Neo-Liberal Globalism and its Challengers: Sustainability in the Semi-Periphery
1.1 The Context of Neo-liberal Globalism
This project responds critically to the paradigm of neo-liberal globalism that has become dominant in the past 20 years. Alan Greenspan, Chairman of the U.S. Federal Reserve, observes that the Western form of capitalism is now the consensus model of how eachindividual country should run its economy (in Wade, 1999, 4). Lawrence Summers, U.S. Secretary of the Treasury and former chief economist of the World Bank argues that “globalist economic policy ... is the forward defense of America’s deepest security interest”. He states that anyone who is a critic of the “Bretton Woods Washington Consensus” is a “separatist” (1996:3). The neo-liberal globalismparadigm is known by several terms: Structural Adjustment Programs, The Washington Consensus, the Wall Street-Treasury Complex, Liberal Productivism, and the New World Order. The prescription for every country is to: open financial and capital accounts remove foreign exchange restrictions cut public expenditures balance budgets, lower corporate taxes deregulate businesses encourageforeign investment sell off public enterprises and secure private property monopolies under law (Williamson 1993, 18). It is the American model. The spread of this model indicates the presence of an overarching ideology of governance that we will refer to as “neo-liberal globalism” or simply “globalism”. Globalism is an “ism”, an ideology.1 By “globalism”, we mean the norms, institutions, and lawsthat support global capital accumulation along neo-liberal principles. Globalism challenges democratic assumptions about the sovereignty of states and national citizenry (Laxer, 1995a). Under globalism, states are: oriented less to internal demands focussed on maximizing exports, freeing the flow of capital and enshrining transnational corporate rights as “national treatment”. locked intoneo-liberal principles by structural adjustment programs in the South, and by international agreements (ie. NAFTA), and international institutions (ie. World Trade Organization) in the North (Clarkson, 1999).
Neo-liberal globalism is a specific response to the perceived requisites of globalisation That the concept of globalisation lacks both a precise definition and theory is not surprising. It wasfirst consistently used, not by academics, but by The American Banker in 1978. Since it came into the academic lexicon it has generated an ongoing debate about what it is, whether it is a
useful term and how much of it is new. David Held et al (1999) identify three distinct understandings of globalisation - the hyperglobalist, sceptical and transformationalist perspectives. Summarised inTable 1, this typology is useful in identifying the dimensions and scope of the debate. In brief, the hyperglobalist school sees globalisation primarily as an economic phenomenon that has ushered in the harmonization of economic, political and cultural practices worldwide thereby heralding the end of the nation-state, the emergence of a global society and the necessity to create institutions ofglobal governance. Sceptics, in contrast, point to historical and comparative economic indicators to argue that globalisation, far from being a new world order, is neither new or as all-encompassing as the hyperglobalist school proposes. Sceptics argue that the late 19th and early 20th centuries experienced more extensive and intensive levels of integration and that the current era requires strongnational governments to regulate, reverse or enforce neo-liberalisation. Moreover, rather than the emergence of a homogeneous civil society, sceptics predict economic and cultural fragmentation and possible deepening patterns of social inequality. Finally the transformationalist thesis emphasizes that globalisation is best understood, not as a static endpoint, but instead as a multifaceted process...
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