Abstract
We are still suffering from the force with which neo-liberalism
was imposed upon the world as an economic system via the right-wing
governments of Margaret Thatcher and Ronald Reagan and the ideologues
and the powerful corporate interests that manoeuvred them into place.
Thatcher's phrase 'there is no alternative' still rings in our ears
and continues to be re-iterated by politicians, now in terms of
`the inevitability of globalisation', this being a euphemism for
continued promotion of neo-liberal policies.
Enough was written at the outset to know that these policies would
lead to progressive widening of the income gap everywhere, if not
exactly just how extreme would be the impoverishment of the majority.
Seeing neo-liberalism as concurring with neo-Mathusianism, we may
presume that those who promoted neo-liberalism really didn't care
what happened to the majority - and indeed cheap labour forces are
seen today as an entirely legitimate trading advantages amongst
the governments of the countries of the South.
Evasive argumentation continues to defend the persistence of a
neo-liberal framework of international economic management: poverty
reduction is a prime policy of the international development agencies
- but studiously separating this from the causes of poverty in the
system of international economic management; whilst it is acknowledged
that there are some (generally ill-defined) problems with globalisation
these are not yet seen as outweighing the (also ill-defined) benefits
of globalisation; and much official literature asserts the belief
that the problems lie in protectionism in the North, without which
the South would be able to find vast markets (conveniently forgetting
that even if this were true, it would likely lead to increased impoverishment
in the North!)
The reality has to be stated clearly: free trade in primary products
is saturating markets everywhere - not to say also degrading environments
- and leading to diminution of prices and inability to sell surpluses,
impoverishing producers throughout the (euphemistically) developing
world. Highly-capitalised multi-nationals are able to produce everything
the world's population needs with little labour. Aggressive selling
into developing economies is destroying practically all formal economic
activity, promoting a `race to the bottom' in terms of wage competition
with the informal economy the only option for growing numbers.
So far critique of the system has been mainly piecemeal although
more comprehensive critiques are beginning to emerge. There remains
much work to be done, however, before such coherence is adequate
to see clearly what the alternative policies might look like. Nevertheless,
the second half of this paper tries to sketch some ideas to be debated.
First it must be affirmed that a simple reinstatement of Keynesianism
won't work. Whilst social democratic Keynesianism was pushed aside
on ideological grounds rather than manifest failure, reinstatement
could have disastrous effects in terms of ecological sustainability.
The answer lies in coherent approaches to reconstructing protected
local and sub-regional economies, developing local resources and
potentials.
It should be noted as a preliminary remark that even before the
advent of neo-liberalism, the frameworks for local economic planning
assumed that local economies are driven by exports and this prejudice
has to be definitively rejected. The international development agencies
are doing some work on local economic development already (see WB
web site; also ILO/UNOPS development of LEDAs) but as yet still
assuming that exports must be the main focus of local development.
New Synergies in Development has been developing a project in Colombia
to generate theory in relationship with practice of a new approach
to local economic development putting local needs first. This paper
will outline both the principles, the strategy and the tactics -
that have emerged in the context of this project.
First initiatives are demonstrating the difficulty of finding support
from development agencies for such an approach to combating poverty
even when pursued without directly asserting this as a challenge
to neo-liberalism. This is connected to the fact that, in spite
of the local economic crises, there is a deep-seated scepticism
amongst local owners of capital in anything other than what they
have always done even whilst they witness the destruction of their
investments. It really will need a sea-change of major proportions
to face up to neo-liberalism, spell out the problems and launch
effective alternatives on a global scale.
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