POL326Y Lecture June 5.docx

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14 Apr 2014
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June 5/2013
Economics cont.
Foreign economic bureaucracy
o1. Foreign policy establishment and various foreign economic bureaucracies have similar
dynamic to the CIA, defense department, etc.
They have an alternative agenda
Main agenda= the expansion of American trade
Expansion of free-market ethos
Foreign policy of the US toward china is very much schizophrenic in this regard
Many aspects
Pension for deregulation
General idea of the free market ethos (market functions best when it is least
oLed to de-regulation of the banking industry within the US
Structural adjustment programs
Devaluation of the currency
Privatization of state assets
Lowering of taxes
Cutting government spending
Encouraging foreign direct investment in failing economies
Opening domestic markets (elimination of protectionism)
Interest rate liberalization
oDetermined by supply and demand of credit not by state policy
oUS has strongly criticized the Chinese government for under-
valuing it’s currency and making it’s product’s cheaper world-
1960 the US invested 85.6 billion in foreign economies and foreigners
invested 40.9 billion in the US
By 2007 the US invests 17 trillion in foreign economies and foreign
economies invested 20 trillion into the US
By 2010 us invests 20 trillion and foreign investment 22 trillion
US budget deficit has increased tremendously
oStood at 410 billion
oUS debt 9,7 trillion
Elections and Groups
US is unique in the influences played by elections and interest groups in US politics and US
foreign policy
oElections have no impact on US foreign policy
oPolitics stops at the water’s edge
Means that foreign policy in an idealized form is in defense of the national interest
National interest unifies the US
Effects everyone equally
There is therefore neither party that is going to depart from this national interest
Politics therefore ends at the waters edge
Elections from this point of view are irrelevant in this regard
There is a large amount of continuity from one administration to another
Another reason why elections don’t have big impact is historical
The current environment is different from the norm throughout American
This has to do with the nature of US political parties
US constitutional system was not created with political parties in mind
oJames Madison fed. 51 states that purpose of US constitution was as
much as possible to thwart the development of political parties
To prevent their development or their gaining of strength
“Factions” were a threat to republican forms of government
Such groups are not problematic if they represent a small
minority but become problematic if they represent a large
majority of the population
Nature of the democratic party historically
oFriendly toward labor and minorities
oFrom the new deal on the Democratic Party consisted on very
progressive politicians from the north, favored civil rights, the union etc.
And segregationist conservative racists in the south
Schizophrenia within a single party
Foreign policy does however have a large effect on elections in terms of presidents
seeking re-election
Foreign policy is what resulted in the failure of Jimmy Carter’s re-election in 1980
Collapse of the samosa dynasty in Nicaragua
Issues in Cuba
Collapse of the Shah government in Iran
oDemocrats vs. republicans in regards to multilateralism
Bush Administration publically recalling the signature on the treaty of Rome
Authorization for the use of force in Afghanistan in the UN during the aftermath of
Attempted to get UN approval for the US invasion of Iraq
Failed to do so and went ahead anyways
Bush administration was very opened to using the UN and using other multi-lateral
approaches to gain US goals
US did not unilaterally intervene in Libya for example
Dates back to the earliest moves of the US
Wilsons concept of the league of nations
International organizations to stabilize the international system
Bi-partisanship in foreign policy
Elections have also resulted in electoral re-alignments or electoral cycles
The new deal realignment
oBrought democrats into dominance until the 1960s
oFollowed by a response by the republican party as a permanent minority
in the US system of government and thus adopted the southern strategy
oInterest Groups
US is rather unique as a political system not only in terms of their interesting party
politics and elections but through interest groups
Domestic politics have a significant influence by interest groups and so does foreign
The US government- Lobbying
Lobbying= talking to members of the senate during in the lobby during
recesses of meetings to help to influence their decisions
oProvides citizens with numerous access points in which they can have an
influence on policy
oIf one wants to influence a specific policy it is more important to focus
not on elections but times between elections
oCongress offers enormous access
oK-street firms
oRevolving door of politics in regards to favored interest in terms of the
ability to influence policy
oThere is lots of easy access to decision makers
oExecutive branch
K-street firms sell their ability to make access to key influencers
US foreign policy can be influenced by these lobbying campaigns
Key lobby groups that have had large impact on foreign policy
oDoes not consist of Chinese Americans but rather is a
lobby that consists of business leaders with a strong
interest with gaining access to the Chinese market
oOrigins are similar to the China-Lobby
oEmerged after Cuban revolution
oUnlike the China lobby the Cuba lobby consist of many
Cuban exiles (Cuban Americans) with interest to
restoring their property rights that were confiscated
during the Cuban revolution
oAdvocate for confrontational policy toward Cuban from
the US