By Sagar Deva

Despite unspeakable horrors that were routinely carried out against indigenous populations across the globe during the Colonial era, it was rare for colonisers to present their repression of native peoples in anything other than morally positive language. The justification for withholding basic rights from native populations was couched in the language of civilisation, where the native and ‘coloured’ populations were portrayed as insufficiently civilised, and too subhuman to enjoy the basic human rights and dignity that were the prerogative of the white, Christian man.

The coloniser, cloaked in righteous whiteness was divinely ordained to rule over the lesser peoples for their own good, his authority shrouded in benevolence and wisdom. In this way, the rapacious exploitation of entire peoples and nations could be portrayed as a glorious and noble endeavour to ‘elevate’ repressed people closer to the level of the white man through forcible processes of ‘civilisation.’

After the end of the Second World War and the global movement towards self-determination, colonial powers which had previously possessed vast empires were no longer able to directly exploit other nations through the use of military force and direct rule. However, this did not mean that the factors which initially drove these nations to colonise vast swathes of the globe disappeared overnight. Unrestrained greed and a ruthless economic mentality were still prevalent amongst many important states, and were particularly apparent within the emerging global presence of the USA, which had rapidly emerged as the worlds dominant power.

In addition, racial and cultural attitudes which perceived white, western civilisation as fundamentally superior to civilisations in the developing world had not entirely disappeared and were still prevalent amongst certain governments and populations within this dominant diaspora.

Nonetheless, the fact that powerful states could no longer dominate other nations militarily necessitated innovative solutions for entrenching their hegemony in the international system. Military multipolarity, and particularly the existence of nuclear weapons, had substantially reduced the ability of powerful states to impose their authority on the global order. A new approach was thus required to impose the authority of developed, northern powers on the autonomy of developing countries in the Global South and to ensure maximum dominance within the international system.

To this end, the core international economic constitutions were created, which comprised of the GATT (which later became the World Trade Organisation) and the ‘Bretton Woods’ institutions, which included the World Bank and International Monetary Fund (IMF). Ostensibly, the purpose of these organisations was to provide a fairer economic playing field by promoting ‘free trade’ and opening up markets to ‘fair competition’, as well as, in the case of the IMF, providing emergency loans to countries with questionable liquidity to ensure the financial stability of the international system.

Bretton-Woods
The ‘Gold Room’ at Bretton Woods, where the establishment of the World Bank and IMF was first agreed. Source: Wikimedia Commons

Much of the rhetoric of the US led coalition who were key in the creation of these organisations has been distinctly utopian, referring to the ‘egalitarian’ nature of a global free market and consistently emphasising the supposed ‘fairness’ of the organisation. Thus, the rhetoric and language used by dominant powers has sought to normalize the intensive process of market liberalization engendered by these organisations by positing them as an objective normative good and promoting them as the only way in which ‘good’ global governance might be achieved, a process which will supposedly benefit the entire global system.

However, this attempt to normalize, even constitutionalise, practices of intense, global, market liberalization has in many ways, simply been a way to entrench the economic hegemony of the developed world over the underdeveloped South. In a world where power is increasingly expressed economically rather than militarily, powerful states and associated multinational corporations have utilised the rhetoric of market liberalization and free trade to exert control over other states and entities to the benefit of themselves and the detriment of others.

Many examples of this paradigm exist but two immediately spring to mind. The first of them refers to the process of ‘structural adjustment’ practiced by the IMF, an organisation dominated by powerful developed countries as voting power is directly tied to fiscal contribution.  Structural adjustment was a process whereby IMF loans were only given to countries if they reformed their markets according to IMF guidelines, which invariably demanded as a key condition market liberalization.

These conditions included opening markets to foreign competition and the creation of ‘fiscal discipline’, particularly with regard to reducing government spending on welfare budgets. This strategy was particularly used in the Latin American Debt Crisis of the 1980’s.

However, the only beneficiaries of these processes were multinational corporations, almost invariably based in the developed world, which now had access to enormous new markets. The effects of structural adjustment on Latin American economies were disastrous, lowering real GDP substantially, creating mass unemployment and driving many local, previously government protected businesses into bankruptcy in favour of multinational corporations backed by powerful developed countries. Despite this disaster, the IMF and World Bank continued to utilise slightly amended processes of structural adjustment well after the end of this crisis, often resulting in substantial damage to the host nation.

A second example of where dominant economic powers have sought to normalize unfair trade practices with potentially damaging and dangerous consequences was in the creation of the Agreement on Trade Related Aspect of Intellectual Property Rights’ or TRIPS agreement. This agreement allows for the almost universal enforcement of global intellectual property rights over almost all products including medicines. Under the guise of ‘free trade’ and ‘fairness’, TRIPS has been accused of creating ‘artificial scarcity’ for important medical products by preventing domestic producers from producing generic drugs.

As a result of this, the price of multiple necessary and lifesaving drugs has been increased considerably, with developing countries highlighting the unfairness of the agreement as well the potential loss of life caused by unaffordable medicines. Once again, the key beneficiaries of this agreement were powerful multinational pharmaceutical countries who possessed enormous lobbying power within dominant developed states.

In the past, colonial powers used the language of racial, cultural, or civilizational superiority to justify dominance and exploitation over other, less powerful nations. Nowadays, powerful states instead seek to normalize their dominance through the language of market liberalisation and free trade which unfairly advantage them over less developed states, allowing for their exploitation. Instead of simply accepting the dominant narrative of the global economic institutions, it is instead imperative to understand the impact that such language can have on imposing injustice and disparity in the world today.

Sagar Deva is a doctoral candidate in the University of Sheffield Department of Law. His research focuses on the relationship between international legal theory and global politics.

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