Posts Tagged ‘Third World’

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From the very beginning, the area of mainstream economics devoted to Third World development has been imbued with a utopian impulse. The basic idea has been that traditional societies need to be transformed in order to pass through the various stages of growth and, if successful, they will eventually climb the ladder of progress and achieve modern economic and social development.

Perhaps the most famous theory of the stages of growth was elaborated by Walt Whitman Rostow in 1960, as an answer to the following questions:

Under what impulses did traditional, agricultural societies begin the process of their modernization? When and how did regular growth become a built-in feature of each society? What forces drove the process of sustained growth along and determined its contours? What common social and political features of the growth process may be discerned at each stage? What forces have determined relations between the more developed and less developed areas?

Rostow’s model postulated that economic growth occurs in a linear path through five basic stages, of varying length—from traditional society through take-off and finally into a mature stage of high mass consumption.

While Rostow’s model and much of mainstream development theory can trace its origins back to Adam Smith—through the emphasis on increasing productivity, the expansion of markets, and the definition of development as the growth in national income—the development models that were prevalent in the immediate postwar period presumed that the pre-conditions growth were not automatic, but would have to be engineered through government intervention and foreign aid.

Mainstream modernization theory was created in the 1950s—and thus after the first Great Depression and World War II, when world trade had been severely disrupted, and in the midst of decolonization and the rise of the Cold War, when socialism and communism were attractive alternatives to many of the national liberation movements in the Global South. It was a determined effort, on the part of academics and policymakers in the United States and Western Europe, to showcase capitalist development and make the economic and social changes necessary in the West’s former colonies to initiate the transition to modern economic growth.*

The presumption was that government intervention was required to disrupt the economic and social institutions of so-called traditional society, in order to chart a path through the necessary steps to shift the balance from agriculture to industry, create national markets, build the appropriate physical and social infrastructure, generate a domestic entrepreneurial class, and eventually raise the level of investment and employ modern technologies to increase productivity in both rural and urban areas.

That was the time of the Big Push, Unbalanced Growth, and Import-Substitution Industrialization. Only later, during the 1980s, was development economics transformed by the successful pushback from the neoclassical wing of mainstream economics and free-market policymakers. The new orthodoxy, often referred to as the Washington Consensus, focused on privatizing public enterprises, eliminating government regulations, and the freeing-up of trade and capital flows.

Throughout the postwar period, mirroring the debates in mainstream microeconomic and macroeconomic theory, mainstream development theory has oscillated back and forth—within and across countries—between more public, government-oriented and more private, free-market forms of mainstream development theory and policy. And, of course, the ever-shifting middle ground. In fact, the latest fads within mainstream development theory combine an interest in government programs with micro-level decision-making. One of them focuses on local experiments—using either the randomized-control-trials approach elaborated by Abhijit Banerjee and Esther Duflo or the Millenium Villages Project pioneered by Jeffrey Sachs, which they use to test and implement strategies so that impoverished people in the Third World can find their own way out of poverty. The other is the discovery of the importance of “good” institutions—for example, by Daron Acemoglu—especially the delineation and defense of private-property rights, so that Rostow’s modern entrepreneurs can, with public guarantees but minimal interference otherwise, be allowed to keep and utilize the proceeds of their private investments.

The debates among and between the various views within mainstream development economics have, of course, been intense. But underlying their sharp theoretical and policy-related differences has been a shared utopianism based on the idea that modern economic development is equivalent to and can be achieved as a result of the expansion of markets, the creation of a well-defined system of private property rights, and the growth of national income. In the end, it is the same utopianism that is both the premise and promise of a long line of contributions, from Smith’s Wealth of Nations through Rostow’s stages of growth to the experiments and institutions of today’s mainstream development economists.

The alternatives to mainstream development also have a utopian horizon, which is grounded in a ruthless criticism of the theory and practice of the “development industry.”

One part of that critique, pioneered by among others Arturo Escobar (e.g., in his Encountering Development), has taken on the whole edifice of western ideas that supported development, which he and other post-development thinkers and practitioners regard as a contradiction in terms.** For them, development has amounted to little more than the West’s convenient “discovery” of poverty in the third world for the purposes of reasserting its moral and cultural superiority in supposedly post-colonial times. Their view is that development has been, unavoidably, both an ideological export (something Rostow would willingly have admitted) and a simultaneous act of economic and cultural imperialism (a claim Rostow rejected). With its highly technocratic language and forthright deployment of particular norms and value judgements, it has also been a form of cultural imperialism that poor countries have had little means of declining politely. That has been true even as the development industry claimed to be improving on past practice—as it has moved from anti-poverty and pro-growth to pro-poor and basic human needs approaches. It continued to fall into the serious trap of imposing a linear, western modernizing agenda on others. For post-development thinkers the alternative to mainstream development emerges from creating space for “local agency” to assert itself. In practice, this has meant encouraging local communities and traditions rooted in local identities to address their own problems and criticizing any existing distortions—both economic and political, national as well as international—that limit peoples’ ability to imagine and create diverse paths of development.

The second moment of that critique challenges the notion—held by mainstream economists and often shared by post-development thinkers—that capitalism is the centered and centering essence of Third World development. Moreover, such a “capitalocentric” vision of the economy has served to weaken or limit a radical rethinking of and beyond development.*** One way out of this dilemma is to recognize class diversity and the specificity of economic practices that coexist in the Third World and to show how modernization interventions have, themselves, created a variety of noncapitalist (as well as capitalist) class structures, thereby adding to the diversity of the economic landscape rather than reducing it to homogeneity. This is a discursive strategy aimed at rereading the economy outside the hold of capitalocentrism. The second strategy opens up the economy to new possibilities by theorizing a range of different and potential connections among and between diverse class processes. This forms part of a political project that can perhaps articulate with both old and new social movements in order to create new subjectivities and forge new economic and social futures in the Third World.

The combination of post-development and class-based anti-capitalocentric thinking refuses the utopianism of Third World development, as it constitutes a different utopian horizon—a critique of the naturalizing and normalizing strategies that are central to mainstream development theory and practice in the world today. It therefore leads in a radically different direction: to make noncapitalist class processes and projects more visible, less “unrealistic,” as one step toward dethroning the “development industry” and invigorating an economic politics beyond development.

 

*At the same time, the Western Powers attempted to reconstruct the global institutions of capitalism, through the triumvirate of the World Bank, the International Monetary Fund, and the General Agreement on Tariffs and Trade (predecessor to the World Trade Organization) that was initially hammered out in 1944 in the Bretton-Woods Agreement.

**A short reading list for the post-development critique of mainstream development includes the following: Wolfgang Sachs, ed., The Development Dictionary: A Guide to Knowledge As Power (Zed, 1992); Arturo Escobar, Encountering Development: The Making and Unmaking of the Third World (Princeton, 1995); Gustavo Esteva et al., The Future of Development: A Radical Manifesto (Policy, 2013); and the recent special issue of Third World Quarterly (2017), “The Development Dictionary @25: Post-Development and Its Consequences.”

***Building on a feminist definition of phallocentrism, I along with J.K. Gibson-Graham (in “‘After’ Development: Reimagining Economy and Class,” an essay published in my Development and Globalization: A Marxian Class Analysis) identify capitalocentrism whenever noncapitalism is reduced to and seen merely as the same as, the opposite of, the complement to, or located inside capitalism itself.

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lowndes

By the 1960s, it was known as “Bloody Lowndes”—because of the long history of lynchings and other forms of racial terrorism against the poor, majority-black population. Then, they began to fight back, with the assistance of the Student Non-Violent Coordinating Committee, forming the the Lowndes County Freedom Organization, which was the first independent black political party in the county since Reconstruction.

But the county remained poor, with a median household income of only $25,876 and a poverty rate of 28.5 percent, with a still-declining population that has been mostly consigned to oblivion.

Lowndes has been largely forgotten—until yesterday, when a new study was published concerning the health of the county’s residents.

What is remarkable is that the study was published in The American Journal of Tropical Medicine and Hygiene and it documents a high incidence of hookworm, an infection that affects 430 million people worldwide, causing iron deficiency, impaired cognitive development, and stunting in children.

This was supposed to be a parasite found only in poor, Third World countries, with poor sanitation and a natural environment suitable for the hookworm life-cycle. It’s a public health problem that I vividly remember from all my years working in and teaching development economics, especially in Latin America.

But here we are in the United States—where hookworm had been rampant, especially in the deep south, in the earlier twentieth century. But by the 1980s public health experts assumed the parasite and the attendant public-health problems had disappeared altogether. However, the authors of the study found that more than one third (34.5 percent) of the participants tested positive for Necator americanus, the American species of hookworm.

Clearly, the authors understand the significance and implications of their study:

The discovery of these parasitic diseases within the United States begins to shift the idea behind global health. One concept is blue marble health, which reveals that many of the world’s neglected tropical diseases are paradoxically found in some of the wealthiest countries, especially in these small regions of extreme poverty.

 

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More than 400 thousand Philadelphians live in poverty. The United States, even after the latest decline, still has more than 43 million men, women, and children below the poverty line. And nearly one half of the world’s population—more than 3 billion people—are poor (more than 1.3 billion of them in extreme poverty).

And yet the policy debate remains the same: how do we get poor people to get themselves out of the “culture of poverty”?

Not how do eliminate poverty? Or, alternatively, how do we create the economic and social institutions that don’t, on a regular and sustained basis, drive millions of people into and keep many of them in poverty?

Instead, what we get from Steve Volk [ht: ja] on Philadelphia, just like from Abhijit Banerjee and Esther Duflo (in their book Poor Economics: A Radical Rethinking of the Way to Fight Global Poverty) for the Third World, is a focus on the pathologies of the poor and the strategies that can be tested and implemented so that poor people can find their way out of poverty.

Now, I’ll admit, Volk writes (of Mattie McQueen and other poor Philadelphians) with more heart than Banerjee and Duflo seem to be able to muster. But it’s the same basic idea—that there’s something enduring about poverty, which pertains to poor people and “their” culture and which needs to be disrupted with the right sort of economic interventions.

In Volk’s case, the problem is “generational poverty”—such that poverty is passed down through two or more generations. And the solution is the “two-gen” strategy, such as the HIPPY (Home Instruction for Parents of Preschool Youngsters) program Bill Clinton celebrated at the Democratic National Convention.

In practical terms, the strategy means providing educational support to kids while offering the full range of housing, social, mental-health and economic services to their parents. “In hindsight, this way of approaching generational poverty looks kind of obvious,” says Susan Landry, director and founder of the Children’s Learning Institute in Houston, Texas. “Everyone wants to help children. What the two-gen strategy recognizes is that children exist in families.”

Educating children without stabilizing the home, says Landry, puts kids in an impossible position — requiring them to lead their parents. Making a child’s home safer and less stressful yields huge benefits in the child’s ability to learn. And two-gen strategies are gaining support among conservatives and progressives alike. Republican governors like Bill Haslam of Tennessee and Gary Herbert of Utah champion the two-gen approach for imparting a sense of responsibility to parents and streamlining government — parking disparate social agencies under one roof. Paul Ryan, Republican Speaker of the House, recently told NPR that helping children requires helping their families — a truism of two-gen thinking.

What is true of all such programs—the ones Volk writes about as well as those that are tested through randomized control trials by Banerjee and Duflo—is they focus on improving individual decisions and household environments, not on the history and dynamics of larger economic and social structures that create and perpetuate mass poverty. In other words, it’s all about individual, not social, responsibility and outcomes. The goal, it seems, is to change individual decisions and promote the mobility of a select few up and out of poverty—and, by the same token, to avoid an analysis of the kinds of changes that need to be made in the economy in order to end existing poverty and prevent its recurrence in the future.*

The problem, as I see it, is not a culture of poverty. It’s a culture of poor economics.

 

*I am reminded of an early World Development Report (unfortunately, I don’t remember the exact year) in which it was shown that a redistribution of productive assets (such as land reform) was much more likely to end poverty than other reforms (such as universal schooling). However, the authors of the report argued, land reform often faces social and political opposition, especially from landlords, and therefore needs to be set aside since it is an unrealistic strategy.