Neoliberal Globalization

NEOLIBERAL GLOBALIZATION

Neoliberal: the current practice of laissez-faire, an economic stance stressing cutbacks in social services, stable currencies, and balanced budgets. Classical liberalism advocated governmental nonintervention and was pre-capitalist when workers were mobile and capital as the land was immobile. The switch here is that labor’s mobility is restricted by immigration laws and discrimination practices while capital is mobilized by technologies of financialization. But, the masses are still in motion while workforces compete across national borders causing a decreasing standard of living.

If we see anything in the past 50+ years, it is the tremendous mobility of labor, from migration to legal immigration to moving from state to state to moving into the cities where the jobs are, at the same time as immigration restrictions, housing shortages and mass incarceration. It is really unbelievable to see this whereas when I was younger, I did what I had to without any awareness of mass movements of labor. In the capitalist mode of production, labor is "free" as contrasted to precapitalist modes where the workers simply did not leave their land. If a person could not find work in the 17th-18th centuries and be starving, they were told to ‘get out’ which meant go to the US, or Australia, or a colony. Capitalism requires the moving of the workers from the rural areas to the cities, from poor nations to wealthier nations. Witness what is happening in China since 1978, where hundreds of millions of workers are being drawn into pre-built cities to work in manufacturing centers and the tremendous service industries supporting it.

There is no upward social mobility without educational credentials. Capitalism today requires intelligent, communicatively competent, literate workers, not to mention actual technical skills of some sort. There is class mobility, you can improve your class status, which is part of the freedom ideology, but the change will not be significant. I retired at 56 with a pension plus my saved earnings for many years. So, I know it can be done because at 18, I was broke and had nothing, no inheritance, and I knew nothing. At that time, I had also been a worker at several jobs: selling stationery, newspaper boy, switchboard operator, and a few other jobs which only gave me some spending money since my parents did not give me any money nor did they pay for any of my college education. Sometimes, I think people don't like me because they are jealous, but I worked hard every day for many years, so I can't sympathize with their emotions.

Anyway, the people in the lower middle and lower classes, over half the population, are manipulated by their desires. The managerial class is extremely small, like 10% just under 1%!! No one, or very few, has a big picture view of society or history. Everyone is directed by an ideology, perhaps even a set of delusions! Whether a crisis leads to a catastrophe or not, like WWI, is more a question of hope and chance, than rationality! But, what is the Middle East today? A huge catastrophe is happening.

The original meaning of 'free trade' was that the worker could leave their job and work elsewhere. This contrasted with the feudal modes of production and other precapitalist modes, like slavery. The serf and peasant or farmer were not free to move, they were anchored by tradition and contract to their land, like tenant farmers. As capitalism developed, the worker could leave their land and seek a job elsewhere, often in cities where there were many other jobs. This was the meaning of 'free trade.'

Then, this idea developed into entire businesses moving from one location to another or opening up a franchise. Free trade in this sense was opposed to protectionism or tariffs on imports or exports. But, tariffs are and have been very common; with the trade agreements since WWII inroads into protectionism have occurred.

Free trade was at its height in the mid-19th century as laissez-faire. Notice however that the three major wars of the 19th were fought over "free" labor: the US Civil War, the serf rebellions in Europe, and the Taiping Rebellion in China, at the same time as colonialism took root, e.g. UK's colonization of India, and the European colonization of Africa. So, 'free trade' was the focus of contestation back then, as trade agreements are today.

The world is not a free market. From currency exchange to trade agreements, there is a variety of import and export duties imposed on goods everywhere. The underlying point of trade agreements is to balance out each nation's natural strengths and weaknesses in the economic sense so that nations are not trying to produce goods that can be imported more cheaply from other states that can produce the transport them more economically.

Labor is mobile and can be transferred from one location to another whereas natural resources cannot be moved. So, the globalization movement searches for labor resources that maximize their profits and perhaps lower costs and prices of the goods. The problem occurs when producers of a good in one country are undersold by the same products being produced in another nation and even transported to the same locality. The competition between international goods and national goods, even with the import duties/quotas/restrictions, etc. wreaks havoc on local small-scale producers. Instead, those labor resources would shift to occupations that are more fruitful for the local people. Restructuring entire economies, markets, and local settings in terms of personal lives, housing, fertility intentions, or family formations, relationships, etc. have put much of the world in tension. This tension is expressed in non-compliance at workplaces and in people's personal lives.

Neoliberalism should be thought of as a macro-project directed from the top-down. There are several stakeholders in the trend towards restructuring the firm, the corporation, as international conglomerates where labor and productivity are dispersed. Corporations today own over one-half of the total wealth of the world! Not only should we consider the 'national models' where bureaucratic formal models of the firm undergo restructuring, like downsizing, and role flexibility, and diversification of labor sources, also, international models which involve navigating large capital investors, international institutions, trade agreements, and tax strategies.

The glitch in the top-down neoliberal models is that worker agency, or resistance, coupled to competition within markets, has made the globalization momentum slow down and forced neoliberal impulses to negotiate trade agreements which are not necessarily eliminations of protectionist policies, but a balancing of strengths and weaknesses which takes time to clear the markets and achieve a semblance of so-called equilibrium within each nation-people.

There is tension between parties, lobbyists, watchdogs, and governmental organizations, that represent classes of workers. Bureaucracies are composed of particular social classes whose relation to state power is always in transition as leadership and appointments change. Workers' informal lives, their housing, their fertility, and their mobility are precarious and vulnerable - neoliberal globalization has mobilized labor to move here and there as jobs open up and close down.

I have somewhat hastily put down a few general points on how the post- Covid19 scenario is likely to play out in the immediate and long-run around the world. I submit them below for your scrutiny and review.

1) Both state governments and private players will seek to enhance their capabilities in the fields of digital surveillance and security systems. There will be a marketing blitz claiming that surveillance apps played a major role in controlling the coronavirus pandemic and that this represents the future of healthcare. The military-industrial-digital complex will aggressively seek an opportunity for themselves in this crisis by installing themselves in healthcare systems around the world.

2) Neoliberalism as an ideology will face increased criticism and cynicism. Keynesian ideas will make a temporary comeback. It is more likely that many state governments including India will opt for a compromise between neoliberal and Keynesian approaches in their efforts to restart the economy, rather than altogether move away from the unsustainable growth model we currently follow. Global capital will seek a safe haven in India, besides other countries. In the coming days, it will be clear if our political leadership has enough foresight to not bite the bait that will come in the form of promised investment and new jobs. There will also be a temptation to print more money and pump it into the economy, but this will only further uproot the money economy from the natural economy of energy and matter.

3) Oil is still the most crucial commodity in the industrial system. But oil prices have tanked and demand is not likely to rise in the short-term. This may precipitate realignments in geopolitics, which we have to carefully observe.

4) The 21st century will most likely be a century of recurrent crises, relative scarcity, and economic contraction. The only long-term solution is to permanently step off the economic model that seeks to deliver greater prosperity for a few through the exploitation of natural ecosystems and the laboring masses. Countries must make use of the ongoing disruption to redesign their economies and make them resilient enough to weather future storms. For example, governments should not attempt to generate employment opportunities for the poor by investing in big-ticket infrastructure projects like airports and highways that cater to the needs of global capital. Rather, the most crucial infrastructure that needs to be build-up for the coming phase of economic contraction is a robust public health system. The test of resilience has to be applied at the most local levels.

5) Finally, economic resilience alone will not be sufficient for countries to emerge successfully out of the current and future crises. Social trust is fundamental to any effort at salvage and recovery. Societies lacking in such trust will respond to a crisis by scapegoating and fighting amongst each other, as seems to be the case in India. We must be vigilant as politicians will certainly seek to add further fuel to these flames.

Christopher H. Dawson, in "Dynamics of World History":

"Now it seems clear that it is impossible to have a purely 'practical' morality divorced from an interpretation of Reality. Such a morality would be mere social custom and essentially unprogressive. Progress springs very largely from the attempt to bring actual conditions and social habits into harmony with what are conceived as the laws or conditions of real life. The very conception of morality involves a duality or opposition between what 'is' and what 'ought to be.' Moreover from the very earliest conditions of primitive savagery up to the highest degree of intellectual culture, the ethical standard can be shown to be closely connected with some kind of world-view or conception of reality, whether that is embodied in a mythology, or a philosophy, or is vaguely implicit in the customs and beliefs of the society.

Now the great obstacle to the attainment of a purely rational system of ethics is simply our lack of knowledge of Reality. If we can accept some metaphysics of Absolute Being, then we shall quickly possess an absolute morality, as the Platonists did. But if we limit ourselves to positive and scientific knowledge of Reality, it is at once evident that we are limited to a little island of light in the middle of an ocean of darkness. Unfortunately, Herbert Spencer's attitude toward the Unknowable will not help us here, for the 'machina mundi' is a dynamic unity, and the part of it we know shares in the movement of the unknown whole. Most philosophies and religions have supposed that there is some kind of meaning or reason in the world process; though there are thinkers like Lucretius (and perhaps Bertrand Russell) who deny this, and yet try to fashion a kind of 'island' morality for reasonable humanity shipwrecked amidst the chaos of an irrational universe. Nevertheless the great majority of modern thinkers, in fact modern men, believe profoundly in the existence of progress, and not merely a progress of succession but a progress of improvement. 'Life moves on to ever higher and richer forms. Here is an adequate goal for moral effort! Here is justification of moral values! Here is a true foundation for a modern system of ethics!'

But from a purely rational point of view what does all this amount to? So far from explaining the problems of human existence, it adds fresh difficulties."