August 7th, 2021

Blast Off

US-MEXICO ARMS FLOWS

This week, the Mexican government sued eleven major US arms manufacturers, alleging that they facilitated the illegal flow of guns into the country. The proliferation of US-manufactured guns in Mexico during recent years has been well-documented, but their presence precedes the twentieth century.

In a 2013 text, BRIAN DELAY investigates how the newly-independent Mexican state navigated wars while lacking capital to purchase arms, leading to a reliance on US creditors.

From the piece:

"During the 1850s and 1860s, in response to demand created by several coups and regional rebellions, more than a decade of civil war, and a foreign occupation, ammunition would pour into Mexico by the tons and firearms by the many tens of thousands. Most of this material came from the United States, most of it came on credit, and mostly the terms were ruinous. During the French Intervention of 1862–1867, Mexico’s conservatives conspired with Napoleon III to install Archduke Maximilian as Mexico’s king. Mexico’s president-in-exile, Benito Juárez, dispatched scores of agents to US cities in search of capital and weapons with which to retake control. Existential desperation encouraged them to make fantastical promises, and to sell more than thirty million dollars in bonds at steep discounts.

Historian John Hart has sleuthed out the list of buyers, and it reads like a who’s who of America’s incipient Gilded Age. These men were not so naïve as to expect prompt repayment on the bonds. They expected the bonds to give them not scheduled returns so much as leverage to secure land deals, mining concessions, commercial privileges, and, above all, railroad projects. The creditors clamored for repayment as soon as the liberals retook the capital. Finally in 1876, despairing of ever recouping their investments, these bondholders conspired with colleagues in the railroad business to fund and arm a coup by Mexican General Porfirio Díaz."

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July 31st, 2021

Burning Bridge

MICRO-STRATEGY

Accounts of major historical shifts tend to treat states as unified actors responding to external incentives. In a new article, INGA RADEMACHER complicates this assumption. Drawing on archival documents from the German Federal Cabinet and Bundesbank Council from 1960-1981, she argues that competition among state actors is a crucial, but often overlooked, factor in shaping policy trajectories.

From the piece:

"The globalisation literature argues that capital mobility, and capital flight in particular, are critical drivers of austerity. However, during the 1970s, capital outflows were not a problem in the German economy. Rather, capital inflows caused problems for monetary actors—triggering conflicts between Bundesbank and administration. In the 1970s, when the expansion of Eurodollar markets peaked, the Bundesbank’s autonomy became increasingly curtailed as so-called ‘hot money’ flooded the German capital market. But the enforcement capacity of the central bank increased with the breakdown of the Bretton Woods system.

Initially, central bank officials were not convinced of monetarist ideas. Instead, during the debates over solutions to the crisis—capital controls or the float of the Deustchmark—in January 1973, the central bank reviewed two rival approaches to resolve inflation: a ‘dirigiste’ approach and monetarism. Since the dirigiste proposal found considerable support among a large group of central bankers, including the president of the Bundesbank, Karl Klasen, it seems unlikely that ideational changes drove the shift to new policy instruments in the central bank. Instead, monetarist policy settings and instruments were suddenly endorsed on the basis of strategic considerations on how to enhance the power position of the central bank in the overall macroeconomic system. This micro-level analysis shows that institutional instruments are only one way that central bankers gain power within the larger macroeconomic framework. They also actively utilise opportunities in the political and economic context to bargain with the government."

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July 24th, 2021

Rayfish

CASTE & LABOR

Structures of unfree labor have always been at the edge of current and historical discourse on labor, mobility and caste in South Asia. This has been in focus during the COVID-led migrant crisis in India, where around 11.4 million migrant workers were forced into an exodus from urban to rural areas.

In a recent book, RADHIKA SINGHA unpacks the category of ‘menial’ labor as one structured by caste, class and race. She focuses on the massive role of Indian labor—involving 563,369 followers or non-combatants in the British Indian Army—in Mesopotamia and France during World War I.

From the book:

"In colonial civil offices, ‘menial establishment’ was the formal categorisation for the lowest rung of employees, from peons (messengers) down to file-suppliers, bhistis and sweepers. The label ‘menial’ was often used in discussion of their service conditions. In exploring this condition of ‘menial’ status, we have the benefit of a valuable body of writing which has shown how caste norms tended to hem powerless communities into the hardest and most stigmatised sectors of work regimes—even in those which were being refashioned under the drives of colonialism and capitalism. ‘Untouchability’ was thereby recast in new contexts, and low pay, degrading conditions of work, and corporal discipline were ‘naturalised.’ The attached followers found it particularly difficult to challenge their consignment to menial status because of the presence in their ranks of ‘untouchable’ castes who swept, cleaned latrines, washed clothes, and crafted leather. This was work characterised both as a ‘trade’—that is, as a caste structured specialisation—and as ‘polluting.’ Regimental followers, public and private, were, in the manner of domestic servants, expected to be constantly at hand to tend to the physical needs of their institutional superiors, who felt they had a personal right to chastise followers for inadequate service, evasion, or questioning of demands. The fact that regiments found themselves having to supplement the income of public followers and employ ‘private’ followers blurred the line between public employee and domestic servant."

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July 17th, 2021

Inextinguishable Fire

CLIMATE PLANNING

Earlier this week, the EU published a series of proposals aimed at reducing its carbon emissions by 55 percent by 2030. The legislation has revived debates on the economic models best suited to facilitating investment and decarbonization.

A Financial Times article by MAX KRAHÉ was circulated widely this week, in which he argued for the importance of central planning in the green energy transition. In an April report for the Royal Belgian Academy, Krahé examines the structural justifications for his position.

From the text:

"As of today, we lack an agreed-upon, reliable methodology for distinguishing between sustainable and non-sustainable investments. Unfortunately, this is not a problem of insufficient data or the imperfect implementation of a theoretically sound methodology. Instead, the problem lies with the basic methodology of the dominant approach that has been used to draw this distinction so far: a bottom-up approach that tries to rate the sustainability performance of individual companies by looking at firm-level performance indicators—such as emissions, the use of land, water, or energy, average and minimum wages, corporate governance structures, and so on—without taking into consideration the wider context into which these firms are embedded. As the report shows, there are deep, conceptual reasons that stand in the way of determining the contribution that individual investments make to sustainable development. In particular, where we cannot identify counterfactuals, the question of sustainability can only be asked of systems as a whole, and not of their individual components. While there is a combination of methods that allows downwards translation, from system-level sustainability to identifying individual sustainable investments, there is no reliable method to translate upwards, from individual investments to their impact on a system’s overall sustainability, and hence to the unsustainability of that individual investment. Concerning this link, the report’s central finding is that upwards translation is impossible in dynamic systems. The link between individual investments and system-level sustainable development is a one-way street."

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July 10th, 2021

Dawning Man

THE HAITIAN STATE

Haiti's President Jovenel Moïse was assassinated on Wednesday, plunging the country into greater political unrest following months of protests around Moïse's controversial decision to rule by decree.

A 2006 article by ROBERT FATTON JR. investigates Haiti's state formation after independence, shedding light on the country's current distributional struggles.

From the article:

"Slaves knew that their freedom depended on the destruction of the plantation economy; however, Haiti’s place in world production and utter dependence on sugar exports also rested on the plantation system. At independence Haitian rulers confronted a cruel choice. If they preserved emancipation by supporting the former slaves’ aspirations to become independent peasants, they would ultimately condemn the country to material underdevelopment. If they promoted an immediate economic recovery, they would be compelled to impose a military-like discipline on the newly freed masses and they would thus emasculate emancipation itself. Moreover, the high army officers who led the revolution were determined to keep and expand their power; this in turn required maximising revenues and foreign exchange. The plantation system facilitated the collection of taxes and privileged the concentration of land ownership in the hands of the new ruling class. Thus the imperatives of economic recovery and defending emancipation against the potential military aggressions of the great powers coincided with the class interests of the first postcolonial leaders to create patterns of unequal land ownership and forced labour. Gross material inequalities and political despotism opened a massive chasm between rulers and citizens. The outcome of the slaves’ revolution for freedom was paradoxically a new authoritarianism in the name of emancipation."

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July 3rd, 2021

Composition

STATE, CLASS, & MILITARY

The impending retreat of US troops from Afghanistan has brought renewed discussion on Pakistan amidst both US and Chinese alliances. Much of the scholarship on Pakistan centers around its military and foreign policy, but less attention has been given to the specific social formations that inform the nation's development.

In a 2014 article, S. AKBAR ZAIDI offers a corrective, arguing that the focus on Pakistan's state and military has obscured readings of class.

From the article:

"The analysis in Pakistan suggests that institutions rather than class determine the nature of the state. The media, judiciary, and parliament are all multi-class institutions, as is the military, although they all work for the defence of the capitalist order in which they function, with the purpose of accumulating more capital. However, they are not class organisations in the way landlords or the industrial bourgeoisie are perceived to be. Yet, these are certainly not institutions that are radical, though they occasionally raise their voices for oppressed nationalities and peoples. Class seems lost in the analysis. The discourse, especially in Pakistan, focuses on very broad categories, such as institutions and on "feudals" and the military.

In recent years, understanding Pakistan has been premised on notions of "Islam", and the country has been forced into an analytical Islamic framework as if no other sense of existence or identity existed. While Islam may be important in analysing Pakistan, it is certainly not the only or even dominant category to examine it, especially in its social formation and class categories. It is the Islam of the post- 9/11 era that has suddenly surfaced as the core of such analyses."

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June 26th, 2021

Window of Chaos

WATER MARKETS

Since the 2000 World Water Forum in The Hague, governance over water resources has gained salience in international development discourse. The allocation of rights (to technology and decisionmaking) and resources (both financial and natural) has shaped local economies in the face of compounding climate emergencies.

A 2014 piece by KAREN BAKKER reviews the literature on water marketization, complicating existing accounts which focus exclusively on models of ownership.

From the article's conclusion:

"Market environmentalism is not synonymous with (or limited to) privatization. It includes commercialization, environmental valuation and pricing, the marketization of trading and exchange mechanisms, and the liberalization of governance. The trend is relatively recent and is by no means hegemonic. In many countries, it has only partially displaced a state hydraulic paradigm of water management—indeed, many aspects of the social and hydrological cycle are still owned, managed, and regulated by governments.

Market environmentalism is difficult to implement in practice, with tensions arising from attempts to privatize, commercialize, value, market, and liberalize water governance—for example, between the desire for less government control and drivers for greater governmental control, spurred by fears over water security. Some of these tensions arise from contradictions that are difficult to resolve in practice, notably the contradiction between monetary and nonmonetary values of water and the tension between framing water as an economic good versus incorporating its noneconomic uses. These tensions, which have acted as a brake on market environmentalism, are inherent to water management and are unlikely to be effectively resolved. The question is how, through institutional innovation, governance reforms, and political mediation, they will be handled."

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June 19th, 2021

Aspiration

GREEN INFRASTRUCTURE

Earlier this week, global leaders at the G7 summit signed a "green belt and road initiative," which offers funds to low income countries for sustainable investment. The agreement comes in the face of a $15 trillion global infrastructure investment gap, which threatens to compound resource and climate-based inequalities.

In a 2018 introductory article, GAVIN BRIDGE, BEGUM ÖZKAYNAK, and ETHEMCAN TURHAN consider the global politics of green investment.

From the piece:

"Energy infrastructures draw together and advance the material interests of specific actors and groups across multiple scales. It is in this multi-actor and multi-scalar context, then, that a resurrection of debates on energy has to be understood: in some contexts energy policy reflects the reassertion of the national state as an economic actor (i.e. resource nationalism in Venezuela, Bolivia and Ecuador). In others, it signals the rise of a populist and authoritarian form of economic nationalism (i.e. Turkey, Poland, India), where energy projects are harnessed to claims for national security in ways that occlude the particular interests of private capital and suppress dissent. In countries that embraced economic liberalization in the energy sector (such as the UK), claims for the national importance of new energy infrastructure reflect concerns about growing import dependency and the way energy systems are no longer ‘nationally’ contained. Elsewhere, it is an artefact of international agreements signed and ratified by nation-states.

It is important that social science research on energy better understand these complex intersections between energy infrastructure and the political economies of national development. Claims about the national significance of infrastructure ‘do political work’ by, for example, licensing state intervention in energy systems, establishing political authority, and marginalizing criticism. In many countries, energy policy-making remains centralized and divorced from public participation. Questions about who bears the costs of power stations, pipelines and other energy infrastructures deemed ‘critical’ to national security or development now animate calls for more inclusive and sustainable energy systems. Energy infrastructure also enables and sustains particular forms of political economy. This includes, for example, the importance of electricity transmission systems, gas pipelines and storage facilities to constituting wholesale energy markets and enabling the adoption of economic liberalization policies in national energy sectors. Chile’s introduction of wholesale markets for electricity in 1978, and comprehensive electricity and gas sector privatization in the UK beginning in the 1980s illustrate how infrastructures for circulating gas and electricity have been a key experimental site for economic deregulation and the introduction of market principles, commercial logics and private capital into national economies. Infrastructures for energy have been a key frontier in the evolution of economic organizational forms—around markets, finance, labor organization and techno-scientific expertise—that transcend the energy sector, such that they can be considered integral to the reproduction of economic power."

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June 12th, 2021

The Concierge

LIBERALIZATION & MOVEMENTS

A close election in Peru has pinned socialist candidate Pedro Castillo against Keiko Fujimori, former congresswoman and daughter of former President Alberto Fujimori. The contest has revealed deep polarization in the country between social movements opposed to foreign investment and those who favored market liberalization that has defined Peruvian politics since the 1990s.

In a 2008 article, MOISÉS ARCE shows the links between these two poles, examining how the policies of the Fujimori regime and decentralization efforts under his successor, Alejandro Toledo, reinvigorated social struggles in mining, agriculture, and industrial labor.

From the article:

"Following the 1992 autogolpe, Fujimori recentralized political authority and effectively created a system with few or no veto points, which, in turn, allowed for dramatic policy change. During this period, Fujimori enjoyed majority support in Congress and was able to minimize political dissension within his own party, thereby expediting legislative approval for policy initiatives drafted by the executive. Fujimori also reversed the decentralization initiative that had created 13 regional governments in 1989. The period of the Fujimori regime, indeed, was characterized by a general decline in strike activity, largely because the political environment delegitimated the use of protest and the economic conditions eroded and weakened collective action.

In contrast to Fujimori’s authoritarian regime, the democratic government of Toledo provided an environment that facilitated greater levels of mobilization. Unlike Fujimori after his autogolpe, Toledo did not have majority support in Congress, and disagreements within his party were customary. In 2002, Toledo restarted the decentralization process that the Fujimori regime had abruptly interrupted. Not surprisingly, Toledo’s democratic government faced many mobilizations. Outside the capital, in September 2001, peasants in Cuzco seized the city’s airport, demanding the construction of an access road to Quillabamba. Later that month, residents of Puno arrived in Lima requesting that the government build through Puno, instead of Cuzco, the so-called intercoastal highway (carretera interoceánica) between Peru and Brazil. The following month, 15 different mayors from 3 poverty-stricken regions, Junín, Huancavélica, and Ayacucho, arrived in Lima demanding more public works. In August 2002, rice producers in Tarapoto went on strike demanding a financial bailout from falling rice prices. At least 13 different departments, mostly in the poorer regions of the country, harbor several active and latent conflicts involving local communities and transnational mining corporations over the extraction of natural resources. Perhaps no other protest was as powerful as the one that rocked Arequipa in June 2002, when citizens violently resisted the sale of the city’s electric companies. Overall, this upsurge in localized protests was unprecedented. The cycle of contentious activity in Peru is exemplified by the Arequipa uprising and other geographically segmented conflicts against foreign direct investment. Many scholars have identified foreign direct investment as the hallmark of globalization and economic liberalization policies; therefore these conflicts can be seen as reactions to neoliberal or market policies."

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June 5th, 2021

Essay on Urban Planning

PEASANT REVOLTS

This week marked the 640th anniversary of the 1381 Great Rising, a rebellion which swept across medieval England demanding an end to serfdom and an overhaul of the legal system and the aristocracy.

A 2009 book edited by A. Haroon Akram-Lodhi and Cristóbal Kay examines the past, present, and future of peasant studies, paying close attention to the impact of globalization on configurations of rural power.

From the book's conclusion:

"Agrarian restructuring has altered the land-, labour- and capital-intensity of production, in ways that have profoundly altered the terrain of the agrarian question. In Brazil and Vietnam, significant linkages between the export-oriented and peasant production subsectors has facilitated an asymmetrical but mutually reinforcing expansion of both subsectors, and consequently domestic demand. In both, the agricultural export sector now drives growth that, through its impact on product prices and wages, fosters increases in domestic demand in the rural economy in the first instance, but also more generally in the economy as a whole. Within both Brazil and Vietnam, rural accumulation continues to be of importance for both capital and labour and, in this sense, the classical concerns of the agrarian question remain salient.

By countrast, in countries as varied as Bolivia, Egypt, Ghana, Guatemala, Honduras, India, Indonesia, Kenya, Morocco, Namibia, Pakistan, Peru, the Philippines, South Africa, Tanzania, Tunisia, Uganda, Uzbekistan and Zimbabwe, the processes of market-led land appropriation can be witnessed, though contingent trajectories of variation have produced manifestly different outcomes in specific settings. In particular, higher-value agricultural exports are an important determinant of aggregate rates of rural accumulation, but substantially weaker linkages between the export and peasant subsectors have fostered a significantly weaker distribution of the gains from rural accumulation and thus equality-deteriorating patterns of rural growth. Indeed, the greater emphasis on higher-value agricultural exports, coupled with devaluations and the removal of import restrictions resulting from ongoing structural adjustment in agriculture, has effectively, and in some cases deliberately, neglected agricultural production for the home market. Thus a range of countries in Africa, Asia and Latin America are increasingly engaged in the production of specialist farm output for niche consumer markets in developed capitalist economies, usually under the aegis of agro-food transnational corporations operating upstream in the commodity chain. The result, in many countries, has been to generate a reproduction squeeze within the increasingly fragmented peasant sector."

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