From the mid-1970s onward the process of world political and economic decentralization, so essential to globalization, picked up momentum. The technological transformations allowed American and other multinational firms to escape national regulations, and also helped free ordinary people from the boundaries of the nation-state. In addition, the rise of the OPEC (Organization of Petroleum Exporting Countries) oil cartel shifted global economic power away from the West. Free exchange rates, unfixed from the gold-dollar standard, gave great flexibility to international investors. American businesses would weather the energy crises and the final phase of the Cold War in different ways. With U.S. tariff barriers continuing to fall and foreign competition surging into the American market, high-cost domestic industries such as steel, autos, and machine tools lost market share to new entrants from abroad. But many bigand medium-sized firms did well in a changing, competitive environment. Firms with leading-edge technologies took advantage of market-opening opportunities to expand abroad. In the era of jet travel and networked business communications, the battle for market share was increasingly fought on a global playing field, involving all of the world's major high-income markets—Japan, Europe, and North America. Companies and nations converged as global markets for standardized consumer products appeared; transnational companies now sold the same reliable, low-priced goods in Brazil as they did in Biafra.
Even as the economic changes occurred, however, and despite the re-ignition of Cold War tensions during the late Carter and early Reagan administrations, ideological shifts occurred that reflected the emerging age of globalization. One was a new international outlook encouraged by better communications, transportation, open borders, deregulation, and the revival of nineteenth-century, laissez-faire liberalism. Business leaders began to think globally and to develop global networks that could exert influence over national political leaders through money and ideas. During the energy crisis of 1973, America's corporate elite reached out to foreign business leaders. Led by Chase Manhattan's David Rockefeller, they formed the multinational Trilateral Commission in 1973, with members from business, politics, law, and academia in America, Western Europe, and Japan. The idea was to facilitate cooperation among resource-rich nations, but outside of government supervision. Similarly, European business leaders began to meet in Davos, Switzerland, in 1982 to develop a common international strategy for European business. This network expanded in the 1980s to include world business and political leaders. In those years it launched the annual World Economic Forum, held every January and bringing together the world's movers and shakers to network, deal, and discuss public policy issues. Similarly in America during the Carter and Reagan years, business lobbying expanded from initial efforts to contain unions to the pursuit of an active agenda of deregulating markets, cutting taxes, and promoting free trade.
The deregulatory business agenda reflected another important paradigm shift that encouraged globalization. The Washington consensus had stressed an active and expansive role for the federal government, but in the 1970s economic thought turned toward a less-regulated marketplace. Under the influence of academic economists Murray Weidenbaum and Milton Friedman, a neoclassical attack on Keynesian interventionism was launched during the Reagan years. It emphasized entrepreneurship, reliance on the Federal Reserve System and monetary policy to manage the economy, tax relief, labor-market competition, deregulation, fluctuating exchange rates, and free trade in goods. In time, this consensus came to include free trade in money, or capital account convertibility.
President Ronald Reagan can be credited with fostering the second era of techno-economic globalization by expounding on the possibilities for freedom, political and economic, under U.S. leadership. He was the first president to push openly for free trade and privatization of government services, and one of the first to appreciate how new technologies of communication were transforming the marketplace and weakening the authority of totalitarian regimes. As he left office the technoglobal revolution was accelerating, bringing major changes to economics and politics, and to culture and society as well. His successors wrestled with the implications of globalization at home and abroad. They initiated new integrative bodies that restructured the global economy, such as the North American Free Trade Agreement (NAFTA) and the World Trade Organization (WTO), institutions that emphasized a rules-based economic system and liberalization of international commerce and that further integrated business processes worldwide. The freer exchanges of goods, capital, and culture inherent in globalization arose from the Cold War's ashes and took America into a new era in which transnational contacts rivaled state power.