Globalization and the American Century

Published by EH.NET (March 2004)

Alfred E. Eckes, Jr., and Thomas W. Zeiler, Globalization and the American Century. New York: Cambridge University Press, 2003. v + 343 pp. $65 (hardcover), ISBN: 0-521-80409-4; $22 (paperback), ISBN: 0-521-00906-5.

Reviewed for EH.NET by Wyatt Wells, Department of History, Auburn University — Montgomery.

Alfred Eckes and Thomas Zeiler do not lack ambition. Their book, Globalization and the American Century, tracks global integration over the twentieth century, and it defines “globalization” to include not only political and economic factors like trade policy and private investment that can break down barriers between countries, but also the spread of technology and culture across national borders.

As the title suggests, this book focuses on how the United States drew much of the rest of the world into its orbit by integrating itself into the broader world economy. Starting in the 1890s, the United States expanded its foreign trade and investment as well as its diplomatic activity, and the authors contend that had these trends continued, in the 1920s and 1930s the U.S. might have gradually replaced Britain as the world’s dominant power. But World War I intervened, throwing the world economy into confusion. In the 1920s, American bankers tried to resurrect the system that had existed before 1914, with themselves rather than British financiers at its center, while American goods and culture (particularly jazz music and Hollywood films) penetrated other countries. The Great Depression ended this experiment, however, and in the 1930s the nations of the world, including the United States, retreated into isolationism and even autarky.

World War II wrought basic changes in American thinking and policy. Convinced that isolation was unrealistic and dangerous, after 1945 Washington devoted considerable resources to building an open world economy, with stable currencies and low trade barriers. The Cold War, however, led the U.S. to pursue a regional approach to integration based on Western Europe and Japan. Nevertheless, American investment abroad and cultural penetration grew apace after 1945, while the growth of international trade drove economic expansion throughout the world.

The end of the Cold War constituted the last great watershed of the American century. It opened up vast new areas for American enterprise even while forcing the United States to deal with ever-stiffer foreign competition. Washington promoted globalization with accords like those creating the North American Free Trade Area (NAFTA) and the World Trade Organization (WTO), while at the same time the cultural and economic disruptions caused by globalization created a backlash both at home and abroad.

This book has substantial merits. It has a broad scope, examining matters like technology and culture that more conventional diplomatic histories skip. It emphasizes the role of figures like William McKinley and Ronald Reagan, whom scholars too often dismiss. Finally, it is often entertaining — particularly those sections on technology and culture.

Nevertheless, Globalization and the American Century has major flaws. It has errors — some minor, but some not. For instance, the Organization of Petroleum Exporting Countries (OPEC) developed, not in response to American quotas limiting oil imports, but because of a unilateral reduction in the “posted” price of oil by the leading international oil companies that cut producer countries’ revenue (p. 180). At another point, the authors state “[Federal Reserve Chairman Paul] Volcker’s tight money policies lifted America out of its recession” in the early 1980s. In fact, the opposite was true. Volcker’s tight money policies broke inflation by creating a severe recession, and the economy recovered only after the Fed reduced interest rates in 1982. The authors imply that, to reclaim nationalized assets, International Telephone and Telegraph (ITT) engineered the 1973 overthrow of the Allende regime in Chile (p. 194). This is, at best, debatable. The Chilean military and middle class, not to mention the Central Intelligence Agency (CIA), all had their own reasons to eliminate Allende, and ITT probably had little impact on their actions.

At other points the writing makes no sense. The authors note “the Carter-Reagan retrenchment of the Cold War,” which would seem to suggest that tensions between the United States and the Soviet Union declined in the late 1970s and early 1980. At another point they argue, “The linkage of democracy to economic liberalization and development did not always hold (as, for example, aid to Iraq showed)” (p. 220). But during the years in question — the 1980s — Iraq was an underdeveloped, socialist dictatorship, and American aid sought to counterbalance Iranian power in the Persian Gulf, not to transform Iraq. The example is irrelevant.

The book’s argument has broader weaknesses as well. It is true that before 1914 the United States substantially expanded its foreign trade as well as its diplomatic involvement in Latin America, East Asia, and even Europe, acting more and more like a great power. But the experience of the 1920s, during which Americans proved unwilling to make sacrifices such as writing off war debts to stabilize the world economy, suggest that this process had limits. Though the United States possessed the power to rebuild the world economy around itself, it was unwilling to do so. The efforts of American financiers and business during the 1920s were suggestive of what would happen after 1945, but without political support, their efforts could only accomplish so much. The book also posits a major shift in American policy and attitudes towards globalization with the end of the Cold War. Certainly, this solidified American hegemony and opened new fields for enterprise in former communist countries, but U.S. policy sought to integrate these nations into the existing western political, economic, and cultural system, not to alter that system.

Most irritating, Globalization and the American Century refuses to take a stand on the merits and defects of the process it describes. Is or is not globalization a good idea? The book just repeats statements of friends and foes of the process, both of which cannot be correct. Presumably, the authors want to let readers decide the matter, but books like this are most valuable when they offer expert guidance on complex issues.

Wyatt Wells is the author of American Capitalism, 1945-2000: Continuity and Change from Mass Production to the Information Society (2003).