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World: TV Documentary Says Globalization At Crossroads

A new television documentary in the United States is generating discussion on the forces shaping the world economy and the phenomenon known as globalization. The six-hour documentary, currently available for viewing for free on the Internet, conveys two messages: that free markets offer the best path to prosperity but also that, after 11 September, the very idea of globalization is at a crossroads. RFE/RL correspondent Nikola Krastev reports on a debate over the program featuring its producer, Daniel Yergin.

New York, 5 April 2002 (RFE/RL) -- The TV documentary "Commanding Heights: The Battle for the World Economy" is in the spotlight because it is the first major televised series exploring the evolution of the global markets after the end of the Cold War and the development of the Internet.

Daniel Yergin, who is the executive producer of the series and the co-author of the book on which it is based, says that in terms of economic policy shifts in the past decade, the most remarkable has been the increased openness of national markets to foreign investors:

"You can see a radical change, both in terms of privatization deregulation but also [in] terms of the openness, the courting of foreign investment in developing countries. Not so long before, the idea had been to drive it out." This receptiveness was on view at the recent UN development conference in Monterrey, Mexico, where numerous ministers from developing nations spoke of the importance of foreign direct investment in reaching sustainable growth. Many from struggling former-Communist countries in transition vowed to continue with painful economic and political reforms in the hopes of attracting more foreign aid.

Yergin, who won the Pulitzer Prize for his previous book on the worldwide oil trade, took his TV project to 20 countries. It features interviews with dozens of leading political and economic figures, among them former U.S. President Bill Clinton, former Soviet leader Mikhail Gorbachev, and U.S. economists Milton Friedman and Jeffrey Sachs.

The documentary traces the classic 20th-century debate between economists John Maynard Keynes and Friedrich August von Hayek. Keynes's view -- which, simply stated, held that government should manipulate the economy -- dominated much of the 20th century. Hayek's view -- that markets, not government, should provide the main impetus for economic change and development -- emerged as a dominant school of thought at the end of the 20th century, championed by leaders like U.S. President Ronald Reagan and British Prime Minister Margaret Thatcher.

The program repeatedly seeks to make the case that open markets are the best path to prosperity, citing the success of countries from Chile to China as they opened up their economies.

During a panel discussion on the documentary organized this week by the Council on Foreign Relations, a think-tank in New York, Yergin said the term "globalization" is a very recent phenomena:

"When [our book, 'The Commanding Heights'] first came out in 1998, I think it would be fair to say that 'globalization' was still for most of the public and certainly for most people in the universities a pretty unfamiliar word. The Seattle [1999 WTO meeting that ended in violence] had not yet erupted, the new economy [Internet] had not yet been born. But since then, antiglobalization has become a global movement -- although muted since September 11. And the new [Internet-based] economy has not only come but it [has] of course gone. Argentina looks very different today than it did four years ago for the worse, and Russia looks very different than it did four years ago for the better."

John Browne, who is the group chief executive of the multinational firm British Petroleum and a participant in the council's discussion, says the first major test for the global economy came during the Asian and Russian financial crises of 1997 and 1998. He said the risk management apparatus of the major financial institutions has been greatly improved since then. Browne says the experience of Russia in recent years provided an education for international investors:

"Two years ago I was confident we'd lost everything and that we'd been probably [swindled]. This is because of lack of structure, lack of allotment of interest, and how wrong I was. So, [something] happened called a change of president, change of circumstances, deeper understanding that perhaps Russia is deeply part of the world and should not be confined to its own particular space."

Other participants in the discussion noted that in a "global economy world" it has to be recognized that poverty will not be eradicated. But every possible effort must be made to reduce poverty and to try to eliminate it, said William McDonough, president and chief executive officer of the Federal Reserve Bank of New York and a panelist in the discussion:

"We can't exist in a world in which the distribution of wealth and income is much too heavily skewed toward the successful, and not enough is given to those who are at least as good as any person in this room but have been less fortunate. We must try to help them. You can do it either for moral reasons, because it's the right thing to do; or for practical reasons because you cannot have a single planet in which there is such a great spread between the rich and the poor."

Yergin says that the participation of a given country in the process of globalization depends to a great extent on the ability of its leadership to formulate an idea of what is needed to bring about economic development.

The documentary is available for viewing, in various formats, for free during the next 30 days at the following website: Commanding Heights.