8 & 9 lecture slides

8 & 9 lecture slides - LECTURE EIGHT/NINE The Debt...

Info iconThis preview shows pages 1–14. Sign up to view the full content.

View Full Document Right Arrow Icon
LECTURE EIGHT/NINE The Debt Crisis and Neoliberalism
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Essential readings: McMichael Ch. 5 & Ch. 6 (pp. 149-160; 186-190) Potter Ch. 8 (pp. 369-377) Harvey “Freedom’s just another word …” Klein “The Other Doctor Shock”
Background image of page 2
The Development Decades (reminder) 1950s/60s The Golden Years 1970s Debt-led development 1980s The Lost Decade (debt crisis) 1990s Neoliberal era, market triumphalism 2000s Free-market globalization (with new challenges from rock stars and South-South cooperation)
Background image of page 3

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Background image of page 4
GROWTH OF LATIN AMERICAN DEBT (IN $US MILLIONS) 1970 1980 1990 2001 Argentina $1,872 $10,285 $62,233 $136,709 Bolivia 477 2,124 4,275 4,682 Brazil 3,680 37,824 119,964 226,362 Chile 2,066 4,885 19,226 38,360 Columbia 1,250 4,090 17,222 36,699 Costa Rica 134 1,585 3,756 4,586 Ecuador 209 2,665 12,107 13,910 Mexico 3,228 33,490 104,442 158,290 Nicaragua 146 1,698 10,745 6,391 Peru 898 6,204 20,064 27,512 Venezuela 729 10,867 33,171 34,660
Background image of page 5

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
I. Development in the 1970s The “Golden Years” are over foreign debts start to rise, but lending and borrowing continue ISI falling out of favor oil shocks raise import prices; terms of trade decline further TW countries call for a New International Economic Order New development discourses: “basic needs,” “redistribution with growth,” women discovered (!) Cold War détente
Background image of page 6
Background image of page 7

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
II. Triggers of the Debt Crisis Collapse of Bretton Woods Gold Standard Agreement Oil shocks petrodollar lending Interest rates raised
Background image of page 8
Why the Gold Standard failed Marshall Plan “a little too successful” US starts to run trade deFcits with Germany and Japan Overextended Cold War military spending, especially Vietnam War Q: What doe the US do? Prints more money! 1971 Nixon Shock: US unilaterally abrogates the Gold Standard Agreement By 1971, almost 5x more US currency was in global circulation than it could cover; ±rance “busts” the US reserve by trying to cash in large amount of currency for gold
Background image of page 9

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
The $ drops 25% in value . ..... Other factors; Growing international currency markets Rising power of international banking consortia General decline of US economic hegemony Opposition to Vietnam War (many countries no longer willing to underwrite US military expenditures)
Background image of page 10
Consequences Switch to fuctuating exchange rates Rising currency speculation Return oF international ±nancial instability More diF±cult For small economies to manage budgets IM² and World Bank lending currency (the US $) now less reliable Emerging Euro-currency mark “stagfation” in US by late 70s
Background image of page 11

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
World Oil Prices 1970 - 2000 The Oil Shocks
Background image of page 12
A Partial List of Key Oil Pricing Events Jan. 1972 : Six OPEC countries raise price to offset losses due to falling US $$ June 1973 : They do it again October 1973 : Fourth Arab-Israeli War; Arab oil embargo declared against US and other states
Background image of page 13

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 14
This is the end of the preview. Sign up to access the rest of the document.

Page1 / 44

8 & 9 lecture slides - LECTURE EIGHT/NINE The Debt...

This preview shows document pages 1 - 14. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online