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Maintaining Global Stratification 217

manage mining operations in several countries, manufacture goods in others, and market
its products around the globe. No matter where the profits are made, or where they are
reinvested, the primary beneficiaries are the Most Industrialized Nations, especially the
one in which the multinational corporation has its world headquarters.
Buying Political Stability. In their pursuit of profits, the multinational corpora-
tions need cooperative power elites in the Least Industrialized Nations (Jessop 2010;
Sprague 2012). In return for funneling money to the elites and selling them modern
weapons, the corporations get a “favorable business climate”—that is, low taxes and
cheap labor. The corporations politely call the money they pay to the elites “subsi-
dies” and “offsets”—which ring prettier on the ear than “bribes.” Able to siphon
money from their country’s tax collections and government budgets, these elites live
a sophisticated upper-class life in the major cities of their home country. Although
most of the citizens of these countries live a hard-scrabble life, the elites are able to
send their children to prestigious Western universities, such as Oxford, the Sorbonne,
and Harvard.
You can see how this cozy arrangement helps to maintain global stratification. The
significance of these payoffs is not so much the genteel lifestyles that they allow the
elites to maintain but the translation of the payoffs into power. They allow the elites to
purchase high-tech weapons with which they preserve their positions of privilege, even
though they must oppress their people to do so. The result is a political stability that
keeps alive this diabolical partnership between the multinational corporations and the
national elites.
Unanticipated Consequences. This, however, is not the full story. An uninten-
tional by-product of the multinationals’ global search for cheap resources and labor
is to modify global stratification. When corporations move manufacturing from
the Most Industrialized Nations to the Least Industrialized Nations, they not only
exploit cheap labor but also bring jobs and money to these nations. Although work-
ers in the Least Industrialized Nations are paid a pittance, it is more than they can
earn elsewhere. With new factories come opportunities to develop skills, acquire
technology, and accumulate a capital base from which local elites can launch their
own factories.
The Pacific Rim nations provide a remarkable example. In return for providing the
“favorable business climate” just mentioned, multinational corporations invested billions
of dollars in the “Asian tigers” (Hong Kong, Singapore, South Korea, and Taiwan).
These nations have developed such a strong capital base that, along with China, they
have begun to rival the older capitalist countries. This has also made them subject to
capitalism’s “boom and bust” cycles. When capitalism suffers a downturn, investors and
workers in these nations, including those in the maquiladoras that you just read about,
have their dreams smashed.

Technology and Global Domination
The race between the Most and Least Industrialized Nations to develop and apply the
new technologies might seem like a race between a marathon runner and someone with
a broken leg. Can the outcome be in doubt? As the multinational corporations amass
profits, they are able to invest huge sums in the latest technology while the Least Indus-
trialized Nations are struggling to put scraps on the table.
So it would appear, but the race is not this simple. Although the Most Industrial-
ized Nations have a seemingly insurmountable head start, some of the other nations are
shortening the distance between themselves and the front-runners. With cheap labor
making their manufactured goods inexpensive, China and India are exporting goods on
a massive scale. They are using the capital from these exports to buy high technology
so they can modernize their infrastructure (transportation, communication, electrical,
and banking systems). Although global domination remains in the hands of the West, it
could be on the verge of a major shift from West to East.