The Price of Information

The Price of Information

Mini Teaser: Many economists, business analysts and especially people in the communications industries are in a state of euphoria about globalization.

by Author(s): Eric Jones

The proclivities of historians mean that they are given to overrating the unique aspects of Europe's evolution and underrating the blind forces of social change. Consider the background: by 1800, Europe had already benefited from centuries of incremental improvement in transport, industrialization, and urbanization. The arbitrariness of kings had been curbed by the invention of the bill of exchange, meaning that capital could slide away to other realms, just as individuals could escape over the borders of pocket handkerchief-sized states.

In the nineteenth century, industrialization and urbanization took place faster than ever before. Constraints on capital and labor were dissolving, improvements in communications were coming faster, and popular education was expanding. When these changes began to affect Eastern Europe, Czarist Russia, and the Balkans--areas with less preparation than Western Europe--they arrived with percussive force. Not every nineteenth-century change "took." In the Balkans, for
example, the building of stable states and inclusive nations was a flimsy thing. Similar inadequate reactions may well occur in
contemporary, hierarchical cultures faced with "Westernization." The best comfort lies in noting that there are more and better role models nowadays, communications are easier, and the advantages of joining the world community are greater.

Nineteenth-century European opinions and debates parallel those we are hearing again. As early as the beginning of the eighteenth century writers such as Sir Andrew Freeport in the Spectator expressed the conviction of capitalists that "war does not pay." Kant, who died in 1804, thought trade was undermining governments. Cobden saw free trade and peace as "one and the same cause," and Proudhon agreed. In its famous passages that eulogize the achievements of the bourgeoisie, the Communist Manifesto spoke of trade creating the "universal interdependence of nations." In 1889 Pareto told the Peace Congress at Rome that economic integration would lead to political integration. In 1910 Norman Angell noted that postal services, the telegraph, and the rapid dissemination of financial and commercial information had put the chief cities of
Christendom in closer contact than the chief cities of Britain had been a century earlier. He wrote The Great Illusion to show that economic interdependence had made war inconceivable. This brand of "economism" is again prevalent. Certainly, economic growth may predispose to political pluralism and interdependence but experience shows that the analysis is dangerously incomplete.

The fifteen countries that participated in the International Labor Convention in 1890 did so because those that had adopted labor laws feared that other countries would undercut them if not persuaded to improve the lot of their workers too. This was akin to the arguments that had been made with respect to Britain's early Factory Acts and to those made today over obliging East Asia to adopt international standards of labor conditions or pollution control.

Links among firms and agreements between governments did advance the interdependence of the nineteenth-century European economy. Threats of spreading epidemics, which had given rise to the earliest international conventions a couple of centuries before, inspired many more conventions during this time. Railways were built to British standard gauge and their cross-border timetables were coordinated, as were postal and telegraphic services. There were plenty of signs of mutual activity. However, all stopped well short of anything deserving the label of full integration.

Because instruments of social change like educational systems were in the hands of governments, they could also be used to strengthen loyalty to the nation-state. "We have made Italy," it was said after the Unification, "now we have to make Italians." Economic growth meant higher tax revenues and full-time bureaucracies which could extend the state's influence still further. Educational and welfare systems, conditions of service and pension schemes, subsidies for ship building, help in export markets--all came to depend on state patronage.

The competence of individual governments was thus increased by tools of the kinds that made for interdependence. Governments were after all still engaged in the long process of centralizing the nation-state. It is noticeable, for example, that despite the way railway tentacles extended across borders, many were laid out as spiders' webs centered on capital cities. The whole of Europe was never made kin. Boundaries between nation-states and nationalities hardened, breaking the hearts of idealists when the workers abandoned pretensions to the Brotherhood of Man and flocked to join the armed forces in 1914. "Wherever the photographs were taken, London or Manchester, Munich or Paris," Don Haworth tells us in a Lancastrian memoir, "the faces in the crowds are the same, rapturous at liberation from the endless hum and clatter of machinery."

Externally, European countries sought their own empires and tied markets. At the end of the century, faced by cheap food imports from lands outside Europe, most responded to the anxieties of their citizens by protecting their agricultures. Britain stood aloof; it did not bring back the Corn Laws. Furthermore, countering the argument that only strong countries are free-traders, the Netherlands remained an open economy, as if it were a modern New Zealand. We can look on the late nineteenth century as a period when its own states set about checking Europe's integration.

Does the experience of this earlier time transfer to the present? Not entirely. There is extensive survey evidence to show that young Europeans are less nationalistic and militaristic than any previous generation. The prosperity to which they are accustomed, even in recession, means that they are not tempted to flee grinding toil into the imagined adventure of "joining up." That motive does not exist in remotely the same degree any more. Yet questionnaire data must always be handled cautiously as representing dreaming, which is free, rather than deciding, which may have a high price. Recall how misleading was the expressed pacifism of the Oxford Union between the wars. In any case, we are speaking only of Europe. It may be more significant for international affairs that in much of the rest of the world people have not yet been cosseted like young Western Europeans.

"Democratization:" Supply and Demand

A further effect of cheaper information is "democratization." This may be taken in the narrower, political sense to embrace pluralism, individualism and human rights; in a broader sense to include an ever-widening agenda of "rights" that is contested even in advanced Western circles. Liberals everywhere may think these things good, but agonizing adjustments are to be expected in conservative societies. The struggle is and will be between regional cultures, or the states embodying them, and universal or world culture. (To see world culture as permanently or inherently "Western," because it first flowered in the West and travels in Western vehicles, underrates its multiple origins, protean nature and breadth of appeal.)

To the extent that there is a directional tendency towards political freedoms and "tender" reforms, we may expect both their extension and efforts to repulse them. Different societies are of course experiencing quite different levels of social challenge. The clash over basic freedoms comes now in societies that have not had the kind of lead-in that the West enjoyed. To the extent that liberalism derives autonomously from new information, developing countries are in a cleft stick: educating their workforces opens the door to seductive written words, screen images, and electronic media which are likely to bring unintended and maybe pernicious consequences.

Even in Europe mass literacy is historically recent. By 1850 the proportion of literate Europeans was about 50 percent, but only about half the "literate" could read easily. Specialists working in adult literacy programs estimate that about 85 percent of Western European adults are functionally literate today, but the minimum standard is not high. In the non-Western world, however, literacy is spreading far faster than it did in Europe. As more people learn something of other systems of government and ways of life, the demand side of world politics will alter. On the supply side, governments will be struggling to dampen the calls made upon them.

In 1965 only twenty percent of radio and television sets were owned outside Europe and North America. By 1990 this proportion had more than doubled, with world totals of over two billion radios and one billion television sets. Satellite dishes are being miniaturized. Fax machines have spread widely. The telephone network--the largest single machine in the world--is becoming denser as entrant countries skip over older technological stages. Usage of the Internet is said to be going up by between 12 and 15 percent per month. Although user numbers are probably exaggerated by as much as an order of magnitude (because firms wall off many computers for security reasons), such rates of growth are amazing. International gossip among the computer-literate, mainly the young, leaks material that previously would not have come to light for decades, if ever.

The spread of education and literacy has been expanding the range of informed judgment by individuals from at least the time of Tyndale's translation of the Bible into English in the sixteenth century. Critical ideas flowered in the Protestant churches during the nineteenth century, contributing to a fragmentation of sects. The process began to work within Roman Catholicism early in the twentieth century. A similar ferment faces Islam in the late twentieth century, provoking a strong reaction in places, as in other authoritarian and male-dominated cultures or regimes. In a strictly intellectual sense, Islam is the least pliable of the world religions. Its guiding ideas and sacred works cannot be made over to order, given the "closure of
the Gate of Interpretation" as early as the tenth century. Yet Islam has not remained static since then and is not politically
homogeneous. Islamic North Africa led the world in science in what the West calls the Middle Ages, and Christendom borrowed heavily from it.

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