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Current Editor: Dr. Robert T. Howell
Volume 40, Number 1
Fall 2002

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On Globalization.

By George Soros

Format: Softcover, 208 pp. ISBN: 1-586648-125-8

Publisher: Public Affairs, LLC.

Reviewed by

Andrew E. Schultz

Central Michigan University

On Globalization is the latest work of George Soros, who frequently writes about international economics. Other than the Industrial Revolution itself, few events have had as profound an impact on industrial education as globalization; yet there has been little examination of the trend or its impact in the literature of the field. Wirth (1989 & 1992), and Bjorkquist and Kleinhesselink (1999) reported on the rise of the contingent worker and the loss of lifelong employment prospects for workers as a consequence of globalization. The push to higher levels of educational achievement that began with the publication of A Nation at Risk (1983), with all of its profound consequences for industrial education, is also a consequence of globalization. While the reform movement itself has a massive literature base, few have linked it to its ideological partner, globalization. Consequently, Soros' book may prove a good point for that discussion to begin, especially in industrial teacher education courses that focus on the interaction between technology and society.

Essentially, the book is a post-September 11, 2001, look at globalization from a world citizen and a sage student of economics. Soros identifies some of the positive and negative consequences of globalization that have occurred since the first Reagan and Thatcher efforts at deregulation were implemented. Soros sees the United States and many of the western democracies as hamstrung between national and global ideas. For example, early in the introduction, Soros describes how unregulated capital affects governance, noting that globalization allows financial capital to move around freely; by contrast, the movement of people remains heavily regulated. Since capital is an essential ingredient of production, individual countries must compete to attract it; this inhibits their ability to tax and regulate the capital. Soros continues that the character of our economic and social arrangements has undergone a radical transformation as a result of globalization. The globalization of financial markets has rendered socialism obsolete because the people who require assistance cannot leave the country, but the capital can.

According to Soros, the noble ideas found in the Declaration of Independence, and in the U.S. Constitution and its Amendments are dwarfed by global market imperatives; thus the force of unfettered capitalism compromises the essence of these documents. Additionally, Soros claims that globalization has at least three negative consequences for lesser developed countries: 1) globalization causes a misallocation of resources between private goods and public goods; 2) globalization makes markets much more volatile; and 3) because third-world nations do not have a social safety net, even minor economic swings have devastating impact.

Those who cast their faith in the markets as the final arbiters of all economics problems, global and otherwise, Soros called market fundamentalists. He noted that market fundamentalists:

recognize the benefits of global financial markets but ignore their shortcomings. They hold that financial markets tend toward equilibrium and produce optimum allocation of resources. Even if markets are less than perfect, it is considered better to leave the allocation of resources to the markets rather than to interfere with them through national or international regulation. (p. 4-5)

While many market fundamentalists in the industrialized west rhetorically canonize the ideals of a democracy, in practice democratic principles are circumvented and dwarfed by the mass of free-market capital. Social institutions therefore suffer, as does the political arena because of its difficulties in reaching collective decisions in a world that lacks a strong morality.

Soro's economic observations were not entirely original. Lynn (2002), Friedman (2002), and Kaplan (1997) have each written on the problems that Soros identified. Kaplan expanded on these observations, particularly noting that the differences between American democratic beliefs and practices are increasingly transparent abroad and that "the evolving corporate community (commonly viewed as American culture) bears an eerie resemblance to the oligarchies of the ancient world." (p. 72)

So none of these were new ideas that Soros relates, but he did note some consequences of globalization that are worrying and others which are also beginning to emerge. Where Soros differs from the others, however, is that he offers a solution, the Special Drawing Rights (SDR) proposal, which he feels may help ameliorate some of the negative consequences, particularly for third-world nations. In his SDR proposal, Soros desired to see more transfer of wealth from rich nations to poor nations; this involved the funding of international reserve assets. Under his proposal, rich countries would donate their SDR assets and poor countries would add these assets to their monetary reserves to be used only for the provision of public goods. Through this mechanism, Soros indicated that donor countries would no longer exercise the heavy-handed oversight with which much foreign aid is burdened.

Will this make a difference? Such an assertion is beyond the expertise of this writer, but several caveats must be noted. First, despite all of the negatives that Soros relates with regards to globalization, ultimately he is for globalization; he, too, is an ideologue, a believer.

In spite of its shortcomings, I am an ardent supporter of globalization. I support it not only because of the extra wealth it produces but even more because of the freedom it can offer. What I call a global open society could ensure a greater degree of freedom than any individual state. (p. 6-7)

Soros' bias is that by education and circumstance he is already a world citizen, already a citizen of the global village. Born in Hungary in 1930, he survived Nazi occupation and all that implies. After World War II, he witnessed the success of the Marshall Plan and the efforts of the United Nations to rebuild Europe. This made him a believer in the idea that political and economic aid could make the world better. In 1947 he left his newly-communist Hungary for England, where he studied at the London School of Economics, graduating in 1952. Shortly thereafter he moved to the United States and began applying his abilities and education through his Quantum Fund under the business label, Soros Fund Management LLC. It has proven to be a very successful investment management firm that specializes in international investments. In the early 1970's, Soros began his philanthropic work based on the idea of building and maintaining the infrastructure and institutions of an open society. Soros is a believer in the ideals of an open society and sees globalization as a positive step towards this ideal. He is clearly a brilliant and wise practitioner of the arcane arts of finance and international economics; but his is also equally clearly a point of view or a perspective, and consequently his arguments have both strengths and weaknesses. Logically, then, Soros' objectivity may be criticized. He comes to the table with a firm set of beliefs already in place, not as a neutral observer, as do we all.

Another criticism of this work is Soros' frustrating and frequent use of acronyms. The book is short, but dense; and while Soros is an adequate writer, some of the other books listed in the bibliography are much more readable. On the other hand, besides the beliefs he brings to the table, Soro's perspective on the world economy is well informed, broad, and deep. His book offers a beginning point for the dialogue that needs to take place with regards to industrial teacher education while the seemingly inevitable transition to the global economy continues.


A nation at risk: The imperative for educational reform. (1983). Washington, DC: U.S. Government Printing Office.

Bjorkquist, D. C., & Kleinhesselink, J. (1999). Contingent employment and alienated workers. Journal of Industrial Teacher Education (2), 5-22.

Friedman, B. M. (2002, August 15). Globalization: Stiglitz's case. The New York Review of Books, 49(13), 48-53.

Kaplan, R. D. (1997, December). Was democracy just a moment? The Atlantic Monthly, 55-76.

Lynn, B. (2002, June). Unmade in America: The true cost of a global assembly line. Harpers, 33-41.

Wirth, A. G. (1989). Toward a post-industrial intelligence and democratic renewal. Journal of Industrial Teacher Education. 27(1), 5-13.

Wirth, A. G. (1992). Education and work for the year 2000. San Francisco: Jossey-Bass.

Schultz is Associate Professor in the Department of Industrial and Engineering Technology at Central Michigan University in Mt. Pleasant, Michigan. Schultz can be reached at

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