Has neo-liberalism fatally undermined the idea of global governance?

GD readers might find interesting this piece by Columbia University’s Mark Mazower, from the FT this weekend. He has a book coming out in October on the history of the idea of global governance. Brief highlights:

“They decided without us. Let us advance without them,” reads the slogan on the website of Syriza, the leftwing Greek party that shot to prominence after elections this month. But what emerges as one reads on is less a clear strategy for the country’s future than a worldview suffused with the images and memories of its turbulent past. Here, the fight against today’s perceived enemy – neoliberalism – evokes the struggle against the military junta 40 years ago, and the resistance to Nazi occupation during the second world war…Alexis Tsipras, Syriza’s leader, is too young to remember this: he was born just as the junta fell, in the summer of 1974. However, his party’s language reminds us that the eurozone crisis is raising some deep historical questions about what has happened to politics, to democracy and to the very idea of international co-operation.

It was in Europe, two centuries ago, where the idea emerged that the world was a governable place. This idea was radically new: the term “international” itself was coined by British philosopher Jeremy Bentham and only entered general circulation in the decades after Napoleon’s defeat. Although nationalism was emerging as a potent force at this time, the supporters of international co-operation were not alarmed. On the contrary, they believed that nationalism and internationalism were soul mates, that a continent of vibrant national democracies necessitated co-operation among its diverse people. Novelist Victor Hugo conjured up the vision of a federal Europe to a wildly cheering audience of peace activists in Paris in 1849; the Italian revolutionary Giuseppe Mazzini inspired US president Woodrow Wilson with his idea of a society of democratic nations.

If Wilson’s ill-fated League of Nations was one outcome of such views, other internationalists fought equally hard for free trade, or for communism. But the second world war saw anti-fascists in Europe return to the idea of federation for the continent as an antidote both to the bellicose nationalism of Hitler and Mussolini, and to the hopeless high-mindedness of the League. They believed that without integration, Europeans would continue to fight indefinitely; with it, the nation could be tamed and the needs of the weakest members of society guaranteed.

The origins of the EU thus reflect the persistence of the old idea that international co-operation is the best guarantee of national well-being. US support for European integration was premised on the belief not only that it would boost growth and keep communism at bay but that it would revive democracy itself. The early decades of the common market coincided not only with unprecedented productivity gains and growth across western Europe, but simultaneously with significant falls in inequality and enhanced spending on social services and welfare.

That achievement seems to belong to an almost neolithic past. The past 25 years have seen many of those gains reversed and have thrown into question the notion that national sovereignty and international co-operation are complementary. The architects of this reversal were not philosophers such as Bentham or revolutionaries such as Mazzini but sober technocrats such as Paul Volcker and the IMF’s Michel Camdessus. Managers of the global monetary system after the oil shocks of the 1970s, they believed that international prosperity and stability depended upon the liberalisation of capital movements. Europe’s enthusiastic participation in this financialisation of the global economy has had striking if largely unintended consequences.

All international organisations require their members to give up some sovereignty in exchange for the benefits of joining the group. But in earlier times, this choice did not entail anything close to the kinds of sacrifices that are required today. Legislatures within the EU, and especially within the eurozone, are now obliged to cede discretionary power to unelected central bankers, judges, bureaucrats and industry regulators. One does not have to be a supporter of Syriza to see how this allows established political parties in difficult times to be turned into stooges of shadowy special interests.

So what is at stake in the eurozone crisis goes beyond the consequences of a Greek exit and beyond even the future of the EU itself. The crisis has thrown into question the very idea that the world can be governed.

Is the Eurozone crisis a threat to democracy?

Here’s a piece I’ve done for Yale Global magazine on democracy under strain in Europe.

Politicians in power since the 2008 financial collapse, regardless of their political stripes, find themselves in peril. Analysis of the recent French and Greek elections followed three lines of thought: voters soundly rejecting strict austerity measures, blaming incumbents, and abandoning mainstream political parties for more extremist leadership, both right and left. The three interpretations are linked.  Read more

Christmas comes early in the form of Tim Worstall

Much delight to be had in the Daily Telegraph, where Tim Worstall is to be found firing a major broadside in DFID’s direction. Here’s a sample:

Aid should help poor people in poor areas get richer. The poster child for which is the Millennium Villages Project. The claim is that by spending only $50 per person per year on health care, better seeds  and mosquito nets, we can dig these rural areas out of their millennial destitution and make the world a better place. And if the plan worked I’d agree that we should do it.

Thing is, it doesn’t work. Jeff Sachs, the demagogue behind the project, had a congratulatory piece in The Lancet a couple of weeks back claiming that all was hugely hunky dory. As it happens, this isn’t quite so. Of the 18 measurements made, compared to similar villages that didn’t have the intervention, only one moved an interesting amount in an interesting direction. The other 17 were much of a muchness and showed very little effect from this extra spending …

…we can see no evidence at all that this sort of development aid is having any effect whatsoever. Call me a curmudgeon if you like, but I can see no purpose in throwing away cash on something that doesn’t work. And do note that this is the first time that anyone at all has tried to actually measure the effects of this type of aid. So it’s the first time that we’d had the proof that it doesn’t work. So, clearly, we shouldn’t be doing this any more. Simply stop ODA and close down the DfID saving us all that £11 billion a year.

Aren’t you tickled, readers? There are not one, not two, but three special treats here for us.

First, the argument that the Millennium Village Project (MVP) is the “poster child” for aid. Um, actually people have been asking questions about the evaluation methodologies used in the MVP for quite a while now. Here’s a blog post making just that argument by the World Bank’s Gabriel Demombynes in 2010. Here’s Madeleine Bunting doing the same in the Guardian in 2011. Have a look at what Lawrence Haddad is saying on his blog. Or A View from the Cave’s Tom Murphy. When four major opinion formers in development are asking big questions about the impact of a project, it’s probaly not entirely accurate to call it a “poster child”, Tim.

Second, the hilarious spectacle of Tim getting all hot under the collar about “evidence” even as he argues that one study – one! – that fails to demonstrate impact for one project – one! – thereby proves that none of DFID’s aid works. It’s just delicious to watch someone managing to get quite this pompous about the fact that “we do need to stick with the rules of scientific evidence” while failing to notice quite how much his approach will elicit gales of laughter from anyone serious about evidence.

But best of all is the fact that Tim works at the Adam Smith Institute.

Would that be the same Adam Smith Institute that’s the sister organisation of Adam Smith International? – you know, the one that has DFID framework contracts on private sector development, on government information and communications and on public administration reform in conflict-affected environments? The one with the £44 million DFID contract on infrastructure advice in Nigeria?

Do tell, Tim – presumably you think your colleagues are similarly guilty of frittering taxpayers’ money away and should stop bidding for DFID contracts forthwith?

I wish all aid critics were this fun.

Latest data on emissions

2 sets of new emissions data out yesterday. First, the overview, courtesy of the Worldwatch Institute‘s new Vital Signs Online project:

Although global emissions of carbon dioxide (CO2) declined slightly in 2009, the beginnings of economic recovery led to an unprecedented emissions increase of 5.8 percent in 2010. In 2011, global atmospheric levels of CO2 reached a high of 391.3 parts per million (ppm), up from 388.6 ppm in 2010 and 280 ppm in pre-industrial times.

OECD emissions were up 3.4% in 2010; non-OECD emissions 7.6%. China became the world’s biggest emitter – but well done Worldwatch for pointing out in their news release that China’s still only 61st in the world in terms of emissions per capita. (The US is second overall and 10th in per capita emissions.) Overall global CO2 levels are now 45% above 1990 levels.

In other news, International Energy Agency data out yesterday and picked up in the FT has this:

US energy-related emissions of carbon dioxide, the main greenhouse gas, fell by 450m tonnes over the past five years – the largest drop among all countries surveyed. Fatih Birol, IEA chief economist, attributed the fall to improvements in fuel efficiency in the transport sector and a “major shift” from coal to gas in the power sector.

Here’s the IEA’s take on the overall picture:

The agency has calculated that in order to contain rising temperatures and avoid the most damaging effects of global warming, annual energy-related emissions should be no more than 32.6GT by 2017. “We are now only 1GT away from that, with five years still to go,” Mr Birol warned. “The door to a 2 degree trajectory is about to close, and to close forever.”

We are so failing to solve this problem faster than we’re creating it.

So Conrad Black, tell us what you really think about France…

A while back I posted an excerpt from an essay by George Orwell about Hitler that, for me, was a perfect piece of political commentary. It was concise, sharp and witty even though it was written during the Second World War. Today, I have stumbled across a piece of political writing that has all the opposite characteristics. In an op-ed on the G8 Conrad Black – the press magnate, peer and former convict – abuses almost all the major economies. But he saves his nastiest paragraph for France:

Among the traditional Great Powers, the grand prize for purblindness goes to the inimitable French, who have elected an unmitigated cipher as president on a platform of sharply higher taxes, bigger deficits, indiscriminate pump-priming, and further concessions to the solid majority of public-sector employees and welfare recipients. A new page will be turned in flogging those who earn the money, and pouring largesse on the unproductive, regardless of merit. Never in its history, apart from the capture of the mountebank Emperor Napoleon III at Sedan by Bismarck’s armies, and when the Third Republic voted itself out of existence at the Vichy casino in 1940 under the jackboots of the returning German army, has France committed such an act of self-emasculation.

Come now Conrad, why be so coy?

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