GlobalizationGlobalization

CMN 2168CMN 2168

Neo-liberalismNeo-liberalism

‘‘Liberal’ has different meanings.Liberal’ has different meanings.

1.1. Socially progressive, open-mindedSocially progressive, open-minded;;2.2. Political doctrine that aims at Political doctrine that aims at limiting the limiting the

State’s powers regarding individual State’s powers regarding individual freedomfreedom;;

3.3. Economic doctrine of Economic doctrine of free enterprisefree enterprise according to which the State must not according to which the State must not interfere in the market and competition interfere in the market and competition (free trade).(free trade).

Neo-liberalism relies on the ideas of Neo-liberalism relies on the ideas of Adam Smith (who was one of the Adam Smith (who was one of the intellectuals who developed the idea intellectuals who developed the idea of free trade and capitalism). of free trade and capitalism).

PrivatisationsPrivatisations Liberalisation of trade and financeLiberalisation of trade and finance Supremacy of marketsSupremacy of markets

All activities and services need to be All activities and services need to be rationalized.rationalized.

Rationalization: the re-organization Rationalization: the re-organization or re-structuring of a company in or re-structuring of a company in order to improve its functioning. It order to improve its functioning. It corresponds to the ‘mathematization’ corresponds to the ‘mathematization’ of work and aims at increasing of work and aims at increasing efficiency and flexibility.efficiency and flexibility.

Neo-liberalism is also known as the Neo-liberalism is also known as the Washington consensusWashington consensus, and is , and is defined by the US government (and defined by the US government (and usually back by the British one). usually back by the British one).

The actors in the neo-liberal order The actors in the neo-liberal order are usually huge corporations.are usually huge corporations.

As neo-liberalism relies on free trade, As neo-liberalism relies on free trade, it aims at removing what it considers it aims at removing what it considers obstacles to its own development:obstacles to its own development:

- State protectionismState protectionism- Public servicesPublic services- Trade unions and workers’ rights.Trade unions and workers’ rights.

Neo-liberalism also represents a specific Neo-liberalism also represents a specific type of management and decision-making type of management and decision-making where productivity, efficiency and where productivity, efficiency and immediate proimmediate profifit are the main criteriat are the main criteria..

it is the it is the fifinancial logicnancial logic that governs that governs decision making: it is the permanent decision making: it is the permanent search for new means to increase prosearch for new means to increase profifit t and share value that now acts as the main and share value that now acts as the main managerial drive in large groups and managerial drive in large groups and conglomerates.conglomerates.

Performance and competitivity are Performance and competitivity are central to neo-liberalism.central to neo-liberalism.

These are present in other spheres of These are present in other spheres of human activities, such as the cultural human activities, such as the cultural and intellectual spheres. and intellectual spheres.

In other words, neo-liberalism uses In other words, neo-liberalism uses concepts usually identifies with trade concepts usually identifies with trade to everything else.to everything else.

Neo-liberalism leads to an important Neo-liberalism leads to an important cultural changecultural change (if not a (if not a change of change of civilizationcivilization).).

Neo-liberalism is partly characterised Neo-liberalism is partly characterised by a high concentration of power and by a high concentration of power and money within the hands of a small money within the hands of a small minority, which represents more than minority, which represents more than 95% of international financial 95% of international financial transactions.transactions.

(General Electrics, CNN etc.)(General Electrics, CNN etc.)

Neo-liberalism and historyNeo-liberalism and history

‘‘Globalization can be understood as a Globalization can be understood as a set of technologies, institutions and set of technologies, institutions and networks operating within, and at the networks operating within, and at the same time transforming, same time transforming, contemporary social, cultural, contemporary social, cultural, political and economic spheres of political and economic spheres of activity’ (21).activity’ (21).

‘‘It is [also] the evaluation and It is [also] the evaluation and interpretation – the naming – of interpretation – the naming – of those technologies, institutions and those technologies, institutions and networks as socially, culturally, networks as socially, culturally, economically and historically economically and historically identifiable phenomena that in a identifiable phenomena that in a sense bring globalization into being, sense bring globalization into being, or make it real to most people’ (21).or make it real to most people’ (21).

Neo-liberalism follows the logic of Neo-liberalism follows the logic of orientalism: ‘it categorizes the world in orientalism: ‘it categorizes the world in terms of the politics of difference’ (23).terms of the politics of difference’ (23).

Unlike orientalism (which divided the world Unlike orientalism (which divided the world in the Occident and the Orient), neo-in the Occident and the Orient), neo-liberalism divides the world several ways liberalism divides the world several ways (e.g. wealthy countries Vs. poor countries). (e.g. wealthy countries Vs. poor countries).

Neo-liberalism partly relies on trade Neo-liberalism partly relies on trade regulations defined by and originating regulations defined by and originating from wealthy countries.from wealthy countries.

However, there is a difference between However, there is a difference between the theory of free trade / neo-liberalism the theory of free trade / neo-liberalism and its practices. and its practices.

See example of Moroccan tomato growers See example of Moroccan tomato growers p.23-4.p.23-4.

‘‘Free / competitive trade works to Free / competitive trade works to increase power differentials while increase power differentials while supposedly bringing about universal supposedly bringing about universal development’ (24).development’ (24).

Neo-liberalism’s ’central logic is that Neo-liberalism’s ’central logic is that individuals, ideas and the individuals, ideas and the movements of the market are movements of the market are inextricably bound together’ (25). It inextricably bound together’ (25). It aims at creating a global free aims at creating a global free market. market.

‘‘What we see in studying the history What we see in studying the history of neoliberalism is the use of reason of neoliberalism is the use of reason and a utopian discourse to justify the and a utopian discourse to justify the setting free of the economic field setting free of the economic field from social, national and from social, national and humanitarian obligations’ (27-8).humanitarian obligations’ (27-8).

Three differents ways of using history Three differents ways of using history to discuss neo-liberal versions of to discuss neo-liberal versions of globalization:globalization:

- MarxismMarxism- Cultural theoryCultural theory- Globalist perspectivesGlobalist perspectives

MarxismMarxism

Marxism is ‘a way of understanding Marxism is ‘a way of understanding the world that focuses on economic the world that focuses on economic relations and class conflict; includes relations and class conflict; includes as an objective the attainment of a as an objective the attainment of a Communist system of economic Communist system of economic organization, whereby the means of organization, whereby the means of production are held in public production are held in public ownership’ (218)ownership’ (218)

Marxist criticisms of globalization Marxist criticisms of globalization focus on the economic sphere.focus on the economic sphere.

According to Immanuel Wallerstein, According to Immanuel Wallerstein, ‘the defining characteristic of all ‘the defining characteristic of all social systems is the social systems is the division of division of labourlabour in a sphere of economic in a sphere of economic exchange’ (28). exchange’ (28).

Division of labour aims at Division of labour aims at improving improving efficiency of production through the efficiency of production through the specialization of cooperative labour specialization of cooperative labour in precise tasks and rolesin precise tasks and roles..

Societies can be organized in two ways:Societies can be organized in two ways:1.1. Mini-systemsMini-systems where divisions of labour where divisions of labour

and economic exchange occur only and economic exchange occur only within discrete groups (now virtually non-within discrete groups (now virtually non-existent);existent);

2.2. World systemsWorld systems that are capitalist, that are capitalist, international and distributive, with international and distributive, with ‘tentacles of trade and exchange criss-‘tentacles of trade and exchange criss-crossing the globe’ (29).crossing the globe’ (29).

This system is capitalist by nature.This system is capitalist by nature.

World systems are stable for the World systems are stable for the following reasons:following reasons:

1.1. The military strength of The military strength of economically dominant states;economically dominant states;

2. ‘the world-system is structured in terms of 2. ‘the world-system is structured in terms of three main strata, or categories – core, three main strata, or categories – core, semi-periphery, and periphery’ (30).semi-periphery, and periphery’ (30).

3. ‘Nations and categories are categorized 3. ‘Nations and categories are categorized as such on the basis of their relative as such on the basis of their relative position within the world economy, and on position within the world economy, and on the basis of their specific internal and the basis of their specific internal and economic characteristics’ (30).economic characteristics’ (30).

Here, the exploitation of the lower Here, the exploitation of the lower stratum by the upper stratum is stratum by the upper stratum is central. central.

A ‘general belief in the legitimacy of A ‘general belief in the legitimacy of the system, and a commitment to it’ the system, and a commitment to it’ is essential to ensure the system’s is essential to ensure the system’s stability. (30stability. (30

Criticisms of world-systems theory: it Criticisms of world-systems theory: it does not ‘provide a satisfactory does not ‘provide a satisfactory account of globalization, because it account of globalization, because it effectively subsumes all social, effectively subsumes all social, cultural and political spheres and cultural and political spheres and activities under, and explains them in activities under, and explains them in terms of, the sphere of economic terms of, the sphere of economic relations’ (31). relations’ (31).

EmpireEmpire

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