In the 1990s and 2000s, globalization created a division within socialism. While some of the social democratic currents adhere to it, seeing in globalization the opportunity for a more regulated world through international agreements and the control of international organizations, globalization can also be perceived as the upper stage of capitalism. Globalized companies are freeing themselves from states and imposing their neoliberal ideology on them; an ideology that legitimizes private interests at the expense of the common good and the exploitation of developing countries, creating then a globalized proletariat.
The anti-globalization movement is very heterogeneous and weakly organized. However, the Porto Alegre Manifesto produced at the 2005 World Social Forum lays out some orientations, including the establishment of an international tax on financial transactions, the cancellation of public debts of developing countries, the guarantee of food security through the promotion of self-sufficiency and fair trade, the fight against racism in all its forms and the restoration of Indigenous rights. The proposals of the anti-globalization movement find a certain echo in South American socialism mixed with populism, particularly in the Bolivarianism of Hugo Chavez.
The social democracy that adheres to globalization will develop the thesis of the “third way.” Theorized by Anthony Giddens and Tony Blair (1998), it considers that there is a place between the “old” statist and redistributive social democracy and deregulatory and unequal neoliberalism.
Because globalization imposes economic, political, and societal changes, this third way aims to regulate them with equal opportunities for everyone, but also it is based on a strong societal progressivism with the recognition of ethnic, national and sexual minorities. The third way corresponds ideologically speaking to social liberalism. It is being emulated almost everywhere in the West: German Chancellor Gerard Schröder was inspired by it from 1998 to 2005, as was US President Bill Clinton from 1993 to 2001 and French Prime Minister Lionel Jospin from 1997 to 2001.