Poverty and Income Inequality in South Korea Essay Example for Free

Poverty and Income Inequality in South Korea Essay South Korea is counted among the world’s leading economies alongside giants such as United States and Germany (Wiseman Nishiwaki, 2006). Before the financial crisis hit Asia in 1997, South Korea was among the fastest growing economies of the world with a Gross Domestic Product (GDP) growth rate exceeding 5 percent (Kakwani, Khandker, Son). Kwack Lee (2007) report that income inequality had been reduced across the country before the financial crisis. Moreover, between the years 1965 and 2005, income inequality had not significantly increased. All the same, between the years 1998 and 2005, South Korea experienced a rise in income inequality seeing that the Asian financial crisis was massive in its scope (Kwack Lee, p. 20). Also, between the years 1990 and 1997, the percentage of South Korean people classified as poor had steadily decreased from 39. 6 percent to 8. 6 percent (Kakwani, Khandker, Son). South Korea was coming to be known as an â€Å"economy with relatively equal distribution of income and with full employment† (Kakwani, Khandker, Son). But, the Asian financial crisis naturally increased the number of poor people in the country. In fact, the percentage of poor increased to 19 percent in 1998; it was 13. 4 percent a year later (Kakwani, Khandker, Son). According to a study conducted by Kakwani, Khandker, Son, the poor of South Korea were disproportionately affected by the Asian financial crisis of 1997. Even though the South Korean economy started to grow again immediately after the crisis, the benefits of growth did not reach the poor as they did the rich. Then again, the government of South Korea introduced new welfare programs for the very poor during that time. The poor people of the country did not benefit from these programs, however. It was only the very poor that were positively impacted (Kakwani, Khandker, Son). What is more, contrary to the interpretation of income inequality statistics as presented by Kwack Lee, the International Monetary Fund has expressed great concern over this problem in South Korea during the present era of globalization (â€Å"Widening Inequality: IMF Acknowledges Downsides of Globalization,† 2007). A report published in Korea Times in October 2007 reads: †¦Many South Koreans believe the nation has no other choice but to pursue the international trend in a bid to survive fiercer competition with other countries. Policymakers are trying to open the local market wider to foreign products, while promoting sales of Korea, Inc. , under the spirit of freer trade. They go all-out to attract foreign investment by setting up free economic zones and international business towns. Businesses are also expanding their overseas networks for production, sales and investment under the motto of globalization. †¦In this regard, a recent IMF report caught the attention of economic policymakers, company executives, citizens and anti-globalization activists. Last week, the international body published its semiannual economic review, the World Economic Outlook, before the IMF and the World Bank meeting scheduled for Oct. 20-21. The IMF said in the report that technology and foreign investment are making income inequality worse around the world. The review tries to figure out why income inequality has widened in both rich and poor countries in the past two decades. It is the first time that the IMF has come up with such a report admitting to the negative effects of globalization. Over the past two decades, income inequality has risen in most regions and countries,’’ the report said. We can learn much from the report. We have to admit that South Korea has experienced widening income inequality, especially following the Asian financial woes. The income brackets have already been divided into 20 percent rich and 80 percent poor. That is the nation’s middle class has crumbled because the gap between the rich and poor widened. The 20-80 ratio is on the verge of moving to a 10-90 ratio, further worsening the income gap. In addition, businesses have exploited non-regular workers and migrant laborers from foreign countries who suffer from low wages, poor working conditions and other discrimination. A law protecting non-regular workers took effect in July, but little progress has been made to guarantee their equal rights. Policymakers will have to take bolder measures to narrow income inequality and tackle other negative effects of globalization. (â€Å"Widening Inequality: IMF Acknowledges Downsides of Globalization†) It is oft stated that globalization is accompanied by a widening gap between the haves and have-nots of the world. When a Korean farmer suddenly appeared during a meeting of World Trade Organization and committed suicide, the problems facing the global political economy were highlighted – that, in fact, the interests of the poor must be heeded, better than before. The farmer was wearing a shirt that read, â€Å"WTO KILLS FARMERS† (Cho, 2008, pp. x). After all, it is not uncommon for experts and non-experts alike to claim that the World Trade Organization does not represent the interests of the rich and the poor equally. Nevertheless, there is a limit to how much the World Trade Organization can do for the poorest people of the world. It is, in fact, for the government of South Korea to bear greater responsibility for poor Koreans. According to another news report published in South Korea in the year 2007, The wage disparity of the lower 10 percent of earners versus upper 10 percent rose to a factor of 5. 4 in 2006 from 4. 8 in 2001, meaning that wages for the top decile of earners were nearly five-and-a-half times greater than those of the lowest decile of earners†¦ (â€Å"A Look at South Korean Society, 20 Years after Democracy,† 2007) It is for the South Korean government not only to improve income distribution in the country but also to implement policies to end abuse as well as discrimination of the poorest workers. Individual income in South Korea rose fivefold between the years 1987 and 2007. But, South Korea has not made progress to end income inequality. The Gini coefficient is typically the statistical measure of choice to assess income distribution. A Gini coefficient of zero indicates perfectly equal income distribution, while a coefficient of 1 indicates perfectly inequality. In 1987, the year that South Korea became a democratic country, its Gini coefficient was 0. 31. By the year 1997, South Korea’s Gini coefficient had been reduced to 0. 28 as the country had made strides in reducing the gap between the haves and the have-nots. But then the Asian financial crisis ensued. By 2006, South Korea’s Gini coefficient was back to 0. 31. Although the size of the economy had grown from $500 billion to $800 billion, income distribution had been reduced between 1997 and 2006. Unsurprisingly, the poorest people of South Korea are confronting discrimination and abuse. After all, the rich are getting richer at the expense of the poor. As a matter of fact, exploitation of labor is reality in South Korea (â€Å"A Look at South Korean Society, 20 Years after Democracy†). Robert J. Barro, a professor of economics at Harvard University, explains that living standards across South Korea were raised with its dramatic rise in GDP. As examples, the infant mortality rate fell from 8 percent to 0. 8 percent and life expectancy rose from 54 years to 73 years. Additionally, income distribution in South Korea has been more equitable as compared to the United States and Japan. When individual income rose in South Korea, low-income groups were beneficiaries, too, and poverty was reduced (Barro, 2003). Then again, as we have already discussed, the Gini coefficient of South Korea in 2006 was the same as in 1987. This reveals that although the poor people of South Korea have higher wages now than before, the gap between the haves and the have-nots has not been narrowed. So, Professor Barro suggests that South Korea must work on improving its education system. If the poor people of South Korea have access to good quality education, it would be easier to improve income distribution. Moreover, the country needs to enhance corporate governance (Barro). These changes are sure to enhance working conditions and living standards of poor workers. Then again, South Korea may not be able to support half of its â€Å"elderly households† living â€Å"in a state of ‘relative poverty’† with these improvements (â€Å"Korea Highest in Elderly Poverty,† 2008). In fact, the income of these households is lower than 50 percent of average household income in the country. Although South Korea has a pension scheme for the elderly, the percentage of the poor that may benefit from the scheme is small. Because the traditions of South Korea demanded of children to take care of their parents upon reaching adulthood, the country does not have a developed social insurance system for the elderly. What is more, South Korea is aging fast. At least 7 percent of its poor are over 65 today (â€Å"Korea Highest in Elderly Poverty,† 2008). At the same time as social welfare programs remained underdeveloped, South Korea generated 3100 more people owning at least U. S. $1 million worth liquid assets between the years 2000 and 2001 (â€Å"Asian Millionaires: A Tough Bunch,† 2002). According to Australian Banking Finance, among the reasons for this rapid production of millionaires is increasing income inequality (â€Å"Asian Millionaires: A Tough Bunch,† 2002). To put it another way, corporate leaders are raising their organizational revenues, thanks in part to globalization, even as the poorest workers of their organizations continue to be paid low wages. In the year 2007, South Korea experienced the widest gap between the haves and the have-nots since the Asian financial crisis. In fact, the annual income of 20 percent of South Koreans earning the highest incomes was 5. 44 times greater than the annual income of the 20 percent that earned the lowest incomes. In 2006, the rich were earning 5. 38 times more than those that earn the least (â€Å"Income Gap at its Widest Point since 1999 Financial Crisis,† 2008). Analyzing the statistics, The Hankyoreh reports that income and wage gaps between 20 percent of the highest earners and 20 percent of the lowest earners had actually widened by 7. 9 percent and 11. 7 percent respectively between the years 2002 and 2007. What is more, statistics on income distribution in South Korea reveal that the richest people of the nation are earning more than the people of developed countries, while the poorest South Korean households have incomes that are equivalent to those of households in less developed countries. Even the World Bank has confirmed that poor South Koreans have the same living standards as those of the citizens of El Salvador or Gabon. Rich South Koreans, on the contrary, have the same living standards as New Zealanders and Australians (â€Å"Income Gap at its Widest Point since 1999 Financial Crisis†). Professor Barro’s analysis of income disparity in South Korea must be considered incomplete for the reason that there is no â€Å"decline in the burden of consumption on low-income households† (â€Å"Income Gap at its Widest Point since 1999 Financial Crisis†). These households pay their cellular phone and Internet bills with twice as much of their incomes as do rich households. Despite the fact that wages have increased – according to Barro – income disparity continues to widen. Son Tae-jeong, one of the researchers at the LG Economic Research Institute in South Korea, stated that salaries increased between the years 2006 and 2007 to boot. However, the poorest workers do not seem to have availed the benefits of the rise in salaries across the country (â€Å"Income Gap at its Widest Point since 1999 Financial Crisis†). South Korea has introduced necessary legislations to strengthen its social welfare programs. There are social security schemes which are insurance based and applicable only to certain occupational groups. These schemes cover pensions and healthcare among other things. The government of South Korea also offers subsidies for housing on a limited basis. But, most social security programs in the country only offer benefits related to earnings. Furthermore, these social security schemes are structured in a way that limits income redistribution from high-income to low-income groups (â€Å"Social Welfare in East Asia: Low Public Spending but Low Income Inequality,† 2008). Even though there are organizations across the country that continue to retain their unproductive workers, there is no way for them to cure the plague of poverty afflicting the elderly poor of South Korea (â€Å"Social Welfare in East Asia: Low Public Spending but Low Income Inequality†). The poor elderly South Koreans cannot be financially supported by their grown up kids because even though labor productivity and GDP have risen together, real wages have lagged behind (Chung, 2007, p. 228). Poor workers have low standards of living in any case, seeing that corporate leaders must focus on raising their own living standards even if they offer support to unproductive workers. Of course, as Barro has stated, education and corporate governance may work wonders in eradicating the problem of poverty facing the worker and his or her elderly parents in South Korea. Uneducated people usually have low living standards (Savada Shaw, 1990). Moreover, in the workplaces of South Korea, these people are â€Å"treated with open contempt by university graduate managers† (Savada Shaw). Increasing numbers of South Korean workers have migrated from agricultural farms to industrial establishments in recent years. Nevertheless, poverty has not been eradicated (Savada Shaw). Rather, the differences between the haves and the have-nots have remained. The Asian financial crisis had negatively impacted both the rich and the poor of South Korea. But, as mentioned before, the poor were disproportionately affected. Poor South Koreans had to reduce their spending by 9. 8 percent in the year 1998. The rich only reduced their spending by 0. 6 percent. Additionally, as soon as the Korean economy was back on its growth track, the rich are known to have greatly increased their spending. In point of fact, the consumption of luxury goods rose to the extent that sales of golf equipment were increased by 357. 6 percent between 1998 and 1999 (Yim, p. 32). The poor South Koreans, on the other hand, were left to their living standards resembling those of people in underdeveloped countries. Of a certainty, the government of South Korea must be formulating and implementing the kinds of policies required to resolve these structural economic issues once and for all. The country possesses the capacity to grow beyond expectations. But, at the same time, income inequality and poverty create such a burden that a South Korean farmer came to commit suicide at a meeting of the World Trade Organization. The rich capitalists of South Korea pay low wages to workers who go on increasing their productivity nevertheless. Furthermore, poor, uneducated workers are abused and exploited in the South Korean workplace. By instituting good corporate governance programs, the government of South Korea may very well correct this problem. After all, it is because of the poor workers’ motivation to increase productivity that has made South Korea one of the most important economies in the world today. The country would not be able to sustain its economic position if it fails to heed its workers’ needs. References A Look at South Korean Society, 20 Years after Democracy. (2007, Jun 8). The Hankyoreh. Retrieved Mar 20, 2009, from http://www. hani. co. kr/arti/english_edition/e_national/214664. html. Asian Millionaires: A Tough Bunch. (2002, Oct 15). Australian Banking Finance. Retrieved Mar 20, 2009, from http://findarticles. com/p/articles/mi_hb4849/is_18_11/ai_n28954879. Barrow, R. J. (2003, Jun 9). South Korea: How to Keep the Miracle Going. Business Week. Retrieved Mar 20, 2009, from http://www. businessweek. com/magazine/content/03_23/b3836031_mz007. htm. Cho, Y. (2008, Oct 10). Participatory Democracy in the Global Public Sphere: Scale, Media Events, and the Body. Paper presented at the annual meeting of the International Communication Association, Sheraton New York, New York City, NY Online. Retrieved Mar 20, 2009, from http://www. allacademic. com/one/www/www/index. php? cmd=www_searchoffset=0limit=5multi_search_search_mode=publicationmulti_search_publication_fulltext_mod=fulltexttextfield_submit=truesearch_module=multi_searchsearch=Searchsearch_field=title_idxfulltext_search=Participatory+Democracy+in+the+Global+Public+Sphere%3A+Scale%2C+Media+Events%2C+and+the+Body. Chung, Y. (2007). South Korea in the Fast Lane: Economic Development and Capital Formation. New York: Oxford University Press. Income Gap at its Widest Point since 1999 Financial Crisis. (2008, Feb 15). The Hankyoreh. Retrieved Mar 20, 2009, from http://english. hani. co. kr/arti/english_edition/e_national/269809. html. Kakwani, N. , Khandker, S. , Son, H. H. Poverty Equivalent Growth Rate: With Applications to Korea and Thailand. Retrieved Mar 20, 2009, from http://siteresources. worldbank. org/INTPGI/Resources/13984_Hyun_Sons_paper_pro-poor-final. doc. Korea Highest in Elderly Poverty. (2008, Nov 8). The Korea Times. Retrieved Mar 20, 2009, from http://www. koreatimes. co. kr/www/news/nation/2008/11/113_34066. html. Kwack, S. Y. , Lee, Y. S. (2007, Dec 31). Income Distribution in Korea in Historical and International Prospects. Retrieved Mar 20, 2009, from http://www. kdi. re. kr/kdi/report/report_read05. jsp? 1=1pub_no=10341. Savada, A. M. , Shaw, W. , eds. (1990). Social Classes in Contemporary Society. In South Korea: A Country Study. Washington: GPO Library of Congress. Retrieved Mar 20, 2009, from http://countrystudies. us:80/south-korea/. Social Welfare in East Asia: Low Public Spending but Low Income Inequality. (2008, Jul). Center for Analysis of Social Exclusion. Retrieved Mar 20, 2009, from http://sticerd. lse. ac.uk/dps/case/cb/CASEbrief7. pdf. Widening Inequality: IMF Acknowledges Downsides of Globalization. (2007, Oct 19). The Korea Times. Retrieved Mar 20, 2009, from http://www. bilaterals. org/article. php3? id_article=10033. Wiseman, P. , Nishiwaki, N. (2006, Jul 23). Income Inequality Shrinks Japan’s Middle Class. USA Today. Retrieved Mar 20, 2009, from http://www. usatoday. com/money/world/2006-07-23-japan-usat_x. htm. Yim, S. Geographical Features of Social Polarization in Seoul, South Korea. Retrieved Mar 20, 2009, from http://www. lit. osaka-cu. ac. jp/geo/pdf/frombelow/0308_frombelow_yim. pdf.

Leon Battista Albertis Treatise on Architecture

Leon Battista Albertis Treatise on Architecture Discuss Albertis treatise on Architecture in relation to San Andrea in Mantua. In particular, discuss the role of humanistic philosophy in his work giving careful attention to the question of proportion Leon Battista Alberti (1404-72) was a true Renaissance man. He was a gifted playwright, mathematician and sportsman trained in Law. As the person in charge of the constructions commanded by the Pope, he had the occasion to write one of the greatest works of the theory of architecture De Re Aedificatoria (On Building). Most of it was completed in 1452 and printed in 1485. In the Ten books of the Art of Building Alberti has explained the usefulness of a roof and wall for human. He said that it helps us to come close to one another and also grow together. Therefore we should be grateful to architects not only because they provides us a safe and welcome place but also for its many innovations, which are useful to both individuals and the public and the also provide our daily needs (page 3). Commissioned by Ludovico II Gonzaga, the church was begun in 1462 according to designs by Leon Battista Alberti on a site occupied by a Benedictine monastery, of which the bell tower (1414) remains. The building, however, was finished only 328 years later. Though later changes and expansions altered Albertis design, the church is still considered to be one of Albertis most complete works. The purpose of the renaissance building was to contain the pilgrims who visited it during the feast of Ascension when a vial, that the faithful argue contains the Blood of Christ, is brought up from the crypt below through a hole in the floor directly under the dome. According to tradition the Most Precious Blood was brought to Mantua by the Roman centurion Longinus and is preserved in the Sacred Vessels. It was held with high respect during the Renaissance which is only display on Holy Friday. Humanism is the studying of the classics (Greek and Latin) and incorporating their ideas into ones own. It is the cultural movement of the Renaissance architecture. Most renaissance classical architecture shows more clarity than the older ones, because it emphasizes clean lines, geometric shapes, symmetry. It argues whether that is more enlightened than medieval architecture. It was more thought out, perhaps; more consistent, more systematic. Alberti had many philosophies when designing for buildings, and like the works of Vitruvius, created text that gave instruction on how to build, but saved main emphasis on the decoration and the exterior aesthetics of the structure. One principle that Alberti made use of was a system of Proportionality that he developed using systematic harmony of musical ratio, to make his buildings appealing. Defined as the precise and correct outline, conceived in the mind, made up of lines and angles, and perfected in the learned intellect and imagination, this theory and lineamenta were fundamental in Albertis process of design. Alberti believed that the Lineamenta stood as an outline and allowed proportions to be perceived in the design , where The very same numbers that cause sound to have that concinnitas, pleasing to the ears, can also fill the eyes and mind with wondrous delight. Reapplying emphasis on the humanistic approach to design The tie with the humanistic style of design is a constant theme throughout Albertis ten books, and the beauty of Buildings also features heavily. Alberts definition, Beauty resides in a reasoned harmony of all the parts within a body, so that nothing may be added, taken away, or altered, but for the worse. It is a great and holy matter, all our resources of skill and ingenuity will be taxed in achieving it; and rarely is it granted even to Nature herself, to produce anything that is entirely complete and perfect in every respect. (VI, ii, 156). Albertis view of what Beauty is has connection to the analogy of anthropomorphism, seeing Man as a component that uses energy to serve and do well. This philosophy maintains that Alberti believed that men were made in Gods image and likeness, creator of the universe, and through this thought, understood that what qualities make a building beautiful opens the path to the route of all Knowledge and the original source of beauty to draw from, God himself. In his treatise nature is used as inspiration, where the reason of Nature permits an architect to investigate into the features of the natural world, including mans influence, to become better equipped to perceive and make use of Concinnitas, (which Alberti refers to as the spouse and soul of reason) to link presenting nature as the source of art in architecture and the nature based laws embedded in the outside world. As in the San Andrea, Mantua the faà §ade of the church is exquisitely decorated with curves and flowing patterns on the ordered columns, drawing from Albertis treatise and its guidance on how to not only create a building, but how to make its beauty reflect that of Gods love and Nature Refrences: sacredarchitecture.org/authors/carroll_william_westfall/ -Carroll William Westfall(Journal entry 16) http://www.greatbuildings.com/buildings/S._Andrea.html Marvin Trachtenberg and Isabelle Hyman. Architecture: from Prehistory to Post-Modernism. p295-6 References Title: On the Art of Building in Ten Books Author: Leon Battista Alberti Translator: Joseph Rykwert, Neil Leach, Robert Tavernor Published by the MIT Press Cambridge, Massachusetts London, England http://www.albertiefirenze.it/english/leon_battista_alberti/index.htm http://eng.archinform.net/projekte/4126.htm

Reliance Steel Aluminum Co

Reliance Steel Aluminum Co Reliance Steel Aluminum Co. is one of the largest metals service center companies in the United States. Through a network of more than 180 locations in 37 states, Belgium, Canada, China, South Korea and the United Kingdom, the Company provides value-added metals processing services and distributes a full line of more than 100,000 metal products. These products include galvanized, hot-rolled and cold-finished steel, stainless steel, aluminum, brass, copper, titanium and alloy steel sold to more than 125,000 customers in a broad range of industries. Some of these metals service centers provide processing services for specialty metals only. The Companys primary business strategy is to enhance its operating results through strategic acquisitions and expansion of its existing operations. This strategy is driven in part by the continued growth and consolidation of the metals service center industry. The Company seeks businesses that are strategically positioned to diversify or enhance its customer base, product breadth and geographic coverage. The Company has successfully completed over 40 acquisitions since its 1994 IPO. Reliance is also expanding its facilities and product offerings in several of its existing geographic locations while penetrating new markets for its products. Corporate History: Reliance was founded in 1939 in Los Angeles, California and began as a fabricator of steel reinforcing bar. In subsequent years, the Company developed into a full-line distributor of steel and aluminum operating through a single metals service center located in Los Angeles. Through the 1960s, the Company expanded its operations via several acquisitions and the establishment of additional service centers. In the mid-1970s, the Company began to establish specialty metals centers stocked with inventories of selected metals such as aluminum, stainless steel, brass and copper, and equipped with automated materials handling and precision cutting equipment. Beginning in the early 1990s, owners of successful service center companies started to sell these companies as they were reaching retirement age. Reliance saw this as an opportunity to expand nationally in a more profitable manner than by expanding with Greenfield operations. This led Reliance to complete an IPO in 1994 to raise the funds to allow for that growth. Reliance has grown significantly through such acquisitions. The Company has completed more than 40 acquisitions since Reliances initial public offering in 1994 and will continue to be an aggressive acquirer of companies. Vision Mission: Reliance serves mission is to provide its customers primarily by providing quick delivery, metals processing and inventory management services. The Company purchases large quantities of metals from primary producers and sells these inventories in smaller quantities. The Companys primary business strategy is to enhance its operating results through strategic acquisitions and expansion of its existing operations. This strategy is driven in part by the continued growth and consolidation of the metals service center industry. The Company seeks businesses that are strategically positioned to diversify or enhance its customer base, product breadth and geographic coverage. Forbes Rankings: Reliance Steel Aluminum Co. 237th on the Forbes Executive Pay in 2008 Reliance Steel Forbes 400 Best Big Companies in 2008 Reliance Steel 13rd on the The 100 Best Mid-Caps in America in 2008 Reliance Steel 1,463rd on the Forbes Global 2000 in 2008 Reliance Steel 1,555th on the Forbes Global 2000 in 2007 Strategy: To become globally competitive: Reduce costs improve operational efficiency. Create economies of scale. Leverage existing assets for future growth: Concentrate on value added differentiated products especially cold rolled segment. Optimize financial structure through debt restructuring including reduction. Diversify market mix through exports to countries like China, Hong Kong and Eastern Europe. Corporate Office: 350, South Grand Avenue, Suite 5100, Los Angeles, California 90071 Phone (213)687-7700 Fax (213)687-8792 Areas of Working: The Company provides value-added metals processing services and distributes a full line of more than 100,000 metal products. These products include galvanized, hot-rolled and cold-finished steel, stainless steel, aluminum, brass, copper, titanium and alloy steel sold to more than 125,000 customers in a broad range of industries. Some of these metals service centers provide processing services for specialty metals only. Major products are: Carbon steel plate, Carbon steel bar, Carbon steel tubing, Carbon steel structural, Galvanized steel sheet coil, Hot rolled steel sheet coil, Cold rolled steel sheet coil, Aluminum bar tube,ÂÂ   Heat treated aluminum plate, Common alloy aluminum sheet coil, Common alloy aluminum plate, Heat treated aluminum sheet coil, Stainless steel bar tube, Stainless steel sheet coil, Stainless steel plate,ÂÂ   Electro polished stainless steel tubing fittings, Alloy bar, rod tube, Alloy, plate sheet coil, Miscellaneous, including brass, copper titanium Toll processing of aluminum, carbon and stainless steel Executive Management: 56 Years Old David H. Hannah, Chairman of the Board and Chief Executive Officer Effective October 17, 2007, David H. Hannah, currently Chief Executive Officer was elected to the additional role of Chairman of the Board. Mr. Hannah, 56, became Chief Executive Officer of Reliance in January 1999. He served as President from November 1995 to January 2002. Prior to that, he was appointed a Director in 1992 and had served as an Executive Vice President and as Chief Financial Officer since he joined Reliance in May 1981. David H. Hannah, Chief Executive Officer, relinquished the title of President in January 2002. He became Chief Executive Officer of the Company in January 1999, in addition to being named President of the Company in November 1995. Prior to that, he was Executive Vice President and Chief Financial Officer from 1992 to 1995, Vice President and Chief Financial Officer from 1990 to 1992 and Vice President and Division Manager of the Los Angeles Reliance Steel Company division of the Company from July 1, 1989 to June 30, 1990. From January 1, 1987 to July 1, 1989, Mr. Hannah was Vice President and Chief Financial Officer of the Company, and from 1981 to 1987, was Chief Financial Officer. Mr. Hannah became a director of the Company in 1992. For eight years before joining the Company in 1981, Mr. Hannah, a certified public accountant, was employed by Ernst Whinney in various professional staff positions. Directors: Gregg J. Mollins, President Chief Operating Officer Thomas W. Gimbel Douglas M. Hayes Franklin R. Johnson, Former partner Mark V. Kaminski, Former Chief Executive Officer Andrew G. Sharkey, President and Former Chief Executive Officer Richard J. Slater, Chairman Leslie A. Waite, Managing Director Impact of Reliance Steel Aluminum Co. on Indian Industry With the governments focus on the infrastructure and electrical sector along with Indias growing importance as a global manufacturing hub for automobiles, infrastructure steel aluminum domestic consumption is expected to grow by 9-10% in 2009-2010. With 10% of the worlds total Steel Aluminum resources India is self sufficient in steel aluminum, combined with low power costs it has a competitive export market. So, till today Reliance Steel Aluminum Co. have not much scope in Indian market because of robust growth in the Asian region, led by China has continued to drive the demand for steel aluminum from Indian market. Demand from East Europe, South Asia and Africa has also contributed to a significant growth in demand of 7%. Growth in power, construction, automotive and telecommunication sectors is expected to increase demand for steel aluminum by 4-5% over the next couple of years. With low demand and high power costs in South America and Europe, copper miners are looking at India. The proximity to a high demand region and the low smelting costs has made India and other South East Asian counties increasingly attractive locations. With its primary use in the galvanizing of steel, the major users of zinc are the automobile and construction industries. India is presently a minor exporter of Steel Aluminum, but with the expansion of new production capacity India is well on its way in becoming self sufficient and will take a much larger role in international markets. Indias have potential in the global base Steel Aluminum market and also its growing appeal to international investors. Often compared to the dynamic growth rates in China, India has promised but failed to deliver the same. This conference will critically examine if Indias recent developments will finally allow that promise to be successfully met. So, it is cleared from the above mentioned facts that till today, India is self sufficient in steel Aluminum, combined with low power costs it has a competitive export market Reliance Steel Aluminum Co. have not much scope in Indian market because of robust growth in Indian Steel Aluminum market, but it have opportunities in future because of continuity in demand for steel aluminum, because of robust growth in power, construction, automotive and telecommunication sectors in India. SWOT Analysis: SWOT Analysis, is a strategic planning tool used to evaluate the Strengths, Weaknesses, Opportunities, and Threats involved in a project or in a business venture. It involves specifying the objective of the business venture or project and identifying the internal and external factors that are favorable and unfavorable to achieving that objective. The aim of any SWOT analysis is to identify the key internal and external factors that are important to achieving the objective. SWOT analysis groups key pieces of information into two main categories: Internal factors The strengths and weaknesses internal to the organization External factors The opportunities and threats presented by the external environment The internal factors may be viewed as strengths or weaknesses depending upon their impact on the organizations objectives. What may represent strengths with respect to one objective may be weaknesses for another objective. SWOT Analysis of Reliance Steel Aluminum Co. Strengths to Build Upon Largest Integrated Aluminum Stainless Steel player in US Cost Efficiencies arising out of : Captive power generation. In house manufacture of HCFC. Economies of scale due to melting capacity. Capacity of 250,000 tones. v Restructuring would enable focus on core strengths / core competencies. v The Company has a very diligent and disciplined acquisition strategy (growth segment) v Has cold rolling capacities which result in : Value added products. Production of international grade Stainless Steel facilitating exports Has diversified into many different areas of the Steel Aluminum industry and has many strong brands under its main umbrella group. Specialized equipment used to process the metals requires high-volume production to be cost effective. Reliance expects to continue to be at the forefront of consolidation in the large and still fragmented Steel Aluminum service center industry, even during poor economic periods when local or regional metals service centers may lack the access to capital required to compete effectively. Weaknesses to Overcome Inappropriate handling of the environmental interest groups is a very big weakness of the organization and can be detrimental to it in the future. High Gearing Capital blocked in group company investments. Opportunities to Exploit Opportunity In the developing Indian market, which is one of the largest consumer of Steel Aluminum. Operations and could greatly enhance its suite. Value added products. Present import duty structure allows protection. Growth opportunities in domestic as well as world market. Leaves scope for volume growth. Export substitution for wide width thin gauge. Cold Roll Stainless Steel (CRSS). Threats to Overcome Entry by global players and dumping by Asian countries. Operations sensitive to global prices of Nickel and stainless steel. Change in govt. policy on duty protection for. CRSS will have adverse impact on pricing. Reasons for Growth of Reliance Steel Aluminum Co.: Diverse, talented and dedicated workforce High degree of stock integration Low-cost producer in many operations Leadership positions in process and product technology Organization structure geared to effective global management Mix of businesses capable of delivering superior financial performance over the business cycle Balanced geographic spread with major investments underway in growth regions. Favorable effect for Reliance Steel Aluminum Co.: The organization has a global presence and thus has access to a wider customer base and a larger market than other Steel Aluminum companies. Reliance expects to continue to be at the forefront of consolidation in the large and still fragmented metals service center industry, even during poor economic periods when local or regional metals service centers may lack the access to capital required to compete effectively. Network of more than 180 locations in 37 states, Belgium, Canada, China, South Korea and the United Kingdom, the Company provides value-added metals processing services and distributes a full line of more than 100,000 metal products. Reliance is also expanding its facilities and product offerings in several of its existing geographic locations while penetrating new markets for its products. Harm full effect for Reliance Steel Aluminum Co.: Investors hammered Steel and Aluminum stocks on renewed fears a global recession would further slash demand for commodities. India is self sufficient in aluminum; combined with low power costs it has a competitive export market. Conclusion: Reliance Steel Aluminum Co. is one of the largest metals service center companies in the United States. Through a network of more than 180 locations in 37 states and Belgium, Canada, China, South Korea and the United Kingdom, the Company provides value-added metals processing services and distributes a full line of over 100,000 metal products. The Company has a very diligent and disciplined acquisition strategy seeking immediately accretive acquisitions with a minimum return on investment, but if Reliance Steel Aluminum Co. wants to operate in India, it has to compete with local robust players, which are not only fulfilling local Steel Aluminum needs but also have potential to set them in Global Steel Aluminum market with their techniques cost efficiencies. Bibliography: www.rsac.com www.magnesium.com www.google.com/finance www.world-aluminium-market.com Reliance Steel Aluminum

Canada Is Becoming Too Americanized Essay -- essays research papers

Canada Is Becoming Too Americanized Today Canada and the United States are major trading partners, allies, and two neighboring countries with a long history of cooperation with each other. But is it possible for Canada to protect its independence and culture living next door to the country so powerful and rich as the United States. Since the Canadian confederation, Canada started developing relations with the U.S. As the years passed by, Canada began to relay on the United States in the national defense. Many Canadians think that the military, political and economical dependence would not make a difference to their daily life. But today more then even Canadian culture is affected by the American influence. Media, American artists, economic dependence, American propaganda and political pressure from the United States is making Canada too Americanized. All of these factors reflect on the social life of ordinary Canadians threatening the heritage and the traditions that define Canada as independent country. Canada and the United States are the largest trade partners in the world. It is the result of the geographical position of two countries and the free trade between two countries. It should be a great thing for the economies of both countries, but since the North American Free Trade Agreement was signed, American businesses almost took over the Canadian economy. When the American companies started to make more business in Canada, it brought more jobs and money to the country in the short-term. But as a long-term effect Canadians became even more depended on the U.S. as the American companies started dominating Canadian companies in Canada. Also, today Canadian manufacturers have little protection from the government when ch... ...m industry, which is the largest in the world. From the movies and shows people see the life style, American life style. They are becoming more Americanized every time when they watch a film where American marines one again save the world. A huge part of American movie industry is based on propaganda movies. And this is not all, bois in the information programs such as CNN and ABC sometimes can be completely misinformed. Finally, if the comparison were ever made a survey, it would really show the full scale of Americanization in Canada. But until now we can only see from the daily life, how American culture is inviting Canada. Today more then ever, Canadians are in real danger of loosing their national identity. It is unfortunate that if the study of this cultural influence will be done few years later, it might be too late to save Canadian culture and identity. Canada Is Becoming Too Americanized Essay -- essays research papers Canada Is Becoming Too Americanized Today Canada and the United States are major trading partners, allies, and two neighboring countries with a long history of cooperation with each other. But is it possible for Canada to protect its independence and culture living next door to the country so powerful and rich as the United States. Since the Canadian confederation, Canada started developing relations with the U.S. As the years passed by, Canada began to relay on the United States in the national defense. Many Canadians think that the military, political and economical dependence would not make a difference to their daily life. But today more then even Canadian culture is affected by the American influence. Media, American artists, economic dependence, American propaganda and political pressure from the United States is making Canada too Americanized. All of these factors reflect on the social life of ordinary Canadians threatening the heritage and the traditions that define Canada as independent country. Canada and the United States are the largest trade partners in the world. It is the result of the geographical position of two countries and the free trade between two countries. It should be a great thing for the economies of both countries, but since the North American Free Trade Agreement was signed, American businesses almost took over the Canadian economy. When the American companies started to make more business in Canada, it brought more jobs and money to the country in the short-term. But as a long-term effect Canadians became even more depended on the U.S. as the American companies started dominating Canadian companies in Canada. Also, today Canadian manufacturers have little protection from the government when ch... ...m industry, which is the largest in the world. From the movies and shows people see the life style, American life style. They are becoming more Americanized every time when they watch a film where American marines one again save the world. A huge part of American movie industry is based on propaganda movies. And this is not all, bois in the information programs such as CNN and ABC sometimes can be completely misinformed. Finally, if the comparison were ever made a survey, it would really show the full scale of Americanization in Canada. But until now we can only see from the daily life, how American culture is inviting Canada. Today more then ever, Canadians are in real danger of loosing their national identity. It is unfortunate that if the study of this cultural influence will be done few years later, it might be too late to save Canadian culture and identity.

Containment and the Cold War Essay -- essays research papers

Containment and the Cold War In February 1946, George F. Kennan, an American diplomat in Moscow, proposed a policy of containment. Containment is the blocking of another nation’s attempts to spread its influence. During the late 1940s and early 1950s the United States used this policy against the Soviets. The United States wanted to take measures to prevent any extension of communist rule to other countries. The conflicting U.S. and Soviet aims in Eastern Europe led to the Cold War. The Berlin airlift, formation of NATO, and the Truman Doctrine all relate to this policy of containment.   Ã‚  Ã‚  Ã‚  Ã‚  At the end of WWII, the United States, Great Britain, and France occupied the western zone of Germany while the Soviet Union occupied the east. In 1948, Britain, France, and the U.S. combined their territories to make one nation. Stalin then discovered a loophole. He closed all highway and rail routes into West Berlin. This meant no food or fuel could reach that part of the city. In an attempt to break the blockade, American and British officials started the Berlin airlift. For 327 days, planes carrying food and supplies into West Berlin took off and landed every few minutes. West Berlin might not have made it if it wasn’t for the airlift. By May 1949, the Soviet Union realized it was beaten and lifted the blockade. By using the policy of containment, the Americans and the British were able to defeat the Soviets.   Ã‚  Ã‚  Ã‚  Ã‚  After the Soviets b...

The Bad Side of Social Network

The bad side of social networks Social network is been lately very popular in society. Because of this all the users wants to be aware of what the other person is posting. Social network is a bad influence for most of the people because sometimes it appears windows that you don’t want to see. Social networks has changed the way people interact. In many ways, has led to positive changes in the way people communicate and share information, however, it has a bad side, as well. Social networking can sometimes result in negative outcomes, some with long-term consequences.It’s a waste of time because you don’t take advantage of your free time in some pages like games or Facebook, MySpace, Hi5, etc, while you can be reading a book or cleaning your room or whatever. You’are in diasplay to all the people, like in facebook you upload a photo of the place you are and everybody see’s where are you at. Many social networking sites regularly make changes that req uire you to update your settings in order to maintain your privacy, and frequently it is difficult to discover how enable settings for your appropriate level of privacy. Related reading: The Other Side of EmailBecause of this, many users do not realize how much private information they are allowing to become public by not re-evaluating settings every time the network makes a change. Tagging can also serve as an invasion of privacy. When social networking sites have a â€Å"tagging† option, unless you disable it, friends or acquaintances may be able to tag you in posts or photographs that reveal sensitive data. In other way it can be good to have facebook or other social network, but just for fun and reconect to old friends, like the friend in primary school that you never saw them again.But most of the time social networks are bad because is a waste of time, it can cause an addiction, and maybe cause a lot of problems. In conclussion, while social networking has clearly demonstrable negative impacts, it is most likely here to stay. Deciding whether you or your children will use social networking is an individual choice. By using it responsibly and encouraging your children to do the same, you can harness the benefits of social networking while avoiding the drawbacks.

The hegemonic decline of the United States and the eastward shift in the global capitalist economy

Abstract The Great Recession of 2007-8 has exposed the inherent weakness of the Western economies, whose growth had been fuelled on heavy indebtedness. This dissertation intends to broach the implications of the Great Recession of 2007-8 by applying the theoretical concepts related to the notion of hegemony in order to determine to what extent there is a geopolitical shift in favour of China, pursuant to the decline of the United States. The dissertation also utilizes the theory of economic crisis in order to ascertain the implications of the Great Recession and corroborate the idea of a hegemonic shift to the East. Objectives The dissertation seeks to intervene in a central debate of our times in the field of Political Economy of International Relations: the possible decline of United States’ â€Å"hegemony† and a possible shift of hegemony towards East Asia, especially China, given East Asia’s growing role in the world economy. This trend has exacerbated since the onset of the Great Recession of 2007-8. Using the theoretical framework of hegemony, I intend to find out to which extent the universalisation of the economic superstructure renders the notion of American hegemony obsolete. A Marxian model of interpretation can potentially shed light into the reasons which China, with competitive advantages that vastly exceed those of the United States will continue to accumulate power and establish itself as the new hegemon. Research questions What is the best way to conceptualise hegemony at the international level in the context of the Great Recession of 2007-8? What elements have to be analysed in order to assess hegemony shifts in Capitalist Global Political EconomyHow does this apply to the crisis 2007-2008? What are the signs that American power decliningWhat are the potential implications of that decline? Did the Great Recession of 2007-8 create an irretrievable hegemonic shift towards the Pacific? Theoretical framework The dissertation is divided into two parts. The first is theoretical and discusses the notion of hegemony at the international level. The second part elaborates on the theory of crises. The way in which hegemony has been conceptualised by influential authors such as Arrighi, Cox, Organski and Kindleberger is critically examined. In particular, the dissertation proposes a re-reading of Gramsci stressing the role of nation states and both elements, coercion and consensus, in the exercise of hegemony. Concerning crises, the dissertation seeks to elaborate an integral and organic theory of economic crises based on Marx, contrasting the latter with recently developed neo-Marxist perspectives, such as the ones espoused by David Harvey and Ernest Mandel. Methodology The method for tackling this dissertation will involve a theoretical treatment of hegemony and the causes of economic crisis. Within that particular methodological framework, I intend to analyse the Great Recession of 2007-8 and its implications for the shift taking place, with the transfer of hegemonic power from the United States to China. Chapter one will be a treatment of the theoretical sources dealing with the notion of ‘hegemony’, as applied to shifts in the international political system. Chapter two deals with the nature of economic crises and long economic cycles, as applied to the hegemonic shift taking place. Chapter three will examine the hegemonic shift taking place as a result of the Great Recession of 2007-8 and how the next long cycle could favour the transition from a US-dominated system to a Chinese-dominated one. I intend to use primary sources which will corroborate the economic and political decline of the United States as well as the rise of China, and analyse my findings through the prism of the Great Recession of 2007-8. I will also utilise theoretical material (as outlined above) in order to examine to what extent there is a hegemonic shift taking place within the context of the ongoing economic crisis of the United States and the West. Literature review Robert Cox uses the Gramscian notion of hegemony in order to expose the structures which arise from shifts in the organisation of the international economy. These structures are kept through consensual and coercive power relations. These power relations are marked by ideological practices which give it an aura of normality, therefore establishing a particular cultural hegemony. Significantly, Cox argued that although specific states may be the bearers of hegemony, at its most fundamental level the term relates to the rooting of a set of elites in different countries that acknowledge certain essential principle on the international economy (Cox in Gill, S. (Ed.), 1993: 42). According to Arrighi, hegemony becomes the added power that a dominant class has as a result of being able to universalise the issues which are capable of leading to conflict (Arrighi in Gill, S. (Ed.), 1993: 148). A state capable of exercising hegemony if it is able to lead the international political system in a particular direction and it is perceived by other states as pursuing the interests of the international community. However, the dominant state could also be interested in leading other countries into their own way of economic development (Arrighi, 1990: 367). Arrighi argues that the competition for resources that promoted the capitalist expansion of the European economy into the wider world is structural rather than conjunctural. Its strength resides in the ability to provoke creative destructions motivated by economic crises, giving rise to the technological breakthroughs that have sustained the process of globalisation (Arrighi, 1998: 128). Organski describes the rise of a hegemonic order in a situation in which powerful nations as well as middle and minor powers accept the given distribution of power and wealth and adhere to the same guidelines when it comes to diplomacy and commerce (Organski, 1969: 354). The international order that arises achieves its legitimacy through the ideology which underpins the ‘power differentials’ between the different states. When a power shift occurs, it may be accompanied by conflict amongst the great powers. This would very much depend on whether the challenger seeks to overhaul the rules of the game in the international political system (Organski, 1969: 354). Gilpin operates with a more deterministic notion of hegemonic cycles, positing that the resolution of a hegemonic war represents the start of another period of growth and eventual decline of a great power (Gilpin, 1981: 210). Kindleberger argues that the need to have a hegemon stems from the idea that only a domina nt power can provide collective goods. He maintains that the main danger that the international political faces is not the existence of too much power accumulated in one single hegemon but the presence of too many free riding states unwilling to exercise authority (Kindleberger, 1981: 253). Gramsci re-examines the Marxian model by positing that the cultural and political ‘base’ of a particular society is necessarily informed by the economic superstructure. The base includes categories such as the legal system, the prevailing ideology, the political make-up of the state and the cultural values of society. These categories are not involved in the production of goods but legitimate the ways in which the productive forces shape society: through surplus value extraction. Gramsci finds that the power of the dominant class goes far beyond the competencies of the state as it extends to the civil society, via institutions like schools, the press and cultural practices. The dominant class maintains hegemony by coopting the civil society, which is imbued with a particular ideology which ensures that the political status quo remains anchored in society and that it legitimates the way the productive forces operate (Holub, 1992: 103). Marx attributed the emergence of economic crises to the tendency of the rate of profit to fall (Marx, 1863). The requirement to provide the workforce with survival wages put limits on the exchange value of the labour capacity. This limits the surplus labour time and surplus value needed for the accumulation of profits. There is a requirement that capital be transformed in consumption, therefore placing another burden on the process of production. Limitations on the production of use value by the requirement to create exchange value and the requisite of private profit before the satisfaction of social needs means that there will be overproduction. Capitalism attempts to create the conditions to resolve the inner contradictions of capitalism, such as the creation of a credit system. However, according to Marxist theory, crises are temporarily resolved until a higher level of economic crisis is attained (McCarthy, 1990: 240). One of the ideas which Harvey puts forward in relation to the rise of neoliberal forms of globalisation is the policy of ‘accumulation by dispossession’, resulting in the centralisation of economic wealth and political power in the hands of a very reduced number of people through policies of dispossession. These policies imply stripping the publics of access to wealth. More precisely, ‘accumulation by dispossession’ entails the practice of financialisation, privatisation, upward state redistribution and the manipulation of crises. Harvey’s work is notably linked in an indirect manner to the ideas postulated by prominent public intellectuals of the Left such as Naomi Klein and Noam Chomsky, who also highlight the symbiosis between accumulation (upwards) and dispossession (downwards). These ideas seem to hark back to the classical Marxian template of a dialectic between the owners of the means of production and those who sell their labour at a fraction of its cost, living permanently in the ‘realm of necessity’ (Harvey, 2005). Mandel maintains the base/superstructure Gramscian symbiosis in its analysis of hegemonic relations in the post-World War Two era, claiming that it ushered in a ‘long-wave’ economic cycle of growth. The working class had been weakened by the effects of Fascism, which focused on the cooperation of the different social classes, and World War Two. Technology had increased the rate of profit, which produced impressive economic growth and accumulation of capital. Drawing on Gramsci, Mandel claims that it is impossible for the working class to capture civil society from a ‘war of position’ as this would lead to reformism instead of creating true change. Any attempt to seize the control of society must be done using a ‘war of maneouvre’. The working class, as a subject of social change, is not capable to capture society in a hegemonic way, as it has always been economically and culturally disenfranchised. Any revolutionary process of change must be dec isively quick. A drawn-out conflict would inevitably lead to an accommodation with the bourgeoisie (Mandel, 1995: 28). The theory of economic crisis is linked to the notion of ‘hegemony’ in its political aspects. Transformations taking place in the international economy, particularly those of the magnitude of the Great Recession of 2007-8, have the potential to create a fracture in the hegemonic order constituted after the end of the Cold War. To be sure, there is a process of political and economic convergence which arises out of the increased level of interconnectedness amongst states. This process of harmonisation has been marshalled by the marriage between democracy and the free market orientation typical of the American political personality which emerged amidst the triumphalist furore of the early 1990s (Fukuyama, 1992: 338). This emerging geostrategic situation steered the hegemonic path taken by the United States towards an expansion of its political personality to the wider world. The Great Recession of 2007-8 created a situation in which the tenets which sustained that hegemon y have been broken. China and the ‘Rest’ (i.e., the non-Western world) have been growing at a healthy rate whilst the West is still mired in an economic crisis which does not seem to have an end. This dissertation will endeavour to united both theoretical frameworks in order to determine to what extent the economic crisis will induce a change of hegemonic order. The most crucial aspect to be analysed is whether China will be able to rework the notion of ‘hegemony’ (which is a Western concept) in order to emerge as a potential challenger to the American dominion over the international order. The Great Recession of 2007-8 will potentially undermine the American military capabilities, which is the main element to be considered in the analysis of a putative hegemonic shift in favour of China. In addition, China seems to be interested in propping up its military capabilities. However, its geopolitical emphasis seems to be on forging commercial links with the Res t, rather than launching a frontal hegemonic challenge against the United States (Jacques, 2009: 22). Case study – The Great Recession of 2007-8 One of my research questions explores the possibility that the Great Recession of 2008 created a hegemonic shift towards the Pacific, specifically China. In some respects, the first stage of globalisation (1990-2008) was successful in creating an extensive network of international governance. The end of bipolarity gave rise to the ability to interconnect mankind by electronic means (personal computers, internet, fast processing of data). Globalisation has also created a uniformity of ideology amongst the nations, such as the concept of liberal democracy and free markets (Dilly, 1992: 59) Although some countries deviated from the norm of untrammelled capitalism after the localised financial crises of the 1990s (Russia, Argentina, etc), by and large there has been a trend towards ideological harmonisation, which also includes a growing concern for human rights. This is true for many countries, notably first world ones. The first stage of globalisation created an interdependence that in ternationalised production and consumption. Whilst the outsourcing of production created benefits for consumers, it also rendered nations incapable of protecting their resources, which are now shared with the rest of the world through its management by transnational economic interests, and managed their economy for the benefit of its populations. As Bobbitt argues, the market-state ushered in by globalisation has as its main purpose the maximisation of opportunities for its citizens instead of protecting their welfare (Bobbitt, 2002: 347). Since economic considerations have overtaken political ones, the increase rate of capitalist profit in the East means that China will continue to accumulate power due to its strategic competitive advantages, lower wages, a young labour force and a huge internal market. The challenges posed by the Great Recession exceed the capacity of individual states to be able to defend themselves. There is no nation, in the incipient stage of globalisation, which can act as steward and caretaker of the system. For example, the total flow of capital in the derivative industries vastly exceeds the size of the major economies of the world like the United States, the European Union and China ($531 tn as of September 2008). In addition, the first state of globalisation was chaotic, horizontal and disorderly. Globalisation brought in many positive elements for the world population, but also created many negative offshoots, which territorial states cannot possibly tackle on their own. The effects of global warming and natural resources degradation, the spread of disease, nuclear proliferation, humanitarian catastrophes and the threat of terrorism has one the one hand exposed the vulnerability of nation-states and created the need for common global action by supranati onal institutions that significantly erode their political sovereignty (Basch, L. et al, 1993: 67) The imperial overstrech that the United States suffers from has resulted in the accumulation of massive debts, which now total more than 100% of its GDP. In addition, its economy is about to be overtaken by China, which is still growing at very high rates (Jacques, 2009: 139). The second stage of globalisation will result in the erosion of hegemonic power of the United States. The Great Recession of 2008 provides an opportunity to recreate the global financial and economic structure as well as create more centralised supranational governance, as seen in the rise of the G20. One of the ways in which the crisis keeps melting down the political sovereignty of the nation-states is seen in the depreciation of the US dollar (the international reserve currency) due to the indiscriminate printing of money (Jansson, 2001: 44). One of the ways in which the second stage of globalisation could bring in a world-state is through the creation of currency harmonisation, possibly based on special drawing rights. The increased indebtedness of nations also harmonises the system towards a world-state, since the nation-state has to rely on a debt-based economy. The socialisation of banking losses through taxpayers’ dollars is also another variable to be reckoned with. The increased fragility of the system at local level creates greater opportunity for extra-national and supranational intervention. To be sure, the role of the nation-state has not gone away. However, their role is subordinated to the requirements of this increasingly emerging extraterritorial financial and economic structure. The reaction to this emerging harmonisation towards a world-state is already being seen in the different arrangements made between BRICS nations and commodity-rich countries seeking to replace the dollar as a medium of exchange (Suominen, 2012: 33) In turn, this will end up hurting the most powerful sovereign nation, which will find it increasingly difficult to maintain military hegemony without the ability to print out as many dollars as it needs. The erosion of political sovereignty as a result of the Great Recession of 2008 and the reaction to it by the ‘Second World’ goes hand in hand with the idea of privatisation of economic power, managed at supranational and extraterritorial level by powerful private concerns (Khanna, 2008: 41). These supranational concerns are in the process of setting up their own regulatory schemes, imposed on individual territorial states, which are finding it increasingly difficult to resist them. My preliminary findings show that the realignment of economic international systems is the main conduit by which harmonisation leading to an hegemonic shift in favour of China will be activated. In addition, there is a definite reaction by what I would call the Shanghai Cooperation Organisation bloc (notably China and Russia, but also the likes of India and Iran). The harmonisation process is proceeding apace in the West. This reaction in the Second World is generating its own kind of harmonisation. The political sovereignty of nations could also be further impaired by the conflict that will arise as a result of it. Trying to eliminate the logic of anarchy brings with it the possibility of conflict. A s Schmitt put it, the political cannot exist outside the realm of conflict. It is expected that the United States will not let China accumulate the necessary military capabilities in order to establish itself as the new hegemon. Preliminary findings There are several factors which enables us to think that a hegemonic transition is taking place. A massive, imposing display of Chinese-constructed fighter aircraft and other military equipment was used to commemorate the 60th anniversary of communist China’s founding, on 1 October, 2009. At the same time, China’s space industry was rapidly burgeoning and continuing to develop. Along with the fact that the Chinese economy continued to expand during a global recession and a rising position on the world political stage, these technological advances indicate China’s movement towards the status of a world superpower. While the rest of the world struggled in 2009, the Chinese economy exemplified a remarkable flexibility in returning to significant growth. The Chinese government attributes this economic resilience to China’s blend of communism with capitalism, in contrast to the laissez-faire approach taken by the West (Guthrie, 1999: 122). In early 2009, a migration of millions of workers from urban areas to rural locales resulted from the closure of factories that produced exports on the east coast and south coast of China. The steep price of fuel and food had put pressure on household budgets in 2008, and in order to halt inflation, stringent financial and credit policies were set in place. These policies caused the construction industry to dip, as well as a slump in the property market. In response, the Chinese government created a stimulus package in November 2008 that was worth 4 trillion yuan (about $586 billion). Approximately 50% of the stimulus package was set aside for improving infrastructure, such as railways and airports, primarily in rural regions, while a further 25% was designated for the Sichuan province, which had been severely affected by a May 2008 earthquake and was in need of rebuilding. Banks were ordered to increase lending, and the result was a 164% upsurge of loans in the first three quarters of 2009. This facilitated a rebound of the economy, which occurred far more quickly than in other countries. (Wright, 2010: 221). Additionally, the latter part of the year saw the recovery of exports, which set China up to overtake Germany as the top exporter world-wide. As a result, speculation grew as to whether China could reclaim the dominant position that it once held prior to the early 1800s, at which time it provided roughly one third of manufacturing in the world, compared to just 25% of manufacturing in the West. This outcome was rendered more probably by a trade deal with the Association of Southeast Asian Nations that transpired at the end of the year. As the world’s largest creditor, China had a symbiotic and mutually beneficial relationship with the U.S., the globe’s biggest debtor, that had become vital in the effort to rebalance the global economy. Zhou Xiaochuan, governor of the People’s Bank of China (PBOC) issued a statement on 23 March 2009 th at called for an international currency that would replace the U.S. dollar as the primary global currency and would remain unattached to individual countries; he argued that this currency would have increased stability over time. The People’s Bank of China also proposed that Special Drawing Rights, which were designed in 1969 by the IMF for utilisation between international institutions and governments, might be employed on a wider scale and used as payment in international finance and trade transactions. This would reduce fluctuations in price and the risks associated with these fluctuations. The initiative was made again at the yearly Group of Eight (G-8) summit that took place in Italy in July 2009. Delegates from China, India, Brazil, Mexico, and South Africa (also known as the â€Å"Group of Five) were also invited to the summit, where China, along with India and Russia (a G-8 member) called for an overhaul of the global financial system and a halt to dollar domination. In the latter part of September 2009, the president of the World Bank, Robert Zoellick, cautioned that the U.S. dollar faced an increasing threat due to the rising force of both the euro and the Chinese yuan. At this juncture China had surpassed Japan as the main creditor of the U.S.; there were concerns coming from Beijing that the $800.5 billion value of U.S. Treasury securities, along with other assets that constituted 60% of China’s foreign-exchange reserves and 30% of foreign-exchange reserves globally, would be attenuated by American debt and decreasing confidence in the U.S. dollar. China presented a temporary solution, which was to resist purchasing U.S. Treasury stock and, more significantly, to advocate the utilisation of the yuan as a world currency. (Kim, 2010: 49). Bibliography Arrighi, G., Capitalism and the Modern World-System: Rethinking the Non-debates of the 1970’s Review (Fernand Braudel Center), Vol. 21, No. 1 (1998), pp. 113-129 Arrighi, G. The Three Hegemonies of Historical Capitalism, Review (Fernand Braudel Center), Volume 13, Number 3 (Summer, 1990), pp. 365-408 Basch, L. et al (1993) Nations Unbound: Transnational Projects, Postcolonial Predicaments, and Deterritorialized Nation-States, Gordon and Breach, London Bobbitt, Philip (2002) The Shield of Achilles: War, Peace and the Course of History. New York, Alfred Knopf Bryson, J. Nick, H., Keebie, D. and Martin, R. (1999) The Economic Geography Reader: Producing and Consuming Global Capitalism, Wiley, New York Dilly, R. (1992) Contesting Markets: Analyses of Ideology, Discourse and Practice, Edinburgh University Press, Edinburgh Fukuyama, F. (1992) The Last Man and the End of History, Free Press. New York Gill, S. (Ed.) (1993) Gramsci, Historical Materialism and International Relations, Cambridge University Press, Cambridge Gilpin, R. (1981) War and Change in World Politics, Cambridge University Press, Cambridge Guthrie, D. (1999) Dragon in a Three-Piece Suit: The Emergence of Capitalism in China, Princeton University Press, Princeton, NJ Harvey, D. (2005) The New Imperialism, Oxford University Press, Oxford Holub, R. (1992) Antonio Gramsci: Beyond Marxism and Postmodernism, Routledge, New York Jacques, M. (2009) When China Rules the World: The End of the Western World and the Birth of a New Global Order, Penguin Press, New York Jansson, B. (2001) The Sixteen-Trillion-Dollar Mistake: How the U.S. Bungled Its National Priorities from the New Deal to the Present, Columbia University Press, New York Khanna, P. (2008) The Second World, Penguin Books, London Kim, Yong-Ki, The Rise of G20 and Korea’s Response , SERI Quarterly. Volume: 3. Issue: 4 October 2010, pp. 49-66 Kindleberger, C. Dominance and Leadership in the International Economy, International Studies Quarterly 25(2) (1981), pp. 242-54 Mandel, E. (1995) Long Waves of Capitalist Development, Verso, London Marx, K. (1863) The Capital, Volume III, http://www.marxists.org/archive/marx/works/1894-c3/index.htm MCCarthy, G. (1990) Marx and the Ancients: Classical Ethics, Social Justice, and Nineteenth-Century Political Economy, Rowman and Littlefield, Savage, MD Organski, A.F.K. (1969) World Politics, Knopf, New York Suominen, K. (2012) Peerless and Periled: The Paradox of American Leadership in the World Economic Order, Stanford University Press, Stanford, CA Wright, T. (2010) Accepting Authoritarianism: State-Society Relations in China’s Reform Era, Stanford University Press, Stanford, CA