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The development of the human community is dynamic, which means that current social agendas and patterns may not have been relevant to society until a few decades ago. One of the most obvious manifestations of these dynamics is the fact of globalization, which has led to the close integration of virtually all cultures and socio-ethnic units. Globalization, nevertheless, should not be seen as a purely unambiguous process but instead is to be critically evaluated when placed under the prism of the natural evolutionary development of society. In this analysis, it becomes clear that these integration processes have, in combination with their profound benefits, significant adverse effects, among them the formation of the foundations for international crises. Thus, globalization is held responsible for the global financial crisis of 2008. This essay aims to argue the justification of this thesis.
In examining the geopolitical structure of the contemporary arena of countries, it becomes evident that globalization processes have become inextricably linked to politics. In fact, globalization is not an academically unambiguous term, and various sources tend to interpret its meaning in peculiar ways. For the purposes of this paper, globalization is the close unification of states and cultures realized in political, social, economic, technological, and scientific contexts. To put it another way, globalization binds and unites countries at the current level of internationalization of society. As a consequence, this process has several important manifestations, including cultural integration and the consolidation of a single world market.
It is the formation of the world market as a product of active globalization processes that can be seen as the cause of the development of the global financial crisis. It is necessary to emphasize further the meaning that is put into the term GFC. Such a phase, it is argued, means the abrupt onset of crisis conditions in most countries of the world — or in the world market as a whole — in the period from 2008 to 2013. It was a challenging and stressful time for nations, the result of which was an intensification of the imbalance of resources between social classes and a dramatic weakening of the positions of the middle classes.
It is not uncommon to cite the bursting of the real estate bubble in the U.S. market as the leading cause of the global crisis. In reality, the sharp decline in housing values, accompanied by an increase in active credit among citizens, created a high-risk environment in which the number of defaults, or crises, increased. In focusing on this cause, many researchers have overlooked an essential causal link based on the profound globalization processes that had developed by that time.
Strong dependence on the U.S. economy and political decisions of several advanced countries of the European Union, including Great Britain, naturally adopted the default experience of America. Thus, by 2008, Iceland, Greece, and Britain were experiencing mortgage crises, in which local residents did not have enough savings to cover the cost of real estate. In turn, such problems triggered an erosion of trust in government, and in Iceland, for example, the government was forced to resign. In reality, the range of real negative consequences of GCF is much more comprehensive and includes imbalances in international supply chains, domestic socio-economic crises, and strained relations between countries in difficult times.
Emphasizing the above, it should be summarized that globalization processes in the world have created a context in which economic forces have had a priority influence on all the backwardness of life. The commitment to international market relations has thrown states into strict dependence on one another, and as a result, when the economic system of one of them collapses, the others suffer. At the same time, globalization is directly responsible for shaping the world crisis since it creates a cultural environment in which the whole world seeks unification.
Indirectly speaking, the observation by residents of one country of their relatives, friends, or colleagues from other countries may have catalyzed risky and reckless lending, resulting in a significant increase in demand for banking services with an inability to repay obligations effectively. Thus, it can be postulated that integration processes made possible the spread of crisis influence from the U.S. around the world and, as a result, led to the formation of the global crisis in 2008.
In conclusion, globalization is a natural pattern of civilizational development in which cultures tend to integrate. One can think about the positive aspects of such integration, but one cannot notice that the manifestations of globalization also have negative consequences for the world. In particular, the deep commitment of the world economy and the development of international trade exacerbated the crisis in the U.S. in 2006-2008 and, consequently, transferred this agenda to European countries. Confidence crises and economic defaults have become actual facts for Iceland, Greece, and the U.K., which still have not reached the speed of economic growth that they had before the crisis. To summarize the above, globalization is indeed responsible for shaping the global crisis.
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