In a few days I will finalize my end of year marks, and my first academic year teaching IDS in Canada will come to an end. It has been quite a year: student numbers of immensely greater magnitude than when I taught in Europe in a post-graduate school, being taught at a level that was, by definition, not as demanding of that found in a post-graduate school. However, what is interesting about my first year is the way in which the students that I have taught have made the year. They have been far more engaged, far more challenging of my views, and far more provocative than perhaps any other batch of students I have taught these past 20 or so years. They have made the year.
My students can basically be divided into 3 groups. The first group are those that are coasting through a university education because--well, that is what you do if you get the marks: it is the way in which you get away from home. Some of these students are in sports, but most are just--coasting, and this is seen in their results. The second group are those that are taking IDS courses, but as options, and who will not have, at the end of the day, an IDS degree--it will be in environmental studies (a very popular option), or women's studies, or in politics or sociology. Some of these students can be very good indeed. Finally, there are those that are opting for an IDS degree.
How is it that an 18 year old Canadian high school student in 2007 decides to do IDS from the first year of their degree (I have had several of these this year) ? Some do have international experience. Some want to do the Trent year-abroad programs, which are an unparalleled opportunity to live outside Canada. Some have a religious or politically-engaged angle to their thinking. What is striking, though, about these students is just how committed they are to international development. They have, through some process, arrived at quite an anti-globalization, anti-capitalist perspective--and this is what has brought them to Trent University. It is quite remarkable. Students will challenge you repeatedly as to how your own work has been too compromised with the powers that be, too accepting of the status quo. At the same time, though, they really appreciate the experience that the IDS staff have of 'real development'. They enjoy the ability to bring ideas down to earth, to show the importance of ideas to people's lives and livelihoods, around the world. They are hungry--hungry!--to learn more. It is quite something to see.
The students that I have taught this year, whether they are graduating or not, are going off to do interesting things. Some, of course, are doing the year-abroad programs, and are getting ready to go to Ghana or to Ecuador for almost a year. Others are going to Vietnam or South Korea or Japan to work. Some are going on to graduate schools. One is going to live in Havana--that will be an eye-opener for them, to the realities of 'real development', I am sure.
What is memorable about these students is how they are not standing still, how they are moving forward, how they are trying to live out their 'alternative' life. For many, if not most, it will be messy, and involve compromises. That is the nature of life. Yet these students, with their passion and energy empower me in a way that I had not thought possible, because they still believe in life, and all its possibilities, as well as the potential for change. It is refreshing.
Anyone who tells you that young people today are not like they were 'in my time' is right: they are better. I feel more confidence in our collective future than I have in some time.
Tuesday, April 10, 2007
Monday, April 9, 2007
from Vimy to Afghanistan
On the television, Canadian Prime Minister Stephen Harper is speaking of the glory of the battle of Vimy Ridge, on the day when, 90 years ago, what is now the Canadian Forces fought for the first time as a single unit in a battle that, some historians now apparently tell us, served as a crucible within which Canada emerged onto the world stage as a nation. Yesterday, in southern Afghanistan, six Canadian soldiers were killed when their vehicle was hit by an explosive device. There too, we are told, Canadian soldiers are 'doing their duty' in 'fighting terrorism' and preventing the re-emergence of the Taliban. What links that day 90 years ago with the atrocity yesterday is that both were senseless.
The 'Great War', as the First World War was known until the Second World War, was, without doubt, one in which soldiers fought with great bravery in a cause that many of them thought to be just. Nonetheless, the Great War was not a war between 'barbarism' and 'civilization', as it was painted at the time: it was a war between an emerging capitalist power, Germany, and a set of established capitalist powers, the United Kingdom and France, and was principally about having the political ability to dictate the terms and conditions governing the world order. It is, in this light, of no little significance that the terms and conditions that the victors imposed on the world order in the light of the German surrender in 1918 led directly to the Second World War. The 3,598 Canadians that died at Vimy Ridge were not battling barbarism; they were battling the soldiers of a capitalist competitor. Moreover, those who fought often faced horrific choices from the commissioned officers, many of whom were English, that acted as their overlords. Thus, as Pierre Berton recounted in his book Vimy, one soldier tried to help a wounded friend and comrade in a crater, only to have a gun pointed to his head by an officer that was forcing him to continue. His friend died. Individual acts of heroism--and barbarism--should not let us forget the basic, fundamental senseless of the Great War, as millions on both sides marched off to the 'war to end all wars', to be used as fodder for cannon, artillery, for the elites who were the victors of the war.
Canada has been involved in Afghanistan now since the Americans toppled the Taliban. What needs to be focused upon in this ongoing conflict is the extent to which we--the West, that is--is engaged in fighting our own creation, and in so doing are creating enemies that were not previously against us. We are, in this sense, the creators of terrorism. The US, the British, and the wider members of NATO supported the mujahaddin when they fought the Soviets in Afghanistan, providing them with arms, including, famously, Stinger missiles, while, in many cases, turning a blind eye to the drugs that paid for much of the conflict. The mujahaddin were open about their use of drugs to fund their 'holy war'--I saw it, with my own eyes. In this conflict grew, of course, the legend of Osama bin Laden. Later, the Soviets withdrew, leaving a weak PDPA government and a set of competing, conflict-ridden guerilla armies intent on running the country (and, in some instances, controlling the drug trade). When the Soviets withdrew, because the PDPA held on to control of the cities, they received no assistance from the West, and continued to face the mujahaddin in an ongoing series of lesser and greater battles. Into this cauldron stepped the Taliban. Financed by the Pakistani security services, the ISI, who had been, in turn, financed by the West during the Afghan resistance, in effect the Taliban arose because of the extension of Western support for the anti-Soviet resistance into Pakistan and the Pakistani state itself. The Taliban represented the very antithesis of enlightenment values, but no matter: they were against the PDPA. When Kabul collapsed, and Najibullah was hung from a crane in Kabul, we were witnessing the victory of a movement that we had, at least indirectly, sponsored, and who now moved to impose a crude version of Islam across the country.
Cut to 2007. The Taliban were defeated, but are resurgent. Osama bin Laden has not been captured. In the process of this war, which is now approaching its 6th anniversary, it is worth asking why, if this war was to bring civilisation to barbarism, is it that 6 Canadian soldiers died senselessly yesterday. The answer is simple: force protection, the mantra of armies throughout the world, and rightly so, is not development assistance. Afghan peasants have had bad crop yields, faced water shortages, are struggling to construct a livelihood in the most difficult of circumstances, and in exchange for this effort, are being, still, killed for nothing by NATO forces. Bombs drop into wedding parades; no one in Berlin knows. Soldiers destroy some homes in a village; no one in London knows. House to house searches in Kandahar kills innocents; people in Toronto have forgotten. The manner by which the war in Afghanistan is being conducted are de-basing a people that have endured more than 30 years of the most brutal war, and who only want, ultimately, to be left alone by all these conflicting forces.
Was the Great War worth it? The Holocaust was a direct consequence. Is the war in Afghanistan worth it? 'Terrorists' are being created by its consequences. We in the West are creating our own insecurity, even as global elites continue, much as they ever have, to undertake actions which are designed not to benefit us, but to benefit them.
The 'Great War', as the First World War was known until the Second World War, was, without doubt, one in which soldiers fought with great bravery in a cause that many of them thought to be just. Nonetheless, the Great War was not a war between 'barbarism' and 'civilization', as it was painted at the time: it was a war between an emerging capitalist power, Germany, and a set of established capitalist powers, the United Kingdom and France, and was principally about having the political ability to dictate the terms and conditions governing the world order. It is, in this light, of no little significance that the terms and conditions that the victors imposed on the world order in the light of the German surrender in 1918 led directly to the Second World War. The 3,598 Canadians that died at Vimy Ridge were not battling barbarism; they were battling the soldiers of a capitalist competitor. Moreover, those who fought often faced horrific choices from the commissioned officers, many of whom were English, that acted as their overlords. Thus, as Pierre Berton recounted in his book Vimy, one soldier tried to help a wounded friend and comrade in a crater, only to have a gun pointed to his head by an officer that was forcing him to continue. His friend died. Individual acts of heroism--and barbarism--should not let us forget the basic, fundamental senseless of the Great War, as millions on both sides marched off to the 'war to end all wars', to be used as fodder for cannon, artillery, for the elites who were the victors of the war.
Canada has been involved in Afghanistan now since the Americans toppled the Taliban. What needs to be focused upon in this ongoing conflict is the extent to which we--the West, that is--is engaged in fighting our own creation, and in so doing are creating enemies that were not previously against us. We are, in this sense, the creators of terrorism. The US, the British, and the wider members of NATO supported the mujahaddin when they fought the Soviets in Afghanistan, providing them with arms, including, famously, Stinger missiles, while, in many cases, turning a blind eye to the drugs that paid for much of the conflict. The mujahaddin were open about their use of drugs to fund their 'holy war'--I saw it, with my own eyes. In this conflict grew, of course, the legend of Osama bin Laden. Later, the Soviets withdrew, leaving a weak PDPA government and a set of competing, conflict-ridden guerilla armies intent on running the country (and, in some instances, controlling the drug trade). When the Soviets withdrew, because the PDPA held on to control of the cities, they received no assistance from the West, and continued to face the mujahaddin in an ongoing series of lesser and greater battles. Into this cauldron stepped the Taliban. Financed by the Pakistani security services, the ISI, who had been, in turn, financed by the West during the Afghan resistance, in effect the Taliban arose because of the extension of Western support for the anti-Soviet resistance into Pakistan and the Pakistani state itself. The Taliban represented the very antithesis of enlightenment values, but no matter: they were against the PDPA. When Kabul collapsed, and Najibullah was hung from a crane in Kabul, we were witnessing the victory of a movement that we had, at least indirectly, sponsored, and who now moved to impose a crude version of Islam across the country.
Cut to 2007. The Taliban were defeated, but are resurgent. Osama bin Laden has not been captured. In the process of this war, which is now approaching its 6th anniversary, it is worth asking why, if this war was to bring civilisation to barbarism, is it that 6 Canadian soldiers died senselessly yesterday. The answer is simple: force protection, the mantra of armies throughout the world, and rightly so, is not development assistance. Afghan peasants have had bad crop yields, faced water shortages, are struggling to construct a livelihood in the most difficult of circumstances, and in exchange for this effort, are being, still, killed for nothing by NATO forces. Bombs drop into wedding parades; no one in Berlin knows. Soldiers destroy some homes in a village; no one in London knows. House to house searches in Kandahar kills innocents; people in Toronto have forgotten. The manner by which the war in Afghanistan is being conducted are de-basing a people that have endured more than 30 years of the most brutal war, and who only want, ultimately, to be left alone by all these conflicting forces.
Was the Great War worth it? The Holocaust was a direct consequence. Is the war in Afghanistan worth it? 'Terrorists' are being created by its consequences. We in the West are creating our own insecurity, even as global elites continue, much as they ever have, to undertake actions which are designed not to benefit us, but to benefit them.
Tuesday, March 20, 2007
the end of the peasantry?
I have spent most of my professional life working in an area that, within the political economy of international development, is called 'the agrarian question'. Simply stated, it is an approach to rural change that tries to understand how changes in rural life do or do not contribute to the development of capitalism, both in the rural economy and more widely.
For the past 10 years or more, there has been a debate within agrarian political economy concerning the relevance of the agrarian question in an era of globalization. The proposition is straightforward: that as a consequence of globalization, the current form of imperialism, the development of capitalism in the rural economy is simply irrelevant to transnational capital. Capital is formed globally, and national capitalisms are now not relevant to its transformative 'project'. This debate is explored at length in my next book, Political Economy, Rural Transformation and the Agrarian Question: Globalization and Peasant Livelihoods.
Does agriculture matter any more, in today's globalized economy? Is the peasantry finished, a relic from an age that does not exist anymore? I have been thinking about this over the past month, both in Europe and in Canada, and it has struck me that this kind of thinking is predicated on a particularly modernist reading of change and development.
We live in an age where an ideology of progress holds firm. In other words, we believe, in our very soul, that human history is a constant movement forward, as problems are solved and our species slowly and fitfully 'progresses'. This motion is highly modernist: that we live in a times where science and technology propel change that will eventually be beneficial. Marx held to this notion; so did Adam Smith; and so does the World Bank.
The problem is that history shows us that progress is not inevitable. In the 10000 years since the human race began settled agriculture, and the 4000 years since 'civilization' emerged, ironically, in the modern day hell that is Sadr City, there have been many instances in which, rather than moving forward, societies have come to a halt, and indeed, regressed. Where progress has given way to retrogression. With retrogression has come technological collapse, and a loss of abilities to solve problems that had already been solved. In other words, human history is marked by periods of retreat, not progress. Invariably, this retreat is always associated with some kind of agricultural collapse, and the consequent inability of civilizations to feed themselves, allowing a degeneration of social order into conflict and death.
Our ideology of progress is so firmly rooted in us that we cannot imagine the idea of an agricultural collapse--although many parts of the world live it, day in and day out. Nonetheless, agricultural collapse may--and I hedge my bets here, and stress may--be staring us in the face. The median predictions of climate change that are currently accepted by those more knowledgeable than I suggest that the increase in planetary temperature in the next 40 years or so will result in end of wheat production in the second biggest wheat producer in the world--India. Of course, Indian wheat collapse will be partially offset by wheat production elsewhere--but that offset will only be partial. With this, and with the consequent possible collapse of grain production in many other parts of the world over the next half century (Argentina? Ukraine?), the idea that progress has rendered agriculture redundant to international development seems a non-starter. So it is. Indeed, it is probable that rather than facing the end of the peasantry, the death of the peasantry, we will soon be living in a world where a peasant's ability to feed themselves will be, once more, fought over by those who cannot or will not feed themselves and who have the resources and coercive power to take what they want.
For the past 10 years or more, there has been a debate within agrarian political economy concerning the relevance of the agrarian question in an era of globalization. The proposition is straightforward: that as a consequence of globalization, the current form of imperialism, the development of capitalism in the rural economy is simply irrelevant to transnational capital. Capital is formed globally, and national capitalisms are now not relevant to its transformative 'project'. This debate is explored at length in my next book, Political Economy, Rural Transformation and the Agrarian Question: Globalization and Peasant Livelihoods.
Does agriculture matter any more, in today's globalized economy? Is the peasantry finished, a relic from an age that does not exist anymore? I have been thinking about this over the past month, both in Europe and in Canada, and it has struck me that this kind of thinking is predicated on a particularly modernist reading of change and development.
We live in an age where an ideology of progress holds firm. In other words, we believe, in our very soul, that human history is a constant movement forward, as problems are solved and our species slowly and fitfully 'progresses'. This motion is highly modernist: that we live in a times where science and technology propel change that will eventually be beneficial. Marx held to this notion; so did Adam Smith; and so does the World Bank.
The problem is that history shows us that progress is not inevitable. In the 10000 years since the human race began settled agriculture, and the 4000 years since 'civilization' emerged, ironically, in the modern day hell that is Sadr City, there have been many instances in which, rather than moving forward, societies have come to a halt, and indeed, regressed. Where progress has given way to retrogression. With retrogression has come technological collapse, and a loss of abilities to solve problems that had already been solved. In other words, human history is marked by periods of retreat, not progress. Invariably, this retreat is always associated with some kind of agricultural collapse, and the consequent inability of civilizations to feed themselves, allowing a degeneration of social order into conflict and death.
Our ideology of progress is so firmly rooted in us that we cannot imagine the idea of an agricultural collapse--although many parts of the world live it, day in and day out. Nonetheless, agricultural collapse may--and I hedge my bets here, and stress may--be staring us in the face. The median predictions of climate change that are currently accepted by those more knowledgeable than I suggest that the increase in planetary temperature in the next 40 years or so will result in end of wheat production in the second biggest wheat producer in the world--India. Of course, Indian wheat collapse will be partially offset by wheat production elsewhere--but that offset will only be partial. With this, and with the consequent possible collapse of grain production in many other parts of the world over the next half century (Argentina? Ukraine?), the idea that progress has rendered agriculture redundant to international development seems a non-starter. So it is. Indeed, it is probable that rather than facing the end of the peasantry, the death of the peasantry, we will soon be living in a world where a peasant's ability to feed themselves will be, once more, fought over by those who cannot or will not feed themselves and who have the resources and coercive power to take what they want.
Friday, March 9, 2007
institutions for international development studies
I am now a few hours from finishing my Gender and Economic Policy Analysis teaching at the Institute of Social Studies (ISS) in The Hague, where I worked for eleven years. Coming back to the ISS after being away for a while has allowed me to see the institution in a different light, and this says something, to me, about aspects of the state of education in international development studies.
The ISS is the oldest graduate school of development studies in Europe--and hence the world. Over the years, 10000 students have attended courses there, and the offerings of the ISS are, in terms of the range available, quite unparalled. Moreover, from a student's point of view, the ISS is a fantastic experience, with extremely low student staff ratios, with close contact with academic staff, and with an international, collaborative, mutally-supporting learning environment. When I meet international development students and practitioners who say they want to study, I tell them: go to the ISS. I still do. It is a remarkable place.
It is therefore all the more worrying to see this institution's continuing dysfunctionality. Being here this week, virtually every non-Dutch academic that is below the age of 50 that I have spoken to is actively seeking employment elsewhere. Many over 50 are as well. In addition, some who are not seeking employment elsewhere, including some professors, wish they had moved years ago. Why do these people, many of whom are amongst the best and the brightest in the field of international development, want to leave?
The answer is simple: management. The ISS was, during my time, a poorly managed institution. That was a major reason why I left. However, from the perspective of the academic staff--who, after all, are the source of the institution's reputation and thus the draw for many of its students and scholars--management has not improved and, in some instances, has in fact deteriorated over the course of the past year. It is very disheartening.
The origin of mismanagement lies in the deep history of the ISS. It is not really relevant here. What is relevant is why mismanagement continues. A large part of the answer lies in the ongoing application of new public sector management practices to the Dutch bureaucracy, and thus the ISS. The culture of targets, of form filling, of policy papers and vision statements generates jobs that are given to unqualified people and which detract from the capacity of academic staff to do their jobs--to teach students, and to undertake research and policy advice that directly addresses the issue of global poverty and inequality. Far, far too much time is spent undertaking activities that are purely administrative, which should be allocated to efficient administrators, resulting in a gross misallocation of the resources and time of the academic staff.
This is not helped by senior management, who are clearly not capable of managing an institution with the complexity of the ISS. A management that stifles innovation, that feathers nests, and which does not create an enabling environment for one of the most diverse and talented sets of development practitioners in an academic environment that can be found today. This is indeed the great tragedy of the ISS--as so many academic staff have said to me over the week, it has so much potential, and yet it does not live up to that potential, because it restricts the ability of the academic staff to creatively engage with international development issues day in and day out. Academic staff spend too much time as bureaucrats, and not enough time as educationalists and researchers.
International development studies requires international development education. It requires institutions with the focus and potential capabilities of the ISS. However, it also requires a managerial environment that fosters those capabilities. As neoconservative globalization restructures the state, it promotes the emergence of educational institutions that fail to foster the capabilities of staff and students, and in so doing lets down international development. The ISS is failing in its mission because of factors that are part and parcel of the very thing that it seeks to understand. That it itself does not understand this--and some of the academic staff clearly do--is a loss, for the ISS, but more importantly, for international development itself.
The ISS is the oldest graduate school of development studies in Europe--and hence the world. Over the years, 10000 students have attended courses there, and the offerings of the ISS are, in terms of the range available, quite unparalled. Moreover, from a student's point of view, the ISS is a fantastic experience, with extremely low student staff ratios, with close contact with academic staff, and with an international, collaborative, mutally-supporting learning environment. When I meet international development students and practitioners who say they want to study, I tell them: go to the ISS. I still do. It is a remarkable place.
It is therefore all the more worrying to see this institution's continuing dysfunctionality. Being here this week, virtually every non-Dutch academic that is below the age of 50 that I have spoken to is actively seeking employment elsewhere. Many over 50 are as well. In addition, some who are not seeking employment elsewhere, including some professors, wish they had moved years ago. Why do these people, many of whom are amongst the best and the brightest in the field of international development, want to leave?
The answer is simple: management. The ISS was, during my time, a poorly managed institution. That was a major reason why I left. However, from the perspective of the academic staff--who, after all, are the source of the institution's reputation and thus the draw for many of its students and scholars--management has not improved and, in some instances, has in fact deteriorated over the course of the past year. It is very disheartening.
The origin of mismanagement lies in the deep history of the ISS. It is not really relevant here. What is relevant is why mismanagement continues. A large part of the answer lies in the ongoing application of new public sector management practices to the Dutch bureaucracy, and thus the ISS. The culture of targets, of form filling, of policy papers and vision statements generates jobs that are given to unqualified people and which detract from the capacity of academic staff to do their jobs--to teach students, and to undertake research and policy advice that directly addresses the issue of global poverty and inequality. Far, far too much time is spent undertaking activities that are purely administrative, which should be allocated to efficient administrators, resulting in a gross misallocation of the resources and time of the academic staff.
This is not helped by senior management, who are clearly not capable of managing an institution with the complexity of the ISS. A management that stifles innovation, that feathers nests, and which does not create an enabling environment for one of the most diverse and talented sets of development practitioners in an academic environment that can be found today. This is indeed the great tragedy of the ISS--as so many academic staff have said to me over the week, it has so much potential, and yet it does not live up to that potential, because it restricts the ability of the academic staff to creatively engage with international development issues day in and day out. Academic staff spend too much time as bureaucrats, and not enough time as educationalists and researchers.
International development studies requires international development education. It requires institutions with the focus and potential capabilities of the ISS. However, it also requires a managerial environment that fosters those capabilities. As neoconservative globalization restructures the state, it promotes the emergence of educational institutions that fail to foster the capabilities of staff and students, and in so doing lets down international development. The ISS is failing in its mission because of factors that are part and parcel of the very thing that it seeks to understand. That it itself does not understand this--and some of the academic staff clearly do--is a loss, for the ISS, but more importantly, for international development itself.
Thursday, March 8, 2007
why don't development economists learn?
I have been, these past few days, teaching a short course at my old workplace, the Institute of Social Studies in The Hague, on Gender and Microeconomic Policy Analysis. The students on the course come from 4 continents, and are here to basically improve their economic literacy so that they can advocate more effectively for gender-aware policy interventions with the economists that they meet and who dominate policy identification, design, implementation and monitoring and evaluation in international development.
I've been an economist for all of my professional life, and yet teaching the material that I have been teaching--about the gender-constructed character of demand, the centrality of the household and care to the capacity of an economy to supply goods and services, and the gendered character of markets and other economic institutions--I am struck by the fact that:
1. it should be obvious that gender shapes economics
2. if it is obvious, why is feminist development economics a minority within a minority within international development?
3. in this light, how can gender be said to be 'mainstreamed' unless it is fully integrated into the economic analysis that dominates international development? It can't.
4. what does all this say about the effective, as opposed to indicative, commitment of international development practioners and practice to gender empowerment?
Economics in general is dominated by neo-classicism. Even at it's most erudite, dealing with the economics of information, it is unable to address the way in which conflict and consensus shape activity in the care economy, the allocation of time and resources to the care and market economies, and the way in which care is a precondition of markets. In failing to address these issues, neo-classicism demonstrates the extent of its abstraction from the real world. Yet teach basic neo-classical ideas to non-economists, demonstrate the gender critique of those ideas, and it is obvious. They get it. Why can't the economics profession get it?
The answer has to lie in the challenge that feminist development economics, along with other branches of heterodox economics, poses to entrenched positions of power and privilege, within economics, sure, but more importantly, in the real world--in the centers of political and economic power that shape the global economy. Ideas do change the world. Feminist development economics offers a humane alternative to our globalized future. This is precisely why it is marginalized. It is also precisely why there is an ongoing need to advocate for feminist development economics in the institutions where we work, and the civil society where we live.
I've been an economist for all of my professional life, and yet teaching the material that I have been teaching--about the gender-constructed character of demand, the centrality of the household and care to the capacity of an economy to supply goods and services, and the gendered character of markets and other economic institutions--I am struck by the fact that:
1. it should be obvious that gender shapes economics
2. if it is obvious, why is feminist development economics a minority within a minority within international development?
3. in this light, how can gender be said to be 'mainstreamed' unless it is fully integrated into the economic analysis that dominates international development? It can't.
4. what does all this say about the effective, as opposed to indicative, commitment of international development practioners and practice to gender empowerment?
Economics in general is dominated by neo-classicism. Even at it's most erudite, dealing with the economics of information, it is unable to address the way in which conflict and consensus shape activity in the care economy, the allocation of time and resources to the care and market economies, and the way in which care is a precondition of markets. In failing to address these issues, neo-classicism demonstrates the extent of its abstraction from the real world. Yet teach basic neo-classical ideas to non-economists, demonstrate the gender critique of those ideas, and it is obvious. They get it. Why can't the economics profession get it?
The answer has to lie in the challenge that feminist development economics, along with other branches of heterodox economics, poses to entrenched positions of power and privilege, within economics, sure, but more importantly, in the real world--in the centers of political and economic power that shape the global economy. Ideas do change the world. Feminist development economics offers a humane alternative to our globalized future. This is precisely why it is marginalized. It is also precisely why there is an ongoing need to advocate for feminist development economics in the institutions where we work, and the civil society where we live.
Sunday, March 4, 2007
microfinance and the mystery of capital
I was struck in a student seminar this week when we were talking about microfinance. I was discussing the underlying assumption, noted in a previous devlog, that behind microfinance is the idea that every poor person is a budding entrepreneur waiting to be unleashed so that they could accumulate. What struck me, as I was saying it, was the relationship between this assumption and the ideas of Hernando de Soto, the widely-lauded author of The Mystery of Capital. De Soto's basic proposition is very straightforward: poor people are not poor. Rather, poor people lack effective and enforceable ownership of the resources that they use to construct a livelihood. Therefore, according to de Soto, the most important policy response to poverty should be to vest property rights amongst the poor in those assets that they use, day in and day out, to manage, but which they do not own. Property rights are the key out of poverty.
Property rights are the way out of poverty, though, for what reason, according to de Soto? The reason is that people with property can get loans, their incentives to accumulate are stronger, and they have a deeper need to make sure that their assets are used in the best possible way. In other words, according to de Soto, poor people are petty entrepreneurs waiting to be unleashed, and all that is required to unleash them is giving them vested ownership in the things that they already use, day in and day out.
For both the microfinance industry and de Soto, then, poor people make the best possible choices they can, given the circumstances they face. Alter the circumstances--by giving them a loan, or by giving them an asset--and their choice set will change, in the effort by them to accumulate using their latent entrepreneurial abilities. Both approaches are, then, deeply neo-classical in their approach to international development issues. People are not structurally subordinate for systemic reasons; they are simply making choices that could be made better by altering their circumstances. That the poverty of some is built on the wealth of others is something that these approaches do not accept.
Property rights are the way out of poverty, though, for what reason, according to de Soto? The reason is that people with property can get loans, their incentives to accumulate are stronger, and they have a deeper need to make sure that their assets are used in the best possible way. In other words, according to de Soto, poor people are petty entrepreneurs waiting to be unleashed, and all that is required to unleash them is giving them vested ownership in the things that they already use, day in and day out.
For both the microfinance industry and de Soto, then, poor people make the best possible choices they can, given the circumstances they face. Alter the circumstances--by giving them a loan, or by giving them an asset--and their choice set will change, in the effort by them to accumulate using their latent entrepreneurial abilities. Both approaches are, then, deeply neo-classical in their approach to international development issues. People are not structurally subordinate for systemic reasons; they are simply making choices that could be made better by altering their circumstances. That the poverty of some is built on the wealth of others is something that these approaches do not accept.
Wednesday, February 28, 2007
Shanghai surprise
Yesterday the Shanghai stock exchange dropped 9 per cent in a single day, apparently setting off a worldwide round of selling as panicked investors sought safe instruments. Wall Street had its biggest fall since September 11, the TSE had its worst day in a year, and several 'emerging' exchanges, in Brazil, Turkey and Russia suffered big drops.
The Shanghai surprise clearly shows the herd mentality of global finance. Shanghai is an exchange which is largely domestic, with limited global participation. The drop was a demonstration of how the market is increasingly dictating policy: there were rumours that the government was going to place restrictions on some of the practices around the buying, selling and taxing of transactions, and in order to prevent this, the market collectively dropped, demonstrating who is in charge of policy (the fact that many big investors are Party people is not unimportant here). In any event, the drop in Shanghai was almost exactly the same as the previous day's rise--so the net effect was profits for some, with limited losses for others.
Why then did this largely domestic event spread? The answer lies in the vulnerability of the world economy. The US is dangerously imbalanced, both externally, in terms of its current account deficit and economic exposure to political events in oil producers, and internally, in terms of its budgetary deficit and the share of profits in total income. This vulnerability is what worries global finance capital. The possibility of a recession in the US has already been raised by Alan Greenspan, and global markets still respect him. A recession in the US will hurt the slow recovery in the European Union, and particularly Germany and France, and this has the possibility of spreading to other EU members. In short, the world economy, dominated as it is by finance capital, is vulnerable, because, simply put, the economy is not leading the market, and has not been for a long time indeed. Market finance is leading, but its fictitious character means that the global economy is being led by shadows and light. In shadows and light, the possibility of a bumpy ride for the real economy is strong. This year should be an interesting one as finance and productive capital struggle to exert dominance over the global economy and global development.
The Shanghai surprise clearly shows the herd mentality of global finance. Shanghai is an exchange which is largely domestic, with limited global participation. The drop was a demonstration of how the market is increasingly dictating policy: there were rumours that the government was going to place restrictions on some of the practices around the buying, selling and taxing of transactions, and in order to prevent this, the market collectively dropped, demonstrating who is in charge of policy (the fact that many big investors are Party people is not unimportant here). In any event, the drop in Shanghai was almost exactly the same as the previous day's rise--so the net effect was profits for some, with limited losses for others.
Why then did this largely domestic event spread? The answer lies in the vulnerability of the world economy. The US is dangerously imbalanced, both externally, in terms of its current account deficit and economic exposure to political events in oil producers, and internally, in terms of its budgetary deficit and the share of profits in total income. This vulnerability is what worries global finance capital. The possibility of a recession in the US has already been raised by Alan Greenspan, and global markets still respect him. A recession in the US will hurt the slow recovery in the European Union, and particularly Germany and France, and this has the possibility of spreading to other EU members. In short, the world economy, dominated as it is by finance capital, is vulnerable, because, simply put, the economy is not leading the market, and has not been for a long time indeed. Market finance is leading, but its fictitious character means that the global economy is being led by shadows and light. In shadows and light, the possibility of a bumpy ride for the real economy is strong. This year should be an interesting one as finance and productive capital struggle to exert dominance over the global economy and global development.
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