Transnational Capital and Its Discontents


Money sloshing around the world is creating third-world mosh pits

Just over twenty years ago, Roger Burbach & William I. Robinson argued that transnational capital was leading us into the fourth stage of capitalism. The new winners would be a transnational elite with new international money that was free to ‘roam’ around the world looking for the best return. Transnational capital has no regional loyalties and can range from foreign direct investment to a global company opening or shutting local factories or to a simple index fund. Yet this faraway money exerts power over local markets never touched before. The two authors warned the losers in this worldwide game would be a labor market that would be undercut based on a global prices and competition. They forecasted that workers in the first world (advanced nations like the United States) would increasingly be living in third world-like pockets as they saw their wages and power decline.

When Burbach and Robinson wrote their article, they contended with a list of countervailing arguments that they had to pierce through. But twenty years later, we see from American Trumpland the real anecdotes of third-world anxiety in a 21st century, first-world transnational capitalist United States. And with the stock market continuously disconnected from the real main street economy, we see the power that cannot be stopped: transnational capital. This time printed on steroids and circling the globe constantly. 

Here in South Korea, numerous attempts to tame the housing market have not worked. Most observers are tempted to say the policies backfired. But in essence the South Korean government unknowingly waged battle on transnational capital and perhaps its own fiscal stimulus. With smart money, hot money and hard-earned money looking for returns and stability, the property market has always been a reliable harbor for South Korean investors. But policymakers seem to believe capital is still local or international at best. They forget there’s no way to regulate a fight against transnational capital when trillions have been printed and spent in a matter of months. 

Stock market bears who cry that the financial markets are overvalued and overbought are countered by those who have resigned to the concepts that you can’t fight the ‘Fed’ (U.S. Federal Reserve) and that there is no alternative (TINA) for depreciating cash to try to find some life in the stock market. Well, it turns out that the in a world of advanced transnational capital, even your apartment hunt in Seoul can’t fight the Fed. With skyrocketing prices despite a slew of policy efforts, those in power should admit that the local housing market is actually part of a global financial portfolio. Plugging one hole in a leaky bucket does little if you keep ignoring the others. Transnational capital is a real thing even though the Trump voters can’t really put it into words and liberal critics overlook in favor of ogling the ugly behavior of working class whites losing status and power. 

And here in Seoul, we’re also about to overlook how transnational capital continues to create pockets of third world living as those on the right and left amplify their disagreements with each other and the public ogles over the increasingly ugly finger pointing. People just want to buy a house, see it grow in value as they age and have access in a fair and stable system. It should be possible yet, but one must admit the presence of transnational capital and its discontents first.

Apartment prices in Seoul have jumped 50 – 60 percent since 2017


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