Consensus Against Neoliberal Washington Consensus
DAR ES SALAAM- One thing is clear from debates at the third Helsinki Process conference, underway here: there is agreement among economic development experts, civil society representatives and government officials attending the meeting that the neoliberal Washington consensus is not a solution to the problems of developing countries, but rather one of the causes of these problems.
In contrast to the neoliberal emphasis on privatisation, participants of the conference argued that the state has a central role to play in launching and supporting economic and social development.
“Neoliberalism is not the solution to the economic and social problems confronted by developing countries,” said Josep Xercavins, professor of development economics at the Technical University of Catalonia, Spain, and co-ordinator of the World Forum of Civil Society Networks: an umbrella organisation of civil society groups studying economic and social development.
“We are seeing in Latin America the devastating consequences of 25 years of application of neoliberalism,” Xercavins added. “We need a new paradigm, with a new role for the state.”
The Washington Consensus is the term commonly used since the late 1980s to describe the set of neoliberal economic and social policies imposed on developing countries by Washington-based international financial institutions (IFIs) such as the World Bank and the International Monetary Fund, through structural adjustment programmes.
The Dar es Salaam meeting is reviewing progress made over the past two years with the Helsinki Process on Globalisation and Democracy. This joint initiative by the governments of Finland and Tanzania got underway in 2003 to give representatives of the North and South “a new kind of equal forum…to come together to discuss common issues of concern.”
Titled ‘Inclusive Governance — Bridging Global Divides’, the Nov. 27-29 event is dealing with numerous issues related to globalisation and democracy, from the role of non-state actors in promoting international peace and security, to the relationship between national and global economic policies in the fight against poverty and for development.
“We should promote a new development agenda, following three principles which differ radically from those of the IFIs,” Kjeld Jakobsen, director of Brazil’s Social Observatory Institute, said Wednesday at a plenary session of the conference.
“First: we need to recognise that it is wrong to adopt the same (social and economic) measures in countries going through different phases of development. One size does not fit all.”
Second, he added, “Economic and social concerns must be given the same importance in the formulation of these measures. And third, this agenda should be conceived through a democratic process…Civil society’s participation in the debate and implementation is crucial in a complex and interdependent world like ours today.”
A similar point was made by Michelle Pressend, senior researcher at the South Africa-based Institute for Global Dialogue. “In countries with high levels of inequality, the state has no choice other than to embark on an active economic development agenda,” she said.
“The state has to concede to these underdeveloped constituencies or face social instability,” Pressend added. “Crucially, the developmental state must develop the capacity and power to implement its economic and social policies.”
The developmental state’s first goal must be the equal redistribution of the country’s wealth among the people, she noted further.
Other participants of the conference agreed.
Mat Noor Nawi, director of the distribution sector at the Malaysian government’s Economic Planning Unit, explained that his country was almost able to eradicate poverty between 1971 and 2004, thanks to “a sustained commitment by the government, manifested in providing pro-poor services and infrastructure, such as schools, hospitals, and the like — and in affirmative action to avoid racial strife.”
Nawi said that during the well over 30 years that had passed since the first application of the so-called New Economic Policy in 1971, life expectancy in Malaysia rose from 61.6 to 71.8 years in 2004, and literacy rates from 58 to 95 percent of the total population. “Malaysia was able to reach high economic growth rates during this period, and at the same time reduce poverty and provide for social equality,” Nawi added.
To reduce poverty, the Malaysian government implemented programmes that included the provision of improved services in agricultural areas, the absorption of poor households into modern agriculture and other sectors through accelerated creation of employment opportunities — and the provision of social services and amenities such as education, health, housing, water and electricity.
“With these programmes and a well co-ordinated delivery mechanism, the poor were able to increase their productivity and income through a fuller utilisation of their productive assets and skills, as well as enjoy quality of life,” Nawi said.
Another consensus was also reached in Dar es Salaam: that the “Global South” — developing countries, assumed to share common problems and goals — does not exist.
“There is no such Global South,” Yash Tandon, executive director of the Geneva-based South Centre, told the conference. “The South is facing, fragmented, the development challenges posed by globalisation.”
While strong emerging economies such as Brazil, China, India and South Africa might advance positions at international forums shared by other nations of the South, they are also pursuing their own agendas — sometimes even acting as new imperial powers towards their neighbours, he said.
Yet another subject discussed at the Dar es Salaam conference was the financing of development policies.
Xercavins urged the Helsinki Process to support the taxing of speculative financial transactions with the aim of having the resources so collected used for international co-operation projects.
He said this tax should be discussed by the U.N. General Assembly. “We have to go back to the U.N., we have to reinforce the multilateral, democratic institutions in favour of this new development paradigm.”
© 2007 Inter Press Service
It would be a great help if they stopped calling it the “neoliberal” consensus and just call it what it is: the “conservative” consensus. Conservatives may have had one or two redeeming qualities in the past, but now they are simply greedheads and greedhead enablers working for Mammon while it consumes all life on earth.
“We need a new paradigm, with a new role for the state.”
Yes, we must change our destructive ways, all of us! Planetary destruction is reaching apocolyptic proportions and it must be stopped on every socio-economic level.
“The significant problems we have cannot be solved at the same level of thinking with which we created them.” - Albert Einstein
It IS greed that prevents us from solving these problems as ezeflyer contributed above.
ezeflyer…Exactly…Where did they come up with that “neoliberal” double speak phrase? “Structural Adsjustment Programmes”?…. don’t they mean extortion via economic hitmen? Just keep the World Bank via the CIA out of their affairs and they will do just fine.
Each country, or area, has its own way of referring to the so-called “Washington Consensus.” In France, it’s called savage capitalism, which really does describe it more aptly than “neoliberalism.” But, it’s the same thing.
The most important book explaining this recent history is Naomi Klein’s “Shock Doctrine.” There’s another article on her today in the lead of Common Dreams. I consider it one of THE MOST IMPORTANT BOOKS to describe this recent history which has NOT been covered by anything in the corporate media. It’s another way that our government has been manipulating propaganda.
The fact that so many countries are beginning to realize what the World Bank, International Monetary Fund, and our CIA have been doing gives one hope that perhaps there still a possibility of serious change.
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willybill, for too long the word “conservative” has enjoyed a positive outlook. “A conservative estimate”, “conservatively speaking”, “we must be conservative on this or that”, so much so that people like to label themselves conservative, even though conservatives are the cause of the world’s troubles. The word “neoliberal” sounds worse than “conservative” if only because liberals have been so demonized by conservatives that even they hide behind the word “conservative”. Never mind that Jesus was a liberal hippie.
The “liberal” in “neoliberal” has to do with freedom of capital. When the IMF, the World Bank, or anyone in the Bush administration speaks of “freedom,” they mean the free flow of capital in and out of a country, usually involving US corporations.
What follows from the facts and arguments laid out in Klein’s “The Shock Doctrine,” is that the neoliberal apologists, including Mr. Bush, are not only mistaken in thinking democracy follows from neoliberal economic policies, but that neoliberalism and democracy are completely incompatible.
Read Naomi Klein’s book. I’d agree that its one of the most important books to read in recent memory to truly understand the world.
I generally think I’m pretty good at paying attention to what’s happening in the world. But Ms.Klein’s book does an excellent job of taking facts from around the world in the last 40 years that I generally knew about, then using the to draw conclusions (or connect the dots) that I hadn’t reached.
If you think there is evil and horror in the world, you’ll probably still be left shaking your head at the sheer magnitude of it.
And the true lesson to draw from the book.
If you are being ’shocked’, whether the shock comes from 9-11 or an American invasion of your country or a military coup or a hurricane or a tidal wave, if you are being shocked, be wary.
There are forces out there that are ready to come rob you blind and take anything of value from you. And they view the time of a ’shock’ as the ideal time to come do it. They openly preach that this is the time to accomplish what they could not normally do.
So, if you sense you are being shocked, be ready to fight. Don’t think that you’ll have time to recover, get your feet back under you, or methodically organize. Be prepared to fight for your lives and what you believe in right away.
They’ll try to steal your land and your houses, like in New Orleans or Sri Lanka. They’ll try to destroy any democracy or citizens institutions that you’ve build up. They’ll try to steal any community belongings you have (aka, ‘privatise’).
Just be aware. If you are subject to a shock, get on your feet fast and be ready to fight.
Many neocon theorists have actually argued against any form of democracy, recently. Their basic contention is as follows:
1. An unrestricted “market”economy always operates rationally.
2. In contrast, a democratic government allows for irrational intrusions into the rational working of a “market” economy.
So, the neocons’ idea of political democracy is very narrow; first and foremost, its irrational tendencies must be controlled by the rational dictates of the market (i.e., trasnational corporations).
Last, according to neocons, there is no need for a developmentalist state because such a state inevitably intrudes in, and destorts the “rational” operation of international trade.
How do you like those hot dog buns?
Of course, to believe in the above neocon logic, one must block out the intrusions of sociology, history, political science,…reality.
Ezeflyer, I like your noun, Greedheads. We need a noun to describe them - like, during the last big progressive movement, they were called Robber Barons. It’s better than what we now use when we use greed as an adjutive, eg those greedy SOBs. I’d also like to suggest greeders.
Gandhi said, “There is enough to meet everybody’s need but there is not enough to meet everybody’s greed.”
This isn’t trivial; we really need to be calling them names. We need to do that so that they are in distress trying to worm their way out of the name we called them. A new noun will do it.
Yes. New, more imaginative names for everybody.
In the US, many of us are not used to the term “neoliberal” but outside the US, just about everyone knows what it means: a whole gestalt of exploitation and misery imposed by the elevation of the “free market” (i.e. capital is free to go wherever it wants)to godlike status.
I like “greedheads” too, or “greeders”. We really do need a catchy name to describe the forces of destruction.
During the 17th and 18th centuries, the rule of monarchs who monopolized political power was rationalized using the “divine rights of kings” theory.
Today, the rule of transnational corporations whom monopolize economic and political power is rationalized as the divine right of “free markets.”
As with the monarchs of yore, one can’t radically question and systematically critique the the divine right of the free market without being dismissed, detained or disposed of.
So many of us have fallen for the western obsession with things. Development should be about things in only a very, very partial and cautious way.
As an Italian friend put it, «the best things in life are not things.»
The non Western countries need to find their identities and their priorities again.
Eduardo Villagrán
Political terms, such as “neoliberal”, do not translate well because each country and language group have their own political context. “Neoliberal” in Latin America could be roughly translated as “Thantcherism”, “Reaganism”, “supply-side economics”, “trickle down economics”, or “voodoo economics” in the Anglosphere.
The term “neoliberalism” has been widely used for more than a decade, and yet, Anglophones still seem confused by it. Perhaps it is because you have not had it imposed on you.
After the shock of the collapse of the global financial system, centered in the rich countries and, more specifically, in the Anglosphere, you will understand.
Perhaps you will even come up with a creative term for it.
Call me old fashion, but I prefer to call “neoliberal)”, fascism.
Fascism today is a political response to globalization - capitalism in the age of electronics - and the U.S. battle to dominate the global economy. It is the political expression of the objective concentration of wealth and the spread of poverty. Fascism is not about reaction, that is, returning to some past period. It is a revolutionary political movement that arises in response to a threat to private property relations. It seeks not to adjust this or that policy, that is, to “reform” the system. It seeks to release the capitalists from the restrictions of bourgeois democracy and all that entails. It seeks the replacement of one state form with another - the unrestrained rule of capitalist interest and the consolidation and legalization of their openly terrorist dictatorship.
Agreed lupita.
Us Westerners have not encountered the liberal or neoliberal political economy for over a century. Many have forgotten. Liberalism is about the free movement of capital, but it requires the exclusivity of that capital. It’s not only about being able to trade goods, but that the people at the destination recognize that those goods are mine/yours until you/I buy them.
All capital requires exclusivity. Physical, Human, “Financial”, Natural, Cultural…and Social Capital.
It is the exclusivity of social capital that is important because social capital is contained in groups, not individuals. It’s about who you know and what they can do for you. The wealthy don’t want to know you, or do anything for you. They refuse to free up this form of capital, because if you/I possess it, then it was all for naught.
medic
Could we call it “Friendly Fascism”?
This is the title of a book written by Bertram Gross.
In fact, this book was censored by its publishers -a first in US publishing.
The uncensored version was published by a small press, South End.
The MSM reaction to this book presaged what we now observe as the MSM norm. This was a big first because Gross was a famous, highly regarded, and multi-award winning mainstream, liberal political scientist. He was an advisor to Hubert Humphrey.
After the publication of “Friendly Fascism”, his name (and book) went down the black hole.
Check this out for technical differences/similarities between neoliberalism & neoconservatism. There’s a pdf for politcal junkies.
http://ptx.sagepub.com/cgi/content/abstract/34/6/690
The fully privatized economy is feudalism. Substitute gated community and private security for castles and knights.
Reminds me of a Monty Python line, “He MUST be the King. He is the only one not covered in shit.”
RICHFILTH. It’s all you need. Give them a label, make them not human, make them into a detestable object that is a threat, then kill them. That’s what they do….are we to do what they do? Do we wish to become them?
Einstein was right. A problem is never solved at the same logical level as the problem statement. Chunk it up to the higher level values that you practice in your daily life or chunk it down to specific consequences. See what happens.
We are in this together. We have a 4000 year old model of elites, oppression, and feudal slavery organized around wealth accumulation by the Few, competing with a gradual forming egalitarian model of shared benefits and cooperative community. Hells bells, we are only now moving away from gender slavery and on much of the globe that is still normative. The old model is killing us and our planet folks. We have to think bigger than our ‘enemies’. Like the line from Matrix, which is easier to say, “There is no spoon, or, there are no enemies.”
Peace.
The neoliberal belief system is founded on a theology of private property. It’s an extreme and irrational view that overlooks the way in which property’s value is determined by context, an essential supporting framework of “commons”. The term PRIVATISM might more accurately represent the “corporate libertarian” fusion of religion and fraudulent economics.
The opposite belief system could be called ORGANISM, reflecting the way that each economic entity exists within a living matrix of other value-creating and -supporting elements, like an organ in a body. The book LIVING SYSTEMS, long out of print, explains this view quite clearly. Oddly, it was written by scholars at the University of Chicago at the same time that Milton Friedman was developing his destructive obsessional/delusional “Washington consensus”.
PRIVATISM treats everything like a mine, to be robbed of value, leaving a slag heap. ORGANISM sees that beyond economics there is nature, with its own principles that must be respected if we are to have an economy. Obviously PRIVATISM is unsustainable, but it will go down very hard. Still, we need to prepare to replace it with ORGANISM.
Kjeld Jakobsen’s points are right on target. It’s not just the developing world though. The WTO has left civil society out of the deliberative process in rich countries as well. I mean, since treaties are the supreme law of the land we have to follow WTO directives. How is that democracy?
The problem with Kliens thesis is it comes across as a “conspiricy” of a few Chicago School “greedheads”, making the solution the simple elimination of a select few. The problem is actually structural and these individuals just fill a role. They are interchangeable. Trying to define greed is a black hole as each of us in the developed world uses more than his/her “fair share”.Once the capitalist system is dismantled these issues become irrelevent. Unfortunately ,Klien settles for market reforms and an improved welfare state.
XAXADO — Thanks for the background on ORGANISM, which Is something that I’m committed to, and is closely coupled with the need to create a replacement for the failed metric of neo-FASCIST’s GNP (based on PRIVATISM).
Our economy is going to be drawn forward, decisions are going to be made, and the system will adapt to the changes on how we value goods and services, where PRIVATISM looks only in the short term, and ORGANISM looks to the life-cycle completion.
When we ignore long term ecological consequences, we never see the real costs up front, and make improper decisions based upon bad data, say of:
Namaste … … … … … … … … … … … … … … … … … Mahatma Gandhi … … …
« We must be the change we wish to see in the world »
« There is enough to meet everybody’s need, but there is not enough to meet everybody’s greed »
I agree with Comarc and others here about the confusion of neoliberals, neocons, etc. And it all hooks up to my thesis on the dead/metaphorical nature of “left” and “right”.
Let’s shoot it straight: “up” and “down” instead.
I recall my training as an anthropology student in the 80’s and early 90’s. The discipline recognized one of the great hazards of fieldwork, participant observation, etc. Don’t pay your subjects in cigarettes, etc. As with torture today, they’ll tell you only what they think you want to hear — and (worse) you’ll be interfering with the culture you’re studying.
There is something fundamentally wrong and imperial with the imperative “development”. People, landforms, ecosystems, etc. should all have the right to be left the hell alone if they do desire (or in the case of ecosystems/species, if they are endangered in some way).
This whole “problem” is couched in terms of how to best plunder their resources, and reduce them to good lifelong indebted wage-slaves like their northern hemisphere counterparts.