The Rise and Fall of Neoliberalism lecture at USF -- by Seán Kinane

11/03/06

Last night at USF’s Tampa campus the Patel Center for Global Solutions hosted a lecture by Tom Mertes, a critic of neoliberal trade policies. WMNF’s Seán Kinane reports on this talk titled “Two Cancuns: The Rise and Fall of Neoliberalism.�

Tom Mertes is an administrator with the Center for Social History and Comparative History at UCLA. He spoke about how Neoliberalism emerged as a global economic model after the 1981 International Meeting on Cooperation and Development in Cancun, which was attended by President Ronald Reagan. The neoliberal model, which has also been called the “Washington Consensus,� was formed as a free-market, open trade alternative to counter the policies proposed by developing nations in the Global South.

But after more than 20 years of neoliberal policies imposing privatization of public resources … and huge loans from the International Monetary Fund (or IMF) and World Bank to developing nations, the Global South had seen only rising poverty, debt, and inequality according to Mertes.

“Cuts in state spending and the conditions that brought about the crisis had profound effects on different national populations including business decline, job losses, cuts in food and fuel subsidies, widespread social dislocation. In other words, the debt crisis became a social crisis, leading to mass action.�

Because of these economic catastrophes caused in part by debts to the IMF and other international financial institutions (or IFIs), Mertes believe that social movements became more important in developing nations.

“The disastrous effects galvanized many citizens to unite at the local, regional national, and international level to demand ya basta, enough is enough. There were many street demonstrations, and these were often referred to as ‘IMF riots.’ Ironically as the space for the state’s role in the economy declined, the space for direct democracy increased as a result of public opposition to further impoverishment administered from above. Mass actions and protests were popular rejections of economic conditions that resulted from state actions imposed or anticipated from the IFIs [international financial institutions].

Mertes proposed that neoliberalism began to rise with the 1981 meeting in Cancun, and he traces the fall of neoliberalism to the same location 22 years later. The 2003 World Trade Organization (or WTO) ministerial was held in Cancun and ended in failure after a number of delegates walked out. WMNF asked Mertes what role he thought that global democracy activists who had gathered in Cancun to protest the meetings played in enabling the delegates to challenge the neoliberal model. But he explains that while the protesters did encourage some delegates, that the wide gap between the demands of developing nations and developed nations were the main reason talks broke down.

“Many of the delegates said that when they see that there’s broad popular support from them. As the protesters showing up there to this island, that that really strengthened their resolve. But I wouldn’t overplay the protesters that much, even though I’m very much in solidarity with them. But I think they were at such far extremes as far as the negotiating positions of the two sides was much more critical. But certainly they played an important role and kept the pressure on the delegates to try and respond to popular pressures.�

Mertes feels that the United States’ insistence on imposing the neoliberal model on the Global South has negatively affected this country’s image in the world.

“The US is no longer considered a benevolent nation attempting to use the multilateral IFIs to build a better world, but rather as an illiberal, militaristic and imperial power. In the WTO, the US promoted increased protections for intellectual property, benefiting agribusiness, pharmaceuticals, and software trans-nationals, most of them headquartered in the US, but demanded open markets for manufactured goods and services. After two decades of more and more open trade, the Global South has not developed along the lines suggested by the Washington Consensus proponents.�

An audience member asked whether terrorism has increased because of the poverty associated with so-called “free-trade� policies, but Mertes thinks that terrorism is a reaction to many factors in addition to poverty.

“Just raw poverty is not the root of terrorism. Otherwise there would be a hell of a lot more of it. Because the world is really becoming more and more impoverished. No doubt about it.�

The Globalization Speakers Series continues at USF on November 30th with a lecture called “Globalizing Ethics? The "Fairness" of Fair Trade.� For more information, visit patelcenter.usf.edu

For WMNF News, I’m Seán Kinane.

FMI

Globalization Speaker Series at USF
http://www.patelcenter.usf.edu/events/speakers.php

Tom Mertes at UCLA’s Center for Social History and Comparative History
http://www.sscnet.ucla.edu/issr/cstch/index.html

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