February 1, 2007
François Chesnais has defined three stages in the process of financial globalization. The first took place in the 1970s and he calls it "indirect financial internationalization of closed national systems." Latin American countries including Brazil took part in this process of attracting a substantial volume of loans. The second stage, 1980-85, started with Paul Volcker's "dictatorship of creditors" and the discovery by Margaret Thatcher of neoliberalism as the doctrine for the new age. The center countries, starting with the United States and Great Britain, unlocked their financial markets by liberalizing the international flow of capital. The interlinking of national systems became more direct and immediate through market finances. In Latin America, the debt crisis exploded with rising interest rates (following the negative Volcker shock) involving massive debt contracted in the prior period brokered by the banking system
February 1, 2007
n the 1980s the Brazilian economy suffered a long spell of stagnation and inflation caused by the foreign debt crisis affecting all indebted countries. That crisis triggered an acute inflationary process that reached 2,012.6 percent in 1989 and 2,851.3 percent in 1993, according to the general price index from the Getulio Vargas Foundation. The second half of the 1980s and the first of the 1990s saw the deployment of successive anti-inflationary plans, starting with the 1986 Plano Cruzado and ending with the 1994 Plano Real.* The period also marked the end of the industrialization strategy known as "import substitution" and the onset of neoliberal policies in Brazil
February 1, 2007
Since Fernando Collor's 1989 presidential victory, and most notably since Fernando Henrique Cardoso's two terms in office (1995-98 and 1999-2002, respectively), economic policies have been enacted in Brazil that represent a subordinate alliance of the country's dominant classes with international capital. Unfortunately, under President Lula these same sectors have remained in control, and economic policy caters to their interests
September 1, 2006
A trademark of our times is the dominance of neoliberalism in the major economic, political, and social forums of the developed capitalist countries and in the international agencies they influence-including the IMF, the World Bank, the WTO, and the technical agencies of the United Nations such as the World Health Organization, Food and Agricultural Organization, and UNICEF. Starting in the United States during the Carter administration, neoliberalism expanded its influence through the Reagan administration and, in the United Kingdom, the Thatcher administration, to become an international ideology. Neoliberalism holds to a theory (though not necessarily a practice) that posits the following
May 1, 2006
The questions regarding U.S. macroeconomic policy these days come down to whether the country can keep borrowing. Can consumers keep spending by increasing their debt level? Can the federal government keep running a large budget deficit without serious problems developing? Can the U.S. current account deficit keep growing? Will foreigners keep buying government bonds to cover this growing debt? If the answer is no to such questions, we can expect serious trouble and not just for the United States but for the rest of the world, which has grown used to the United States as the consumer of last resort. The United States buys 50 percent more than it sells overseas, enough to sink any other economy. In another economy, such a deficit would lead to a severe devaluation of the currency, sharply inflating the price of imports and forcing the monetary authorities to push interest rates up considerably
May 1, 2006
velopment economics, as a branch of economics that attempts to show how the world's poor economies can develop, had its origins in the 1940s and 1950s. One of its earliest ideas was that the economies of the less developed countries were mired in a cycle of poverty and needed a "big push" to develop. This push was seen as a large boost in investment, helped by the state's infrastructural and social spending, as well as by private foreign capital spending and aid from the governments of the developed nations
May 1, 2006
Immanuel Ness, Immigrants, Unions, and the New U. S. Labor Market (Temple University Press, 2005), 230 pages, cloth $59.50, paper $21.95.
Howard Karger, Shortchanged: Life and Debt in the Fringe Economy (Berrett~Koehler Publishing, 2005), 252 pages, cloth $24.95.
The widening and deepening of capitalism, which many economists misname globalization, has had traumatic impacts on workers. Sped up by what has been called neoliberalism (basically, the political program of modern global capital), the growing penetration of capitalist production and consumption relationships around the globe has literally pitched workers from pillar to post. For example, the North American Free Trade Agreement (NAFTA) has forced hundreds of thousands of Mexican peasants and wage workers to abandon their home country and migrate to the United States. Similarly, government austerity and "free market" programs—curbing food and health subsidies to the poor, closing and selling state enterprises, suppression of worker and peasant protests, and the like—in countries like India and China have deprived many workers of what security they had attained and pushed peasants from their land into cities
April 1, 2006
Agreements like the North American Free Trade Agreement (NAFTA) and the World Trade Organization (WTO) have enhanced transnational capitalist power and profits at the cost of growing economic instability and deteriorating working and living conditions. Despite this reality, neoliberal claims that liberalization, deregulation, and privatization produce unrivaled benefits have been repeated so often that many working people accept them as unchallengeable truths. Thus, business and political leaders in the United States and other developed capitalist countries routinely defend their efforts to expand the WTO and secure new agreements like the Free Trade Area of the Americas (FTAA) as necessary to ensure a brighter future for the world's people, especially those living in poverty
March 1, 2006
Education is an essential part of modern economic progress, yet in recent decades, the right wing has consistently been unfriendly to public education. For example, the Walton family’s donation of $20 billion to help conservative causes was weighted toward the privatization of public education.… The economic effects of privatization will not be felt immediately. Over time, however, as a larger share of the workforce suffers the handicap of inferior education, the negative effect on all aspects of society will be unmistakable.
December 1, 2005
At the end of October John Bellamy Foster and Martin Hart-Landsberg (coauthor with Paul Burkett of China and Socialismand author of Korea: Division, Reunification and U.S. Foreign Policy—both published by Monthly Review Press) traveled to Mexico City to participate as representatives of Monthly Review in the Fifth Colloquium of Latin American Political Economists. John spoke on "Imperial Capital: The U.S. Empire and Accumulation." Martin presented a paper (cowritten with Paul Burkett) on "China and the Dynamics of Transnational Capital Accumulation." Among the conference participants who met with John and Martin in a special meeting for Monthly Review were Guillermo Gigliani of Economistas de Izquierda (EDI) in Argentina (see "Argentina: Program for a Popular Economic Recovery" in the September 2004 issue of MR), Alejandro Valle of Mexico, the chief organizer of the Fifth Colloquium, and Leda Maria Paulani, President of the Sociedade Brasileira de Economia Política (SEP). Our hope is that this important meeting will lead to the establishment of a strong connection between MR and Latin American political economists confronting neoliberalism. The final outcome of the Fifth Colloquium was itself a landmark event: the founding of the long-planned Sociedad Latinoamerica de Economía Política y Pensamiento Crítico (Latin American Society of Political Economy and Critical Thought). The new organization will not be simply (or mainly) an academic and professional organization but will be actively dedicated to opposing neoliberalism and to supporting political and social movements for radical change in Latin America. We salute our Latin American political-economic comrades in this important struggle
