In Melbourne
Mood:
spacey
I'm in a Melbourne internet cafe. A little Korean place with Korean TV and bubble tea. For some reason the woman at the desk allocated me the computer at the far corner- the total opposite end of the cafe to the few other people there...
[ps just sorted out visa dramas] anyway...
Just wrote an email to Vanessa that I will reproduce some of it here:
anyway...
anyway... sorry I wrote a lot here... I think you should say 'deregulating' rather than 'opening up' markets...
Question: > 1. you once said to me you don't like us using >the term 'open up' when talking about markets etc. >because that is the term corporations use - what >is a better way of putting it? (i actually kind of >think it has negative connotations so i don't mind >it, but you probably have a good explanation which >i would agree with... i'm just too lazy to think >of it myself)
On 'opening up' markets...I would prob need to chat to you about it - because it depends on the situation and I am also not 100% clear on it. This is partly because of the wishy washyness of the concept (I just don't think you can categorise many different economic policies under the banner of 'freeing/opening up markets'. I don't see a definite common thread. Hence I believe 'free trade' as a concept when disconnected from the historical context of Adam Smith, Ricardo etc. is problematic.(I am open to peoples' disagreement with me here) Hey I'll take this answering process as a way of clarifying it for myself- sorry if I make it too simple I'm just trying to tease out the different aspects.
I think the word 'free trade is similar to 'development' because it is a normative word assuming a universal beneficiary when more often than not it is a euphemism for 'corporate dominance'. However at the same time it is seen as a 'principle' that different geopolitical players share as a 'common value' (and hence the consensus process of the WTO- consensus often works from a starting pt of common values). I think it is a common belief in the worth of export-oriented development.
'Free trade' is always constructed as a clear ideal that exists in a binary opposition to 'protectionism'. However I don't find this binary useful to explain reality or to recommend proposals. There are too many unanswered questions. I think it is fine when applied in a particular domain of economics where the 'players' are equal, and where there will not be inefficiency created through unnecessary exports. However I don't find it so ideal in other situations.
I think 'free trade' viewed as a 'principle' can only be a justifying discourse for simplistic (and hence destructive) policies. For example, viewing environmental regulations as 'barriers to free trade' when in reality environmental protection is necessary for the future of any economic activity, since human production is dependent on natural production.
Re: 'Opening up': In practice, many 'free trade' policies of the WTO strategically favour particular corporations who write their 'wish lists', and their home countries often lobby for their requests- (eg US pharmaceutical giants lobbied for Aust's PBS to be dismantled). So that does not seem like changes to 'open up ' a level playing field but rather a coercive form of corporate protectionism, that will benefit pre-determined players. Such policies clearly advantage companies with massive offshore supply chains that source goods at rock-bottom prices/ wages.
When trade policies are too simplistic, they only reward companies for sourcing goods cheaply and maximising profit. This is supposedly 'economic efficiency' (based on a narrow view of what is economic). However, there are other ideas of efficiency (eg an engineers view, in minimising resources used. Doug Henwood wrote about this in the book"After the New Economy"). Also there are many other reasons why a company/ coop should be rewarded in our economy, eg by being environmentally sustainable. How could such operations be rewarded in a money-based economy other than through some kinds of government intervention (eg penalties for polluting companies or subsidies for new solar businesses)?.
The reason why I don't like the phrase 'open up' to describe free trade is because it is a visual image that fits into the bigger metaphor of 'freedom' associated with neoliberal policies. (I discussed this issue of 'freedom' in a comment on Vibewire.net that I will reproduce below.)[Also if you want to read more about influential political metaphors, Lakoff's 'Don't Think of an elephant' is a good start]
It's true that 'opening up' can have neg connotations [eg 'opening up' a can of worms or a pandoras box] but the kind of 'opening' that the phrase usually refers to is an opening of restrictions that have previously restrained 'innovation', 'economic growth', 'market dynamism', etc. It also implies greater transparency and democracy (as in the metaphor 'opening up' windows). [even this is misleading since democracy as you know does not 'naturally' arise out of the market- it actually requires eternal vigilance]
Note that all these words suggest neutrality- and an abstract force without any beneficiaries or agents behind it. The implication is that EVERYONE is freed from these 'restrictions'. This is extremely misleading. We need to ask 'freedom for whom? to do what? 'Innovation of what? economic growth of GDP or local production? transparency for whom? (shareholders or employees?)
Every abstract word must be placed in a context. Without doing that it is meaningless and potentially manipulative. Metaphors (such as the level playing field) too are potentially manipulative, because they substitute a fairy tale (which may be partially accurate) for evidence. They construct the way we think about reality. Every time we use a conventional metaphor we are playing into a socially established framework that usually reflects certain unquestioned ideologies.
(I have got this from philosophy- in phenomenology they say that you cannot just 'have consciousness' full stop. That wouldn't make sense. It has to be consciousness OF something- of an object, - if you didnt want to specify I guess you could say consciousness in general......In the same way I was thinking about this the other night when I was having a beer with Matt S and some others and he commented that I am "self-motivated". However what does that mean? I thought afterwards "self motivated about what?" that this does not make sense- I am only self-motivated in relation to a certain domain of activities. I am only motivated to do those activities that i see as important. I am not very motivated to go and get boring jobs although I have needed to. I am not motivated to go swimming every day with my sister).
Anyway thats enough for now...
speak to you later
Anne
===
Comment on Vibewire (maybe I shouldn't have bothered cos this guy is really one of the economic rationalist faithful)
Hi Sukrit,
I'm wondering what you mean when you call yourself a libertarian-
because I am also a libertarian yet I am clearly of the left rather than the right.
I think the political compass is useful in this respect: http://www.politicalcompass.org/
historically, the word 'libertarian' was associated with the Left- with those who favoured liberty (as well as equality
and fraternity). I see freedom as the capacity to fulfil ones' potential, so I also believe that the 'sink or swim' mentality of many of the free market policies imposed on African countries (eg through World Bank structural adjustment programs etc) are antithetical to freedom for most people for whom the 'invisible hand' of the market becomes a coercive force in their lives.
Also, in response to your definition of a worker, yes that is a similar definition that most socialists/left libertarians have of the working class. The "ruling" class is only in reality very small- those people whose livelihoods do not depend on their own labour but on the performance of their assets. But even then, some of their actions do 'add value' to a company/ product. It is very hard to not do any creative labour at all.
I like to see class in terms of how much autonomy people have at their workplace. Employers have power-over to the extent that their employees are afraid of losing their jobs. So if you don't really care if you are fired, you probably have some other income stream or you have enough social capital/ education/ skills to make you employable. Those who are at the bottom end of the sloped bargaining table are those people who are in some way incapacitated in their ability to assert their rights. These are the people who are affected most dramatically by individual contracts. (such as those being imposed on universities as a condition of their extra funding by governments).
Finally, I am wondering how African nations can develop through free trade alone, if many African nations have specialised in commodities as their 'comparative advantages'. Commodity prices have gone into freefall over the last 30 years, esp the last 5 years (the commodity price of coffee has halved over 5 years). Export oriented agriculture has displaced local economies, leading to bizarre situations where countries are in famine whilst exporting mangoes to Europe (one year, The Ivory Coast producers dumped their mangoes in the sea, because the commodity price was too low, whilst their local people starved).
Surely all this calls for some way of ensuring fair wages for the people who produce such products, so that their lives aren't controlled by such uncertainty. This is what 'Fair trade' is about.
Anyway I could write much more but that's enough for now...
Posted by anneenna
at 10:55 PM NZT
Updated: Wednesday, 6 July 2005 11:21 PM NZT