up mortgage-backed securities while 200bn will be aimed at unfreezing the consumer credit market (Shah, 2009).
Fast forward to year 2010, with the new President it gives a new hope that the global financial crisis would soon be over. The new president signed a stimulus package immediately. However, his first action to revive the ailing economy is not without controversy. In fact, several economists were split in their views, and some of them rained the new President with criticisms left and right. The fiscal stimulus was intended to improve the economic activity during the time of economic weakness, which is to be made possible through increasing short-term collective demand. This package addresses different angles in a troubled economy. This is the centerpiece of the new U.S. government promising income tax cuts, reduction in Social Security withholdings, bolstering consumer spending, modernizing the economy, education and health care, among others. This is the most expansive unleashing of the governments fiscal firepower in the face of a recession since World War II (NYTimes).
The global financial crisis is far from over and the world is far from safe from another big shock. The United States and the rest of the world however are optimistic in their anticipation that this would smoothen out very soon. Of course, citizens all over the world are typically skeptic, but are now more or less adjusted to their new way of living. However, it is in the wishes of everyone that the economy would correct itself already, either by itself or by the decisions of experts and let them have their old lives back.
Because of their strengths, countries such as China, Japan and the United States have the ability to take advantage of their policy capacity to undertake expansionary measures. They conducted structural interventions in finance as well as various approaches of monetary and fiscal easing. The rest of the world was not that lucky. Eichengreen and ORourke (2009) showed that in comparison with the rest of the world, after the worst was over, the three economies looked very strong compared to the other countries. This reflects their ability to implement economic policies. The currencies of other countries, for example, Korea and Indonesia, the UK and the Eastern Europe have depreciated substantially (Petri Plummer, 2009).
The global financial crisis tells us that the world economy is a very vulnerable structure. The shock experienced by the world economy tells us that there are already high levels of interdependence in the world, yet there are still low levels of policy cooperation and oversight. It highlights global culture that was quickly emerging, which adds to the quick contagion effect of the crisis. Although the United States, China and Japan were able to recover their economies, the other countries are left behind. The US, China and Japan have worked together to counter the effects of the crisis from becoming more aggravated, yet it has been observed that their cooperation with each other was just ad-hoc and uncoordinated. Therefore, there were concerns of the vulnerability still of the world economic system, especially if they are the only countries that can probably withstand such shocks again (Petri Plummer, 2009).
It has been argued that the economic crisis highlights the lack of cooperation that would allow for the reduction of the risk of future crises, and for managing the various challenges that could possibly emerge in an interdependent global economy. Each economy is getting smaller, and they are getting more vulnerable to risks from collective shocks. The world should invest in greater cooperation and international surveillance. Therefore, it can be said that although the financial crisis has become global because of the great interdependence of the countries with each other, this cooperation should still be increased because it is the only way to avoid further shocks, this time with increased international surveillance. Some nations would abhor being subjected to external intrusion or intervention in their policy space, but the financial crisis showed that all countries, even the United States, can benefit if there is greater external scrutiny of their policies (Petri Plummer, 2009).
Because of the economic crisis, a pattern of negative homogenization may be perceived (Roth, 2008). The working and living conditions have deteriorated throughout the world, however the regional differences in proletarian living standards have also deepened significantly. Multicultural workers in the metropolitan neighborhoods are perceived to be better off than those who work in the outskirts of the cities. Negative homogenization can ensure out of the hardships the global financial crisis has brought. People will be more inclined towards fixation on religious promises of salvation, and the submitting to mafia-type of patronage. A new global culture based on these can emerge. These tendencies can fortify the inclinations toward patriarchal and ethno-political regression in the whole world (Roth, 2008).
Another effect of the global financial crisis is the acquiring of new sets of beliefs, values and behavior that would constitute as a new global culture. The emerging global culture has been more about the values of the United States being exported to other nations. Because the crisis has originated there and showed that there are some forms of instability in the United States, they might be more appealed to another emerging culture. Some cultures are more adaptive at being economically successful, and usually these are the cultures that people become adaptive to because their population movements often go there where the money is as well as the greener pastures. It has been the case that national cultures being shed for the global culture only take place more in countries where poverty is heightened. A national culture that could not deliver economic success would be viewed as less successful than another culture that is more wealthy and prosperous economically. Therefore, although this would not take place overnight, the fact that the United States has crumbled at some point and some people will adapt to other cultures that deem stronger, a new form of the global culture could possibly take place (Roth, 2008). It could be concluded therefore that even with the financial crisis, the global culture would not just disappear overnight even people find it the main reason why the crisis has spread all over the world quickly. It can only change in form, but there is still a possibility that the national and regional cultures would still be on their way to obsolescence.
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