{"id":225,"date":"2009-01-04T14:40:14","date_gmt":"2009-01-04T14:40:14","guid":{"rendered":"http:\/\/global-labour.info\/en\/2009\/01\/04\/the-coming-capitalist-consensus-walden-bello-2008\/"},"modified":"2009-01-04T14:40:14","modified_gmt":"2009-01-04T14:40:14","slug":"the-coming-capitalist-consensus-walden-bello-2008","status":"publish","type":"post","link":"https:\/\/global-labour.info\/en\/2009\/01\/04\/the-coming-capitalist-consensus-walden-bello-2008\/","title":{"rendered":"The Coming Capitalist Consensus – Walden Bello (2008)"},"content":{"rendered":"


\nThe Coming Capitalist Consensus<\/strong><\/em>
\nby Walden Bello*<\/strong><\/em>
\nPublished on December 24, 2008 by Foreign Policy in Focus<\/a><\/em>
\nNot surprisingly, the swift unraveling of the global economy combined with the ascent to the U.S. presidency of an African-American liberal has left millions anticipating that the world is on the threshold of a new era. Some of President-elect Barack Obama\u2019s new appointees \u2013 in particular ex-Treasury Secretary Larry Summers to lead the National Economic Council, New York Federal Reserve Board chief Tim Geithner to head Treasury, and former Dallas Mayor Ron Kirk to serve as trade representative \u2013 have certainly elicited some skepticism. But the sense that the old neoliberal formulas are thoroughly discredited have convinced many that the new Democratic leadership in the world\u2019s biggest economy will break with the market fundamentalist policies that have reigned since the early 1980s.
\nOne important question, of course, is how decisive and definitive the break with neoliberalism will be. Other questions, however, go to the heart of capitalism itself. Will government ownership, intervention, and control be exercised simply to stabilize capitalism, after which control will be given back to the corporate elites? Are we going to see a second round of Keynesian capitalism, where the state and corporate elites along with labor work out a partnership based on industrial policy, growth, and high wages \u2013 though with a green dimension this time around? Or will we witness the beginnings of fundamental shifts in the ownership and control of the economy in a more popular direction? There are limits to reform in the system of global capitalism, but at no other time in the last half century have those limits seemed more fluid.
\nPresident Nicolas Sarkozy of France has already staked out one position. Declaring that \u201claissez-faire capitalism is dead,\u201d he has created a strategic investment fund of 20 billion euros to promote technological innovation, keep advanced industries in French hands, and save jobs. \u201cThe day we don\u2019t build trains, airplanes, automobiles, and ships, what will be left of the French economy?\u201d he recently asked rhetorically. \u201cMemories. I will not make France a simple tourist reserve.\u201d This kind of aggressive industrial policy aimed partly at winning over the country\u2019s traditional white working class can go hand-in-hand with the exclusionary anti-immigrant policies with which the French president has been associated.
\nGlobal Social Democracy<\/strong><\/em>
\nA new national Keynesianism along Sarkozyan lines, however, is not the only alternative available to global elites. Given the need for global legitimacy to promote their interests in a world where the balance of power is shifting towards the South, western elites might find more attractive an offshoot of European Social Democracy and New Deal liberalism that one might call \u201cGlobal Social Democracy\u201d or GSD.
\nEven before the full unfolding of the financial crisis, partisans of GSD had already been positioning it as alternative to neoliberal globalization in response to the stresses and strains being provoked by the latter. One personality associated with it is British Prime Minister Gordon Brown, who led the European response to the financial meltdown via the partial nationalization of the banks. Widely regarded as the godfather of the \u201cMake Poverty History\u201d campaign in the United Kingdom, Brown, while he was still the British chancellor, proposed what he called an \u201calliance capitalism\u201d between market and state institutions that would reproduce at the global stage what he said Franklin Roosevelt did for the national economy: \u201csecuring the benefits of the market while taming its excesses.\u201d This must be a system, continued Brown, that \u201ccaptures the full benefits of global markets and capital flows, minimizes the risk of disruption, maximizes opportunity for all, and lifts up the most vulnerable \u2013 in short, the restoration in the international economy of public purpose and high ideals.\u201d
\nJoining Brown in articulating the Global Social Democratic discourse has been a diverse group consisting of, among others, the economist Jeffrey Sachs, George Soros, former UN Secretary General Kofi Annan, the sociologist David Held, Nobel laureate Joseph Stiglitz, and even Bill Gates. There are, of course, differences of nuance in the positions of these people, but the thrust of their perspectives is the same: to bring about a reformed social order and a reinvigorated ideological consensus for global capitalism.
\nAmong the key propositions advanced by partisans of GSD are the following:
\nGlobalization is essentially beneficial for the world; the neoliberals have simply botched the job of managing it and selling it to the public;
\nIt is urgent to save globalization from the neoliberals because globalization is reversible and may, in fact, already be in the process of being reversed;
\nGrowth and equity may come into conflict, in which case one must prioritize equity;
\nFree trade may not, in fact, be beneficial in the long run and may leave the majority poor, so it is important for trade arrangements to be subject to social and environmental conditions;
\nUnilateralism must be avoided while fundamental reform of the multilateral institutions and agreements must be undertaken \u2013 a process that might involve dumping or neutralizing some of them, like the WTO\u2019s Trade-Related Intellectual Property Rights Agreement (TRIPs);
\nGlobal social integration, or reducing inequalities both within and across countries, must accompany global market integration;
\nThe global debt of developing countries must be cancelled or radically reduced, so the resulting savings can be used to stimulate the local economy, thus contributing to global reflation;
\nPoverty and environmental degradation are so severe that a massive aid program or \u201cMarshall Plan\u201d from the North to the South must be mounted within the framework of the \u201cMillennium Development Goals\u201d;
\nA \u201cSecond Green Revolution\u201d must be put into motion, especially in Africa, through the widespread adoption of genetically engineered seeds.
\nHuge investments must be devoted to push the global economy along more environmentally sustainable paths, with government taking a leading role (\u201cGreen Keynesianism\u201d or \u201cGreen Capitalism\u201d);
\nMilitary action to solve problems must be deemphasized in favor of diplomacy and \u201csoft power,\u201d although humanitarian military intervention in situations involving genocide must be undertaken.
\nThe Limits of Global Social Democracy<\/strong><\/em>
\nGlobal Social Democracy has not received much critical attention, perhaps because many progressives are still fighting the last war, that is, against neoliberalism. A critique is urgent, and not only because GSD is neoliberalism\u2019s most likely successor. More important, although GSD has some positive elements, it has, like the old Social Democratic Keynesian paradigm, a number of problematic features.
\nA critique might begin by highlighting problems with four central elements in the GSD perspective.
\nFirst, GSD shares neoliberalism\u2019s bias for globalization, differentiating itself mainly by promising to promote globalization better than the neoliberals. This amounts to saying, however, that simply by adding the dimension of \u201cglobal social integration,\u201d an inherently socially and ecologically destructive and disruptive process can be made palatable and acceptable. GSD assumes that people really want to be part of a functionally integrated global economy where the barriers between the national and the international have disappeared. But would they not in fact prefer to be part of economies that are subject to local control and are buffered from the vagaries of the international economy? Indeed, today\u2019s swift downward trajectory of interconnected economies underscores the validity of one of anti-globalization movement\u2019s key criticisms of the globalization process..
\nSecond, GSD shares neoliberalism\u2019s preference for the market as the principal mechanism for production, distribution, and consumption, differentiating itself mainly by advocating state action to address market failures. The kind of globalization the world needs, according to Jeffrey Sachs in The End of Poverty, would entail \u201charnessing\u2026the remarkable power of trade and investment while acknowledging and addressing limitations through compensatory collective action.\u201d This is very different from saying that the citizenry and civil society must make the key economic decisions and the market, like the state bureaucracy, is only one mechanism of implementation of democratic decision-making.
\nThird, GSD is a technocratic project, with experts hatching and pushing reforms on society from above, instead of being a participatory project where initiatives percolate from the ground up.
\nFourth, GSD, while critical of neoliberalism, accepts the framework of monopoly capitalism, which rests fundamentally on deriving profit from the exploitative extraction of surplus value from labor, is driven from crisis to crisis by inherent tendencies toward overproduction, and tends to push the environment to its limits in its search for profitability. Like traditional Keynesianism in the national arena, GSD seeks in the global arena a new class compromise that is accompanied by new methods to contain or minimize capitalism\u2019s tendency toward crisis. Just as the old Social Democracy and the New Deal stabilized national capitalism, the historical function of Global Social Democracy is to iron out the contradictions of contemporary global capitalism and to relegitimize it after the crisis and chaos left by neoliberalism. GSD is, at root, about social management.
\nObama has a talent for rhetorically bridging different political discourses. He is also a \u201cblank slate\u201d when it comes to economics. Like FDR, he is not bound to the formulas of the ancien regime. He is a pragmatist whose key criterion is success at social management. As such, he is uniquely positioned to lead this ambitious reformist enterprise.
\nReveille for Progressives<\/strong><\/em>
\nWhile progressives were engaged in full-scale war against neoliberalism, reformist thinking was percolating in critical establishment circles. This thinking is now about to become policy, and progressives must work double time to engage it. It is not just a matter of moving from criticism to prescription. The challenge is to overcome the limits to the progressive political imagination imposed by the aggressiveness of the neoliberal challenge in the 1980s combined with the collapse of the bureaucratic socialist regimes in the early 1990s. Progressives should boldly aspire once again to paradigms of social organization that unabashedly aim for equality and participatory democratic control of both the national economy and the global economy as prerequisites for collective and individual liberation.
\nLike the old post-war Keynesian regime, Global Social Democracy is about social management. In contrast, the progressive perspective is about social liberation.
\nCopyright \u00a9 2008, Institute for Policy Studies<\/a>
\nWalden Bello is a columnist for Foreign Policy In Focus, a senior analyst at the Bangkok-based Focus on the Global South, president of the Freedom from Debt Coalition, and a professor of sociology at the University of the Philippines. <\/em><\/p>\n","protected":false},"excerpt":{"rendered":"","protected":false},"author":3,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[33],"tags":[],"_links":{"self":[{"href":"https:\/\/global-labour.info\/en\/wp-json\/wp\/v2\/posts\/225"}],"collection":[{"href":"https:\/\/global-labour.info\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/global-labour.info\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/global-labour.info\/en\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/global-labour.info\/en\/wp-json\/wp\/v2\/comments?post=225"}],"version-history":[{"count":0,"href":"https:\/\/global-labour.info\/en\/wp-json\/wp\/v2\/posts\/225\/revisions"}],"wp:attachment":[{"href":"https:\/\/global-labour.info\/en\/wp-json\/wp\/v2\/media?parent=225"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/global-labour.info\/en\/wp-json\/wp\/v2\/categories?post=225"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/global-labour.info\/en\/wp-json\/wp\/v2\/tags?post=225"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}