www.iwallerstein.com
It has been a marvel of capitalist adjustment to a long process of
constant change of circumstance. This marvelous system has however
depended on one structural element – the possibility of finding new
“virgin” areas for relocation of runaway factories. By virgin areas, I
mean rural zones that were relatively uninvolved in the world market
economy.
However, over the past 500 years, we have been “using up” such areas.
This can be measured quite simply by the de-ruralization of the world’s
populations. Today, such rural areas are reduced to a minority of the
world’s surface, and it seems likely that by 2050, they will be a very,
very small minority.
To see the consequences of such massive de-ruralization, we need only
turn to an article in The New York Times of April 9. It is entitled
“Hello, Cambodia.” The article describes the “flocking” to Cambodia of
factories that are fleeing China because of the rise of wage-levels in
China, a previous recipient of such runaway factories. However, the
article continues, “multinational companies are finding that they can
run from China’s rising wages but cannot truly hide.”
The problem for the multinationals is that the incredible expansion
of communications has caused the end of the win-win situation. Workers
in Cambodia today have begun syndical action after only a few years, not
after twenty-five. There are strikes and pressure for higher wages and
benefits, which they are receiving. This of course reduces the value for
the multinationals of moving to Cambodia, or Myanmar, or Vietnam, or
the Philippines. It now turns out that the savings of moving from China
are not all that great.
