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POLB90 Lectures 7 - 12.docx

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Political Science
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Judith Teichman

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SHELAGH JOSEPH POLB90 LECTURE NOTES Page 1 of 17 LECTURE 7 Tuesday, October 22, 2013 Pre-colonial Societies and the Impact of Colonization  Post-colonial thinkers alert us that the expansion of Europe had profound impact on the attitudes of the colonized Europeans.  Modernization perspective operated from the premise that simple derivatives making transition. o What happened? Why very developed cities were ‘behind’? Trading Empires with Complex Administrative Structures  Africa o From 1083 AD, trade between Africa and China  Silver and gold through Mozambique  African trade with India and Arabia  Trading Empires: o In order to become a trading empire, you have to have a complex administrative structure. Keep order of exports, organize merchants, and regulate trade.  Katanga (Zaire)  Mexico (Aztecs)  India [dynamic and textile industry]  China [had gun powder and printing press] Societies with Significant Technological Advances Example:  The Meroes Empire th o 8 Century BC  Engaged in iron work  23 character alphabet  Meroitic Finery Other Examples th th  Nok Empire (northern Nigeria, 4 and 5 centuries  Mali Empire, Africa, 12 and 13 centuries o Theory that the Mali Empire was able to sell to America. o Found images of black people in Central America.  Maya, Central America, 11 century o Had calendar more advanced than the American calendar. o Had written language  India (exporter of textiles)  Sophisticated agricultural systems: India, China, Peru (Inca) o Can’t move on until able to produce agricultural surplus Features of Some Pre-Colonial Societies  Complex administrative structures o Maintenance required extensive administrative work  Skill and competence counted o It was where you were born and what social group you were born into. o Particularly in pre-colonial societies, competence and skill were taken into account.  Provision of basic needs o Some of them were very good at providing basic needs to people o Stem from concept that disappeared with colonial rules – sharing obligation o No concept of private property (can often interfere with distribution of basic needs and living standards of lower part of the system) SHELAGH JOSEPH POLB90 LECTURE NOTES Page 2 of 17 o Cannot sell or throw lower cast off the land. Moral obligation to ensure the lower cast. o Peru (Inca): land was given to family in accordance to their needs and their ability to  Imperialism o Political control and acquisition of resources of conquered societies 1400: European Expansion begins  Rise of trade, decline of feudal Europe.  Emergence of artisanal industries (particularly in textiles)  Began to expand o Food (soil began to deplete) o Trade routes o Bullion (gold, silver) Expansion of Europe  1400-1500 – Portugal – North and Northeast Africa o 1480s Portugal took over Indian Motion Trade. o Establish direct trading relations with India o Cohesion required, civilization East of Africa began to decline o Portugal increased taxes. o Trade declines in region due to all the fighting and warfare. o Involved in the Americas (Brazil). Competed with Spain to control America  1500-1600 – Spain – the Americas o Facilitate by  diseases (Americans were not resistant to European diseases)  weapons (steel and horses)  Motivations wealth, religious conversion Consequences of the Conquest of the Americas  Destruction of pre-colonial civilizations  Drastic drop in population o Encounter of Spanish and Portuguese.  Emergences of mixed-blood population (mestizo) o Consequence of intermingling of Spanish conquest and indigenous population o Majority of the country are mestizo.  Complete economic re-organization o Mass amount of gold and silver for the European market. o Organize labour to extract all of this. o Emergence of enormous land holdings o Concentration of wealth  Conquest assumed that the conquerors had the right to extract enormous amount of wealth.  Ultimately not Spain, most were shipped to Spain created inflation, manufactured goods pricing went up and couldn’t compete with British manufactures goods. Profits flowed to Britain instead. 1650-1800: British Hegemony and the Slave Trade  Sugar became king. North Brazil became center of sugar production.  Every island in the Caribbean had large plantation and sugar production Triangular Trade:  Manufactures goods to Africa  Slaves to the Americas SHELAGH JOSEPH POLB90 LECTURE NOTES Page 3 of 17 Impact of Sugar Production and the Slave Trade  Sugar regions in the Americas ceased to produce food for domestic consumption o Alters the production in these countries. Soil became depleted. o NE Brazil, dynamic center for sugar production. Now poorest place in the world.  New plantation/slave societies emerged in the Caribbean o Indigenous people who eventually died off. o Emergence of societies controlled by white elites and black slaves at the bottom. o Skin colour and degree of pigmentation associated with political power and association. o Consequence of expansion  Slave trade devastated Africa o Had profound implication. Meant people became commodities. o Consequence of crime and debt. o Slave trade produced war and destroyed economies  British and Europe supplied arms and in return, slaves were given. o Removed large numbers of productive people. o Rise to predominance of Africans who would collaborate with Europeans  African slaves benefitted from the slave trade.  Distancing between rulers and ruled. 1757 – 1858: British Conquest and Colonization of India  British had an extensive agricultural system produced surplus. 1757: All Indian commerce in the hands of the East India Trading Company  Marked British economic control over India 1813: Its monopoly of trade between India and Europe is abolished But continues to rule India until 1858.  Set of advanced policies, successfully destroyed the Indian textile industry. Economic Impact (Laws, 1768-1784)  The British government o Required the East India Company to bring British goods (mostly textiles) to India o Required the Company to pay a large annual sum to the British government  East India Company had to tax heavily on locals. o Put heavy tariffs on Indian good (textiles) entering Britain  Indian textile were cheaper and better, would threaten the British textile industry o Then banned them altogether. (banned tariffs on British goods entering India) th Building of railways, 19 century.  British textiles flooded the Indian market.  Indian market was not the only one destroyed by the British (Mexico, Argentina, etc.) The creation of a strata of Indian Collaborators  “Zamindars” o Tax collectors o Allowed to take away land for not paying tax.  Agricultural production began to decline The Social Consequences  Last quarter of 19 century: 18 famines, 16 million deaths o 1943: Bengal famines – 3.5 million deaths  Average life expectancy dropped from 20 years in 1881 to 23 years y the 1920s o Average life expectancy in Britain in 1920s was 55 years. SHELAGH JOSEPH POLB90 LECTURE NOTES Page 4 of 17 1880-1905: The Conquest of Africa  What drove the conquest? o From Britain’s point of view, began to think slavery was not a good idea. Began to support abolition of slavery, wanted markets where it could sell its manufactures goods. o Europe wanted raw materials, wanted a secure source and markets.  Economic production reorganized Africa to meet European needs. o Various form of direct cohesion. o Tax heavily and forced to work in mines.  Conquest in Africa o Involved actions and military activities of Africans. o Slave trade: Europeans able to build strata of Africans and marshal them into cooperation to conquer parts of Africa for various European powers. Types of European Rule Indirect Rule: Rule through local institutions, leaders and customary laws.  MOST effective rule.  Utilizes local leader and institutions and customary laws. Utilizes local/indigenous leaders to collect taxes, adjudicate cases and impose punishments.  Least disturbance to the status quo.  Legitimized colonial rule. (People believed in the institution.) o Allowed for extraction (esp. collection of taxes) o Contributed enormously that separated leaders from the population.  Deflected discontent Direct Rule: The imposition of European laws and institutions down to the village level.  LESS effective  Less apparent of who is extracting from you.  Produced much more violence Political Independence  Latin America: first quarter of the 19 century  Asia and Africa: 1946-1965 o By high level of education and thinking. o Many adopted western way of thinking. Thought of developing. Franz Fanon (1925-1961) LECTURE 8 Tuesday, October 29, 2013 Economic Globalization, Debt and Neoliberal reform in the Global Last Week: Franz Fanon(1925 – 1996) Black psychiatrist from Martinique  Involved in the Algerian struggle for independence from France o Became aware psychological and cultural impact of colonialism  What it did was inculcated the notion that everything “European” was superior  Literature had an enormous impact on European views on the Global south Fanon argued that colonized were not only weighted down by economic notions, but the idea of cultural inferiority of the colonized  Most of these colonies retained their ties with former colonial powers o “Hybrid elites” – a result of western educated people and indigenous values o Violent revolutionary struggle was necessary in removing the deep psychological impact of colonialism would be shaken SHELAGH JOSEPH POLB90 LECTURE NOTES Page 5 of 17 The international financial system  Would have a profound impact on what Global South countries could not do in terms of development o Mechanism of control Definition:  Private commercial banks  IMF  World bank  Various regional development banks The World Trade Organization:  Important influence on development o All of these are linked The Role of the IMF and World Bank  1948 – Bretton woods  IMF: short term balance payments  Bank: Project lending o Based in Washington  Makes it easily accessible  Developed country dominance o The countries that are the wealthiest have more votes meaning that they have more say o Gives the opportunity for these countries to influence policy making World Bank:  1960’s supported tariffs  Public lending How and why did these institutions become such heavy advocates of neoliberal reform?  Change in the “conventional wisdom” about what constitutes good economic policy John Maynard Keynes – advocate of state intervention in good capitalism  1970’s: the new orthodoxy o Central role to the market  Human beings operate on in their own economic self interest  Prices should not be interfered with o State intervention creates a miscalculation of resources Economic events:  Rise in petroleum prices  Decline in US competitiveness  The international debt crises o GS countries borrowed heavily  Decline in commodity prices o Poverty and inequality shot up o 1980’s – “the lost decade”  Had permanent implications How did the new thinking become translated to policy?  Policy conditionality o Stabilization agreements (IMF)  Credit restriction  Devalue currency  Reduction in global spending  To repay debt, stimulate exports. If they didn’t agree, they could not get loans from the World Bank. Results? SHELAGH JOSEPH POLB90 LECTURE NOTES Page 6 of 17  Constrict economy o Rising unemployment o No public spending Then they notices that this policy was not working The Washington consensus  Trade liberalizations  Privatization o Sell off your companies  Deregulation of foreign investment  Labour flexiblization  removal of subsidies  removal of restrictions on capital flow o instrumental in GS  Negative social consequences Repeated economic crisis  The Mexican peso crisis of 1995  The Asian crisis 1997  The Argentine crisis of 2001 The Role of Private Commercial Banks  1970’s: Banks pressure GS to borrow o Due to a rise in petroleum, they had money  Needed a place to invest  They had all this capital to lend out  Country A lends out money in peso’s, the Canadian banking regulations do not apply, no insurance , no credit checks o Totally unregulated  Lent huge amounts of money o Very much a part of this surge in debt 1982: refuse further lending 1982 on: private banking sector is busy lobbying US government and IFI’s  Lobbied these countries o Had to repay their loans o No regard for the social implications of this o While recognition of insolvency – debt reduction  Informal conditionality o Banks had enormous power, how did they pressure countries to repay?  Struck a committee of the most important private commercial banks  Review the policy of the GS countries and renegotiate their loans  Pushed countries to shape policy in GS that would please loaners.  The debt was not just held in the GS government o Huge loan was on private domestic companies o Commercial banks wanted states of developing countries to take over and pay it off The consequences: Net capital outflow  Very difficult to get a country to pursue structure (had to say they would do so, otherwise they would get no loans) SHELAGH JOSEPH POLB90 LECTURE NOTES Page 7 of 17 Attempts at a debtor’s Cartel Did not work- Mexico opted out and backed out IFI`s provide incentives Sectoral adjustment loans  But debt load was too heavy o Finally debt relief – 1989 o Very much tied to SAP`s  Only when private banks would not suffer losses  Even though many had recognized the need much earlier The role of policy dialogue  More important than anything else to get GS countries to reform o Transmission of new policy culture of market reform o Years of discussions between WB and country officials.  Wasn’t going to happen unless countries actually owned the policies  Especially country officials in finance ministries  Rise of technocrats  Facilitated by the debt crisis The undemocratic nature of the process  Discussions were secretive  Only a small group of country officials o Finance ministry officials  Onside with the idea of balancing the budget. SAP’s are unpopular: use of strong arm tactics  Argentina – Presidential decrees and manipulation of trade unions Mexico – repression of labour When you have poor political policy in economic crisis it is the common folk or poor who suffer greatly. The WTO  Role of MNC’s o Example: pharmaceutical companies, trade related property rights (TRIPS) Industrialised versus GS countries  Agriculture o Financial services  Government procurement Decision making in the WTO  Theoretically democratic, but not in practice o Green room meetings: draft Doha declaration o Divide and rule tactics o Lack of resources of LDC LECTURE 9 Tuesday, November 5, 2013 Dealing with Social Deficit Ways in which WTO Restricts Development Policy Choices  Industrial policy o Export promotion subsidies  Copying and adaptation of technology  Tariff protection o Too much tariff protection for too long is probably not a good thing SHELAGH JOSEPH POLB90 LECTURE NOTES Page 8 of 17 o Impossible for global south to reduce poverty and inequality through 1900s The Concern for Poverty Reduction  Civil society organizations(CSOs)  All organizations and citizens activity that operates between the individual and the state.  Nongovernmental organizations(NGOs) o Non profit o Service and humanitarian functions o Provide services with the withdrawal of the state o Many are international o They needed to deal with poverty Social investment funds Main Features  By 1995 these funds functioned in 32 countries / operate in over 90 countries today o Infrastructure , social services microfinance  Started as emergency measures o -1985 started in Bolivia, rapid trade and privatization HUGE unemployment/ increase of poverty. First case where the WB had intercepted and made an investment.  Participation Criticisms of Social Funds  Do not help the extremely poor  Benefits may be captured by local elites  Substitute for government services  Used for political purposes  Who determines who gets what? And when The World Bank and Social Capital Definition: Set of associations between people consisting of social networks and associated norms  Enters into the discussion of SIFs  Incorporates and tames the notion of societal participation in policy o NGOs deliver services o Supports the idea of “good governance” Criticism of the Bank’s Notion of Social Capital  Social inequalities are largely ignored by the social capital  Ideal community in which everybody will produce equal outcomes.  Gender inequality social investment funds and social capital depended in women that engage in deliverance of service( volunteer) women in global south countries are already overburden they don’t have time to volunteer  Responsibility for development rests with the poor  Ignores power and politics Conditional Cash Transfer Programs (CCTS)  30 countries with them  WB funds 13 countries o Cash to (Female) heads of households in exchange for certain conditions  Participatory?  Problems o Market will reduce moderate poverty o Sole us of income for inclusion o Can divide families and communities o Ignores the quality of services SHELAGH JOSEPH POLB90 LECTURE NOTES Page 9 of 17 Microfinance What is it?  Banking services that are provided to unemployed or low income individuals or groups who would otherwise have no other means of gaining financial services  Grameen Bank, 1983 Muhammed Yunus Who provides funding?  World Bank  UNDP  Regional development banks  Commercial banks  Private companies  Charitable Foundations The Struggle over Meaning  Grameen Bank Philosophy  Credit as a human right  Other supportive services  Training  Food  Housing  CCTS quality of schools  Social goals not just repayment rates financial independence not a goal  World Bank Philosophy and Practice in Microfinance  Establishes norms, metrics ranking…. Practices for microfinance  Consultative group to assist the poor (CGAP) o Aim: to integrate microfinance into global financial markets  Criteria for “success” o Repayment of loans LECTURE 10 Tuesday, November 12, 2013 Multinational Corporations as Political Actors Criticism of the HIPC initiative  Inappropriateness of macroeconomic criteria for eligibility o Keep exports up o Maintain particular public spenditure  The actual debt reduction is quite small  Only modest increases in social spending  Participation might not be substantial o They do not get to criticize macroeconomic policy  Excludes many needy countries  Fails to address root causes Tanzania, PRSP, 2011 Conditions  Watch over the fiscal deficit o Advocates of export drive  Create and enabling business environment o Promote domestic and foreign investment o Improve infrastructure o Promote domestic and international investment in mining o Promote export processing zones SHELAGH JOSEPH POLB90 LECTURE NOTES Page 10 of 17 Multinational Corporations Definition: enterprise which is based in one country but operates and has assets in more than one country  MNC’s have a home base  Ensure their own protection For
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