Founding commitments to cope with problem of own

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founding commitments to cope with problem of own making, bailout of banks and automotive industries in 2008 crisis contradicts founding commitment of self regulating markets and minimal government -NL try everything to appeal to voters but three dimensions that separate it from other governing: preferred policies, political interests, and world view Preferred Policies -Privatization, Liberalization and deregulation designed to eliminate barriers to free flow of business around world and create new global markets for goods and services -Globalization and neoliberalism for that reason related but not to be confused with one another -Development of technologies and air travel crafted globe as social and political space, this known as globalization -Neoliberalism in contrast is how this transnational should be governed -Privatization principle is with claim markets more efficient than governments in provision of goods and services, this why NL want government to sell off companies to private sector -Liberalization principle asserts that gov’t remove barriers to free movement of gods, services, and investment across border by removing tariffs and sign international agreements to treat domestic and foreign companies in same way -Deregulation principle requires government to scale back on measure that hinder market forces, include corporate taxes, environmental regulation, bureaucratic oversight and business fees and subsidies -IMF and WB imposed these policies on debtor countries in developing world through Structural Adjustment Policies (SAPs) condition for financial aid, these countries forced to redirect production (agricultural mostly) from domestic to international markets and open key sectors of economy to foreign adjustment, only few countries got benefits of free market -International commodities flooded market, this drove prices down, the domestic population experienced food shortage, profit from exports used to pay back loans rather than using this money to improve domestic infrastructures and life
-Eventually one size fits all approach did not work, SAPs replaced with Poverty Reduction Strategies (PRSP) which paid more attention to single cases but they are still committed to principles of Privatization, Liberalization, and deregulation -Advanced economies adopted core principles of NL through election of like minded parties -Not all countries able to use PLD uniformly due to political and institutional constraints Politcal Interests -Second perspective complementary to first understand NL aims to advance wealthy, and global corporations up at expense of poor, and middle class down -This view says wealthy unwillingly agreed to post war compromise, and eagerly support NL when Keynesian model failed in 1970s -Despite all rhetoric about individual freedom, democracy, and free market at its core NL about restoring class power -NL era saw never before seen transfers of wealth to the few very rich from rest, 1% control 43% of world’s assets, wealthiest 10%= 83%, bottom 50% only 2%

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