Chapter One: A Human Rights Approach to Globalization

bookcoverOne Sunday in 2008 I visited Houston’s Lakewood Church, the institutional home of America’s popular televangelist Joel Osteen. A refurbished basketball stadium, the church has an average weekly attendance of forty-seven thousand followers. On the large speaker’s stage the most prominent fixture is not a big cross, as one might expect given Osteen’s commitment to the Christian faith. Instead, it is a giant, rotating globe. Once everybody had taken their seats, several rounds of rock music put the congregation into a celebratory mood. A few introductory remarks by Osteen’s wife Victoria followed, and then her husband, the celebrity pastor himself, stepped into the limelight. At that moment, eight cameras started to roll and tape the show. Once the message was recorded, it would flood into the homes of millions of Americans and to viewers in one hundred other countries who tuned in to hear Osteen speak. Followers anywhere in the world could watch the famous preacher by podcast. While they listened to his message of self-love and wealth creation, they saw faint outlines of the globe, which turned quietly in the background.

Inside the Giant Globe

Although I had spent years studying the dynamics of globalization and had grown accustomed to their workings, my Sunday outing struck me on several levels. First, it showed me how potent the information technology (IT) revolution has become: Thanks to the advances in end user equipment and the improvement of the global communication network, Osteen’s message spreads effortlessly into the corners of the world. In 1980, such rapid information transmission would have been unthinkable—partly because the hardware was not developed, and partly because the countries that were involved in cross-national data transmission had not yet agreed on rules for handing off network traffic or allowing foreign investment in their communication infrastructure.

Second, it demonstrated that the IT revolution is part and parcel of globalization, the integration of national markets worldwide. On the one hand, market integration has been driven by trade liberalization through international agreements negotiated at the World Trade Organization (WTO). They have made it easier for Osteen to sell his books to a worldwide audience, because he does not need to contend with the varying intellectual property laws that once impeded trade in knowledge products. On the other hand, market integration has been achieved through the IT revolution—the development of desktop and palm top computing technologies, the build-out of national communication networks, and the interconnection of all these components into a global communication grid. This has allowed Osteen to connect to audiences across the globe and alert them to his message. Thanks to trade liberalization and the IT revolution, Osteen has been able to sell over five million copies of his book Your Best Life Now , which was released in October 2004 and has been translated into twenty-five different languages (Dooley 2007).

Third, for those who have the resources and skills to play the game, globalization pays. For Joel Osteen, the funds to be gained from book sales are enormous. If we assume a conservative one dollar in royalties per book sold, his first publication earned him five million dollars.

Fourth, while theoretically the IT revolution allows for two-way communication, in practice, communication flows are often one-directional, originating from industrialized economies and flowing into the industrialized and the Third World. In the case of Lakewood Church, podcast recipients in foreign countries can choose whether or not to consume the weekly show “Discover the Champion in You.” But their ability to speak back and engage in dialogue with church leaders is limited.

Sketch 1-1 Joel OsteenFifth, my experience gave me a winner’s perspective on globalization. When I was inside the church and a part of the crowd, I shared in the congregation’s feeling of creating something great. In addition to receiving a chance at salvation, musical entertainment, and the permission to feel good about themselves, the faithful had an opportunity to help build the church’s values—a uniquely American blend of capitalist and individualist ideas—and watch them take flight across the planet. At least for the time they were inside the church and actively supporting the message, they had the ability to participate in forging the norms that would shape their lives. They experienced autonomy.

Turning the Globe

The air of elation and success that I felt at Lakewood is not part of the day-today American experience. Nevertheless, that Sunday service captured something typical of life in this country, although it intensified it and expressed it in heightened form: In a sense, U.S. residents are inside the command center of the global economy. We produce information, entertainment, and high-tech commodities that are exported to countries worldwide. The companies for which we work benefit from international trade and IT rules that the U.S. government negotiated on their behalf and in their favor. With a per capita gross domestic product (GDP) of forty-six thousand dollars purchasing power parity (PPP), we are sufficiently wealthy to buy and travel.

Let’s walk up to the globe and turn it 125 degrees clockwise. This takes us to Egypt, a country of 81 million that is in many respects very different from the United States. While the United States enjoys the benefits of being the world’s only superpower, Egypt’s time as a hegemon passed several thousand years ago. While the United States is shaping world history, Egypt struggles to preserve the symbols of its ancient greatness from environmental degradation. While Americans are among the wealthiest people in the world, Egyptians have a very limited purchasing power of fifty-four hundred dollars PPP per capita—less than an eighth of ours. While American companies benefit from their alliance with a government that can negotiate trade rules in their favor, Egyptian businesses are aligned with a government of limited international stature that can gain them few benefits. While Americans are at the center of the global economy, Egyptians are at its periphery.

Egypt, like the United States, has popular television preachers who interpret the Qur’an for their followers. But it is hard to imagine that one of them might ever become a Joel Osteen. For one thing, Egypt has an authoritarian government that resents those who upstage it. But in addition they do not speak English, the language of the hegemon, the Internet, and global commerce; they do not have the technological resources to broadcast their godly message to the rest of mankind; and they do not preach values of capitalism and individualism that are aligned with corporate America. By virtue of living inside the center of the global economy, we have opportunities that those who inhabit its margins do not have. Being located in the world’s periphery has negative consequences for a human being’s autonomy. This is true even for the supposedly empowering IT revolution.

Meet a Nineteen-Year-Old Egyptian

If I asked Reverend Osteen whether he believed that the IT revolution enhanced the autonomy of people in poor countries like Egypt, he would probably answer in the affirmative. And in doing so he could count on the support of most development experts. The World Bank (2006), for example, defines empowerment similarly to what I call “autonomy,” as “the process of enhancing the capacity of individuals or groups to make choices and to transform those choices into desired actions and outcomes.” In 2002, the Bank’s Empowerment Sourcebook explained that

Information and communications technology (ICT) is creating economic, social, and political empowerment opportunities for poor people in the developing world. Direct and independent access to information about prices and exchange rates can transform the relationship between poor producers and middlemen. Connectivity through telephones, radio, television, and the Internet can enable the voices of even the most marginal and excluded citizens to be heard, promoting greater government responsiveness. ICT can thus help to overcome poor people’s powerlessness and voicelessness even while structural inequities exist in the distribution of traditional assets such as education, land, and finance. (Narayan 2002, 73)

According to this reasoning, deploying IT throughout the peripheral society will even out power differentials and render society more equitable.

To illustrate the World Bank’s idea of empowerment, I’ll use the story of Hisham, a composite based on several young Egyptians with whom I have spoken. The year is 1999, and Hisham is enrolled at Cairo University’s Faculty of Commerce. His family of five lives in Shobra, an older and somewhat rundown Cairo district. They share one wireline telephone. Making long-distance calls from this phone is difficult, because Egypt’s telephone infrastructure is poor. Making international calls from the apartment phone is impossible. If the family wants to call a cousin in Sydney, Australia, they have to go to a long-distance telephone station two miles from the apartment. Luckily, two international consortia have recently set up shop in Egypt and compete to provide customers with cellular phone service. Hisham just used up his personal savings to purchase a small handset and a cellular plan. He can now call or text his friends. He feels empowered.

From this perspective, which treats IT as external input into social actors’ struggle for influence and status, IT is indeed empowering. This aspect of the IT revolution is real and must be taken into account. However, IT is more than ready-made pieces of hard and software, as the Bank suggests. Underneath the computing devices that people use are networks that connect the equipment. They are governed by rules of ownership, market entry, interconnection, data transmission, and the privacy of digital content that is sent across the infrastructure. The creation and enforcement of these rules is marked by a power struggle that puts Hisham and all other human beings at the periphery of the world economy at a disadvantage. There are two reasons for this. First, when it comes to forging the global rules of the game, those organizations that could possibly represent Third World citizens’ interests in international negotiations have little bargaining power. Second, in implementing the rules, Third World citizens are at a disadvantage because their states must bow to the dictates of creditor states, development agencies, and corporations. If we want to fully understand the ramification of the IT revolution for citizens’ autonomy, we have to consider this part of the story, too.

Delving further into Hisham’s story illustrates this. Hisham is an idealist who regularly reads the newspaper. In the fall of 1999 a story announces the government’s decision to inject the country into the global market as a software exporter. A few weeks later Hisham reads another story. It states that to implement the new strategy, President Mubarak has decided to establish a new ministry for IT, which will lure transnational IT corporations to Egypt. Hisham is disappointed. He has always believed that Egypt should keep foreign investors at arm’s length and build on indigenous strength. More importantly, he is frustrated, because in drawing up this development plan his government worked closely with transnational corporations and development agencies. At the same time, it failed to involve the Egyptian people in its decisions. As a citizen who wants to take part in molding his own government institutions, Hisham feels powerless.

This book will attempt to counterbalance the one-sided understanding of globalization and the IT revolution that prevails among development experts. To do that, it will examine how the negotiation and implementation of IT rules affect the autonomy of Third World citizens. And since this book is about negotiating and implementing IT rules, the term “IT revolution” will serve as a shorthand for this process.

Ways of Looking at Information Technology

Hisham’s two-part story points up the contrast between two research traditions that have examined connections between the situation of the Third World and the use of technology. The first part of Hisham’s story treats technology as an external input into Third World politics. It does not to look at the rules that underpin technology, making it work in certain ways, and not in others, and committing its recipients to specific understandings of property rights, privacy, or trade. This is the perspective that is taken by the optimistic research tradition. Its early representatives were the modernization theorists, who treated the capitalist economies of Europe and the United States as models that poor countries should emulate. Moreover, they conceived of the development process that would bring the poor country into the state of prosperity, democracy, and industrialization as linear and divided into stages (Rostow 1960). The purpose of communications technology, which had been created in industrialized nations before being exported into the Third World, was to propel poor economies along this straight path, by diffusing “modern” social practices from the developed into the “backward” nations (Lerner 1958; Pye 1963).

Today, at least two strands of argument can be discerned within the optimistic paradigm. One emphasizes the impact of IT on culture. It argues that the diffusion of technology undermines authoritarianism, because it gives people in the developing world access to information that is independent of the government-controlled media. It also emphasizes that IT enables decentralized communication, and thereby evasion of dictatorial control by the dictator (Kedzie 1997; Pool 1983 and 1990; Taubman 1998).

The second strand examines technology as a factor of production that can improve economic efficiency (Saunders et al. 1994). J.P. Singh (1999), an expert on culture and technology at Georgetown University, has explained that these works often talk of “leapfrogging development.” He describes the idea as follows:

The phrase “leapfrogging development” reflects the belief, especially in the 1980s, among policymakers and theoreticians that information technologies, especially telecommunications, can help developing countries accelerate their pace of development or telescope the stages of growth. This results from the modernization and expansion of telecommunications infrastructures in developing countries. The infrastructure, in turn, feeds into demand for telecommunications services by other sectors of the economy . . . Often the word “leapfrogging” is used interchangeably in both technological and economic ways. (4f)

The second part of Hisham’s story is aligned with the critical tradition of studying the relationship of technology and Third World politics, because that tradition examines the institutions that enable the workings of technology and investigates to what extent they express differences in wealth and are fraught with power.

The critical tradition aligned itself with dependency theory, an approach to development that combined Marxism with nationalism (Packenham 1992). Under the rubric “critique of cultural imperialism,” this line of research argued that communication served advanced capitalism, the transnationalization of production, and a new business world order (Dan Schiller 1996, 88–105; Mosco 1993; Webster 1995, 74–100). Unlike the optimistic studies, these critiques treated communication technology not as ready-made pieces of equipment. Instead, they discussed how communication technology was made, regulated, and sold; and they showed that these processes were marked by a fight for control over the global communication network, in which the U.S. government and the U.S. service industry played leading parts (Comor 1998b; Dan Schiller 1999; Hamelink 1983; Herbert Schiller 1970; Mosco 1993). All in all, the critical approach to communication and its technologies has remained a weak undercurrent in the discussion of technology and development.

Embarking on a Dissertation

While optimistic and critical authors differ profoundly in their approaches to studying technology, all agree that IT is an integral aspect of globalization (Harvey 1990; Kellner 2002; Keohane and Nye 2000). A book that investigates the power relations marking the IT revolution would therefore have a great deal to contribute to our understanding of the struggles that characterize globalization.

That is why I dedicated my doctoral dissertation to this topic. The constraint that I imposed upon myself was that the specific topic I chose to investigate should somehow involve Europe and Egypt—the two shores of the Mediterranean from which I, with my German mother and Egyptian father, originated.

Although my choice of Egypt as model for how this social, economic, and political drama played out was influenced in part by my own advantages of familiarity and family connections, I also found that it made an ideal example in helping thoughtful North Americans and Europeans understand the issues surrounding the IT revolution. No two countries are the same, but Egypt shares significant qualities with many others in the Third World. It has a long history as a well-defined nation, during which it has been an active trading partner with its neighbors and other countries farther afield. It balances geographic advantages (position on the Mediterranean Sea and the Red Sea, its long and fertile Nile River valley) with disadvantages (vast expanses of Sahara Desert and limited arable land). It has had long periods under foreign control—most recently of France and England during the nineteenth and early twentieth centuries. Its economic growth has been largely fueled by foreign investment ($47.16 billion according to the 2008 CIA World Factbook ), but little of that has trickled down to its rapidly growing population of eighty-one million. I concluded that what I learned from Egypt would illuminate the impact of the IT revolution on the rest of the Third World.

During my hunt for a good dissertation topic, I learned three things about the IT revolution that deeply puzzled me. First, the global telecom landscape had just undergone a profound overhaul in ownership. At the dawn of the new millennium, in country after country, the traditional state-owned operator had seen its administrative purview curtailed. Private companies had become the new, privileged operators. I wondered: Why did so many countries change a practice of administering telecom that had proven its effectiveness for more than a century?

Second, this wave of change appeared to have originated in Europe or the United States. Egypt and other Third World countries seemed to follow, and as they revamped their approach to providing communication infrastructure, they also established new government agencies that resembled America’s Federal Communication Commission. This surprised me: Did Third World states seek to imitate their First World counterparts as scholars such as Martha Finnemore (1996) would suggest? Or were they pressured to create those agencies?

Third, the arcane topic of telecom sparked enormous interest among transnational corporations. Why were companies such as American Express and Sony so vested in the future of telecom? It dawned on me that great economic stakes had to be involved, and I concluded that it might be a good idea to get to the bottom of this.

Once I had reached this point, I decided to divide my research into two steps. In the first, I would investigate how global IT rules were made. In the second, I would examine whether the implementation of these rules led, in some way, to the creation of new state agencies in the Third World. I decided to arrange my research around one such agency, Egypt’s newly established Ministry of Communications and Information Technologies (MCIT).

Only at this stage did I become interested in theoretical debates, and I searched the literature for concepts that would help explain what I had begun to see on my own.

From Fordism to Flexible Accumulation

While studies that fell into the optimistic paradigm offered interesting insights, none of them adequately explained the connections among the pieces of my jigsaw. Most importantly, they did not explain why corporations and the American government so eagerly persuaded Third World states to change their way of administering national communication networks.

Sketch 1-2 FordismThen I came across David Harvey’s The Condition of Postmodernity (1990). Its attention to the motivations of actors from the core economies and its prophetic discussion of IT matched the data that I had gathered thus far. Harvey explained that between 1945 and 1973 the Fordist mode of accumulation dominated industrialized economies. Named after Henry Ford, its characteristic feature was assembly-line mass production. Fordism rested on a coalition among organized labor, corporations, and the state in the core economies. In this coalition, unions secured the cooperation of workers. Corporations invested in mass production and so provided employment. The state stabilized demand with Keynesian policies, and it protected the economy from negative external influences. Production happened in the industrialized countries at the core of the world economy, and peripheral economies delivered raw materials.

By the mid-1960s the hegemonic U.S. economy entered a crisis, and by the 1970s it was in full recession. American corporations drew their conclusion: to restore profits and take on the new Asian competition, they would change their operations and become flexible in production and marketing. They reorganized their operations. Horizontal networks based on teamwork replaced hierarchical chains of command, and production moved to cheaper locations at the periphery of the global economy, either through direct investment or through outsourcing. Corporations of countries at the world’s economic center lobbied their governments to secure them access to these offshore sites by dismantling barriers to trade and investment. To obtain flexibility corporations also withdrew from the Fordist coalition. Supported by the governments of Ronald Reagan and Margaret Thatcher, American and British companies pushed labor unions—the former coalition partners—into retrenchment.

A new mode of flexible accumulation began to take shape. In the core economies it rejected stability and solidarity in favor of flexibility, and it expanded production across the world. Harvey predicted that IT would be central to this transition. Under flexible accumulation, corporations depend much more on communication and information processing than they used to. They need IT to gauge rapidly changing demand. They require it to maintain corporate cohesion in the face of operational decentralization. They depend on it to communicate with suppliers in the absence of large inventories.

Published in 1990, Harvey’s analysis of globalization suggested that corporations would try to capture the IT rule-making process if they could and subject it to their needs, preempting input from those actors who might have had alternative visions for the IT revolution. Two decades of hindsight demonstrate that Harvey was prescient. Globalization is in fact the transition from Fordism to flexible accumulation.

The IT Revolution from a Post-Marxist Perspective

Harvey’s study was unabashedly Marxist, and a Marxist perspective forms a helpful jumping-off point for this book. Like Marxism, my work attends to the ways in which economic resources influence the ability of humans to shape their environments. But my perspective on the IT revolution is anchored more securely within post-Marxism as defined by Tormey and Townshend (2006, 3–6). The philosophy of science position that guides it is critical realism.

This study departs from the Marxist legacy in a number of ways. First, whereas Marxists use “class” as their primary unit of observation, I opt for“organization.” Marxist analyses regard class-based organizations, such as unions or firms, as direct expressions of class interest. That is, they view organizations as a mere extension of those individuals who own them. This assumption is problematic. Organizations may channel their owners’ desires or be aligned with them, but they are also capable of violating them. Economic literature on the principal-agent problem supports this view: It stipulates that in cases when the interests of principal (the owner) and agent (the organization that is to carry out the owner’s will) do not coincide, the agent is tempted to leverage its informational advantage to dodge the principal’s interest in favor of its own needs.

Organizations also do not simply aggregate the interests of the individuals who staff them but have their own interests. They possess what Bhaskar (1979) describes as “emergent powers”: abilities that are unique to the organization and cannot be reduced to its constituent parts, that is, the individuals that make up the entity. Consequently, organizational interest must be determined on a case-by-case basis, taking into account such factors as the institutional context that constrains what the entity can and cannot do (i.e., the external social structure) and the organization’s internal, hierarchically ordered web of roles that determines its interest formation (i.e., the entity’s internal structure). Organizational interest may, for instance, be environmental or religious, or—as in the case of corporations—it may come down to maximizing returns for shareholders.

Second, in traditional Marxist thinking, the state is the backdrop of social struggle (Miliband 1969, 5). In contrast, my approach emphasizing organizations views the state as an actor in its own right. Specifically, the state is a complex and potentially fragmented organization that insists on sovereignty and the legitimate monopoly on coercive power in a given territory (Migdal 1988).

The Social Construction of the IT Revolution

A third point that distinguishes this study’s approach from traditional Marxist works is its focus on the idea that reality is socially constructed. That is, social actors first make common rules and then are bound to implement them. The best account of this remains Berger and Luckmann’s (1966) landmark work The Social Construction of Reality. As it will form an important backbone for this book, an explanation of its concepts is in order.

Berger and Luckmann build a sociology of knowledge that draws on Marx’s insight that humans produce the social world while the social world determines their consciousness. The two authors discuss how social rules and role expectations come about and then shape human awareness. They begin their discussion with an encounter between human beings in a state of nature—that is, prior to the formation of a society that could have imprinted its norms on these individuals. As these pre-societal human beings interact, they fill their clean slates with information about each other. They notice that one of them engages in a specific action: He washes clothes. They respond by doing something typically human: From the multiplicity of that person’s actions, they extract those that take up a good part of his day (washing clothes) and assign a type to the person that engages in those activities. The individual therefore becomes the “clothes washer.” As our human beings encounter other persons who engage in clothes washing, they also refer to them as members of the type “clothes washer.” Over time these humans develop an encompassing set of types, or social categories, on which they draw as they make sense of their environment: “farmer,” “woodworker,” and so forth. Berger and Luckmann call this process “typification.”

As time passes, our state-of-nature individuals begin to connect certain behavioral predictions with each type they have created. They see a person who belongs to the type “ruler” and predict that he will decide over harvest times and local disputes, and occasionally wear a crown.

Through the decades, impromptu typifications become institutionalized. That is, they become part of the nascent society’s intersubjective memory. Types now cover entire groups of people, who accept the types into which they have been cast together, along with the behavioral expectations, and they typify their counterparts in turn. The end point of institutionalization is the formation of actual institutions. These are patterns of behavior that have acquired an existence independent of the actors who embody them at any particular moment. The patterns are no longer simple behavioral predictions that are associated with a type. Instead, they have reached the status of rules, and each formed society has a host of them.

An example of a behavioral prediction is the following: “Princes, before becoming king, are crowned.” The following institution has emerged from it: “In order to become a king, a prince must be crowned.” Because over the centuries coronation has evolved into an institution, it would be impossible for Britain’s Prince Charles to demand the privileges of kingship without going through the crowning ceremony. Coronation has thus acquired an existence that is independent of Prince Charles or any currently living king. And no matter how little a coronation actually accomplishes, without it we would not accept Charles as monarch of England.

The complete web of society’s rules (or, synonymously, institutions) is called its “social structure.” As Berger and Luckmann (1966) explain, members of society experience social structure as possessing a reality of its own, “a reality that confronts the individual as an external and coercive fact” (58). It has coercive power over the members of society, both by the simple fact that its institutions exist and call citizens into submission, and “through the control mechanisms that are usually attached to the most important of them” (60). A control or enforcement mechanism could be a police officer’s act of making parents comply with their duty to send children to school, or a teacher’s act of enforcing a dress code in her class room.

Social structure contains roles, that is, behavioral expectations and prescriptions that are associated with types of actors: “Roles share in the controlling character of institutionalization. As soon as actors are typified as role performers, their conduct is ipso facto susceptible to enforcement . . . The roles represent the institutional order” (74; emphasis in the original).

When a high school graduate enters college, she takes on the role of college student. As such, she must register for a certain number of credits, purchase text books, come to class on time, treat her instructors respectfully, and score above a certain minimum on exams. If an individual does not abide by these role prescriptions, she will be penalized. The web of hierarchically ordered roles—students, assistant professors, associate professors, administrative assistants—together with the associated enforcement mechanisms make up the “institutional order” of the university. Because role expectations and associated enforcement mechanisms have an existence that is independent of the individuals who embody them at any time, the institutional order that is the university perpetuates itself into the future, even as the individuals filling out this institutional order change. As Berger and Luckmann explain, this social structure constrains what human beings can do without penalty. However, it also shapes a person’s identity by imprinting in him or her norms of desirability, success, and the good life.

For the purposes of this book, Berger and Luckmann’s model will serve to conceptualize the IT revolution as a rule-making and rule-enforcement process. The individual human beings in their model become organizations, such as state agencies and corporations. Together, these organizations create specific rules or institutions. They determine how many operators a telecom sector may have, who legally owns digital property on the Internet, and who is allowed to register domain names on the web. The unconscious communication process that yields institutions as a by-product becomes an explicit rule-making process that actors consciously seek to dominate so as to shape the rules in their favor. Last, the actor to be pressed into role compliance is the Egyptian state, and enforcement mechanisms include World Bank-administered structural adjustment and a trade agreement with the European Union.

On Regime Theory

Berger and Luckmann conceive of the institutional order as consisting of two basic components: specific rules on the one hand and inclusive social structure on the other. I will introduce an additional, intermediary component: regimes, that is, sets of rules that govern a specific issue area such as IT (Krasner 1982). Rules for IT are integrated into an IT regime. This regime, in turn, forms part of social structure—that is, the entirety of rules that govern the interaction among organizations at the global level and cast each one of them into specific roles, for example, those of “creditor state” and “debtor state.”

This use of terminology points to the deep affinity of the present study for the literature on regime theory, in particular its constructivist or cognitivist strand (Hasenclever et al. 1997). A subfield of International Relations, regime theory emerged in the early 1980s. Since then it has analyzed whether and under what circumstances bodies of rules facilitate cooperation among states. Scholars such as Peter Cowhey (1990), Derrick Cogburn (2003, 2004, 2005), and Marcus Franda (2001) have successfully applied this literature to telecom and the newer information technologies.

This book speaks to the regime-theoretical literature. By systematically applying the concept of enforcement mechanisms it illuminates how regimes can alter state behavior. By causally relating the creation of Egypt’s new ministry for IT to the IT regime, it supports the constructivist view that regimes in fact shape state identity.

At the same time this volume leaves the straight and narrow of the regime theoretical debate in at least three ways. First, it not only investigates state actors, as is common for regime-theoretical treatments, but organizations more generally.2 Second, to fully understand the workings of the IT regime, it first studies politics at the international level, as regime theorists do, but then delves into the intricacies of (Egyptian) domestic politics—a realm where regime theorists seldom venture. Third, by querying the IT regime’s impact on the peripheral state, it elucidates the IT revolution’s impact on the autonomy of Third World citizens. Most fundamentally, perhaps, the present study diverges from regime theory in its explanatory intention. Its ultimate goal is not to illuminate the effects regimes can have under numerous sets of circumstances, at different times, and across a range of issue areas. Instead, it seeks to advance a new understanding of globalization.

Transformation of the State

So, how does the IT revolution impact the state? The present examination puts forth the following account: First, states and corporations at the center of the global economy worked to define an IT regime that would favor the transition toward flexible accumulation. This regime entered the global social structure and faced, in different ways, both state and nonstate organizations.

Second, in bringing this IT regime about, core states were motivated by the desire to situate their corporations so that they would capture the most lucrative niches in the global corporate struggle for competitive leadership. Means for doing so consisted of opening foreign markets and production sites. The hope was that corporations would invest abroad, sell their products, and repatriate their profits.

Third, peripheral states remained largely excluded from the negotiations that yielded the new IT regime.

Fourth, flexible accumulation had a role assigned for peripheral states: that of cheap production sites and consumption markets (Harvey 1990).

Fifth, as the case of Egypt will demonstrate, several enforcement mechanisms bore down on Third World states, prodding them toward role compliance. These mechanisms pressured the state to change its approach toward IT.

Sixth, in some cases—such as Egypt—the enforcement mechanisms had the combined effect of bringing about new state agencies for IT, thereby changing the composition of the state. The new agencies support their country’s integration into the global economy.

This outline of how the Third World state is pushed into role compliance matches the model of state transformation that scholars of Gramscian international political economy have developed (Brenner 1999, 41; Comor 1998a and 1999; Cox 1996; Gill and Law 1993; Panitch 1996). Cox (1987) states:

First, there is a process of interstate consensus formation regarding the needs or requirements of the world economy that takes place within a common ideological framework (i.e., common criteria of interpretation of economic events and common goals anchored in the idea of an open world economy). Second, participation in this consensus formation is hierarchically structured. Third, the internal structures of states are adjusted so that each can best transform the global consensus into national policy and practice, taking account of the specific kinds of obstacles likely to arise in countries occupying the different hierarchically arranged positions in the world economy. (254)

By exerting pressure on the peripheral state and changing its internal structure, the enforcement mechanisms associated with the IT regime thus help align the peripheral economy with flexible accumulation.


While this study examines the impact of the IT revolution on the state, its ultimate concern is the fate of human beings, particularly those in the world’s periphery. An important motivation of this inquiry is the assumption that all human lives are valuable and equally so, no matter where in the world those lives are lived. This assumption is widely shared. It informed the work of Karl Marx, who sought to improve the condition of the most wretched members of society. It also lies at the heart of liberalism, a philosophical position that affirms foundational rights for all human beings, among others the right to freedom (Christman 2009).

Political theorists traditionally applied the tenets of liberalism to the national realm. However, under the mantle of cosmopolitanism an increasing number of scholars have recently transferred liberal ideals to the international arena. Philosophy professors Gillian Brock and Harry Brighouse (2005, 4) define the cosmopolitan position: “The crux of the idea of moral cosmopolitanism is that each human being has equal moral worth and that equal moral worth generates certain moral responsibilities that have universal scope.”

David Held of the London School of Economics summarizes the cosmopolitan idea in eight principles:

  1. Equal worth and dignity. All human lives are valuable and equally so.
  2. Active agency. Individuals can and do shape their surroundings, and a flourishing life requires that human beings can make choices.
  3. Personal responsibility and accountability. To the extent that human beings can make choices, they must take responsibility for the measures they take and can be held accountable for the consequences of their actions.
  4. Consent. Interaction among human beings should be governed by deliberation and compromise, not coercion.
  5. Collective decision-making about public matters through voting procedures. The principle of “consent” can be formalized in public decision processes that emphasize voting and majority rule.
  6. Inclusiveness and subsidiarity. Those affected by social rules should have an equal opportunity to shape them. This may happen directly or indirectly through elected representatives.
  7. Avoidance of harm and amelioration of urgent need. Policies that are implemented must not be harmful to human beings. Moreover, the alleviation of pressing human needs must be a priority concern.
  8. Sustainability. Economic development must respect the world’s fragile ecological system.

From these eight principles arises the metaprinciple of autonomy (Held 2005, 20). The Stanford Encyclopedia of Philosophy describes autonomy as follows:

To be autonomous is to be one’s own person, to be directed by considerations, desires, conditions, and characteristics that are not simply imposed externally upon one, but are part of what can somehow be considered one’s authentic self. Autonomy in this sense seems an irrefutable value, especially since its opposite—being guided by forces external to the self and which one cannot authentically embrace—seems to mark the height of oppression. (Christman 2009)

For the purpose of this inquiry, autonomy is operationalized on the basis of Held’s principles four through six as the human being’s right to participate as equal in making the decisions that constrain his or her life.

Measuring Respect for Autonomy

The chapters in this book will evaluate how organizations, in their efforts to mold and enforce the IT regime, affected the autonomy of Third World citizens. This is easier said than done. To see why, consider the following ideal world scenario.

In an ideal world, each organization, at its founding, receives a mandate from its human originators, and it implements that mandate faithfully. In such a world, the company acts out the directives of its capitalist masters, the labor union does exactly what the workers want, and Marxists are justified in treating organizations as tools in the hands of their owners. If an ideal-world organization shuts Dan and Jane out of a decision process in which they have a right to participate, the organization’s creators are morally responsible for the entity’s action, and they can be said to have violated Dan and Jane’s autonomy by giving their organization an unjust mandate.

Unfortunately, in the real word, organizations are not simple extensions of their creators’ will. Some organizations actively avoid scrutiny by their owners or principals and subvert the mandate that they were given. Others—such as democratic states turned authoritarian—start out obeying their originators—the national body politic—but then become beholden to a narrow segment, for example, the military elite. Again other organizations, such as the Global Business Dialogue on Electronic Commerce (GBDe) that will be discussed in chapter three, have a highly mediated relationship to what might be considered human owners: The GBDe was founded not by humans, but by corporations. These are partly owned by other corporations or investment funds, which in turn represent a multitude of small investors (such as university faculty members who invest their monthly retirement contributions) and a small number of large investors.

In the real world, there is a variety of complex relationships between organization and their human principals. That makes it difficult to assess which human beings have violated Hisham’s autonomy when a certain organization injects itself into the process of making and enforcing rules. This is particularly true if the researcher does not possess precise information on the human beings whose interests the organization purports to represent.

Hence, this present study of the IT revolution will use an admittedly crude measurement to determine whose autonomy is disrespected. It will look at the organizations that are involved in rule-making processes and ask to whose feedback they are exposed. Those human beings who have the ability to provide their feedback to an organization, express displeasure with its actions, or engage in protest can be said to experience greater autonomy than those who are deprived of this feedback possibility.

Applying this measurement to the first part of this book, the formation of the IT regime, yields a clear picture. The organizations that were involved in the decision processes involving IT had strong roots in the core economies, and consequently they were exposed to the feedback of First World citizens. Few organizations with strong roots in the periphery were included in the bargaining process; hence, citizens from the periphery had disproportionately fewer opportunities to provide their feedback to the negotiation process. Consequently, their autonomy has been disrespected.

The second part of this study reveals that in the 1990s corporations and states from the core, as well as development organizations, insisted that peripheral economies opened their borders to trade, sold their state-owned enterprises, became wired, and created a transparent mechanism for administering the new technologies that were so central to flexible accumulation. If the presiding states did not have the bureaucratic capacity to administer the new technologies, they were pressured into creating the necessary capabilities.

This pressure disrespected the autonomy of the peripheral citizens, because they should have been the ones to determine their country’s national policy and the shape of their government agencies.

In sum, this study, which covers a time period extending from the early 1980s to the early 2000s, suggests that our understanding of the IT revolution and globalization needs revision. Handing a human being a laptop with an Internet connection may be empowering, as the World Bank suggests. But negotiating the rules of the game without inviting peripheral citizens to the bargaining table accomplishes just the opposite.

Looking Ahead

Prior to the 1990s, countries across the world had administered telephony in a uniform fashion, which had been devised in Europe and then diffused into the European colonies. The sector was organized as a protected monopoly that the state owned and ran in conjunction with the post. Monopolists did their work in bureaucratic obscurity, and few people questioned their performance. In the 1980s this changed. A nonissue for so long, telecom administration became the object of great political activism in the core economies. Only ten years later a new “best practice” was in place, encapsulated in a small number of international agreements. They encouraged states across the world to privatize their telecom sectors and simultaneously open the service to competition. Monopolies fell, one by one.

Who stood behind this profound change, and why did it happen when it did? This question will be addressed in chapter two, which will trace the political battles that corporations and core states waged to obtain an improved telecom infrastructure. The chapter will show that these actors shaped the new telecom consensus. They did it to the exclusion of states and nonstate organizations from the periphery, which were only admitted to the bargaining table once the basic parameters were set.

Chapter three will take a close look at the Internet. Originally a technology developed for use by the U.S. Department of Defense, it opened its doors to the public in 1994. Shortly thereafter, new rules for encryption, electronic commerce, and the definition of intellectual property rights came into being, and supportive organizations that administered them emerged. This study will show that once again organizations from the core were the protagonists behind these processes and that they excluded organizations from the periphery that might have opted for a different set of institutions had they been consulted. In doing so, they disrespected peripheral citizens’ autonomy.

Given that actors from the periphery were excluded from the decision processes of the IT revolution, were any attempts made to coax them into embracing the resulting IT regime? This question will be taken up in chapter four, which will explain how core corporations, states, and development. organizations launched a concerted effort to persuade peripheral actors of their notion of the information society—that is, a market-driven information society that privileges the corporate desire for profit.

The World Bank and a number of other development organizations produced what can be called “IT-for-development narratives.” These narratives took the desirability of globalization as an undisputable given, and they promised that Third World economies would leapfrog development if, and only if, they integrated into the global market. In producing their narratives, development organizations suggested that there was only one feasible vision of the information society. The IT-for-development narratives entered the global social structure where they joined the emerging international IT regime. The IT regime spelled out guidelines by which participants in the global economy were to abide. Supportive organizations such as ICANN, the Internet Corporation for Assigned Names and Numbers, enforced these guidelines. The IT-for-development narratives served as ideological frames. They encouraged voluntary compliance by detracting attention from alternative political possibilities.

In addressing the ideological aspect of the IT revolution, chapter four completes the discussion of how social structure was constituted. It then transitions to the enforcement of the IT regime, by introducing the mechanics of the case study that will fill out the second part of this study. Substantively, part two investigates how peripheral states were socialized into the roles that social structure had produced for them. It will show that core actors and development organizations pressured Third World states to comply with social structure. The case that will serve to make the argument is that of Egypt, but the findings apply to other states occupying similar positions in the hierarchy of states.

Understanding Egypt’s embeddedness in the world’s social structure requires traveling back to the days of Gamal Abdel Nasser, who set the country on a collision course with those organizations that sought to advance flexible accumulation. As chapter five explains, Egypt had a troubled relationship with the global economy. By the late nineteenth century the country had come under de facto British rule, where it was used to safeguard the passage to India. In subsequent decades, Egyptians gradually regained their independence. Because of their imperialist experience, the Egyptian people, in the early twentieth century, became ever more assertive about their religious and national identity. In the 1950s, under President Gamal Abdel Nasser, the state translated this quest for identity into policy. It entered into a social contract with employed labor. In return for guaranteed social security, workers would commit their productive abilities to a nationalist development project.

This project consisted of a policy of industrialization through import substitution (ISI), which was designed to shield the Egyptian economy from the world market. But instead of freeing Egypt from foreign domination, as had been intended, the state over the following decades incurred rising levels of debt, raising its vulnerability to foreign pressure. In the early 1990s, when the Soviet Union collapsed and its influence on Middle East politics ended, Egypt’s creditors from the core could leverage the country’s debt, have the economy undergo structural adjustment, dismantle all remnants of the ISI policy, and lay the groundwork for globalization.

Freed from their Soviet rival, the core states of Europe and North America leaned on the Egyptian state, prodding it to embrace globalization and the tenets of the IT revolution. As chapter six will show, this pressure took a number of forms. Trade agreements that the European Union negotiated with Egypt called for trade liberalization and improvements in Egypt’s capacity to utilize IT. Structural adjustment, administered by the World Bank, demanded that Egypt dismantle its barriers to trade, privatize state-owned enterprises, and float the exchange rate.

This pressure not only caused the state to seriously consider export-led growth as its new economic strategy, it also helped the emergence of a peripheral business elite, which favored the idea of globalization and demanded IT connectivity. Seeking to maintain its grip on society in the face of creditor demands for economic restructuring, the state entered into an alliance with this “globalization elite,” while increasingly oppressing most other civil society groups.

Chapter seven will turn to Egypt’s telecom sector. Like many other countries, Egypt in the early 1980s had a state-owned monopoly. The monopolist was part of the Ministry of Transport and Communications, which had been established during the presidency of Nasser. Rather than being market-oriented, the ministry’s approach to infrastructure was motivated by a Nasserist commitment to social engineering. How did the ministry and its operator fare in the 1990s? As chapter seven explains, when the global economy began its move toward a new, market-oriented telecom arrangement, the monopolist and the supervising ministry fell out of favor with transnational companies, development organizations, and the domestic globalization elite. Together they nudged the telecom carrier to become more market-oriented.

Chapter eight focuses on Egypt’s IT stakeholders: highly educated computer scientists, engineers, and managers whose social status was tied to IT adoption. A lower-level government agency, the Information and Decision Support Center for the Egyptian Cabinet (IDSC), channeled their desire for an improved, market-friendly information infrastructure. Tasked by the government with the informatization of the presidential cabinet, IDSC single-handedly expanded its mission to bringing IT to Egypt and making the country a software exporter.

The organization worked diligently to increase its domestic power base. Because its vision of a wired, borderless world economy was compatible with flexible accumulation, core actors provided abundant resources that IDSC used to expand its power base.

Sketch9-1SphinxBy the end of the 1990s, the network of IT stakeholders entered an alliance with Egypt’s globalization elite and with a state that—thanks to pressure from creditors—embraced the notion that Egypt’s future lay in globalization. Chapter nine will explain that in the fall of 1999, President Mubarak announced Egypt’s new national goal of becoming a software exporter. A month later, he mandated that a new Ministry of Communications and Information Technologies (MCIT) be created. Telecommunications and postal operations were removed from the Ministry of Transport and assigned to MCIT. This curtailed the power of the Nasserist ministry, weakened the Egyptian ISI constituency, and improved Egypt’s compliance with the role that the global social structure had created for it. The establishment of MCIT exemplifies the kind of state transformation described by Robert Cox.

Chapters five through nine show that Egypt’s citizens were largely excluded from the decision-making process that opened the country to foreign trade and investment and that led to the establishment of MCIT. At the global level, Egypt’s citizens were thus excluded from the formation of the IT regime, and domestically, they were excluded from shaping their own government institutions. Their autonomy was therefore disrespected twice.

Chapter ten will generate causal inferences from the case of Egypt to other poor economies. Chapter eleven, the conclusion, will draw general lessons from the preceding discussion. It will also address the question of what needs to be done, from a cosmopolitan perspective, on both the national and the global level, to work toward treating every human being as an end in her or his own right.

You just read Chapter One of Nivien Saleh’s book Third World Citizens and the Information Technology Revolution.

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