1. Founding Theses Ch. 2, Payne

2. Critical political economy: ( which drew on the Frankfurt School and the writings of Robert Cox) 4 particular debates: position on these four debates will constitute the founding theses. These are: HegemonyGlobalization Role of states Development

3. They collectively generate an argument which has the following key characteristics: No genuinely hegemonic state power Taking globalization seriously, but not overwhelmed by its supposed force Continuing reality of states but acknowledges the fact that states are being significantly restructured in the current era Does not reject concept of development, but instead reinterprets it as a universal problem by all states and societies in the world.

4. Hegemony Critical political economy’s initial preoccupation with hegemony. Robert Cox’s initial contribution on hegemony was made at the time neoliberal and neorealist institutionalist strands converged around the theory of hegemonic stability. Charles Kindleberger and Robert Gilpin: the need for a stabilizer to manage the world economy Robert Keohane described hegemony as: a control over raw materials, markets and capital as well as ‘competitive advantages in the production of highly valued goods involving the use of complex or new technology.Hegemony deployed as force.

5. Robert Cox’s conception of hegemony Neo-Gramscian definition Dominance with order, ideology and consent, general principles that ensure supremacy of leading states and social classes but at the same time offer some measure or prospect of satisfaction to the less powerful There can be dominance without hegemony Hegemony bringing together coercive and consensual elements

6. This understanding of hegemony was used by Cox to analyse the nature of the post-1945 world order (Pax Americana). Based on liberal international economic order- containment of Soviet influence Characterized by the freeing of trade between national economies and the eventual convertibility of other major currencies with the US dollar Development of national security states in the ‘West’, characterized by the acquisition of nuclear arsenals, a readiness to fight localized wars in the ‘Third World’ Rhetoric of the Cold War, extolling ‘freedom’ over ‘repression’ the ideological cement binding the system Early post-war period characterized by a measure of state economic intervention and welfare provision

7. Breakdown of system in 1960s and 1970s- Vietnam var Dollar overhang: the gap between US foreign-exchange reserves and the extent of its financial liabilities overseas International inflation US devalues dollar but avoids recessionary pressures by running a deficit 1980s – Reaganism: militarism and monetarism (increasing profit margins, weakening trade unions, neoliberalism) The strategy to create a new mix of consent and coercion But US strategy partly successful- neoliberalism spread via structural adjustment imposed on Third World Countries The problem US’s inability to tackle the endemic trading and expenditure deficits of the US economy. Rising power of other countries (Japan and Western Europe)

8. US ‘hegemony’ gave a way to US ‘dominance’. Key difference the evaporation of that broad measure of consent more or less automatically and generally willingly given to the leadership of the most powerful state. “Clinton boom” (the US economy grew substantially and persistently through the 1990s) But US is no longer strong enough to establish consensual hegemonic order No ideological command “Empire”: but really, it is no more than reflection of decline and reliance on domination (coercion)

9. The Globalization Debate 3 broad schools within the globalization debate : Hyperglobalizers, the sceptics and transformationalists Hyperglobalizers :both neoliberals who welcome the triumph of the market over the states and radicals and Marxists who are critical of what they see as the ultimate victory of an oppressive capitalist system can be categorized as such. They agree that globalization signals the arrival of a new era in human affairs which they see as created by a technological revolution in communications that massively accelerated the exchange of people, ideas and money.

10. Hyperglobalist account A borderless world has been thus brought into being, characterized by the establishment of proliferating transnational networks of production, finance and trade which operate according to a genuinely global dynamic. Economic world is constructing new forms of social organization that are supplanting traditional nation-states as the primary economic and political units of world society. They foresee the rise of global governance, global civil society and global cultural motifs. The problem with this account: it is too determinist, too sweeping, too apolitical.

11. The skeptical approach It is associated with the critique of Paul Hirst and Grahame Thompson. Their book aims to bring globalization into question. Globalization is no more than ‘heightened internationalization: intensified interactions between predominantly national economies, the conventional units of economic analysis. Even these, Hirst and Thompson argue do not significantly exceed the levels of economic interdependence witnessed historically at the end of the nineteenth century. Globalization is a myth rather than a reality, global corporation is a rarity, national governments are far from losing their power, global governance is a facade behind which the most powerful Western countries continue to dominate the traditional international economic and political system.

12. Skeptical account has been overtaken by events and now in real danger of appearing as if it has an irredeemably closed mind on the matter. Transformative account much sensitive and persuasive. Globalization is defined as a massive shake-out of societies, economies, institutions of governance and world order. The direction of the shake-out remains uncertain. There is thus no end-game, no single ideal-type of what a ‘fully globalized’ world would look like. Yet certain trends: historically unprecedented levels of global interconnectedness in trade, finance, production, culture and much else. Virtually all parts of the world are functionally part of a global system.

13. Transformationalist account No global convergence. New, emerging patterns of stratification in which parts of some states and societies are becoming enmeshed in the globalizing order whilst others are being marginalized. In short we are provided here with ‘a dynamic and open- ended conception of where globalization might be leading and the kind of world order which it might prefigure. Transformationalist account is better in comparison to first two because it offers a strong sense of globalization as an unfolding historical process. It insists on the capacity of actors to alter structures by their actions which means that they can and do influence the process of globalization.

14. The State debate Retreat or return of the state? Rather reorganization of the state (neither decline of the state, not rejection of globalization) The usual understanding of a dichotomy between the state and globalization is an illusion, as the processes of global restructuring are largely embedded within state structures and institutions, politically contingent on state policies and actions. The state is neither transcended nor unaltered, instead each state is transformed because of globalization. Different authors explained this transformation in different ways. Cox described the process as the ‘internationalisation’ of the state, a process that gives precedence to certain state agencies, such as ministries of finance and prime ministers’ offices.

15. Peter Burnham highlighted the widespread shift in the politics of economic management in advanced capitalist societies from ‘politicized management’ (discretion-based) to ‘depoliticized management’ (rules-based). Peter Evans, construction of a leaner kind of stateness which came to be associated with the thinking of Clinton, Blair administrations. Michael Mann: the state remains crucial to contemporary economic and political practice, but great sensitivity must always be displayed to the enormous variety of forms of state

16. The Development Debate End of national Keynesianism; end of developmentalism 1980s: debt and balance of payment problems in states in Africa, Latin America and the Caribbean Structural adjustment programs (routinely involving deregulation, privatization, devaluation, the removal of trade tariffs, increased indirect taxation). The planned extension of global free trade Neoliberalism: world development ideology: development as a process attainable all over the world, provided that the ‘market’ was allowed to assert itself over the ‘state’. Various alternative arguments to neoliberalism: Neo-Keynesianism: Brandt Commission (1980) and Socialist International to promote the belief in the fundamental interdependence binding the ‘developed’ and ‘developing’ worlds. Yet such alternative arguments had difficulty in shaking the ideological hold of neoliberalism.

17. Neoliberalism laid effective claim to the new mainstream development paradigm. Yet not an unchanging paradigm. Softened structural adjustment policies- more time allowed for implementation and emphasis placed on social measures. Softened structural adjustment policies- more time allowed for implementation and emphasis placed on social measures. Emphasis on ‘good governance’ in 90s- a phrase used to catch the essence of all that was considered to be best about ‘Western’ liberal state forms.

18. Useful insights raised within the literature that can lead to a new approach of development: -Schuurman: dependency theory too general, too dogmatic, too pessimistic. It de-emphasized the local, and it was insufficiently sensitive to the great diversity of situations in Africa, Asia, Latin America and the Caribbean. -Hettne: in mid-1990s the field of development become trapped somewhere between an obsolete ‘nation state’ approach and a premature ‘world’ approach. A stance needs to be taken at a mid-point between these two extreme positions. -From these beginnings, it is possible to identify the main features of a new critical political economy of development. Marriage between certain strands of development theory and certain strands of international political economy. P. 40 -

19. It can be assembled in four stages: 1-It rejects the exceptionalism of a special category of countries deemed to be in particular need of development and aims to recast the whole question of development as a universal question

20. 2-It focuses attention on development strategy, principally as still pursued by a national economy, society and/or polity, albeit within a global/regional environment

21. 3-It recognizes that such strategy necessarily involves the interaction, and appropriate meshing of internal and external elements 4-It insists upon duo recognition of variations of time, place and history in development predicaments.

22. Development: collective building by the constituent social and political actors of a country of a viable, functioning political economy, capable of advancing the material well-being of those living within its confines (p. 41) Redefined in this way, development is as much a problem for the ex-hegemon as the smallest ex-colonial territory. “Development is everywhere”.