Springer International Journal of Politics, Culture, and Society

Globalization: The Final Demise of Socialism?
Author(s): Larry S. Carney

Source: International Journal of Politics, Culture, and Society, Vol. 10, No. 1 (Fall, 1996),
pp. 141-174
Published by: Springer
Stable URL: http://www.jstor.org/stable/20019877
Accessed: 18-09-2016 23:57 UTC
JSTOR is a not-for-profit service that helps scholars, researchers, and students discover, use, and build upon a wide range of content in a trusted
digital archive. We use information technology and tools to increase productivity and facilitate new forms of scholarship. For more information about
JSTOR, please contact support@jstor.org.
Your use of the JSTOR archive indicates your acceptance of the Terms & Conditions of Use, available at
http://about.jstor.org/terms
Springer is collaborating with JSTOR to digitize, preserve and extend access to International Journal of
Politics, Culture, and Society
This content downloaded from 157.182.150.22 on Sun, 18 Sep 2016 23:57:14 UTC
All use subject to http://about.jstor.org/terms
International Journal of Politics, Culture and Society, Vol. 10, No. 1, 1996
II. Globalization
Globalization: The Final Demise of Socialism?

Larry S. Carney
You could say it's really the bond markets that run the country, not the President
and not Alan Greenspan.1
?Irwin L. Kellner, chief economist, Chase Regional Bank
...the [World] bank has managed to make its own view of the world appear the
norm. We think its real success has been not so much economic?however great
the economic power it wields?as cultural, ideological and, in a not entirely meta
phorical sense, religious.2
?Susan George and Fabrizio Sabelli
If the current confused yearnings for a better world are not to be taken advantage
of by reactionary and conservative political trends, and so should not fail to break
out of the capitalist social order, political economy for socialism must provide a
workable frame of reference for understanding the past and the future of socialism,
as well as of capitalism.3
?Mikoto Ito
In the first two volumes of his sweeping near-future Mars trilogy, Kim
Stanley Robinson provides us with a dystopian view of globalization spread
to the solar system level.4 Although there is no center of rule, gigantic trans
national corporations, in shifting alliances with one another, are the primary
agents of power, transforming and consuming the red planet at a dizzying
pace, relying mainly on machines built by machines and an information tech
nology that ceaselessly revolutionizes itself in the act of being applied. Capi
tal rains down on the planet in colossal localized torrents, whose origins are
difficult to trace and perhaps untraceable. On Earth, ecological and demo
graphic disasters, as well as outbreaks of collective violence, threaten every
where; nation-states are without effective means to establish order; and the
United Nations is, as on Mars, less the supragovernment that it is charged
to be than the tool or shill of transnational coalitions.
But the dystopia is also a utopia, or at least harbors the makings of
one (or many). Informational technology and its productive potentials can
not be monopolized by any agent, and anarchists, revolutionaries, and Uto
pian terraformers put it to their own uses to challenge, escape, or make
humanly rational, the transnational world-in-the-making. Even some of the
141
? 19% Human Sciences Press, Inc.
142 Carney
transnational thems
launched in pursuit of p
the elan of socialist pla
Robinson's science fict
trends, lends us a dram
disorder within those t
the analyses and ideolo
token, examination of t
the question whether g
there ever were any) fo
The downfall of "actu
elsewhere does not so m
a great historical mome
on the world scale. As
The irony is that Karl Marx
could transform the whole
a good job at it. In this resp
very much like the old, not
the artificial cover of colon
alternative (1917-91). In th
economic growth?this inter
little over the past century
What faces socialism a

well as a political projec
Marx from the outset:
versalizing tendencies o
the socialist transforma
ists, particularly those
however it is to be und
it points toward the inhe
But how is globalizatio
cept, but many, most o
tent.6 As, however, an em
interrelationships have
become salient in wor
would seem, at a minim
1) The "autonomous" su
financial capital at the
tion of capital markets
the communications an
2) The unpackaging an
production processes an
Globalization: The Final Demise of Socialism? 143
(or even factory or enterprise) specific. Globalization theorists who want

to distinguish the current phase of this development from mere "multina
tional" or "transnational" economic activity emphasize that this dispersal
increasingly takes place on the basis of a bewildering variety of shifting
corporate alliances, institutional affiliations, complex property instruments,
and means of management and coordination that make it more and more
difficult to identify what the "unit" of production actually is at any given
moment.
3) The progressive integration of national markets into world markets,

which not only facilitate the first two tendencies, but also generate increas
ingly common patterns of consumption (or "consumer choice") around the
world. Concomitantly, diverse subnational, national, or regional cultural
tastes or "traditions" are themselves transformed and packaged for world
wide dissemination on constantly changing cultural markets of fashion.
4) The revolutionizing of all aspects of social existence by technology, par

ticularly (again) by the advances in communications and information tech
nologies. For some globalization theorists, this represents the crunching of
cultures in ways that transcend the sharing of goods and services through
the conventional mechanisms of trade: populaces confront one another in
terms of the near annihilation of space and time: history becomes arcane.
Stated in broad outline, the above trends may, for good or ill, appear
to signal the advancing triumph of the "market" at the world level, with the
consequent weakening of nation-states, national cultures, and the discredit
ing of any global attempts to regulate the market.7 In this perspective, if
order is to characterize the further operations of globalization, it will be the
order imposed by the disciplines and constantly expanding opportunities for
profit making generated by the market, fueled by global competition.
It is in the ramifications of such an interpretation of globalization that
we may discern the fluidities that exist between prevailing attempts to un
derstand the historical trajectories of contemporary world capitalism and
the ideological parameters of a political project. This is perhaps most evi
dent in the vertigo-producing debates concerning the globalization of world
capital markets. In an article aptly titled "Surrender to Markets," Erik P.
Peterson, vice-president and director of studies at The Center for Strategic
and International Studies at MIT, expresses alarm that the drift toward
"antimarket policies" and "economic nationalism" in the United States may
be allowed to continue by short-sighted politicians. All governments must
recognize reality, that
144 Carney
there is reason to believe t
their traditional sovereign
policies. Technology and
plexities and time frames
linkages with other financ
ing national responses to
render to the new global
From all sides, inclu

Left, the message is c
capitalism is surrende
is to link rational plan
lations into collective
ized well being, it w
global markets is also
relevance of socialism
But what does the a
the mid-1990s, that w
governments, politici
they must surrender
all, themselves?can r
THE CURRENT PA
Even the most curso

ized capitalism reveals
ing force of the mark
none of which are, in
tion from the standpo
of two sets of "develo
"newly industrializing
core capitalist centers
conclude by drawing
cialism. First, we draw
markets through an e
THE 'WASHING
THE HAND M
Markets have archite

markets that are labe
1980s, a "liberal," mo
called a "neoconservative," to add to the semantic confusion) congeries of

ideological premises, economic analyses, and policy predilections was pack
aged into a political design for the orderly spread of globalization.9 Al
though the design was most visibly associated with the operations of
international financial institutions, most notably, the International Mone
tary Fund (IMF) and the World Bank, it is widely shared by central bank
ers, administrators and technicians in financial ministries and departments
in Western Europe, the United States, and a great many developing (Third
World) countries; influential think tanks and consulting firms; and aca
demic communities and networks of professional economists; as well as?at
least in the strategic terms of vested interests?transnational businesses,
banks, and investment corporations.
Although employing a globalizing rhetoric, the immediate foci for the
application of the design were the economically troubled nations of the Third
World and, after 1989, the new capitalist economies of Eastern and Central
Europe. Leaders of the advanced industrial societies could and have given
the implementation of the neoliberal policy package powerful impetus in ad
vancing their own interests in the global economy, but, especially in the case
of the United States, have had only selective interest in applying elements
of the package to their own economies. The package, aptly identified as the
"Washington Consensus,"10 is most concretely expressed in the policies that
the international financial institutions and associated bilateral and multilateral
agencies have attempted to impose ("negotiate")?especially as conditions of
approving loans to Third World countries. These conditions have been sum
marized by Stephany Griffith-Jones and Barbara Stallings as follows:
(1) elimination of large fiscal deficits, mainly through a reduction of government
spending; (2) reorientation of public spending, especially toward education and
health, and perhaps infrastructure; (3) establishment of a broad tax base with mod
erate rates; (4) market determination of interest rates, preferably at a positive but
moderate level; (5) maintenance of a competitive exchange rate, so as to promote
exports and bring about a current account that can be financed; (6) promotion of
exports, especially nontraditionals, and the liberalization of imports; (7) encourage
ment of DFI [direct foreign investment] to provide capital, skills, and technology;
(8) sale of public enterprises ["privatization"], both to relieve the demands for sub
sidies and because private ownership is believed to be more efficient; (9) deregu
lation to increase competition and make it easier for the private sector to engage
in economic activities; and (10) guarantee of property rights in order to stimulate
private investment, both domestic and foreign.11
In actual practice, these various elements of "conditionality" have not

been pressed with equal rigor by international lending agencies; for exam
ple, the taxation and "human capital" and infrastructure emphases of items
(2) and (3), although given much attention in recent years in studies and
reports of the World Bank, have not been implemented with the same ur
gency as the market-opening, government-reduction, and deregulation fea
146 Carney
tures of the rest of the package. Moreover, sustaining the coherence of the
various elements of the "structural readjustment" programs negotiated on
the basis of the Consensus has not proven to be an easy task, and consid
erable controversy exists, even among proponents of the Consensus, as to
where and how many "success stories" are to be found. Nonetheless, in
those cases where the managers of the Consensus have had considerable
leverage to shape national economic policies, the effects of "structural ad
justment reforms," as we will see in our discussion of Latin America, have
been quite profound, if as yet, falling short of the revolutionary transfor
mations that many neoliberal globalist managers envision.
"Revolutionary" is less than hyperbolic in describing the intent of many
Consensus managers, advisors, and negotiators. The reports of the IMF in
particular are overspread with the dramatic language of mission, of the
need to bear the human costs of administering the shock therapies to "get
the prices right" for the benefit of the long-run development of the world's
nations.12 Amidst the talk of achieving necessary "flexibilities" and remov
ing the "rigidities" (especially, for example, in regard to labor markets) of
national economies, there are reminders that it is ultimately the transfor
mation of social institutions and cultures that is at stake. In commenting
on the thrust of the most recent IMF World Economic Outlook, the IMF
Survey informs us that "[to] be successful . . . reforms may have to change
habits, social norms, and attitudes."13 The release of the natural energies
of Homo Economicus will not be enough: indeed "economic man" must
be created through appropriate disciplines and priestly enlightenment in
the face of what is often an appalling lack of incentives.
One of the most striking aspects of contemporary globalization is, then,
the dedicated dirigisme that animates its spread. This development has
achieved increasing momentum with the fall of "actually existing socialism."
The strategic bipolar restraints of the Cold War on the global marketization
of client states have also fallen with the demise of "real" socialism and the
world (it seems) can truly become a business. But how does this business
work: For whom does it work? How are the rules of competition actually
structured and maintained? What is the "political" in the political economy
of contemporary world capitalism? Most important for the subject of this
article, where do the contradictions of globalization lie?
LATIN AMERICA: THE NOT-QUITE-UNCONDITIONAL

SURRENDER TO MARKETS
In November 1994, Fernando Henrique Cardoso, sociologist, perhaps

the most influential of the dependista challengers of orthodox economic
development theory in the 1970s,14 and one of the world's most highly re
spected social-democratic intellectuals, was elected President of Brazil, the
fourth largest national territorial unit and ninth largest economy in the
world. In office, Cardoso continues to pursue the task he had begun as
Brazil's Minister of Finance?the systematic transformation of Brazil's gov
ernmental structure, overall economic policy regime, and economic insti
tutions to make them suitably adapted to the market arrangements of
globalizing capitalism. In this role, Cardoso has expressed no ideological
repudiation of the ideals of social-democratic egalitarianism and the desir
ability of a human society based upon justice, freedom from material want,
and the vital political participation of all segments of the citizenry.15 Per
haps President Cardoso's administration is one of the most dramatic ex
amples of the complexities and contradictions of the Latin American
surrender to markets that began with the overthrow of the Allende regime
in Chile in 1973, but became regionally definitive in the 1980s and 1990s.16
In the early 1970s, when signs were already appearing that the import
substitution-industrialization (ISI)17 strategies common in the region were
encountering perhaps intractable limits, Latin America became the major
actor in the drama of Third World indebtedness unleashed by two world
wide rises in the price of oil and the emergence of the petrodollar. Oil
importing countries in the region suffered abrupt and severe effects on their
balances of payments, a development that portended massive aggravation
of the foreign exchange shortages that had been one of the persistent un
solved problems of ISI.18
But with the crisis came what appeared to be the remedy, and for
some countries an unprecedented dividend of available pools of untied for
eign exchange to spur economic development.
OPEC petrodollars had to be recycled somewhere, since the oil-pro
ducing countries could not possibly absorb them all. The breakdown of the
Bretton Woods system of international monetary stability as well as ad
vances in the instrumentation of international lending by large commercial
banks made such banks ready offshore candidates to carry out the recycling.
The OPEC-induced (but only partially caused) economic crises of most of
the advanced industrial nations made developing countries, hungry for capi
tal, attractive customers for petrodollar loans.
In hindsight, the optimism of the international banking community in
embarking on this orgy of lending to Latin American countries and main
taining it into the early 1980s seems to have been largely sustained by gen
erous amounts of wishful thinking. By the time bank managers became
aware that the effects of the capital inflows on the capacity of these coun
tries to generate the export earnings necessary to remit interest and to re
pay the principal on these loans was not forthcoming, the only immediate
148 Carney
solution they saw was

to cover debtor short
It is therefore impor
of the 1970s and 1980
by unanticipated even
the region, not the l
ruling classes in majo
of Brazil's military r
velopment, least of a
Chile, already host,
the Pinochet governm
opening strategy?des
Harberger and Milt
nanza decade to open
to the benefit of the
along with Mexico a
countries, also attem
nipulate its exchange
tion and inflation (a
negatively the growth
tal. In addition, along
government), Chile p
rection, as in the lat
suddenly cash-awash
in speculative lending
As Jeremy Adelman
lost on the internati
external debt respon
Latin American econ
boom having underw
through industrializa
cessful attempts to m
in trade regimes, fai
transfers of income t
flight) through the p
and the underwriting
In August of 1982,
his country could no
loan orgy was over. T
the gods of the finan
in real interest rates
cieties were once aga
producing countries had been broken (meaning among other things, poor
Mexico, poor Venezuela); and Latin America faced what came in the 1980s
to be known as the "lost decade."
The Latin American countries?each in their turn, as no debtors' cartel
emerged (largely because of international, state-backed carrot-and-stick
policies designed to prevent such a development)?attempted to renegoti
ate their outstanding loans, a process that actually resulted in the rise of
foreign debt as banks rolled over loans already on the books. The IMF as
coordinator of this process and lender of last resort became the major eco
nomic managerial actor in the region, preparing the way for the second
stage of "adjustment" beginning in 1987.
By 1987 it had become clear that the deflationary policies of the IMF
had not only not achieved fiscal and monetary stabilization in Latin Amer
ica, but had actually contributed to several dramatic inflationary episodes
as well as continuing deficits in government budgets and balances of pay
ments in the region?the very opposite of the "macroeconomic" effects
sought by international lending agencies.
No real solution for the debt problem by continuing more of the same
was in sight. But the ascendancy of the pseudo-monetarist administrations
of Reagan in the United States, Thatcher in England, and Kohl in West
Germany had set the stage for a true "internationalist" (trans-Atlantic) po
litical environment in which the Washington Consensus could become con
solidated. The IMF's leverage had been increased by a significant expansion
of its quotas (members' contributions). The transnational corporations, in
creasingly involved in massive international financial transactions and rep
resenting well over half of the world "market"21 (through interfirm and
intrafirm transactions) in trade of goods and services had become sophis
ticatedly aware of the links between global financial liberalization and the
breaking down of trade and investment barriers in foreign markets. Re
payment of debts to international commercial banks thus became linked
to wider issues of "structural readjustment" to more definitively (and irre
versibly) integrate developing countries (at least those that showed some
promise of being growth poles for globalization) into the global system of
"open" markets.
The prelude to the second phase of adjustment began, again, in Chile,
whose economy?despite (because of?) the Chicago Boys?had collapsed
in 1982 (a 15 percent drop in gross domestic product) and had become
the object of intense efforts to refurbish and make more effective neoliberal
institutional reforms?effective, that is, for fostering and sustaining long
term economic growth sufficient to repay the region's external debt. In Sep
tember of 1985, the United States under the leadership of Secretary of the
Treasury James Baker unveiled a systematic plan to restore access by the
150 Carney
most indebted developi

through the sustained
ily on the implementa
tures of the Washing
commercial banks and
World Bank.
Two years after its in
that the Baker Plan w
a renewal of economic
in Chile, but by 1989
Rica, Uruguay, and Ar
the Brady Plan (then S
the Plan in March 198
Debt buyback was to b
and the U.S. Treasury
Central banks could th
national portfolio or
through vigorous def
pressure to open and d
and assets, already und
only as a source of gov
a primary instrument
the economy. Labor m
and the decimation of
as a particularly blunt
mechanism of "debt-eq
changed for arrears of
major countries becam
The saldo (balance) of
can ultimately only be
poverty and the chron
capabilities in much of
in dramatic terms by o
the statistical baseline:
place at the end of the
in Bolivia, -3.1 percent
and -1.1 percent in Me
with a 1.7 percent inc
only a 0.2 increase in
growth over the decade
in the region over the
in Chile. Argentina led
capita decrease.24 Widening gaps in income distribution and wealth were

endemic in the region, with Costa Rica the lone example of a country (ex
cluding Cuba from the discussion) that was able to maintain the essential
rudiments of its social-democratic welfare system intact, despite its struc
tural adjustment agreements with the IMF.
By the beginning of the 1990s external capital flows facilitated by fur
ther liberalization of global capital markets, were returning in considerable
volume to Latin America, but this time involving only a minimum partici
pation of commercial banks, with FDI (much of it linked to privatization)
and portfolio (bonds and securities) taking the lead. But as the "tequila
meltdown" at the end of 1994 in Mexico demonstrates, what comes quickly
on the portfolio side of investment can leave even more quickly; and what
to do about the volatility of capital movements in and out of Latin America
has become the major concern of official lending agencies to the region.25
On the other hand, these agencies are experiencing their own variations
of "privatization," as managers of private investment funds are finding
more open and institutionalized methods to piggy-back their own opera
tions on the activities of multilateral lending agencies in the region.26
Renewed capital inflows have not, then, created the (purportedly)
long-desired stabilization of the Latin American economies, even though
the transition from military governments to democratically elected admini
strations has not diminished the drive toward adherence to the structural
adjustment imperatives of the Washington Consensus. On the contrary, in
absolute terms, the debt situation is more serious in the mid-1990s than it
was at the beginning of the 1980s, and the cost of servicing the debt con
tinues to rise.
Mexico, which despite episodic downturns, has in recent years received
almost half of total external financing to the region, was reported by the
Banco de Mexico to have a foreign debt of US$162 billion in April of
1996, 61 percent of it held by the public sector. According to the central
bank, this was despite the fact that Mexico has transferred US$150 billion
dollars to its creditors over the last 15 years. The country is very near its
limits for further borrowing from the IMF and the Inter-American bank
for emergency purposes, and as of the date of the central bank report, the
government was seeking to refinance almost a fifth of its total external
debt on international markets. The newspaper El Financiero reported at
about the same time that servicing the foreign debt now stands at 10 per
cent of the GDP or the equivalent of 45 percent of projected export earn
ings for 1996. A rise of 1 percent in U.S. interest rates adds US$1.6 billion
to Mexican external debt service.27
Financial markets within Mexico continue to fluctuate, with precipitous
short-term swings making production plans for industry extremely hazard
152 Carney
ous. Although the Mexican stock market index fell 26 percent in 1995, in
the wake of the tequila meltdown, it fell even more?40.5 percent in 1994?
when the government was desperately emptying out its reserves to protect
the peso.28
Brazil struggled through 1995 to prevent massive capital flight?as
happened in Argentina?because of the "contagion" (the so-called "Te
quila Effect") effects of the 1994 Mexican Christmas crisis. It faced an ex
ternal debt of US$123 billion at the end of 1995 (41.4 percent of its export
earnings were paid out in debt service in 1995) and prospects of perhaps
no better than 1 percent growth in the GDP for the current year.29 The
Cardoso administration is struggling above all to keep inflation low and
protect the exchange rate, while proceeding with its intentions to step-up
privatization efforts to smooth the way for increased foreign investment.
Cardoso continues to push for the constitutional, administrative, and labor
market reforms that will consolidate Brazil's integration into global mar
kets, an achievement that he believes is a prerequisite to dealing with the
yawning problems of poverty, income and wealth inequality, and rampant
ecocide (that is, "seek ye first the kingdom of structural adjustment to glo
balization, and all these other things shall be added unto you [perhaps]").
Argentina (in the 1970s, the third Latin American candidate to become
a "newly industrialized country [NIC]" to rival those of East Asia), with a
population a fifth of that of Brazil, yet bearing a foreign debt equal to
almost 80 percent ($US96.5 billion at the end of 1995) of Brazil's, suffered
a disastrous economic turndown in 1995, as a result of massive capital flight
caused by the Tequila Effect. After impressive recovery and growth rates
(7.7 percent per year) during 1991-1994?albeit accompanied by persistent
problems in the trade balance and current account that had already begun
to promote capital flight by 1994?Argentina's economy fell by -4.4 percent
in 1995. The country's foreign reserves, subject to the most daring of struc
tural adjustment foreign exchange policies in Latin America?the pegging
of the Argentinean peso to the U.S. dollar?fell by a third before IMF
intervention came to the rescue. Argentina's external debt stood at 315
percent of its exports at the end of 1995, and it had to pay out 47.4 percent
of its export earnings for debt service in that year.30
Having abolished indexation and capital controls, vigorously pursued
privatization, severely restricted the expansion of bank credit, and politically
neutralized Latin America's most powerful organized labor movement, Ar
gentina is a current "showcase" of Washington Consensus success and
hence high on the list of the IMF for most favored treatment. But as recent
events have shown, in Latin America, the frames that hold together the
most gaudy of globalized showcases are extremely vulnerable to the seismic
qualities of volatile capital movements, which show no loyalty to ortho

doxy's faithful when the going gets rough.
The Latin American experience with globalizing international financial
markets and their institutional overseers in the 1970s, 1980s, and the 1990s
may seem to lead to the familiar conclusion: Latin American societies have
entered a new and radical phase of being strangled by the external sector.
Despite, however, the pitiless peregrinations of global capital movements
and the implacable conditionalities of global money managers, such a con
clusion is simplistic and ultimately misleading.
Through the last two and a half decades, with few exceptions, Latin
American societies have been continuously infused with the threat or actual
eruptions of a wide variety of political insurgencies and civil protest.31 Even
the most totalitarian and systematic forms of military repression in a num
ber of countries during that period of the 1970s and 1980s that has been
called the "long dark night of state terror" did not destroy resistance. Al
though some of these protests, such as the Zapatista uprising in Chiapas,
Mexico, have drawn attention to the direct effects of globalization or have
been directed explicitly at the interventions of "senor IMF," mass mobili
zations in almost all countries in the region have for the last 25 years, and
well before, challenged the day-by-day injustices, economic instability, po
litical repression and exclusion, and persistent dramatic socioeconomic in
equalities that ruling-class and political-elite rule have generated in these
societies.
As many observers have pointed out, in contrast to countries such as
South Korea and Taiwan, even repressive authoritarian ruling regimes in
Latin America have failed to establish "hegemonic" alliances capable?or
desirous?of pursuing developmental models that promise sustained eco
nomic growth?not to speak of equity?through effective control over their
national economic environments based on a sense that large segments of
the population have some stake in the specific form of national develop
ment. Globalization is indeed the political-economic Tinanmen Square that
has exacted a surrender to markets from Latin American governments, but
the origins of why most of the governments are defenseless before globali
zation are not to be found in globalization itself.32
In this regard, the case of Colombia is most instructive. Although given
little international (or even regional) attention, Colombia is in many ways
the economic success story in Latin America during the period under con
sideration. This argument can be made if the primary measure is the results
of self-conscious elite economic policy in dealing with the effects of glo
balization, as manifested in sustained growth rates, export promotion, con
trolling inflation, dampening the effects of volatilities in inflows of global
capital, dealing with balance of trade and current account difficulties (one
154 Carney
must, in this regard, remember both the opportunities and problems cre
ated by the sizeable and reliable inflows of "unofficial" remittances of drug
and drug-related earnings),33 preventing domestic financial markets from
being swamped by uncontrolled speculation, and the protection of domestic
savings. Yet Colombia has been and continues to be the most violence-rid
den and politically recalcitrant nation in the region.34 The political, social,
and cultural roots of violence and mass protest in Colombia are historically
deep, and the continuation of such patterns cannot be understood apart
from the effects of the drug economy on Colombian society.35 Nevertheless,
with these factors taken into account, and indeed within the operations of
these factors, one consideration stands out: political, social, and economic
instability in Colombia responds to the fact that its economic successes
within the framework of globalization have not created an economic nation,
and show little signs of doing so, despite the historical resiliency of its po
litical ruling classes.
To this conundrum, in Colombia and elsewhere in Latin America, glo
balization offers no answer, least of all as a hegemonic ideological invitation
to bow to the inevitable, to the disciplines of faceless forces that cannot
be controlled.
EAST ASIA: WHERE THE STATES ARE
Documentation and analyses of the success stories of the East Asian

NICs (EANICs), notably the "four tigers," South Korea, Taiwan, Hong
Kong, and Singapore are by now legion in the development literature. Also
available in considerable plenitude are attempts at comparative analysis to
explain why these countries have been so much more successful than the
industrializing societies of Latin America.36 There have been more than a
few economists and economic commentators who have argued that the suc
cess of the East Asian NICs has been due to their steadfastness in adhering
to the principles of free market economics, the dictates of the neoliberal
bible, and "getting the prices right." Whatever plausibility such analyses
may seem to have when applied to the very special case of the entrep?t
city-state of Hong Kong, their usefulness for understanding the other three
cases requires such strained selectivity in the reading of history, not to
speak of current events, that even the most loyal defenders of the Wash
ington Consensus will admit that state intervention has at least at some
time been significant in the recent developmental stories of these coun
tries?although many diehards will argue that the stories would have been
at least as successful (perhaps more successful?) without such intervention
(or at least most of it).
The record of state-promoted export-oriented industrialization is in

deed, as would be expected, not uniform across the three states. Also not
surprisingly, there have been some clear-cut "failures" in certain industrial
projects. But the record itself is overwhelming: fundamentally authoritarian,
labor-repressive regimes in the three countries have earned the right to be
called "developmental states."37 Moreover, although all three have made
ample use of foreign investment and the incorporation of transnational cor
porations into their economies and?especially in South Korea's case?re
sorted liberally to foreign borrowing and the build-up of foreign debt?they
have done so largely on their own terms, and have never wavered from
the goal of regulating their economies for the sustained accumulation of
massive domestic savings as the main substratum for investment in the
economy as a whole. The specific conditions of the Cold War, their nego
tiated (rather than imposed) complex economic relationships with Japan,
and the nature of their early access to the import markets of the United
States aided them in all this. But the dirigiste commitment to growth and
controlled redistribution (for economic as well as political reasons) initially
through land reform, then through investment policies, and eventually even
through labor market policies, were essential for these "success stories" to
be told.
In the context of this article, however, the question we want to pose
is whether, in light of the increasing intensity of globalization, especially
of financial markets, the East Asian development states are disappearing,
that is, are they ceasing to be the central architects of the domestic eco
nomic environments in which other economic actors must function on their
territories? Put another way, are they still the central instruments of me
diation of global political economic forces within their own societies? Are
they too "surrendering to markets"? To address this question, we review
the recent developmental history of the three countries.
Globalization of international capital markets has directed increased
political attention to exchange rates as instruments by which trade disputes
can be mediated or exacerbated by contending trading partners. Efforts by
the United States to intervene (or to fail to intervene when other consid
erations seemed to call for intervention) in currency markets to push up
the value of the German mark and Japanese yen against the dollar as a
means of alleviating deficits in its trade balances led in the 1980s to cur
rency realignments among the advanced industrial nations. The political as
well as economic problems associated with these efforts eventually became
the object of a set of agreements among the United States, the United
Kingdom, West Germany, France, and Japan at a secret meeting at the
Plaza Hotel in New York City in September 1985. The substance of these
agreements was later formally confirmed (with Canada and Italy added to
156 Carney
the sign?es, forming the "Group of Seven" or G-7 nations) at the Tokyo
economic summit meeting in May 1986. The Plaza accords called for closer
cooperation between the major industrial powers in aligning their domestic
economic policies with one another for the benefit of all in achieving long
term growth and restraining inflation. This included commitments for more
effective intervention in exchange markets to facilitate monetary stability
and nondiscriminatory trade.38
Subsequent efforts to coordinate domestic economic policies among
G-7 countries have at best been lukewarm, but the new regime of man
agement of exchange markets represented a real shift in the structure and
dynamics of world trade and the international industrial division of labor
associated with it. The primary target for the United States in exerting pres
sure to abandon the use of persistently undervalued currency to gain ad
vantages in export markets was Japan. But the United States soon began
to exert like pressure against South Korea and Taiwan, dramatically driving
up the value of the Korean won and the New Taiwan dollar.
The most important consequence of the new currency regime brought
about by U.S. pressure was that, beginning in the early 1990s, South Korea
and Taiwan (and also Singapore), following the path of Japan, began a
notable shift of its labor-intensive manufacturing to low-wage Southeast
Asian countries and eventually to China. The obverse of this movement?
which represented greater and more complex integration of the economies
of Japan, the NICs, Southeast Asia, and perhaps most portentously,
China?was the increased urgency for the accelerated industrial transfor
mation and technological upgrading of the EANIC economies. This ur
gency was further intensified because of internal, but especially external
pressures, to integrate EANIC financial institutions and policies into glo
balized capital markets. The alacrity and perspicacity with which the gov
ernments of Taiwan, Singapore, and South Korea are responding to these
challenges are impressive and show that the developmental state is still
quite alive.
The vigor of the NIC digible states in promoting the spread of direct
foreign investment through the Asian region is perhaps most dramatically
illustrated by the recent experience of the tiniest of the three, the city-state
of Singapore. Singapore's political leaders have felt especially compelled
to regionalize and internationalize their country's productive base, not only
because of the challenges of globalization, but also because of the limits
posed upon domestic expansion due to the minuscule size of its territory
(246.7 square miles) and the smallness of its population (3 million people).
The Singaporean government provided the impetus for the creation
of Southeast Asia's first subregional cooperation zone (a so called "growth
triangle"), the Johor (Malaysia)?Singapore?Riau (Indonesia) triangle,
which combines manufacturing activities, large tourist projects, and other

services.39 Natsteel, once owned by the Singapore government and now pri
vatized, has established joint ventures with steel companies in Malaysia,
Thailand, and Indonesia. Other large Singaporean firms are moving toward
transnationalization: "with a heavy nudge from the state, the biggest are
heading out: the Keppel Group to Vietnam, Semawang to India, IPC to
China, Singapore Telecommunications to Belgium, Excel Machine Tools
to Hungary?to name just a few."40
According to data supplied by the receiving countries, by 1995 Singa
pore was the second largest investor in Thailand and Burma, the third larg
est in Russia, the fourth in Vietnam and the fifth in China. According to
the Far Eastern Economic Review,
The government has been tireless in prodding Singapore Inc's move offshore. Senior
officials take businessmen on trips to explore investment opportunities and set up
government-to-government bodies such as the China-Singapore Joint Steering
Council, in which they raise with their foreign counterparts specific problems Sin
gaporean companies face. The government provides economic data to investors and
offers them tax incentives, capital infusions, investment guarantees and training pro
grammes back home.41
A notable feature of this government-stimulated spread of Singaporean

enterprise abroad is that most of it is designed to take advantage of low-cost
labor in the Asian region as well as penetrating?and actually creating?new
markets, while at the same time providing the impetus to upgrade domestic
industry in the direction of high-tech and R&D intensive production and
services linked to regional expansion. In this respect it joins the foreign in
vestment activities of Japan and the other three Tigers in producing tre
mendous economic synergism in the region, in which government-to
government as well as government-to-private sector alliances are increasingly
important.
As the Taiwanese and South Korean governments have aided the
spread of their nations' investment resources and more labor-intensive pro
ductive enterprises to low-wage countries in Asia (and elsewhere), they
have also, since the late 1980s, aggressively pursued the technological and
value-added upgrading of domestic industries through a variety of policy
strategies and institutional innovations.42 Most of these initiatives are of
particular interest from the standpoint of globalization because they are
aimed at engagement with transnational corporations?especially American
firms?not just defensively, but in order to facilitate the transfer of state
of-the art high technologies and opportunities for national firms to learn
and adapt these technologies for production in high-growth, high-value
added global markets. This has meant opening the doors more widely (but
not indiscriminately) to direct foreign investment, which had previously
158 Carney
been subject to considerable restrictions. An additional aspect of these

strategies is to reduce technological dependence on Japan (which is show
ing increasing reluctance to share advanced technologies with its NIC
neighbors).
Both the South Korean and Taiwanese governments have given strong
financial and institutional backing to joint ventures between foreign TNCs
and domestic firms, in which strong emphasis is placed on technological
transfer and the use of domestic suppliers of components. Both govern
ments have also used state procurement policies for high-tech imports (such
as military aircraft) to facilitate technology transfer and to create or expand
networks of technologically sophisticated domestic suppliers. The major
supporting strategy for the technological upgrading of domestic production
systems has been the direct government sponsorship of R & D, the provi
sion of incentives to increase private-sector R&D, and the facilitation of
the commercialization of new technologies:
In both South Korea and Taiwan, all the most complex and expensive research
projects, such as the submicron microelectronics technology and high-definition tele
vision, were carried out by state-sponsored R&D consortia, which were typically
organized around state research organizations such as the Korean Institute for Ad
vanced Technology and Taiwan's Industrial Technology and Research Institute.43
Taiwan and South Korea's globalization strategies for their domestic

industries have been accompanied by containment strategies in regard to
the liberalization of their financial markets. Pressures from the advanced
industrial societies have forced liberalization, but their own globalizing in
vestment and industrial strategies have also required it. Previous to the
mid-1980s, the export-oriented-industrialization strategies of the two coun
tries relied on the rigorous maintenance of exchange rate stability, tight
regulation of both incoming and outgoing capital flows, and the shielding
of domestic monetary regimes from the disturbances of external financial
markets. Since the mid-1980s all aspects of these restraining policies have
eased, but under the phasing-in guidance of the state and in ways that have
resisted the full internationalization (not to speak of globalization) of se
curities and exchange markets, systems of credit, the fixing of interest rates,
and the liquidity relationships between financial and productive capital.
The responses to globalization by the EANICs?in terms of trade, in
terms of investment, in terms of government-driven strategies to harness
new technologies to spur national development?have become a vital part
of that other globalization story whose trajectory no one can predict: China,
its 1.2 billion people, and its average annual growth rate in GDP of more
than 10 percent since 1980.44 Despite the continuing tensions between Tai
wan and the mainland, Taiwan has poured huge investments into China's
coast, Shanghai, the large urban complexes along the Yangtze River, and
throughout Guangdong and Fujian provinces. Hong Kong is the dynamic

growth pole for the entire Pearl River Delta area. Taiwanese and Hong
Kong investment projects have fused both nations into an increasingly in
tegrated production zone with almost all of China's coast.45 In a wider pur
view, China draws powerfully on the wealth, cultural ties, and economic
dynamicism of the "overseas" Chinese throughout Asia?Taiwan, Hong
Kong, Singapore, and the minority business classes of Malaysia, Thailand,
Indonesia, and the Philippines?who are at the center of the rapid eco
nomic expansion of the Southeast Asian region, energized by Japanese and
EANIC investment.46 As Taiwanese political scientist Yun-Han Chu has
said, "In this sense, China enjoys a development resource that Russia can
only dream about, and India can only partially copy."47
But there is also India, not yet achieving anything near China's gal
loping growth rates, but possessing the world's largest, and among the most
highly educated, middle classes (their globalized window on the future:
Bangalore, India's Silicon Valley),48 and located in the currently most dy
namic economic region in the world. China? India? Two billion of the
world's people becoming "developed" through unfettered "globalized" free
markets? The environmental and resource implications of this vision alone
invite stupefaction.49 Is it possible that there will ever come a time when
the Asian states will "surrender to markets"?
TRIADIZATION: FINANCE CAPITAL IN THE LEAD
At present, globalization is above all else the framework of irresolution

of the conflicts and contradictions that reside in the relationships between
the capitalist centers of the United States, the European Union, and Japan.
The final breakdown of the Bretton Woods system in the 1970s and with
it U.S. hegemony over a regime of worldwide growth revealed the structural
origins of these contradictions and the political realities of the transforma
tions of the international financial system that attended the breakdown.
The world trade and monetary system as designed by John Maynard
Keynes and others before and at Bretton Woods never really functioned
as intended, but it did provide the point of departure for the U.S.-managed
polity of international economic relations that underlay the long period of
capitalist expansion and growth in investment, productivity, and incomes
from 1947 to 1973.50 This system relied on demand-driven production;
quasi-Keynesian management of demand; welfare-state intervention; stra
tegic foreign aid; exchange-rate stability and a fixed dollar price of gold;
dollar-convertiblity; the dollar as the reserve, trade, and financial currency
of the capitalist world; and the U.S. worldwide military security system
160 Carney
predicated on the containment policies of the Cold War. Only partially was
it a system of free markets, since it maintained a relatively high degree of
access to U.S. markets by most capitalist nations, while tolerating, for most
of the period, strategic protectionist closures of the markets of key trading
partners, especially those of the defeated powers of World War II, Ger
many and Japan. This asymmetry, was not of course, a result either of myo
pia or excessive benevolence on the part of the United States, but an
essential part of the system, the major mechanism by which capitalist
growth was advanced in the system as a whole and the Cold War was eco
nomically fought. Moreover, at least for most of the period, the system
functioned with a considerable amount of restrictions on the international
flow of capital by most countries other than the United States. Indeed,
among the architects of the Bretton Woods agreements themselves, there
was a strongly held belief that capital controls were necessary for a stable
trade regime.51
The actual operations of the system rested, however, on a structural
dilemma, a fundamental long-run contradiction (already recognized by 1960
by Robert Triffin52) that became increasingly manifest by the late 1960s:
worldwide economic growth depended on the steady and abundant supply
of the universal currency, U.S. dollars, to other countries.53 Eventually this
meant that maintaining global growth, no matter how prudent U.S. eco
nomic management might be, depended on the United States building up
payments deficits that would eventually undermine confidence in the dollar.
In the event, U.S. economic management was not so prudent. The system
also depended largely on changes in domestic economic policy and man
agement to adjust to external imbalances and maintain exchange rate sta
bility. In practice, this would prove difficult and, of particular importance,
often in contradiction to governments' efforts to maintain consistent wel
fare intervention and their Keynesian social pacts with labor.
By the 1960s U.S. holdings in gold, the reserve backing for the dollar,
were in clear decline, and dollar holdings abroad had far surpassed the
value of these holdings. From a structural standpoint, therefore, the con
vertibility of the dollar into gold was in clear jeopardy, and the United
States had entered a variety of cooperative arrangements with the Euro
pean and Japanese governments and central bankers to protect the inter
national system from runs on the dollar and other currencies. Although
these arrangements became increasingly complex and sophisticated, they
fell short of full-scale policy coordination on the basis of mutual adjustment
of domestic economic policies. Most notably, the United States, in its po
sition as dollar supplier and monetary hegemon, and unlike other major
capitalist nations, continued to ignore the economic logic of the disequili
brium problems of its external accounts and to maintain its expansionary

economic policies.
Although this behavior was of growing concern to the other capitalist
industrialized countries, their leverage over U.S. actions was exceedingly
small, and they were constrained at a more comprehensive level by the
fact that the whole international system depended upon U.S. economic ex
pansion. By the end of the 1960s, the Vietnam War had hastened the in
evitable. Lyndon Johnson, who had taken the United States to the crest
of welfare state intervention and Keynsian economic management, would
not abandon pursuit of the Great Society, jeopardize full employment, or
raise taxes. The war was fought through increased deficit spending in an
overheated economy with rising inflation. The United States could not yet
contemplate the unthinkable?the devaluation of the dollar?yet other
countries modified their exchange rates as a response to inflation, intensi
fying the overvaluation of the dollar.
Richard Nixon, although the accent he lent to U.S. politics was in
many ways very different from that of his Democratic predecessors, did
not reject welfare state intervention, the maintenance of very low levels of
unemployment as a policy goal, or of course, the escalation of the war. He
was to preside over the final demise of the Bretton Woods system, aban
doning dollar convertibility on August 15, 1971. In 1972, the United States
experienced its first post-World War II trade deficit. At the time it did not
initiate a long-term trend, but it was a harbinger of what would become a
persistent fact of international economic life in the 1980s and 1990s.
By the time of suspension of dollar convertibility, the structure and
operations of the international finance and monetary system had undergone
dramatic changes from the early years of Bretton Woods. German and
other Western European currencies had returned to virtual convertibility
by the end of the 1950s, and the Japanese yen followed suit in 1964. In
ternational financial transactions were free to expand tremendously and
did so primarily through the mediation of the growing number of multina
tional commercial banks. Trade protectionism, tolerated by the United
States, encouraged the internationalization of production, as multinational
firms moved behind tariff walls to achieve access to burgeoning markets,
especially in Western Europe. Such corporations became increasingly pow
erful agents in the growth and transformation of international financial
markets, as they moved their large liquid assets back and forth across na
tional borders to take advantage of spreads in interest rates and anticipated
changes in exchange rates.
Most spectacular was the growth of eurocurrency markets centered on
London. The growth of these markets?largely a direct result of the dollar
overhang resulting from the U.S. role as monetary hegemon?provided the
162 Carney
prototype of international financial nirvana longed for by finance capital

globalists today: huge stores of liquidity (US$110 billion by 1970, US$1
trillion by early 1979)54 free from any state control, available to move in
stantly in search of profit and the windfalls of arbitrage.
These developments in the international finance system placed increas
ing strain on the fixed exchange rate regime built on the dollar. The po
litical implications of making the short-term adjustments in domestic
economic management in order to maintain exchange rate stability in the
face of vast movements of international capital not only became increas
ingly onerous, but such measures themselves became increasingly dubious
in terms of their likelihood of success. At the same time, these develop
ments made it more and more difficult for many governments to consis
tently effect Keynesian policies of management of demand, investment, low
unemployment, provision of state services, and the avoidance of deleterious
inflation.
But of the options available to them, governments did not choose to
move toward an international system of capital controls. Such a move was
simply not on the agenda of the U.S. (or the British) government and was
inimical to the interests of multinational corporations, international bank
ers, and institutional investors who had the largest stake in the emergence
of the new system of international finance. But in addition, the implications
of such a move implied such a level of international coordination not only
in the regulation of capital flows but in the management of entire national
economies that no major government was willing to take the initiative or
was even in the position to do so without the lead of the United States.
After a series of ineffectual efforts to create a managerial international
monetary system to replace Bretton Woods, defensive moves by several
governments in response to pressures on their exchange rates brought to
an end the fixed exchange rate system by early 1973; and the floating rate
system that obtains to the present was, essentially by default, in place.
"Management was left to the market and in a minor way to central bankers
who intervened in exchange markets on a somewhat cooperative basis to
prevent extreme fluctuations."55 Not the least of the eventual consequences
of the institutionalization of this "system" is the fact that at present the
average volume of transactions in dollar trading (exchange rate arbitrage
being one of the most frenzied games of globalized financial markets) on
the New York Clearing House Interbank Payment System is US$1 trillion
a day.56
The first post-Bretton Woods decade, the 1970s, was marked by mo
mentous disequilibrating shocks in the international economy. Most pro
found were the oil crises of 1973/1974 and 1978/1979. Of much less
significance in its actual effects on the world economy, but important in
terms of what it represented as a bonafide threat to bring down, through

chain effects, the emerging international banking system, was the near-col
lapse of the Franklin National Bank in the United States, a victim of its
own activities in foreign exchange speculation.57 The United States in par
ticular, first under Richard Nixon and Gerald Ford, then under Jimmy Car
ter, discovered that it could no longer ignore with impunity the impact of
the world economy on its domestic economic policies and institutional ar
rangements.58 Stagflation?persistent high inflation combined with slow
growth?raised the not totally ironic speculation: Is the United States be
coming a Third World Country? Japan, the one Asian core capitalist power,
had in turn, left behind its prolonged period of double-digit growth rates
and its economy was ravished by the first oil crisis.
But the very dramatic character of these upheavals, their localized ef
fects, and the improvised short-term policy responses to them, made it dif
ficult to judge whether or not the world economy had entered a period of
structurally induced long-run uncertainty and slow growth. Moreover, with
all the Sturm und Drang of the world economy, the G-7 countries still
achieved a combined growth rate of 3.5 percent a year between 1971 and
1978. Japan grew at an annual rate of 4.5 percent during that period;59
and in contrast to the chaos of the OPEC crisis, the policy adjustments
put into place by its political and corporate managers allowed the Japanese
economy to weather the 1978/1979 Iranian oil crisis almost without a ripple.
It remained then for the 1980s and the 1990s to reveal that the troubles
of core capitalist triad countries and the world economy in general were
not episodic and not curable by short-term domestic policy adjustments. In
the most recent period, the G-7 economies have grown only at a 2.1 percent
rate since 1989.60 Most surprisingly, Japan's economy, which through the
mid-1980s could still be thought to simply have arrived at the comfortable
growth rates of a mature industrial economy, has still not emerged from
what is now almost a five-year-long recession.
Besides slow growth, the major story is the growth of unemployment,
widening income inequality, and loss of employment security in the Triad
nations. Japan, the exemplar Asian dirigible state, has maintained low un
employment rates compared to the other core capitalist countries, but in
terms of its long-term postwar experience, these rates are uncomfortably
high. Moreover, deep inroads have been cut into its lifetime employment
job-security system for core workers, job growth itself has been highly re
strained, and personal incomes have virtually stagnated.61
For Europe, Ethan Kapstein paints the recent picture:
In Western Europe, the unemployment figures are frightening. In France, average
unemployment between 1969 and 1973 was 2.6 percent; today it is over 11 percent.
In Germany the rate was below 1 percent; today it is approaching 10 percent. In
164 Carney
Belgium, the unemploym
peans have created a lost
terms of increased crime
ingly popularity of extrem
that Germany's current l
since the early 1930s.62
Western Europe, desp

nevertheless dealt wi
to maintain the living
organized sectors of
incomes and benefits
shut out of jobs. The
to the brink in econo
capita terms and cont
The U.S. version of
of unemployment in
Keynesian period), bu
security, and effectiv
deremployment, for
groups, and the less
insecurity has becom
in the Triad nations).
Despite recurring att
among unskilled wor
logical advances and i
tual course of product
all statistical estimate
in Japan where all th
seem to be still in pla
sector, has been mo
productivity growth
however, seem to som
least some of the pro
logical change per se,
sizing" of the labor f
But as the Keynesian
throughout the econo
rates of growth in ou
a prerequisite for all
on a sustained basis. T
Neither do rising m
satisfactory explanat
dustrial societies in t
job losses in labor-intensive sectors of their economies). What needs to be

explained are the persistent deflationary policy regimes in the Triad coun
tries, their failure to perform as expansionary stimuli for one another in
their interrelationships in the world economy, and their consequent failure
to maintain high levels of effective demand.
John Eatwell offers a key to understanding the Triad impasse: "the
persistence of the slow growth of demand into the 1990s seems to have
been predominantly caused by the change in the structure of international
finance and the consequent impact on the structure of domestic macroe
conomic policies."66
The breakdown of the Bretton Woods system and the surrender to a
system of floating exchange rates created a variety of incentives to deregu
late world capital markets. First, the core capitalist states could no longer
bear the costs of dealing with exchange rate instability through adjustment
of domestic policy. (This had never been a welcome political expedient;
the post-Bretton Woods currency regime simply made it intolerable for a
number of states). The move toward deregulation of capital markets effec
tively "privatized" the risks of exchange rate instability.67
Second, exchange rate disequilibrium was itself the creation of a mar
ket that invited massive speculation based upon the ubiquity of risk and
the opportunities of huge profits through effective arbitrage. It is of the
utmost importance to recognize that the awesome gains offered through
speculation in global financial markets are the obverse of the equally awe
some potentials for loss. These markets thrive on the perpetuation of risk,
volatility, and instability.68 Hence, there were immediate and powerful in
terest groups in the private sector in the post-Bretton Woods situation to
press for the deregulation of financial markets.
Third, from the standpoint of the states, privatization of the risk of
exchange rate instability required the lifting of controls on international
capital flows in order to mitigate the dangers of risk itself for domestic
banking systems.69
Fourth, the impact of the post-Bretton Woods situation was not evenly
distributed among core capitalist states. Most particularly, the United States
was poised, so to speak, to take advantage of its own defeat. The United
States, as part of its efforts to divest itself of the role of Bretton Woods
monetary hegemon, had already begun the lifting of all controls on capital
by early 1974. By the late 1970s, further weakening of the dollar had pro
duced, in the words of one of the most acute analysts of the phenomena
we are describing here, Eric Helleiner, the following scenario:
It was true that international financial markets during the 1978-79 dollar crisis had
undermined U.S. Policy. For this reason some scholars have argued that the crisis
signaled the decline of American financial hegemony. Although the United States
166 Carney
had lost power to the global financial markets [some U.S. policy makers] ... argued,
correctly, that it had not lost financial power with respect to other states. They
noted the [continuing] preeminence of the dollar and of U.S. financial markets in
the open global financial order continued to give the United States a dominant
position in global finance that it could use to its advantage. This power was effec
tively demonstrated by the global impact of [Federal Reserve Board Chairman Paul]
Volker's stabilization plan and even more strikingly by that of the economic policy
of the Reagan administration....70
As the U.S. case indicates, a fifth incentive to liberalize global financial

markets then became what Helleiner calls "competitive deregulation": once
deregulation is initiated by those states who see its advantages for them,
other states feel compelled to follow suit and liberalize their own financial
systems, in order not to be denied access to international capital and in
vestment.71
With deregulation becoming pervasive and the flows of global capital
immense, the states and domestic economies of the Triad countries have
become increasingly vulnerable to the movements of international financial
capital. This is even and particularly so when states may seem to defy the
logic of globalization, the most notable example being the United States
sustaining its huge trade deficits in recent years primarily on the willingness
of investors from Japan, the United States' chief adversary in trade nego
tiations, to finance those deficits because of confidence in the U.S. dollar
and the overall health of the American economy.72
John Eatwell has described the connections between risk management
in global markets and the behavior of states who seek to maintain domestic
economic environments that are inviting rather than threatening to inter
national traders.73 To be "market friendly," governments must appear to
be pursuing policies that are "sound" according to conventional Consensus
ideas of prudence. Two paradoxes are being suggested here: (1) Speculative
gains in international financial markets based upon the ubiquity of risk
must be realized through the arbitration of images of relative stability
among states and national economies; the management of risk requires dif
ferentiated stability. (2) Rather than arbitrage decisions in global financial
markets being based on the instant transfer of minute information con
cerning changes in the "fundamentals" or measured potentials of given
economies, they depend on estimates of the impact of violations of various
stereotypes of what are believed to be commonly held indicators of gov
ernmental economic responsibility. Eatwell (following Keynes) describes
the situation this way:
Since markets are driven by average opinion about what average opinion will be,
an enormous premium is placed on any information or signals that might provide
a guide to the swings in average opinion and as to how average opinion will react
to changing events. These signals have to be simple and clear-cut. Sophisticated
interpretations of the economic data would not provide a clear lead. So the money
markets and foreign exchange markets become dominated by simple slogans?larger

fiscal deficits lead to higher interest rates, an increased money supply results in
higher inflation, public expenditure bad, private expenditure good?even when
those slogans are persistently refuted by events.74
It must not be thought, however, that such slogans are arbitrary; they
work because they are reenforced?by what Ethan Kapstein calls the new
"international rentier class,"75 the epigones of Wall Street and transnational
corporations, academic economists and policy analysts, international finan
cial institutions, media editorialists and pundits, Washington think tanks,
politicians of all stripes, ordinary people who are convinced you have to
run a government like a business (what "business"?) and that such slogans
have something to do with the preservation of "family values" (from
whence comes that idea?), and "realists" of a variety of types. In other
words, global financial capitalism has produced something that looks very
much like the Gramscian model of "ideological hegemony."
Deflationary, high interest rate, wage-depressing, fiscally conservative
domestic policy responses are those most compatible with financial globali
zation, and of course, interstate capital controls are the specter most to be
feared. The dilemma is perhaps most poignantly expressed in the conditions
of the Maastricht Treaty, where European monetary union, supposedly to
begin in 1999, is predicated on all eligible member states reducing their
budget deficits to 3 percent of GDP by that year. Recent political upheavals
in France indicate the repercussions of all member countries attempting
to play by these German rules.76
But what other rules are available? Any genuine attempt for the Triad
countries to jointly construct effective capital controls that would allow for
economic expansion and the return to policies focused on maintaining high
levels of effective demand bears with it not only the problematics of the
Prisoner's Dilemma, but the much more far-reaching implication that Triad
domestic economies must become subject to national planning, if only?at
a minimum?of the pluralist indicative sort. That is the capitalist Consensus
that is not there to name, using the sobriquet of any capital city among
the Triad countries. It is, then, perhaps not surprising that as Ethan Kap
stein has said, "Just when working people most need the nation-state as a
buffer from the world economy, it is abandoning them."77 It is perhaps
also not surprising, given the implications of the rule of global financial
capitalism, that a frequent "liberal" (meaning here what many in the
United States like to call "the liberal left") response to the Prisoner's Di
lemmas of globalization is to invoke zero-sum thinking, proffering measures
to "win" economic prosperity through vanquishing other states and nations
on the competitive battlefield for technological supremacy in world trade.
168 Carney
But if nation-states may be abandoning their workers, it does not mean

that workers will necessarily continue to abandon themselves. A hegemonic
ideology is after all, an ideology, albeit one with tremendous material force.
Even the most effective ideology could not contain a real breakdown in
the mechanisms of risk management in world capital markets. But it does
not have to come to that to predict that globalized domestic economies
among the Triad countries will continue to be disturbed by the conse
quences of policy efforts to drive the citizenry of these countries to sur
render to markets.
CONCLUSION: IS SOCIALISM DEAD?
In what in overall terms is an optimistic treatment of the problematics

of risk and volatility in world capital markets Roy C. Smith, professor of
finance and international business at the Stern School and limited partner
of Goldman, Sachs, and Co., makes the following observation:
Hedge funds and others of the more aggressive among [today's]...investors some
times appear to have become dangerous to the system. They move money around
without regard to the consequences, into and out of currencies, for example, which
may destabilize a worthy effort by European governments to create a monetary
union, and into and out of countries like Mexico, or Turkey, or India, accepting
no responsibility for the effect that such rapid movements have on the local econ
omy. Of course, that is what free markets do?they adjust to changed economic
conditions as they see fit, without asking for permission.78
To which we might say, with Kim Stanley Robinson, Tell it on Mars. And
we might add: Look at Sub-Saharan Africa, where free-market money has
no interest in going in the first place; let its people compete with the edu
cated masses of Eastern and Central Europe, the new recruits to globali
zation.79
The selective and highly condensed perspective we have adopted in
this article on the present panorama of "actually existing globalization" is
primarily designed to make one affirmation: the old socialist-inspired issue
of the "anarchy of the market" has returned to us with a vengeance, indeed
on a global scale. To argue that globalized capitalism must collapse because
of the working out of its own contradictions is unwarranted, although cer
tainly such an event is not beyond the realm of possibility. But to argue
that it will persist without increased contestation from many quarters seems
to point to the most unlikely of events. That at least some of these move
ments of contestation will articulate themselves in terms of hybrid expres
sions of traditional socialist ideology seems highly probable. That socialism
in that limited sense is not dead and is not dying, one can affirm with
some assurance.
But what of those attempts, that also will most surely come, to address
the contradictions of globalization by the rational alteration of its institu
tions?80 These efforts will by no means be indifferent or irrelevant to the
issues of equality, collective human control, and emancipation of human
powers classically raised by socialist theory and even occasionally by social
ist practice. The current hegemonic ideological celebration of the irration
ality of the market has, as an essential function, the blunting of the rational
consideration of how the world could be different?should be different. Yet
the trajectory of globalization opens fissure after fissure on the surface of
the world's economy, through which emerge demands for controls and in
tervention, as well as ideologies and movements of disruption that attempt
to master chaos by initiating their own chaos.
One of the things that can be said about this trajectory that is in fact,
globalistic, is that the rational responses it calls for are those that must be,
whether technocratic, authoritarian, "democratic," or a mixture of all three,
global in scope. One of the most problematic examples of this is what seem
to be the inherent long-run contradictions of growth strategies themselves.
As our "windows" analyses of globalization in this article imply, if there is
a crisis of capitalism at the national level generated by globalization, it is
a crisis of growth, of expansion. Yet, as our cryptic observations concerning
China and India imply, "growth," as a solution to the problematics of glo
balization, may be conceptually jejune in long-run terms and perhaps prac
tically disastrous in something less than the long term. (We may not have
Mars to rescue us.) But what possible models of viable social life and eco
nomic security could be compatible with the curtailment of constant "eco
nomic" (meaning capitalist) expansion? Here, if any vocation remains for
it, socialism must respond. No form of capitalist "modeling" has even posed
that question?although there is always (but not always) Mars.
ENDNOTES
1. Robert D. Hershey Jr., "Nintendo Capitalism: Zapping the Markets," New York Times
(May 28, 1966), pp. D1-D4, at D4.
2. Susan George and Fabrizio Sabelli, Faith and Credit: The World Bank's Secular Empire
(Boulder, CO: Westview Press, 1994), p. 3.
3. Mikoto Ito, Political Economy for Socialism (New York: St. Martin's Press, 1995), p. 216.
4. Kim Stanley Robinson, Red Mars (New York: Bantam Books, 1993) and Green Mars
(New York: Bantam Books, 1994). The third volume, Blue Mars (New York: Bantam
Books) appeared in mid-1996.
5. Fred Halliday, "The Third World and the End of the Cold War," in Barbara Stallings
(ed.), Global Change, Regional Response: The New International Context of Development
(New York: Cambridge University Press, 1995), pp. 33-66, at 66.
6. For various perspectives on globalization, see Malcolm Waters, Globalization (New York:
Routledge, 1995); Leslie Sklar, Sociology of the Global System, 2d ed. (Baltimore: Johns
170 Carney
Hopkins University Press
Imperial Corporations and
Jeffrey Henderson and
Development (Newbury P
New Global Economy in
(University Park, PA: Th
and William K. Tabb (eds
Monthly Review Press, 19
The New International Co
1995); The Group of Lisb
1995); Robert Boyer and
Globalization (New Yor
Processes of Integration a
Society 8, no. 2 (1994), p
(eds.) Socialist Register 1
7. Waters, Globalization, i
8. Erik R. Peterson, "Surre
pp. 103-15, at 108.
9. For the emergence of n
see Thomas J. Bierstecke
World," in Stallings, Glob
Spaces, Citizenship, and t
no. 1 (1995), pp. 51-79.
10. See John Williamson
(Washington, DC: Institut
the 'Washington Consens
11. Stephany Griffith-J
Implications for Developm
symposium of country
Williamson (ed.), The Poli
International Economics,
12. As a very recent exam
13. Ibid., p. 164.
14. See especially, Fern
Development in Latin Am
15. See, for example, Fer
Context: A New Depend
Information Age, pp. 1
Development," Address
the occasion of his visit
CEPAL Review, no. 56 (1
16. For an overview of th
"Latin America: Toward
pp. 272-308.
17. For overviews of ISI, see Werner Baer, "Import Substitution Industrialization in Latin
America," Latin American Research Review 7, no. 1 (1972), pp. 95-121; Eliana Cardoso
and Ann Helwege, Latin America's Economy: Diversity, Trends and Conflicts, 2d ed.
(Cambridge, MA: The MIT Press, 1995), ch. 4; and Thomas E. Skidmore, "Dependency
by Any Other Name?" The Brown Journal of World Affairs 2, issue 2 (1995), pp. 227-29.
18. For the following discussion, see Jeremy Adelman, "The Money Store," Hemisphere 1,
no. 1 (1995); Varas "Latin America"; Cardoso and Helwege, Latin America's Economy,
Arthur MacEwan, Debt and Disorder: International Instability and U.S. Imperial Decline
(New York: Monthly Review Press, 1990); Carlos Vilas, "Forward Back: Capitalist
Restructuring, the State and the Working Class in Latin America," in Bernd Magnus
and Stephen Cullenberg (eds.), Whither Marxism: Global Crises in International Perspective
(New York: Routledge, 1995), pp. 123-51; and Atilo A. Boron, State, Capitalism, and
Democracy in Latin America (Boulder, CO: Lynne Rienner Publishers, 1995).
19. Juan Gabriel Vald?s, Pinochet's Economists: The Chicago School in Chile (New York:
Cambridge University Press, 1995).
20. Adelman, "The Money Store," p. 30.
21. Estimates of TNC involvement in world trade vary considerably, but the UN agency that
is the closest monitor, the United Nations Conference on Trade and Development
(UNCTAD), in its most recent report, set this participation at two-thirds of world trade
in goods and services. This is a consideration of eminent importance in the discussion
of globalized "free markets." See Chakravarthi Ragavan, "Multinationals' Spreading
Tentacles," Multinational Monitor 17, no. 3 (1996), pp. 25-27.
22. See Vilas, "Forward Back"; Duncan Green, Silent Revolution: The Rise of Market
Economies in Latin America (New York: Monthly Review Press, 1995); Joseph Collins
and John Lear, Chile's Free-Market Miracle: A Second Look (Oakland, CA: The Institute
for Food and Development, 1995); and the articles in the special issue on "Latin America
and the World," International Journal of Politics, Culture, and Society 8, no. 2 (1994).
23. Cardoso and Helwege, Latin America's Economy, p. 112.
24. Ibid.
25. See Ricardo Hausman and Liliana Rojas-Su?rez (eds.), Volatile Capital Flows: Taming
Their Impact on Latin America (Washington, DC: Inter-American Development Bank,
1996).
26. Former Senator and Secretary of the Treasury Lloyd Bentson has been especially active
in this regard. See Jeff Garth, "In Post-Cold-War Washington, Development is a Hot
Business," New York Times (May 25, 1996), pp. 1, 6.
27. For the statistics on Mexico and an analysis, see Latin American Regional Reports: Mexico
and NAFTA Report (May 9, 1996), pp. 1, 4.
28. Latin Amerian Weekly Report (January 18, 1996), p. 18.
29. See "Further Slowdown in Economic Growth," Latin American Regional Reports: Brazil
(February 15, 1996), pp. 4-5; and "Debt and Debt Service: Good News or Bad?" Latin
American Economy & Business (February, 1996), p. 1, 2-3.
30. See "Debt and Debt Service"; "Argentina," IMF Survey (May 6, 1996), pp. 155-56; Latin
American Weekly Report (February 29, 1996), p. 91; Latin American Weekly Report (May
16, 1996), p. 206; and Latin American Region Reports: Southern Cone (April 25, 1996),
pp. 2-3. The debt-to-export ratio for the entire Latin American region was 254.2 percent
in 1995 (compared to 83.3 percent for the East Asian developing countries). Latin
American Weekly Report (May 16, 1996), pp. 210-11.
31. For political resistance movements and civil actions in Latin America during the period,
see James D. Cockcroft, Latin America: History, Politics, and U.S. Policy, 2d ed. (Chicago:
Nelson-Hall Publishers, 1996); Susanne Jonas and Edward J. McCaughan (eds.), Latin
America Faces the Twenty-First Century: Reconstructing A Social Justice Agenda (Boulder,
CO: Westview Press, 1994); Arturo Escobar and Sonia E. Alvarez (eds.), The Making of
Social Movements in Latin America (Boulder, CO: Westview Press, 1992); and articles
from NACLA Report on the Americas throughout the period.
32. The argument here is not that Latin America's political and socioeconomic problems are
exclusively "internal." Given U.S. dominance over the region and the long history of U.S.
intervention, such an argument would be preposterous. Rather, it is the conduct of those
who in fact have been the prevailing ruling groups and dominant classes in Latin
American societies, given this history of regional dominance, that is here called into
question. On the failure of Latin American ruling classes to achieve "hegemonic" efficacy,
see Boron, State, Capitalism, and Democracy in Latin America; and Ruy Mauro Marini,
"La lucha por la democracia en America Latina," Cuadernos Pol?ticos [Mexico] 44
(July-September, 1985), pp. 3-12.
33. See "Exactly What Impact Do Drug Exports Have on the Colombian Economy," Latin
American Regional Reports: Andean Group Report (June 29, 1995), p. 1. For a differing
example of the marriage of structural adjustment and the drug trade, see Manuel Castells
and Roberto Laserna, "The New Dependency: Technological Change and Socioeconomic
172 Carney
Restructuring in Latin A
Comparative National Deve
Hill: The University of No
34. The best survey in Eng
America Bureau, 1990).
35. Pearce, Colombia; an
Contemporary Crises in H
1992).
36. Among influential sources, see Gary Gereffi and Donald Wyman (eds.), Manufacturing
Miracles: Paths of Industrialization in Latin America and East Asia (Princeton, NJ:
Princeton University Press, 1990); Frederic Deyo (ed.), The Political Economy of the New
Asian Industrialism (Ithaca, NY: Cornell University Press, 1987); Alice Amsden, Asia's
Next Giant: South Korea and Late Industrialization (New York: Oxford University Press,
1989); Steve Chan, East Asian Dynamicism, Order, and Security in the Pacific Region, 2d
ed. (Boulder, CO: Westview Press, 1993); and Robert Wade, Governing the Market
Economic Theory and the Role of Government in East Asian Industrialization (Princeton,
NJ: Princeton University Press, 1990).
37. On developmental states, see Peter B. Evans, "Predatory, Developmental, and Other
Apparatuses: A Comparative Political Economy Perspective on the Third World State,"
in Kincaid and Portes (eds.), Comparative National Development, pp. 84-111.
38. On the Plaza Agreements, see Yu-han Chu, "The East Asian NICs: A State-Led Path
to the Developed World," in Stallings, Global Change, pp. 199-237; and Joan Edelman
Spero, The Politics of International Economic Relations, 4th ed. (New York: St. Martin's
Press, 1990), pp. 60-63.
39. Linda Y.C. Lim, "Southeast Asia: Success Through International Openness," in Stallings,
Global Change, pp. 238-71, at 256.
40. Murray Hiebert, "It's a Jungle Out There," Far Eastern Economic Review (April 25,1996),
pp. 58-62, at 58. For a history, including recent changes, of Singapore's economic
development, see W.G. Huff, The Economic Growth of Singapore: Trade and Development
in the Twentieth Century (Cambridge: Cambridge University Press, 1994).
41. Hiebert, "It's a Jungle Out There," p. 59.
42. The most complete coverage of these initiatives is Chu, "The East Asian NICs," to which
the following discussion is indebted.
43. Chu, "The East Asian NICs," p. 227.
44. See the special issue of The China Quarterly, no. 144 (December, 1995) on "China's
Transitional Economy"; Nicholas R. Lardy, Foreign Trade and Economic Reform in China,
1978-1990 (New York: Cambridge University Press, 1992); and Keith Griffin and Azizur
Rahman Khan, "The Transition to Market-Guided Economies: Lessons for Russia and
Eastern Europe from the Chinese Experience," in Magnus and Cullenberg, Whither
Marxism, pp. 153-89.
45. Chu, "The East Asian NICs," pp. 220-21, 233-36; and Xiangming Chen, "The New Spatial
Division of Labor and Commodity Chains in the Greater South China Economic Region,"
in Gary Gereffi and Miguel Korzeniewicz (eds.), Commodity Chains and Global
Capitalism (Westport, CT: Praeger, 1994), pp. 165-86.
46. Chu, "The East Asian NICs," pp. 233-35.
47. Ibid., p. 235; and Chen, "The New Spatial Division of Labor and Commodity Chains in
the Greater South China Economic Region."
48. John Stemlau, "Dateline Bangalore: Third World Technopolis," Foreign Policy, no. 102
(Spring, 1996), pp. 152-68. The waves of Japanese/NIC-led regionalization of Southeast
Asia and parts of South Asia recapitulate the larger "globalization" process as the
exploitation of unprotected labor (with particular impact on girls and women) generates
astonishing forms of new poverty as well as new "globalist" forms of wealth. See Jeremy
Seabrook, In the Cities of the South: Scenes from a Developing World (London and New
York: Verso Books, 1996); and Richard Robison and David S. G. Goodman (eds.), The
New Rich in Asia: Mobile Phones, McDonalds and Middle-Class Revolution (New York:
Routledge, 1996).
49. Both the scholarly and business press are beginning to take note of these implications.
See Martin Walker, "China and the New Era of Resource Scarcity," World Policy Journal
14, no. 1 (1996); and "The New Economies of Food" and "China's Huge Appetite,"
Business Week (May 20, 1996), pp. 78-84, 86-87. For the center of the controversy over
the resource implications of Chinese economic growth, see Lester R. Brown, Who Will
Feed China? Call for a Small Planet (New York: Norton, 1996).
50. On Bretton Woods, see Spero, The Politics of International Economic Relations, pp. 31-41;
Georg Schild, Bretton Woods and Dumbarton Oaks: American and Political Postwar
Planning in the Summer of 1944 (New York: St. Martin's Press, 1995); and Eric Helleiner,
States and the Reemergence of Global Finance: from Bretton Woods to the 1990s (Ithaca,
NY: Cornell Univesity Press, 1994).
51. Helleiner, States and the Reemergence of Global Finance, ch. 2.
52. Robert Triffin, Gold and the Dollar Crisis (New Haven: Yale University Press, 1960).
53. Spero, The Politics of International Economic Relations, p. 36.
54. Ibid., p. 42.
55. Ibid., p. 46.
56. Doug Henwood, "The Free Flow of Money," NACLA Report on the Americas
(January/February, 1996), pp. 11-17, at 12.
57. Helleiner, States and the Reemergence of Global Finance, pp. 171-75.
58. Miles Kahler, "America's Foreign Economic Policy: Is the Old-Time Relgion Good
Enough?" International Affairs 56, no. 3 (1980), pp. 458-73; Robert J. Carroll, An
Economic Record of Presidential Performance: From Truman to Bush (Westport, CT:
Praeger, 1995); Anthony S. Campagna, Economic Policy in the Carter Administration
(Westport, CT: Greenwood Press, 1995); and Helleiner, States and the Reemergence of
Global Finance, chs. 5,6.
59. Ethan B. Kapstein, "Workers and the World Economy," Foreign Affairs 75, no. 3 (1996),
pp. 16-37; at 28.
60. Ibid.
61. See The Industrial Bank of Japan, Monthly Report: Economic & Financial Trends in Japan,
no. 295 (April, 1996).
62. Kapstein, "Workers and the World Economy," p. 22.
63. Sanford M. Jacoby (ed.), The Workers of Nations: Industrial Relations in a Global Economy
(New York: Oxford University Press, 1995). On the case of Germany, see "Germany: Is
the Model Broken," The Economist (May 4, 1996), pp. 17-19.
64. See Michael A. Bernstein and David E. Adler (eds.), Understanding American Economic
Decline (New York: Cambridge University Press, 1994).
65. John Eatwell reviews and critiques the productivity argument as well as the following
import-competition argument in John Eatwell, "Unemployment on a World Scale," in
John Eatwell (ed.) Global Unemployment in the '90s (Armonk, NY: M.E. Sharpe, 1996),
pp. 3-20.
66. Ibid., p. 9.
67. Ibid., p. 11.
68. Cf. Roy C. Smith, "Risk and Volatility," Washington Quarterly 18, no. 2 (1995), pp. 117-31.
69. Eatwell, "Unemployment on a World Scale," p. 11.
70. Helleiner, States and the Reemergence of Global Finance, p. 145.
71. Ibid., p. 12.
72. See the superb "insider" study of R. Taggart Murphy, The Weight of the Yen: How Denial
Imperils America's Future and Ruins an Alliance (New York: W.W. Norton & Company,
1996).
73. Eatwell, "Unemployment on a World Scale," pp. 12-13.
74. Ibid. Doug Henwood adds the following observation: "Despite their reputation for
sobriety and sophistication, most portfolio managers ... display the emotional instability
of teenagers." Henwood, "The Free Flow of Money," p. 12.
75. Kapstein, "Workers and the World Economy," p. 29. A comprehensive study of the
"class" embodiment and networks of association of transnational elites has yet to be
written. For some notes in this regard, see Kees van der Pijl, "The Second Glorious
174 Carney
Revolution: Globalizing
International Political Ec
1995), pp. 100-28.
Apparently even some
globalization. In his book,
Books, 1994), Bob Woodw
by Wall Street investmen
created position of head
president-elect Clinton an
economic realities of inte
of the table, Clinton's fa
that the success of the p
bunch of fucking bond t
76. Daniel Bensaid, "Neo-L
(1996), pp. 109-16; and R
Globalization,'" Monthly R
and all of Europe, see the
I Department, in IMF Su
"rises," as we have noted,
"Europe: The Grand Illusi
77. Kapstein, "Workers an
78. Smith, "Risk and Vola
79. Michael Chege, "Sub-
Global Change, pp. 309
International Labour Re
become for many Weste
civilization in wide tract
the Earth: A Journey at
is one of the most frighte
The proper riposte to th
describe the effects of gl
in Christopher Hitchens,
and Central Europe, see
East Central Europe," in
169-98; Peter Gowan, "Ne
Review, no. 213 (1995), p
War"; and Drainville, "O
World Economy."
80. See the articles in Boyer
"Is a Strong National Eco
pp. 415-40. See also John
Bretton Woods: Alternati
and David Held, Democrac
Governance (Stanford, CA

Springer International Journal of Politics, Culture, and Society

Uploaded by

Document Information

Original Description:

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Springer International Journal of Politics, Culture, and Society

Uploaded by

Copyright:

Available Formats

Globalization: The Final Demise of Socialism?

Author(s): Larry S. Carney

Globalization: The Final Demise of Socialism?

What faces socialism a

(or even factory or enterprise) specific. Globalization theorists who want

3) The progressive integration of national markets into world markets,

4) The revolutionizing of all aspects of social existence by technology, par

From all sides, inclu

Even the most curso

Markets have archite

called a "neoconservative," to add to the semantic confusion) congeries of

In actual practice, these various elements of "conditionality" have not

LATIN AMERICA: THE NOT-QUITE-UNCONDITIONAL

In November 1994, Fernando Henrique Cardoso, sociologist, perhaps

solution they saw was

most indebted developi

capita decrease.24 Widening gaps in income distribution and wealth were

qualities of volatile capital movements, which show no loyalty to ortho

EAST ASIA: WHERE THE STATES ARE

Documentation and analyses of the success stories of the East Asian

The record of state-promoted export-oriented industrialization is in

which combines manufacturing activities, large tourist projects, and other

A notable feature of this government-stimulated spread of Singaporean

been subject to considerable restrictions. An additional aspect of these

Taiwan and South Korea's globalization strategies for their domestic

throughout Guangdong and Fujian provinces. Hong Kong is the dynamic

TRIADIZATION: FINANCE CAPITAL IN THE LEAD

At present, globalization is above all else the framework of irresolution

brium problems of its external accounts and to maintain its expansionary

prototype of international financial nirvana longed for by finance capital

terms of what it represented as a bonafide threat to bring down, through

Western Europe, desp

job losses in labor-intensive sectors of their economies). What needs to be

As the U.S. case indicates, a fifth incentive to liberalize global financial

markets and foreign exchange markets become dominated by simple slogans?larger

But if nation-states may be abandoning their workers, it does not mean

CONCLUSION: IS SOCIALISM DEAD?

In what in overall terms is an optimistic treatment of the problematics

You might also like