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Sorrells, Intercultural Communication, Instructor Resources

Chapter 8

The Culture of Capitalism and the Business of Intercultural Communication

Lecture Notes: Chapter Overview, Objectives and Outline

Chapter Overview

The financial crisis that erupted in the U.S. in fall 2008 sent shock waves throughout the entire global financial system with devastating consequences for billions around the world. The economic crisis illustrates well the intricate web of financial interdependence, the frailty of the global economic system and the ubiquitous yet uneven impact of economic globalization. Around the globe and in the U.S., the economic crisis dramatically increased the ranks of the unemployed and the number of people living in poverty. Foreclosed homes, lost jobs, reduced credit to meet payroll, diminished investments, shrinking consumption, corporate closures, furloughs and layoffs, bank collapses, reduced remittances that increase hardship for people dependent on money from migrants, a dramatic slow-down in world trade…what does all this have to do with intercultural communication?

This chapter addresses the linkages between intercultural communication and capitalism historically and today in the global context. We begin with a history of capitalism and discuss the emergence of the culture of capitalism in the U.S. and globally. The purpose of the overview of the culture of capitalism is threefold: the first goal is to situate the culture of capitalism historically to understand how we find ourselves where we are today; the second aim is to unmask what is seen as “normal” and “just the way things are” by revealing the values, assumptions and ideologies that underlie and constitute the culture of capitalism; the third purpose is to understand how the culture of capitalism impacts intercultural interactions. A discussion of cultural dimensions in the workplace, trends in managing “diversity” and multicultural and virtual teams is presented to understand the challenges and benefits of an increasingly diverse workforce. The global intercultural marketplace is our next stop where we explore the commodification of culture, tourism and the consumption of cultural “others.” The final section offers steps to move towards increased economic and social responsibility as intercultural actors in the global context.

Chapter Objectives

To understand how the culture of capitalism impacts intercultural communication.
To explore the history, values and ideologies that constitute the culture of capitalism and the effect on cultures in the U.S. and globally.
To examine the cultural dimensions of the workplace, diversity management and multicultural teams.
To provide concrete strategies for economic and social responsibility as intercultural actors in the global context.

Key Terms *indicated in bold and italicized letters below

Capitalism GLOBE Dimensions

Use Value Assertiveness

Exchange Value Performance Orientation

Surplus Value Humane Orientation

Sign Value

Mercantilism Multicultural Teams

Neoliberalism Virtual Teams

Hofstede’s Cultural Dimensions Commodification of Culture

Individualism-Collectivism Spectacle

Power Distance Fetishization

Uncertainty Avoidance

Masculinity-Femininity

Confucian Dynamism

Introduction:
1. The economic crisis in 2008 illustrates the intricate web of financial interdependence, the frailty of the global economic system and the ubiquitous yet uneven impact of economic globalization.
2. The economic crisis reveals wealth disparities among racial and ethnic groups and the inequitable global relations between developed and developing nations.
3. Commodities shape intercultural relations, migrations, and intercultural conflicts.
4. This chapter addresses the linkages between intercultural communication and capitalism historically and today in the global context.

Historical Context: Capitalism and Globalization
1. Capitalism 101: The Historical Emergence of the Culture of Capitalism
  1. Capitalism: A complex social logic that produces a set of relationships among capitalists, laborers, and consumers.
  2. Use Value: The value of commodity determined by its utility.
  3. Exchange Value: The value of commodity determined by the profit it generates through exchange.
2. Capitalism and Colonialism: Capital Accumulation and the Nation-State
  1. At the beginning of the 1400s, China was the most technologically advanced society in the world with sophisticated trade practices, military, and political/social organization.
  2. By the 16th century, economic dominance shifted to Europe.
    1. The extraction of raw materials from the New World and other colonies financed the European development.
    2. Slavery provided the exploitable mass labor to extract raw materials to produce commodities, which were sold for profit developing the modern capitalist economy.
      1. The world racial hierarchy was foundational to the accumulation of capital and the concentration of wealth in Europe and the U.S.
  3. By the 17th century, the nobility and merchant class in European nation-states enacted policies and practices, which economist refer to as mercantilism.
    1. Mercantilism: The implementation of protectionist policies that exclude foreign goods and subsidize cheap labor in certain industries.
    2. Trading companies (i.e. the East Indies Trading Company, the Hudson’s Bay Company. Precursors to today’s corporations) joined forces with nation-state militaries to ensure the continued extraction of wealth around the world.
    3. Intercultural encounters with trading companies dramatically altered the way of life, economic livelihood and social organization of indigenous communities in the New World and Africa.
    4. Material things made locally such as pottery, clothing, tools and weapons were replaced by imported goods.
      1. Increased dependence on world trade and contributed to the loss of cultural knowledge.
      2. Integration into the world economy, then as now, has significant and irreversible impact on cultures.

Capitalism and the Industrial Revolution: Creating the Working Class
1. The industrial revolution in England between the 1800s-1900s initiated a new means of capital accumulation.
  1. The link between producers and the means of production is severed.
  2. Control of the means of production—land, materials, tools and equipment—are taken away from peasants, craftspeople and workers.
  3. Workers have no alternative but to negotiate agreements to use the land and the tools they need, receiving wages for their labor.
  4. Since capitalists control the means of production and the goods that are produced, laborers who produce the goods must buy what they need from capitalists.
  5. Therefore, people not only become laborers but also consumers. Thus, through the industrial revolution of the 19th century, the working class was forged.
  6. Working class is characterized by:
    1. Members of the working class must be mobile, allowing them to move, unfettered by property ownership, to places where work is needed.
    2. They are segmented by race, ethnicity, gender, religion and age.
    3. They must be disciplined.
      1. Modeled after prisons, the factory was a central site of control with constant supervision, rewards and punishments.
      2. The culture of capitalism established a distinct orientation to time as ruled by the clock, equated with money and exploited like commodities and laborers for maximum profit.
    4. They often resisted the conditions imposed upon them by the capitalist class.

Capitalism and Consumption: Creating the Consumer
1. By the late 1800s, capitalism had reached a defining moment with panic gripping businesspeople and governments.
  1. The construction of the capitalist and labor classes led to the overproduction of goods and economic depression loomed.
2. In the early 20th century, the consumer was born.
  1. To accommodate the excess production of goods accomplished through the industrial revolution, luxuries had to be transformed into necessities.
  2. Americans had to be socialized through rewards and enticements to consume and the desire for things developed through the culture of capitalism.
3. Textbox 1: Intercultural Praxis: Culture and Consumption
  1. The textbox discusses how we can use intercultural praxis to understand the spread of consumer culture around the world.
  2. Uses examples from India to show how the development in Indian economy cultivated younger generations as consumers.

Capitalism, Corporations and Global Bodies of Governance
1. Corporations have their origins in the trading companies of the 17th century, which allowed groups of investors to avoid the risk of individual debt and loss though backing by the nation-state.
  1. Today, corporations exercise power through campaign contributions, lobbying for legislation such as “free” trade agreements, environmental, health care and labor policies as well as military contracts that serve corporate interests and by using the media to influence public opinion.
2. At the end of WWII, President Roosevelt invited government financial leaders from 44 countries to Bretton Woods, New Hampshire to lay out plans to re-build war-torn economies and to insure economic stability.
  1. Established the IMF, the World Bank, and the General Agreements on Tariffs and Trade (GATT, later the World Trade Organization)
    1. These organizations forced the integration of Latin American, Asian, African, and Eastern European countries into global economy.
    2. Their regulations and restrictions on developing countries had devastating impact on the local economies and social services.

Capitalism, Neoliberalism and Globalization
1. At the end of the 20th century, neoliberalism dramatically increased the movement of capital, commodities, services, information and labor around the globe.
2. Neoliberalism: The reassertion of liberal ideologies for reduced state intervention, deregulation, privatization, decreased social protection, and elimination of labor unions.
  1. Today, global financial institutions (IMF, WB, WTO) replaced the colonial and military forces to accumulate capital and exploit labor.
  2. Surplus value: The profit made by reducing labor costs.
    1. Companies move their manufacturing and assembly sites offshore to countries like Mexico, China and Indonesia where cheaper labor is available, and where few if any labor laws or environmental restrictions exist.
    2. Dispossessed of their land and means of production, farmers and craftspeople in developing nations have no choice but to seek work in factories at less than living wages.
    3. The labor force is segmented or stratified based on various forms of social discrimination.
      1. The increased flow of women into the workforce who are paid lower wages than men.
      2. In the logic of capitalism, sexism, racism, bias against immigrants and exploitation of the working class are profitable.
    4. Capitalism shapes and informs U.S. culture and cultures that are touched or engulfed by its catalytic and consuming powers.

The Culture of Capitalism
1. The culture of capitalism promotes:
  1. Individualism.
  2. Competitiveness
  3. The pursuit of personal goals and interests.
  4. Consumption.
  5. Social relations that are structured by consumer relations.
  6. Interpersonal relationships that are theorized, assessed and experienced in terms of costs and benefits.
  7. Relationships that are mediated and expressed through commodities, where relationships with people are secondary to relationships with things.
  8. Segmentation and stratification of labor as well as consumers.
  9. Reinforces and profits from sexism, racism, classism and other forms of social discrimination.
  10. The rhetoric of “colorblindness,” “cultural difference,” and the market logic of capitalism.
2. Textbox 2: Communicative Dimensions: Communication and Ideology
  1. Uses the movie Wall Street (1987) and its sequel (2010) to discuss the shifting ideologies of capitalism and corporate greed.
  2. Shows examples of how capitalist ideologies are part of our everyday communication, such as proverbs and bumper stickers.
3. In capitalist societies, our identities, values, and relationships are mediated and defined by commodities.

Intercultural Communication at Work
1. Cultural Dimensions of the Workplace
  1. Hofstede’s Cultural Dimensions: In the late 1960s Dutch psychologist Geert Hofstede (1980) came up with four dimensions of cultural variability through his research on IBM employees.
  2. Individualism-Collectivism: Hofstede’s cultural dimension that highlights the differences between individualistic cultures and collectivistic cultures.
  3. Power Distance: Hofstede’s cultural dimension that highlights how the less powerful members accept unequal distribution of power within organizations.
  4. Uncertainty Avoidance: Hofstede’s cultural dimension that highlights the tendency to feel threatened by unknown and uncertain situations.
  5. Masculinity-Femininity: Hofstede’s cultural dimension that distinguishes the societies with distinct gender roles and achievements (masculinity) and societies with flexible gender norms and balanced lifestyle (femininity).
  6. Confucian Dynamism: Hofstede’s cultural dimension that highlights the characteristics of East Asian countries such as long-term orientation to time, hard work, frugality, and respect for hierarchy.

1. GLOBE Dimensions: Nine cultural dimensions of Global Leadership and Organizational Behavior Effectiveness, including institutional and group collectivism, gender egalitarianism, power distance, uncertainty avoidance, future orientation, assertiveness, performance orientation, and humane orientation.
  1. Assertiveness: One of the dimensions of GLOBE on the extent to which individuals in organization or societies are assertive and confrontational.
  2. Performance Orientation: One of the dimensions of GLOBE on the extent to which an organization/society rewards members for their quality of performance and level of involvement.
  3. Humane Orientation: One of the dimensions of GLOBE on the degree to which organizations/society reward people for being fair, friendly, generous, and kind to others.

1. Managing Diversity, Multicultural and Virtual Teams
  1. Multicultural teams: Task-oriented groups composed of members from different national and ethnic groups.
    1. The cultural composition of work groups impacts group effectiveness in three inter-related ways:
      1. Cultural norms about how work groups function and how they are structured
      2. Cultural diversity or the number of different cultures in the group
      3. Relative cultural distance or the degree to which members of the group are culturally different from one another.
  2. Virtual Teams: Work groups with members who are geographically dispersed and who rely on technology-mediated communication.
    1. Virtual terms can face a number of misunderstandings and conflicts due to the lack of awareness of cultural differences.
    2. Example: E-mail exchanges between U.S. Americans and Israelis.
    3. Effective virtual teams can be achieved by building trust, offering constructive feedback, increasing awareness of cultural differences and histories, and establishing group norms.

The Intercultural Marketplace and Economic Responsibility
1. Commodification of Culture: The practice in which cultural experiences are produced and consumed for the market.
  1. Example: Art work created by Pueblo and Navajo women in New Mexico, and how tourists and buyers consume them as “traditional” and “authentic” cultural products.
  2. Cultural difference is viewed as exotic and marketable.
  3. Commodification of culture often creates barriers for ICC.
    1. Creates stereotypes.
    2. Reduces cultural differences into objects
    3. IC relations are reduced into monetary exchanges.

Tourism and Intercultural Communication
1. Tourism is one of the world’s largest industries employing more than 258 million people worldwide.
2. Travel can provide opportunities for intercultural engagement.
3. However, today, tourists increasingly choose options that limit their exposure and access to the very places they pay to visit.
  1. On the one hand, Western tourists desire and often demand the familiarity of “home;” yet, simultaneously, complaints abound that “other” cultures are too “Americanized,” too “Westernized” or too much like home.
4. Spectacle: The domination of media images and consumer society over individuals and their relationships with others.
  1. Seduced through leisure, entertainment and consumption, the spectacle serves to pacify and depoliticize society.
  2. Happiness and fulfillment are found through consumption of commodities and spectacles.
  3. Example: Mardi Gras celebration in New Orleans.
5. Sign Value: The symbolic value of commodity that conveys social meaning and social positioning.
6. Fetishization: The process of endowing commodities with symbolic and social power.
  1. Example: The marketing and consumption of Mardi Gras serves both to accumulate profits for commercial interests and at the same time constructs demands for and attempts to satisfy the tourists’ desires for experiences—experiences that satisfy needs for self-expression and identity.
  2. The fetishization of commodities and the spectacle society hide the exploitation of labor, damage to the environment and the impact on culture that make them possible.

Economic Responsibility and Intercultural Communication
1. Disparities caused by the culture of capitalism:
  1. U.S. Americans, 4.6% of the world’s population, accounted for 33% of the global consumption.
  2. The one billion residents of high income countries consumed more than 80% of the global total.
  3. The 2.3 billion residents of low income countries consumed less than 3%.
  4. Today, more than 1/5th of the world’s population lives on the brink of hunger and death.
Four Steps Towards Economic Justice and Sustainability:
1. Observe your consumption patterns
  1. Keep a journal of the things you purchase
  2. Note where you shop
  3. Note where the goods—things, entertainment and experiences—are produced
2. Educate yourself about the circumstances and impact
  1. As a consumer: Find out about the working conditions of the people who make the goods you consume; engage in dialogue with the people who provide services for you while on vacation or when consuming a cultural experience.
  2. As a laborer/worker: Learn about the relationship between owners and workers in your organization/corporation; educate yourself about the norms, behaviors and attitudes that have enabled the success (or lack of it) of your company/organization.
  3. As a capitalist: If you have a savings account, investments, stocks or other means of making money from money, learn about how this works.
3. Act responsibly based on your knowledge
  1. Make conscious and responsible consumer choices: For example, when you find out that the mega-store where you prefer to shop is only able to provide such low prices because of exploitative labor and unsustainable environmental practices, seek out alternatives.
  2. Transform sites of consumption into sites for intercultural praxis: Along with purchasing an object or experience, actively engage in intercultural dialogue.
  3. Act to challenge inequities in the workplace.
Join others in challenging inequity and injustice
1. Consider your spheres of influence: Make a point of talking with others about your decisions and find others who support your values of social and economic responsibility.
2. Join consumer groups or activist organizations: One of the greatest losses of advanced capitalist societies is human connection, engagement with others and civic contributions. Join or start your own group that creates alternatives and challenges the dehumanizing conditions of the culture of capitalism.

Summary
1. Introduction
2. Historical context of capitalism and globalization
3. Culture of capitalism
4. Intercultural communication at work
5. The intercultural marketplace and economic responsibility