The Flat World of Neoliberal Utopianism
Thomas Friedman begins his best-seller, The World Is Flat, with an account of an epiphany experienced on a golf course in downtown Bangalore in southern India. His playing partner, pointing “to two shiny glass-and-steel buildings off in the distance, just behind the first green,” suggested he aim either at IBM or at Microsoft. After he had gotten to the eighteenth green (having encountered Hewlett Packard and Texas Instruments on the back nine), Friedman called his wife to say, “Honey, the world is flat.” Free-market globalization and rapid technological changes have, he says, produced a world of
digitalization, virtualization, and automation of almost everything. The gains in productivity will be staggering for those countries, companies and individuals who can absorb the new technological tools. And we are entering a phase where more people than ever before in the history of the world are going to have access to these tools. . . . I think this new era of globalization will prove to be such a difference in degree that it will be seen, in time, as a difference in kind. That is why I introduced the idea that the world has gone from being round to flat. Everywhere you turn, hierarchies are being challenged from below or transforming themselves from top-down structures into more horizontal and collaborative ones. . . . Hencefforth, more and more economies [will] be governed from the ground up, by the interests, demands and aspirations of the people, rather than from the top down by the interests of some narrow ruling clique.1
As he travels from country to country, meeting with CEOs, techno-geeks, and pundits, Friedman finds them everywhere integrating themselves into global networks, actively cultivating the deployment of the new technologies, creating unheard-of efficiencies, and, it goes without saying, making plenty of money. He describes unparalleled technological and organizational changes, particularly in the information technology (IT) sector (at one point he even happily pleads guilty to the charge of technological determinism, erroneously attributing such a theory to Marx, having liberally quoted from The Communist Manifesto). Behind this there exist important macroeconomic reforms. Initiated “by a small handful of leaders in countries like China, Russia, Mexico, Brazil and India” (and often relying upon authoritarian state powers to accomplish their goals), country after country has been pushed “into more export-oriented free-market strategies—based on privatization of state companies, deregulation of financial markets, currency adjustments, foreign direct investment, shrinking subsidies, lowering protectionist tariff barriers, and introduction of more flexible labor laws.” These countries’ leaders, he says, confronted “the irrefutable fact that more open and competitive markets are the only sustainable vehicle for growing a nation out of poverty, because they are the only guarantee that new ideas, technologies, and best practices are easily flowing into your country and that private enterprises, and even government, have the competitive incentive and flexibility to adopt those new ideas and turn them into jobs and products.” But two other conditions are necessary for a country to succeed. First, the state has to stimulate innovation and structure a regulatory environment favorable to entrepreneurialism and to personal accountability and responsibility. Constructing such a good business climate is the top-down part of the magical formula for economic success. Second, there has to be a parallel shift in bottom-up, grass-roots cultural understandings. The people of a country have to internalize “the values of hard work, thrift, honesty, patience, and tenacity,” and be “open to change, new technology, and equality for women.” In other words, everyone has to embrace contemporary bourgeois virtues and a neoliberal work ethic if they and the countries they inhabit are to succeed in today’s competitive environment.2 As with Kant’s cosmopolitanism, we all have to become the same everywhere in order to qualify for admission to the regime of universal (in this case neoliberal) rights and benefits.
Friedman’s is a brilliant but hyped-up caricature of the neoliberal world view that currently reigns supreme. The erasure of geographical and anthropological differences is striking, although at times it seems as if these do pose barriers to be overcome. A universal system of private property rights, free markets, and free trade together form the privileged, if not the sole, institutional framework within which the universal virtues of liberty and freedom can be realized. This is the supposed “irrefutable fact” upon which all of our hopes for a decent future must, according to Friedman, be founded. President Bush (not one of Friedman’s favorite politicians) makes a similar argument: repression, resentment, and poverty will everywhere be countered “with the hope of democracy, development, free markets and free trade,” because these have already proven “their ability to lift whole societies out of poverty.”3
Theories of this sort have been around for a very long time, but they took on their distinctive contemporary coloration in 1947, when a group of luminaries led by Friedrich von Hayek, Milton Friedman, Ludwig von Mises, and several others formed the Mont Pelerin Society. They claimed that individual rights, including freedoms of thought and expression, were everywhere being “progressively undermined by extensions of arbitrary power” and “by a decline of belief in private property and the competitive market,” adding that “without the diffused power and initiative associated with these institutions it is difficult to imagine a society in which freedom may be effectively preserved.”4 The role of the state with its monopoly of violence is, therefore, to create and support private property rights and free-market practices and to promote the integrity of money and a good business climate. But the state should go no further because, according to the theory, it cannot possibly possess enough information to second-guess market signals (prices), and because powerful interest groups (such as the infamous “K Street” lobbyists who currently so corrupt politics in Washington, D.C.) will inevitably distort and bias state interventions for their own benefit.
Neoliberal theorists have been particularly assiduous in cultivating the myth of private property as the guarantor of liberty and freedom. They convert the eighteenth-century view of the virtues of private property when embedded in a social system of moral obligations (of the sort that serious scholars of the time, such as Hugo Grotius and Adam Smith, went to great pains to specify) into an absolute fetish of property as an untrammeled and exclusive individual right to do exactly as one pleases with what one owns. In neoliberal theory, any restraints upon the exercise of private property rights are construed as an unconstitutional form of “takings.” This fetish belief is illustrated in what Thomas Friedman considers the “brilliant and innovative work” of Hernando de Soto.5 Usually depicted as an indigenous “third world theorist” from Peru, de Soto was in fact raised and educated in Geneva and early on gained the support of the Atlas Foundation for Economic Research, a right-wing North American neoliberal think tank. With its funding and advice, de Soto set up his Institute for Liberty and Democracy in Lima, Peru, and promptly became one of the leading voices in the neoliberal movement in the global South. Endorsed by Margaret Thatcher, Milton Friedman, and a host of other neoliberal luminaries as an indigenous thinker, he published books that became international best-sellers, exercising considerable influence over development theory (including that of the World Bank).
De Soto argued that poverty in the global South was self-inflicted rather than imperialistically, neocolonially, or capitalistically generated: the main barrier to development was the lack of clear title to ownership of assets, particularly land and housing. Ownership would open access to credit markets and integrate those in the informal economy into the global market, thereby ending poverty. The implementation of de Soto’s ideas, at first under his direction but later taken over by the Peruvian government and then by the World Bank, did not produce the expected results for the 1.2 million people who gained title in Peru. The one tangible effect seemed to be that adults worked more hours, while their children worked less. This was lauded in the World Bank and the mainstream press, as well as by Thomas Friedman, as a positive outcome. But, as Timothy Mitchell shows, the finding is probably more a product of how the data were collected than a reflection of people’s daily lives, to which I would add that even if it were properly substantiated, the idea that it is beneficial to the people who work more hours, as opposed to the people they work for, is far from proven.6
The idea that individualized private property, as a universal value, is a necessary condition for economic development and poverty alleviation has, however, no historical substantiation. Britain stood at the origin and dominated the world of industrial capitalism for a century or more while the crown, the church, the Oxford and Cambridge colleges, and a few aristocratic families controlled around two-thirds of the land. In practice, granting property rights to impoverished populations opens them up to market exploitations. In Egypt, the effect of reconceptualizing what used to be called “the informal economy” as a private property–led “microenterprise” economy (along lines recommended by de Soto) and of integrating it into “microlending” credit structures is, as J. Elyachar reports, far from benign. It seeks to impose market valuations and discipline upon a traditional workshop culture and to extract value out of that culture at relatively high rates of return. While neoliberals applaud such projects, the real effect, as Elyachar depicts it, is to create a “market of dispossession.” Such practices are now gathering strength around the world as microcredit is more and more touted as the solution to global poverty. Initiated in the first instance as a noncommercial scheme to provide very small amounts of capital to large numbers of very poor people (especially women), microcredit projects are now touted by commercial financial institutions as a way to bring large numbers of people into the disciplinary apparatus of the market while extracting high rates of return (in some instances as high as 20 percent). This conversion of philanthropic microcredit into a commercially viable system of microfinance is of considerable significance. It is an attempt to impose the cultural change (a self-disciplinary apparatus) that Friedman considers crucial to creating the flat world of neoliberalism. This now refracts back into philanthropic practices. A new school of philanthropists (trained in the ways of Wall Street) now believes, David Gross reports, that “fighting poverty effectively relies on the creation of low-wage factories, as well as the establishment of lending institutions that charge rates that many Americans would deem usurious.”7
This astonishing view that the poor will benefit the more they are disciplined by the market—and, incidentally, exploited by the rich—is not at all uncommon. Earlier, it was John Turner’s famous anarchist-inspired advocacy in the mid-1970s of self-help housing in the favelas and slums of the world that was so delightedly seized upon by McNamara’s World Bank as the key to reducing the travails of poverty and underdevelopment. It was supposed to give rise to a populist capitalism that would work for all and thereby abolish poverty. The scheme failed to realize its aims (though some intermediaries became wealthy), and poverty is worse than ever, as excruciatingly documented in recent reports on the state of our “planet of slums.”8 Private property arrangements, we should remember, have any chance to work only when, as Grotius and Adam Smith long ago insisted, the “moral sentiments” that regulate social interactions are of the requisite quality. The noncommercial microcredit schemes for which Yunnus, the originator, received the Nobel Peace Prize, incorporated this moral element, while the now numerous commercially grounded microfinance schemes do not.
The failure of neoliberals to imagine the consequences of imposing private property rights and monetized market institutions on divergent geographical, ecological, and anthropological situations is one of the more astonishing conceits of our times. In 2003, for example, the United States mandated the privatization of all state-owned assets and enterprises in occupied Iraq, full ownership rights of Iraqi businesses by foreign firms, the opening of Iraqi banks to foreign control, no barriers to foreign direct investment or to the repatriation of profits out of Iraq, and the elimination of nearly all trade barriers. The attempt to impose this free-market fundamentalism on Iraq, without any regard for the country’s complex social structures and history, has contributed to the disastrous collapse of the country’s political economy. The turn toward more neoliberal policies had, however, gathered steam throughout the world from the 1970s onward, led most spectacularly by the market reforms initiated in the United States under Reagan and in Britain under Thatcher. Social democratic, developmental, interventionist, and dirigiste states that had dominated global capitalism in the period from 1945 until the mid-1970s were bit by bit reformed along more neoliberal lines. In some instances (as in Chile after the coup of 1973), the changes were violently imposed. In other instances, neoliberal reforms were mandated as part of the solution to serious financial crises. Many of the formerly successful “developmental states” in East and Southeast Asia, for example, were pushed into partial neoliberalization through the catastrophic debt crisis of 1997–98.9 Elsewhere the reforms were pushed through by some mix of external pressures (typically orchestrated by the U.S. Treasury operating through its control over the International Monetary Fund [IMF] and the World Bank) and internal dynamics in which local elites sought political-economic advantage from neoliberal reforms.
I have analyzed the rise of neoliberalism as a purported answer to the economic crisis of the 1970s in detail elsewhere. Although neoliberalization promised in principle a world free of excessive state interference, in practice states have been heavily involved in producing a good business climate (often subsidizing capital and curbing the aspirations of labor), in bailing out financial institutions when they are threatened, and in integrating business into government through public-private partnerships (and other structures of governance) or through the legalized corruption of electoral processes (hence all those lobbyists in Washington). Neoliberalization also promised rapid economic growth and an expansion of the world market that would redound to the benefit of all. What actually occurred was something quite different. Neoliberalism broadly failed to stimulate worldwide growth.10 But it did entail relentless attacks upon forms of social solidarity incompatible with a system based on personal responsibility and individual initiative. It also saw significant state withdrawals from social provision. The reduction in barriers to trade and the opening up of global markets helped generate rapid shifts in the location of economic activity, in part accounting for the vast wave of deindustrialization and social disruption in working-class communities and even whole city-regions. “Offshoring” became a household word. While there were gains to be had from increasing trade, these gains were unevenly distributed, both geographically and socially. The power of finance capital, for example, was much enhanced, while the powers of organized labor were much reduced as state after state sought and in some instances violently imposed greater flexibility upon its labor markets. Furthermore, the advocates for the neoliberal way came to occupy positions of considerable influence in education (the universities and many think tanks\ set up during the 1970s by rich donors and corporations), in the media, in corporate board rooms and financial institutions, in key state institutions (treasury departments, the central banks), and also in those international institutions such as the IMF, the World Bank, and the World Trade Organization (WTO) that regulate global finance and trade. Neoliberalism became, in short, hegemonic as a universalistic mode of discourse as well as a foundation for public policies worldwide. It increasingly defines the common-sense way many of us interpret, live in, and understand the world. We are, often without knowing it, all neoliberals now.
This hegemonic shift, if we can call it that, permeates almost all attempts to grapple with what the term globalization means. In jumping on the globalization bandwagon, all manner of academics, policy makers, as well as purveyors of information in the popular media construct a picture of the world that is in essence no different from that which Friedman depicts (thus accounting for the popularity of Friedman’s text). This is unfortunately true even within anthropology, where an influential analyst like Arjun Appadurai has taken a leading role in describing what he sees as the new conditions of globality. Within that frame, he holds, we must now understand not only what he calls “the social life of things” (that is, the worldwide trend toward the commodification of everything) but also the production of distinctive landscapes, such as “ethnoscapes,” “technoscapes,” “mediascapes,” and the like, which then provide a certain kind of heuristic geographical framework through which we can interpret the anthropological diversity that is both actively produced and sustainable in a neoliberalizing world. The problem with such formulations is not that they are wrong per se, but that by presuming a singular and highly abstract force called “globalization” as the agent behind these changes, they give up on the necessity to “unpack” what that force is about, where it comes from, who is promoting it, and for what reasons. The world gets flattened conceptually almost by default. To begin with, the shift of language from terms like capitalism and imperialism to globalization performs a masking function as to the power relations involved. But in themselves these concepts are equally abstract and potentially flat, because they in turn tend to mask the contested and contradictory processes of uneven geographical development of the class forces both promoting and resisting globalization.11
For example, the idea that more and more economies will be governed, as Thomas Friedman asserts, “from the ground up by the interests, demands and aspirations of the people, rather than from the top down by some narrow ruling clique” is totally at odds with the immense and ever increasing concentrations of personal and corporate (particularly financial) power that have emerged in many areas of the world over the last thirty years. Wherever neoliberalization has occurred (from the United States to Mexico, Russia, South Africa, India, and now even nominally “socialist” China), social inequality has burgeoned. Neoliberalization has created a flat world for the multinational corporations and for the billionaire entrepreneur and investor class, but a rough, jagged, and uneven world for everyone else. As one of Friedman’s informants cogently observed, neoliberal reforms made it possible, perhaps for the first time, “to stay in India and become one of Forbes’s richest people in the world.”12
What amounts to a restoration and reconstitution of class power worldwide is of such significance (and so frequently ignored in social-scientific analyses of globalization) that it calls for documentation. Class power is, in itself, evasive because it is a social relation that eludes direct measurement. But one visible, necessary, and universal condition for its exercise is the accumulation of income and wealth in a few hands. The existence of such accumulations and concentrations throughout the world was being widely noted in U.N. reports by the mid-1990s. The net worth of the 358 richest people in the world was then found to be equal to the combined income of the poorest 45 per cent of the world’s population—2.3 billion people. The world’s 200 richest people, during the halcyon years of the so-called Washington Consensus, when neoliberalism ruled supreme, more than doubled their net worth in the four years to 1998, to more than $1 trillion. These trends subsequently accelerated, though unevenly. The share of the national income taken by the top 1 percent of income earners in the United States more than doubled between 1980 and 2000, while that of the top 0.1 per cent more than tripled. The income of the 99th percentile rose 87 percent” between 1972 and 2001, while that of “the 99.9th percentile rose 497 percent. In 1985 the combined wealth of the Forbes 400 richest people in the US was $238 billion with an average net worth of $600 million, adjusted for inflation. By 2005, their average net worth was $2.8 billion and their collective assets amounted to $1.13 trillion—more than the gross domestic product of Canada. By 2006, the top 1 percent of Americans gained their highest share of the national income ever (more than 21 percent). Wealth and income inequality reached levels not seen since the 1920s (which perhaps explains why the 2008 financial crash looks rather similar to that of 1929). Much of this shift derived from rapidly rising rates of executive compensation. In 1980, the average chief executive in the US made about $1.6 million a year in 2004 dollars. By 1990 the figure had risen to $2.7 million; by 2004 it was about $7.6 million, after peaking at almost twice that amount in 2000. In other words, executive pay rose an average of 6.8 percent a year compared to the 0.8 percent a year increase in average worker pay. And then there are the hedge fund managers who supposedly play such a productive and central role in spreading risks that the top twenty-five of them personally took home no less than $250 million each on average in 2005. By 2006 several of them took home more than a billion dollars, and the top earner was reported to have gained $1.7 billion (setting off an obscene competition between the major cultural institutions in New York City to place him on their boards of directors). In 2007 the four leading managers received over $3 billion each in compensation. The heads of private equity firms, which surged into prominence in the 1990s (they specialize in taking public companies private, reorganizing them, and putting them back in the public domain at a huge profit), were reported to be receiving parallel levels of compensation. And to prevent traders from starting out on their own hedge fund ventures, the leading banks had to raise their rate of remuneration for leading personnel from the $10 million or so that had been the norm in 2000 to around $50 million in 2006 (the head of Goldman Sachs received $52 million, and the average bonus to traders was $685,000). The tax policies of the Bush administration have scandalously multiplied these disparities in the United States. Most of the benefits have gone to the top 1 percent of income earners and to those living off dividends and capital gains rather than on salaries and wages. The tax reform of 2006 delivered tax relief of approximately $20 to those at the center of the income distribution, while the top tenth of 1 percent, whose average income is $5.3 million, would save an average of $82,415.13
Such trends have not been confined to the United States. Wherever and whenever neoliberal policies have taken hold—and the geographical spread has been very uneven—massive disparities in income and wealth have ensued. Following the wave of privatizations in Mexico after 1988, fourteen Mexican billionaires appeared on the 1994 Forbes list of the world’s wealthiest people, with Carlos Slim ranked twenty-fourth. In 2005 Mexico, with its very high rate of poverty, claimed more billionaires than Saudi Arabia, and by 2007 Slim was thought to have overtaken Bill Gates as the richest person in the world. Following the neoliberal reform wave in India in the 1990s, a dozen or more Indians appeared on the Forbes wealthiest list. Within a few years of “shock therapy” market reforms in Russia, seven oligarchs controlled nearly half of the economy, and there are now some twenty-seven billionaires in Russia, according to Forbes (creating a power base that Putin is furiously struggling to contain by a regrettable but understandable return to state authoritarianism). OECD countries registered big increases in inequality after the 1980s, as did the countries of Eastern Europe and the CIS. While firm and conclusive data are very hard to come by, abundant signs exist in China of the accumulation of massive private fortunes since 1980 (particularly in real estate development). A public offering on the Hong Kong Stock Exchange of a real estate company in southern China started by a poor farmer in 1997 raised $15 billion, “making the family of Yang Guoqiang perhaps the richest in China.” The family’s twenty-five-year-old daughter, who controls 60 percent of the shares, is now personally worth about $9 billion, more than George Soros or Rupert Murdoch. Margaret Thatcher’s neoliberal reforms in Britain contributed to the top 1 percent of income earners doubling their share of the national income by 2000. Even more scandalously, we see that the very top group of British income earners tripled their share of the national income from 1997 to 2007 under the Labour Government of Tony Blair and under the economic management of that good socialist George Brown. (“We are intensely relaxed about people getting filthy rich,” a Labour cabinet minister, Peter Mandelson, famously remarked). The so-called “developmental states” of East and Southeast Asia, which initially managed to combine strong growth with a reasonable equity of distribution (South Korea, Taiwan, and Singapore, in particular), have experienced a 45 percent increase in inequality indices since 1990, most of the change occurring after the fierce financial attack upon and subsequent forced neoliberalization of their economies in 1997–98. The vast fortunes of a few trading moguls in Indonesia escaped unscathed from this trauma, which left some 15 million Indonesians unemployed, and an Indonesian-based (though ethnically Chinese) trading group like that of Salim is now one of the wealthiest conglomerates in the world. The only measure of inequality that has diminished is that between countries, and this decline is almost entirely due to the astonishing growth performance of China, followed by India. Average per capita incomes in those countries have risen even as internal inequalities have surged.14
At the other end of the wealth scale, neoliberalization has done little or nothing to improve the condition of much of the world’s impoverished and marginalized populations. The global labor force available to capital has tripled in size—to around 3 billion workers—since 1980. One-quarter of that increase arose out of population growth (largely in the poorer countries of Africa, Asia, and Latin America), but three-quarters can be attributed to the proletarianization through integration of Russia and Central Europe, as well as China, and the better integration of India and Indonesia into the global economy. The sheer size of these increases has put strong downward pressure on the remuneration of labor worldwide, but the political weakness of this newly available global labor force has provided capitalists of all sorts (from petty commodity producers to large global corporations) with a golden opportunity to engage in very exploitative practices (justified, as we have seen, as necessary for poverty reduction!). Toward the end of his account, Thomas Friedman acknowledges that “there are hundreds of millions of people on this planet who have been left behind by the flattening process or feel overwhelmed by it.” As of now only 2 percent of the Indian population of 1.2 billion (according to Friedman’s estimate) participates in the new prosperity epitomized by the view from the golf course in Bangalore. The rest of the Indian population is living under conditions either “unflat” (full of pain and despair) or “half flat” (full of anxiety, hoping and struggling to find a place). It never occurs to Friedman that his proposed solution—further flattening through the extension of neoliberal reforms—actually is the root of the problem of spiraling inequalities and deepening insecurities.15 But this is precisely what neoliberal theory is so effective at disguising.
In the same way that Edmund Burke appealed to the facts of geography to critique British imperial practices in India, so the facts of geography, ecology, and anthropology are frequently used as sticks to beat upon the inappropriateness of neoliberal policies. For some, the problem lies primarily at the point of application. Joseph Stiglitz (once head of Clinton’s Council of Economic Advisors) has complained vociferously at the way policy makers, particularly in the extremely powerful financial institutions like the U.S. Treasury and the IMF, indiscriminately apply a universal, “one size fits all,” orthodox neoliberal approach to economic development everywhere. Appalled at the social devastation this wrought in Indonesia in 1998, he voiced his criticism of the IMF openly and shortly thereafter was forced out of his position as chief economist at the World Bank. While Stiglitz notes that the result of the Indonesian disaster was to favor Wall Street and U.S. financial interests, and to exacerbate rather than assuage local social and geographical inequalities, he fails to recognize that this enhancement of class power has been fundamental to what neoliberalism has always been about. Advantaging the rich was, in his account, an unfortunate by-product of policies created for other purposes, such as economic stabilization. Jeffrey Sachs (who teamed up with Angelina Jolie to do good works in impoverished parts of Africa) now broadly agrees with Stiglitz’s diagnosis. “Today’s development economics is like eighteenth century medicine, when doctors used leeches to draw blood from their patients often killing them in the process.” The world’s “money doctor”—the IMF—typically prescribes “budgetary belt-tightening for patients much too poor to own belts.” The result has been “riots, coups, and the collapse of public services.” Neoliberalism has all along, he argues, been “based on a simplistic, even simple-minded, view of the challenge of poverty. The rich countries told the poor countries: ‘Poverty is your own fault. Be like us [or what we imagine ourselves to be—free market oriented, entrepreneurial, fiscally responsible] and you, too, can enjoy the riches of private-sector led economic development,’”16 This is, of course, exactly what Friedman presupposes.
Others object that neglect of the cultural conditions within which capitalism can flourish leads to consummate errors of interpretation and judgment. Until the crisis of 1997–98, the remarkable growth performances that had occurred in East and Southeast Asia were frequently attributed to “Asian” or “Confucian” values (much as Protestant values were supposedly central to the rise of capitalism in Britain in the seventeenth and eighteenth centuries) and to long-embedded systems of mutual trust and reciprocity among businessmen (and it was almost entirely men within the confines of patriarchal relations). Known as guanxi among the Chinese, this system was widely admired for the ways in which it used cultural traditions in distinctive territorial settings to gain competitive economic advantage.17 Neoliberal institutions such as the World Bank took to describing it in their reports as an excellent example of how market economies could work. Only when crisis struck was this system of social relations scathingly criticized as “crony capitalism” (as if K Street in Washington is not crammed with cronies). The solution, the neoliberals in the U.S. Treasury and the IMF held, was “good governance,” to go back to the fundamentals of private property arrangements, pure competition, and properly functioning markets. This was, of course, the solution that just happened to be so beneficial to Wall Street and the financiers.
More fundamental criticisms of the violence and inhumanity of neoliberalization are articulated through social movements. In this the lack of respect for local social and ecological conditions looms large. Trenchant analyses by Walden Bello, Susan George, Arundhati Roy, Samir Amin, de Souza Santos, and many others who make up the umbrella Alternative Globalization Movement, have exposed the dark side of neoliberalization, with great emphasis upon particular destructions in particular places that have affected particular social groups (such as the Zapatistas, the indigenous populations and Hindu farmers in the Narmada Valley of India, the landless peasant movement in Brazil, or the Green Belt women’s movement in Kenya). Hierarchical power has indeed been challenged, but by the Bolivarian revolution of Chavez and Morales in Latin America rather than by the entrepreneurial processes that Thomas Friedman had in mind.18 The organizational form of the “malcontents” in the World Social Forum is far more in line, it turns out, with the horizontal and collaborative structures that Friedman idealizes than anything that can be found on Wall Street or in the City of London, let alone in the IMF or the WTO. Movements against the IMF, the WTO, and the G8 meetings have all emphasized the class and neo-imperialist character of these institutions, while emphasizing the local insensitivities of neoliberal policies in relation to actually existing anthropological, geographical, and ecological conditions. Criticism of neoliberalism, however, is not confined to the left and to social movements. The conservative political scientist John Gray, for example, complains that while the “Utopia of the global free market has not incurred a human cost in the way that communism did,” yet “over time it may come to rival it in the suffering it inflicts.” “We stand,” he says, “on the brink not of the era of plenty that free-marketeers project, but a tragic epoch, in which the anarchic market forces and shrinking natural resources drag sovereign states into ever more dangerous rivalries,” leading to “a world of war and scarcity at least as much as the benevolent harmonies of competition.”19 The spirit of Edmund Burke lives on.
Oppositional movements to neoliberalism frequently invoke the facts of geography, ecology, and anthropology to support their criticisms and their alternative visions. Local foods and food sovereignty, self-sufficient geographies, bioregional configurations, local trading systems, and the development of new and more intimate systems of social relations in new territorial structures become part of the rhetoric in the search for alternatives. Some proposals advocated e-linking from the global economy. In others, such as the International Forum of Globalization, a new geography of a “planetary system of economies made up of locally owned enterprises accountable to all their stakeholders” is envisaged as a way to overcome the alienation from nature and from fellow human beings produced by neoliberalization and globalization. Communitarian and localist in tone, such proposals still incorporate strong elements of liberalism, in the form of private property rights, individual initiative, and democratic institutions, even as they corral them within a much more intimately designed territorial structure of social relations. Nevertheless, such proposals view the production of a different kind of geography as essential to the achievement of a more egalitarian and satisfying mode of relating both to nature and to other human beings.20 This poses the question of how that different geography might be produced and by whom, and this, in turn, requires a closer examination of the inherent geographical character of the neoliberal project.
Why, for example, in the face of its very patchy record of actual achievement and the multiple criticisms that have been voiced, has neoliberalism remained so influential, if not dominant? Part of the answer lies in the power of the neoconservative and neoliberal think tanks and the corporate-dominated media, as well as many segments of academia, to dominate the discussion. The power and prestige of economics as a discipline and its ahistorical and aspatial manner of theorizing also play a major role. Liberal and neoliberal economic theories assume a world of deracinated men and women; producers and consumers; buyers and sellers; entrepreneurs, firms, and megacorporations; and supposedly neutral but placeless institutions of market and the law. While conventional economic theory has long been concerned to explain differences in the wealth of nations (a very geographical/anthropological problem), it has signally failed to provide coherent answers, even though the discipline has been endowed with far more resources, prestige, and influence over public policy than all the other social sciences combined. In spite of a raft of recent innovations, the explanation within economic theory of differences in the wealth of nations remains as elusive as ever from within the closed (and totally aspatial) terms of its foundational propositions.21
That neoliberalism produces uneven geographical development is clear, but less clear is the way it uses uneven geographical, anthropological, and ecological developments (including those it produces) as means to promote the universality of its own world project, which has nothing to do with the well-being of the whole of humanity but everything to do with the enhancement of its own dominant forms of class power. Uneven geographical development, in short, has been not only a result but also a driving force of neoliberalization on the world stage. We need to consider how this is so.
The ease and fluidity with which capital, particularly money capital, moves across space—between, say, Bavaria, Bangalore, Birmingham, and Botswana—is illustrative of a dynamical relation between spaces, places, and ecological systems within the global economy. In this movement, minor differences in the qualities (physical, social, and political) of particular places in relation to investment requirements can be parlayed into significant profits for those doing the moving. At the same time, the increasing weight of fixed capital and social investments in place creates a new geographical landscape (a built environment and local cultures, for example) that requires a serious commitment to sustaining that humanly produced landscape into an indefinite future. This means active engagement on the part of certain capitalist class interests (sometimes in alliance with popular local forces), with a politics of protection of privileged places—even the golf course in Bangalore—from the fierce winds of open competition.
Competition between territories (states, regions, or cities) as to who has the best model for economic development or the best business climate has intensifed in the more fluid and open systems of trading relations established after 1970. Successful states or regions put pressure on everyone else to follow their lead. Leapfrogging innovations put this or that state (Japan, Germany, Taiwan, the United States, or China), region (Silicon Valley, Bavaria, the Third Italy, Bangalore, the Pearl River Delta, or Botswana) or even city (Boston, San Francisco, Shanghai, Singapore, Barcelona, New York, or Munich) in the vanguard of capital accumulation. But the competitive advantages all too often prove ephemeral, introducing an extraordinary spatial volatility into global capitalism. Periodic episodes of localized growth have been interspersed with intense phases of localized creative destruction, usually registered as severe (and often socially devastating) financial crises in particular places at particular times. Argentina, for example, opened itself up to foreign capital and privatization in the 1990s and for a few years was the darling of Wall Street, only to collapse as international capital withdrew at the end of the decade. Financial collapse and social devastation were followed by a serious political crisis. Financial crises of this sort have proliferated all over the developing world, briefly devastating some economic giants, like South Korea, before leading to a recovery associated, as usual, with a radical transformation of class power. In other instances, such as Brazil and Mexico, repeated waves of structural adjustment and austerity have led to economic paralysis for the masses, while conferring considerable advantages on political-economic elites. That “success” was to be had somewhere and for someone obscures how neoliberalism has generally failed to stimulate strong and sustained global growth. The illusion is created that if only we all performed like the successful countries of the moment then we, too, could be successful.
As the role of the state shifts, from caring for the well-being of its citizens (under a paternalistic social democracy) to providing for a good business climate, so heightened interterritorial and interstate competition deepens neoliberal commitments. The decentralization of political powers here becomes a highly significant adjunct to the neoliberal project. If municipalities, cities, regions, and nation-states function as more or less autonomous, self-contained entrepreneurial units, then the intensification of competition between them forces all of them to offer more and more in the way of a good business climate to capital in order to sustain or attract investments and, hopefully, jobs. Increasing geographical decentralization of political power has been a very important feature of the historical geography of capitalism over the past thirty years. In China, for example, it was the controlled decentralization of economic decision making to regions, provinces, municipalities, and even villages that formed the basis for the remarkable economic development of the country after 1978.
What has to be offered in the way of a good business climate is not, however, entirely obvious. An adequate labor force is one necessary component, but the capitalist demand can vary all the way from low-waged and compliant to highly skilled and innovative labor supplies. Subsidizing companies to come to or stay in town is another familiar strategy, and during the 1980s in particular local governments throughout the capitalist world gave up vast subsidies from their public coffers to corporate capital (often going seriously into debt in the process). Intensifying interurban competition actually produces some curious geographical results. For example, the search for monopoly rents leads to a strong emphasis upon the commodification of unique features of an urban environment (such as cultural heritage). If such unique features (such as the Acropolis) do not already exist, then they have to be created (for example, by building signature architecture such as the Gehry Museum in Bilbao, staging unique cultural events such as film or art festivals, or bringing the Olympic Games to town). Urban administrations seek to build up symbolic capital through the development of so-called cultural, knowledge-based, or simply spectacle-driven industries. The marketing and selling of a city’s reputation in itself becomes a big business.22
Intensifying interterritorial competition thus locks in the need to orient government (and structures of governance) more and more toward the provision of a good business climate, without any regard for the well-being of a local population and in some instances without any regard for the fiscal consequences. And the coercive laws of interterritorial competition ensure that there appears to be no alternative. If the world were anywhere near as flat as Friedman portrays it, then neoliberalism would not work.
Neoliberalism has proven a huge and unqualified success, both materially and ideologically, from the standpoint of the upper classes almost everywhere.23 Countries that have suffered extensively, such as Mexico, have seen the massive reordering of internal class structures. With the media dominated by upper-class interests, the myth could be propagated that territories failed because they were not competitive enough—thereby setting the stage for even more neoliberal reforms, as well as increasing levels of subsidy to corporate interests. Increased social inequality (even super-exploitation of labor) within a territory is considered necessary to encourage the entrepreneurial risk and innovation that confers competitive power and stimulates growth. If conditions among the lower classes deteriorate, this is because they fail, usually for personal and cultural reasons, to enhance their own human capital (through dedication to education, the adoption of a Protestant work ethic, submission to work discipline, acceptance of flexibility, and all the other cultural adjustments that Friedman recommends). The idea is put about that problems arise only because of lack of competitive strength or because of personal, cultural, and political failings. In a Darwinian world, the argument goes, only the fittest should and do survive.
This brings us to a central conundrum. If the rich are to get much richer, and if neoliberalization is not generating much growth, then wealth and income must be redistributed either from the mass of the population toward the upper classes or from vulnerable to richer regions. Both movements entail what I call “accumulation by dispossession.”24 By this I mean a turn toward predatory accumulation practices of the sort that accompanied the rise of capitalism. These include the commodification and privatization of land and labor power, and the forceful expulsion of peasant populations from the land (as in Mexico and India in recent times); conversion of various forms of property rights (common, collective, state) into exclusive private property rights; suppression of rights to the commons; suppression of alternative (indigenous) forms of production and consumption; appropriation of assets (including natural resources); the slave trade (which continues today, particularly in the sex industry); usury; and, most devastating of all, the use of the credit system and debt entrapment to acquire the assets of others, most dramatically represented by the mortgage foreclosures that swept through the United States housing market beginning in 2006.
The primary aim of the vast global wave of privatization—a central tenet of neoliberal reform programs—has been to open up new fields for capital accumulation in domains hitherto regarded as off-limits to the calculus of profitability. Public utilities (water, telecommunications, transportation), social welfare provision (social housing, education, health care, pensions), public institutions (universities, research laboratories, prisons), and even warfare (as illustrated by the “army” of private contractors operating alongside the armed forces in Iraq) and the environment (trading in pollution rights) have all been privatized. The privatization of the ejidos in Mexico during the 1990s forced peasants off the land into the cities or to the United States (illegally) in search of employment. The Chinese state likewise dispossessed many peasants of their tacit land rights and transferred control over these assets (even in the absence of private property rights) to party elites. Eminent domain has been used by the state in the United States to release land for more profitable uses, at the cost of destroying viable communities. . The intellectual property rights established through the so-called TRIPS agreement within the WTO defines genetic materials, seed plasmas, and all manner of other products as private property. Rents for use can be extracted from populations whose practices had played a crucial role in the development of these genetic materials. Some corporate executives now believe that patents and intellectual property will actually become components of greater value to a company than real estate, plant, and equipment. The global environmental commons (land, air, water) are being depleted and habitats degraded through the wholesale commodification of nature (as exemplified in capital-intensive agribusiness). The commodification of cultural forms, of people’s histories and traditions, through tourism entails dispossessions. The music industry is notorious for its exploitation of grass-roots cultures and personal creativity. The reversion of common property rights won through years of class struggle (the right to a state pension, to welfare, to national health care) into the private domain has been one of the most egregious of all policies of dispossession pursued in the name of neoliberal orthodoxy. Assets are transferred from the public to the private domains where elites can more easily capture them. State power is frequently used to force such processes through, even against popular will.
Deregulation since the 1970s has allowed the financial system to become one of the main centers of redistributive activity through speculation, predation, fraud, and thievery. Stock promotions, asset stripping through mergers and acquisitions, the promotion of levels of debt incumbency that reduce whole populations, even in the advanced capitalist countries, to debt peonage (in the United States, household debt has tripled over the last thirty years even as wages have stagnated), to say nothing of corporate fraud and the raiding of pension funds: all these became central features of the capitalist financial system. The emphasis on stock values, which resulted from bringing together the interests of owners and managers of capital through the remuneration of the latter in stock options, led to market manipulations that brought immense wealth to a few at the expense of the many. The spectacular collapse of Enron was emblematic of a general process that dispossessed many people of their livelihoods and their pension rights. Beyond this, we also have to look at the speculative raiding—of the sort that sparked the Asian crisis of 1997–98—carried out by hedge funds and other major institutions of finance capital. These formed the cutting edge of accumulation by dispossession on the global stage, even as they supposedly conferred the positive benefit for the capitalist class of “spreading risks.” For performing such functions, as we have seen, the leading hedge fund managers gained $250 million on average in remuneration in 2005 alone, a figure that paled into insignificance compared to the earnings of several managers in 2007 that exceeded $3 billion.
Beyond the speculative and often fraudulent froth that characterizes much of neoliberal financial manipulation, there lies a deeper process that entails the springing of “the debt trap” as a primary means of accumulation by dispossession. Crisis creation, management, and manipulation on the world stage have evolved into the fine art of deliberative redistribution of wealth from poor countries to the rich. Debt crises in individual countries, uncommon during the 1960s, became very frequent during the 1980s and 1990s, culminating in the financial crash of 2008, which caught much of Wall Street by surprise even as it spread losses (when it was supposed to spread risk) for almost everyone, everywhere. The more frequent the debt crises, the more the solution was touted that the rationalization of debt by assuming more but carefully structured debt was the solution (this is what the IMF became so expert at and which now guides the policies of the world’s central bankers). Hardly any developing country remained untouched as crises were orchestrated, managed, and controlled both to rationalize the system and to redistribute assets largely from the poorer and more vulnerable economies back into the financial metropoles. R. Wade and F. Veneroso described the effects of the Asian crisis of 1997–98 this way: “Financial crises have always caused transfers of ownership and power to those who keep their own assets intact and who are in a position to create credit, and the Asian crisis is no exception . . . there is no doubt that Western and Japanese corporations are the big winners. . . . The combination of massive devaluations, IMF-pushed financial liberalization, and IMF facilitated recovery may even precipitate the biggest peacetime transfer of assets from domestic to foreign owners in the past fifty years anywhere in the world, dwarfing the transfers from domestic to US owners in Latin America in the 1980s or in Mexico after 1994. One recalls the statement attributed to Andrew Mellon: ‘In a depression assets return to their rightful owners.’”25
While the 2008 financial crisis looks different, it actually fits all too well into this longer history. The only significant difference is that it is larger and more all-encompassing. Localized crises and devaluations have been orchestrated in the past to facilitate accumulation by dispossession without sparking a general collapse or too violent a popular revolt. The structural adjustment program administered by the Wall Street/Treasury/ IMF complex of imperialist financial power takes care of the first, while it is the job of the comprador neoliberal state apparatus (backed by military assistance from the imperial powers) in the country or the sector that has been raided to ensure that unrest does not get out of hand. In 2008, however, the crisis that began in the United States quickly spread to engulf the whole world. The response followed the typical path taken by the IMF, but this time governments and central banks (rather than the IMF) bailed out the financial institutions while leaving it to the general public to pay, through some mix of unemployment, recession, loss of asset values (particularly housing), and an astonishing increase in the national debt. Some Wall Street institutions failed or were forcibly merged, but those that remain are more powerful than ever. The neoliberal rule of rescuing the financial institutions at the expense of the people was meticulously enforced at an unimaginable cost. Far from spelling the end of neoliberalism, the 2008 financial crisis was, from the standpoint of the consolidation of despotic class power, its culmination, even as it stripped away the veil of rhetoric concerning neoliberalism’s supposed dedication to individual liberties and freedoms. Assets were, once more, returning to “their rightful owners”! It remains to be seen whether there will be popular revolt.
When epochal shifts of the sort that brought neoliberal globalization into its current position of overwhelming dominance occur, then all manner of other conceptual, ideological, political, and cultural transformations will likely accompany it (though not exactly of the sort that Friedman had in mind). De Sousa Santos notes, for example, that the term governance, rarely used before 1975, has in recent times become a dominant way to think about and practice politics. The ideology of governance is grounded in ideals of efficiency and rationality of administration, bringing together significant “stakeholders” (the favored term) to come up with “optimal” but “politically neutral” public policies. But this is a beguiling mask—so much so that it is presented by Aihwa Ong, for one, as the essence of neoliberalization. Grounded in the idea of “private-public partnerships” and elaborate mechanisms for bringing various stakeholders into a consensual coalition, governance effectively masks the class and social relations that are redistributing wealth and income to the affluent through a networked and decentered system of organized political-economic power.26 But Ong never even considers, let alone interrogates, this possibility. The Michael Bloomberg administration of New York City is a classic example. A billionaire himself, he could effectively purchase the mayoralty unbeholden to anyone and announce an administrative system “above politics.” He has indeed rationalized city government to a high level of efficiency and delivered much in the way of improvements in the city. But his aim is to make the city competitive in the global economy. Innumerable high-value development projects are reshaping the city. He prefers, as we have seen, not to subsidize businesses to come to the city but to attract high-quality businesses that can bear the costs of a high-value location. While he does not dare say so, the same principle applies to people. Manhattan has increasingly become a haven for the affluent classes, an astonishingly rich and often transnational capitalist class, active beneficiaries of what the “neutral” and “efficient” Bloomberg administration is able to deliver. To conceptualize this lopsided class project as if it is just about efficient governance is plainly misleading.27
D. Chandler highlights a parallel growth of interest in human rights under neoliberalization (particularly those rights grounded in individualism and private property). Before 1980, he notes, very little attention was paid to the matter. Advocacy groups (many of them transnational), nongovernmental organizations (NGOs), and grass-roots organizations (GROs) have likewise multiplied and proliferated since 1980. These organizations step into the vacuum left by the withdrawal of the state from social provision. In some instances this has helped accelerate state withdrawal from social provision, turning NGOs into “trojan horses for global neoliberalism.”28 Legal arrangements have necessarily had to adjust to these conditions, and the courts now take a more prominent role. The centrality of civil society (as opposed to the state) is increasingly emphasized in policy circles and governance practices. Effective actions and organizations within civil society are now often considered more important as a locus of social change than is the state apparatus. The drive to command state power in order to get things done is therefore considered less and less urgent. Voluntary associations become more prominent, while political parties decline. All these transformations are implicated in each other and register the depth and breadth of social and political changes associated with the neoliberal turn.
The underlying connections of these shifts with the rise of neoliberalism are reasonably easy to establish. The neoliberal ideological insistence upon the individual as foundational in political-economic life opens the door to extensive individual rights activism. By focusing on these individual rights, rather than on the creation of social solidarities and democratic structures, movements cast their opposition in neoliberal terms, which means within the legal apparatus or through civil-society organizational forms (the NGOs in particular). It is costly and time-consuming to go down legal paths, and the courts typically favor rights of private property and the profit rate over rights of equality and social justice. Yet corporations are considered legal individuals (except when they deem it important, as before the International Criminal Court, to deny such a status in order to avoid liability for anything they do). Even the state is considered a “virtual individual” (Kant’s words) within the interstate system (though again, states have strategic ways to avoid, as in the case of the United States, liability for “crimes against humanity”). The frequent appeal to legal action reflects the neoliberal emphasis upon the rule of law and the preference to rely upon judicial and executive powers rather than those of representative democracy. Law replaces politics “as the vehicle for articulating needs in the public setting.” Chandler concludes that the neoliberal elite’s “disillusionment with ordinary people and the political process leads them to focus more on the empowered individual, taking their case to the judge who will listen and decide.”29 But there is a certain room for maneuver. The law can be challenged and revised, and some social movements, such as the landless peasant movement in Brazil, have achieved significant revisions in the legal code through their actions. Furthermore, the law is not monolithic across territories, even though it may be universal in its pronouncements. The need to coordinate legal arrangements across state boundaries creates innumerable areas of uncertainty. Over what space does the regulation of air safety or of labor processes extend, for example? In practice, the FAA rules set in the United States apply globally, since all airlines that fly into the lucrative U.S. market have to abide by them. Laws regulating environmental impacts or interstate commerce can, furthermore, be used for all manner of other purposes, such as arresting Mafia leaders or delaying the destructive operations of capitalist developers.
The NGOs sometimes do very good work and promote progressive politics. But they can often be elitist, unaccountable, and socially distant from those they seek to protect or help. They can conceal their agendas (which are often set by far-away donor organizations). More often than not, they seek integration within governance structures and then end up having to control their clientele rather than representing it. They presume to speak on behalf of those who cannot speak for themselves, and even to define the interests of those they speak for. When, for example, organizations agitate successfully to ban child labor in production as a matter of universal human rights, they may undermine economies where that labor is fundamental to survival. With their parents lacking any viable economic alternative, the children may be sold into prostitution instead (leaving yet another advocacy group to pursue the eradication of that). The universality presupposed in “rights talk” and the undoubted dedication of the NGOs and advocacy groups to universal principles sits uneasily with the local particularities and daily practices of political economic life.30
But there is another reason why a particular oppositional culture stressing rights and organizational mobilizations in civil society has gained so much traction in recent years. Accumulation by dispossession entails a very different set of practices from accumulation achieved through the expansion of wage labor in industry and agriculture. The latter, which dominated processes of capital accumulation in the 1950s and 1960s, gave rise to an oppositional culture (such as that embedded in trade unions and working-class political parties) that typically worked toward a social democratic compromise (if not outright socialist revolution). Dispossession, in contrast, is fragmented and particular—a privatization here, an environmental degradation there, a loss of identity or a financial crisis of indebtedness somewhere else. It is hard to oppose all this geographical specificity and particularity without appeal to universal principles. Dispossession entails the loss of rights. Hence the turn to a universalistic rhetoric of human rights, dignity, sustainable ecological practices, environmental rights, and the like, as the basis for a unified oppositional politics. This is what the transnational advocacy groups, NGOs, and GROs have become so expert and often effective in pursuing. And increasingly this is what radical oppositional politics is about.
The appeal to the universalism of rights is, however, a double-edged sword. It may and can be used with progressive aims in mind. The tradition that is most spectacularly represented by Amnesty International, Médécins sans Frontières, and others cannot be dismissed as a mere adjunct of neoliberal thinking. The whole history of humanism (both of the Western—classically liberal—and various non-Western versions) is too complicated for that. But the limited objectives of many rights discourses (in Amnesty’s case, the exclusive focus, until recently, on civil and political as opposed to economic rights) makes it all too easy to absorb them within the neoliberal frame, even as an oppositional culture. Universalism seems to work particularly well with global environmental issues, such as climate change, loss of biodiversity through habitat destruction, and the like. But its results in the human rights field are more problematic, given the diversity of political-economic circumstances and cultural practices to be found in the world. As de Sousa Santos notes, it has generally proven more effective in defending the right to difference (hence its importance in fields such as women’s and indigeneous rights and identity politics, where much has been accomplished) than in upholding the right to political-economic equality (fundamentally a class issue).31 Furthermore, human rights issues have been coopted as “swords of empire” (to use Bartholomew and Breakspear’s trenchant characterization).32 More broadly, we can conclude with Chandler that “the roots of today’s human rights–based humanitarianism lie in the growing consensus of support for Western involvement in the internal affairs of the developing world since the 1970s.”33 Domestically, public political debate is narrowed in debilitating ways. “Far from challenging the individual isolation and passivity of our atomised societies, human rights regulation can only institutionalize these divisions.” Even worse, “the degraded vision of the social world, provided by the ethical discourse of human rights, serves, like any elite theory, to sustain the self-belief of the governing class.”34
The temptation, in the light of this critique, is to eschew all appeal to universal rights and to the law as fatally flawed, as an untenable imposition of abstract ethics, and even as a mask for the restoration of class power. While these propositions deserve to be taken seriously, the terrain of rights cannot be abandoned to neoliberal hegemony. The critical connection forged between neoliberalization and the appeal to universals, ethical principles, and human rights should alert us. “Between two rights,” Marx famously commented, “force decides.”35 There is a battle to be fought not only over which universals and which rights matter, but also over how universal principles and conceptions of rights shall be constructed and incorporated into law. If class restoration of the sort that has occurred under neoliberalism entails the imposition of a distinctive set of rights, then resistance to that imposition entails struggle for entirely different rights.36 In particular, it suggests that it is collective rights and social solidarities around those rights rather than individual rights that really matter.
Behind all universal claims there lies, as always, the awkward problem of how to account for geographical, anthropological, and ecological differentiations. In the first instance this can be construed as a problem of sensitive application of universal neoliberal rights. The professional economist, argues Sachs, “requires a commitment to be thoroughly steeped in the history, ethnography, politics and economics of any place where the professional advisor is working.” The IMF, for example, with its “one shoe fits all” vision, “has overlooked urgent problems involving poverty traps, agronomy, climate, disease, transport, gender, and a host of other pathologies that undermine economic development. Clinical economics should train the development practitioner to home in much more effectively on the key underlying causes of economic distress, and to prescribe appropriate remedies that are well tailored to each country’s specific conditions.” Geographical situation matters, because countries are “shaped profoundly by their location, neighborhood, topography, and resource base.”37 Many oppositional GROs, seeking to de-link from the global economy, likewise articulate their discontent with neoliberalism by appeal to the specificity of their own geographical situation in much the same way that postcolonial critics appeal to Burke and Heidegger to challenge the universal claims of liberal imperialism.
Kant recognized that geographical, anthropological, and ecological differentiations led to the construction of local truths, laws, customs, environmental exigencies, and even national characteristics. These are hard to reconcile with universal pronouncements about rights, justice, liberty, and freedom. Kant’s answer was to proclaim the right for citizens of one state to be treated hospitably for a time in some foreign land, but not to stay indefinitely, particularly if they were not welcomed by indigenous inhabitants (hence Kant’s principled objection to colonialism). Sovereignty and citizenship within the absolute confines of a territorially defined republican state anchored his arguments. The effect is to create innumerable spatial exclusions (on this point, at least, Ong’s analysis of exceptions under neoliberalism is informative). The nature of the space within which the state held its sovereignty—its absolute qualities—permitted Kant to construe the state as a virtual individual in relationship to all other states constituting the state system. Competition as well as cooperation, war as well as trade, conflict as well as harmony among these virtual individuals became a central preoccupation of political theory as well as geopolitical practices. From Westphalia through the founding of the United Nations to the contemporary structures of global collaboration (such as the G8, the WTO, and various collaborative agreements like the European Union or the looser organizations of NAFTA or Mercosur,), attempts are constantly being made to construct adequate rules of the game to regulate international relations in peace and war, as well as with respect to economic, cultural, and social exchange, and the patterns of mobility of the people, capital, and commodities that these exchanges inevitably entail. That this does not always end in harmony should be evident, and John Gray’s fear that it can all too easily descend into “a tragic epoch, in which the anarchic market forces and shrinking natural resources drag sovereign states into ever more dangerous rivalries” cannot be ignored.38 One response to this threat has been to reinvent the cosmopolitan tradition as a way to transcend, or at least mitigate, the negative effects of the coercive laws of interterritorial and interstate competition. And it is to this possibility that we now turn.