The nation – state and the challenge of global capitalism
Mark. T. Berger 2001
Key words: history of nation state, state development model, globalization,
The rise of the globalisation project in the 1970s led to a shift from the state guided national
development project to a laissez faire validated by neoclassical economies. It reconfigured the role
of the state and transformed the dominant idea of development.
However, at the same time globalisation also brings with it the promise of the development of global
progressive organisation, which thanks to their global networks, move beyond the limitations of the
nation-state.
Neoliberal economy and liberal democracy are central to the powerful global narrative on capitalism
and development. Neoliberal globalisation project:
o Shift of power from nation state to international institutions (mainly IFI)
o Directly related to the increase in global levels of inequality.
o Victory for liberal capitalism that has been promoted as the triumph for common
sense and as a new era of prosperity.
George bush’s election is presented as a turning point in the history of the US-led globalisation.
Berger makes a prediction when he argues that even if a dramatic crisis for the US economy and so
for the global economy would happen, it would be impossible to reverse the course of the
globalisation project driven by the US.
Opposition to the US led neoliberal globalisation: In 2001 the most important claim for global
democracy and globalisation from below is symbolised by the “battle for Seattle”. However, Social
movements did not manage to unify; they do not have a unique agenda to claim against globalisation
but often conflict with each others.
Friedman: the post cold age of globalisation is based on three balances
- Traditional balance between nation-state in the wide globalisation system
- Balance between nation states and global markets
- Balance between individuals and nation states
Berger criticizes Friedman approaches.
- He underlines that Friedman celebrates rather than addresses the contradictions of a
post cold war era. The ideas of nationalism and patriotism are used by the leaders to
mobilize although those same leaders undermine the institutions that underpinned the
social and economic cohesion of nation state. (it empty nation state model from it
signification)
- Friedman does not confront the social cost of globalisation.
- Global institutional framework undermines greatly state sovereignty and lead to the
subordination of the states and their citizens to a global order (one of the contradiction).
Serious internal contradictions and the external pressures associated with globalisation, increasingly,
called the idea of state-guided national development into question world-wide, reconfiguring the
role of nation state and altering the character of nation state system. At the same time this decline
might present an opportunity to move beyond the categories and practices of the nation state
system which has finally been a poor vehicle of development.
I-
The making of the Third World: from colonies to developing countries
1- Capitalism, colonialism and the rise of the nation state system
- 18th and 19th: Modern territorial states and then nation states emerged as part of the rise of
capitalism. It consolidated and reproduced the social forces pre-existing (mercantile time,
industrialization and then capitalism). Sovereignty is grounded in the state and not the people which
enabled to consolidate it as capitalist sovereignty.
During this period the nation state model has been spread out to the third world via colonization.
The inequalities of wealth and income between developed countries and developing countries were
grounded on an unequal inequitable integration of the third world in the 19th.
-1930s Crisis of colonialism: Economic depression, Rise of nationalist movement in the colonies.
In order to stabilize the colonies, reorientation of the western policies: need for colonial
development. - Deep economic integration in order to improve the standards of living
- redefine the civilizing mission
However, the intrusive character of the colonial developmentalism resulted in greater conflict.
Nationalists appropriated the language of state-guided development in the 1940s. The promotion of
national development by the British and French colonial government led to the claim that colonial
subjects could operate as modern subjects and actors of their own development.
2- Decolonization, the Cold War and the universalisation of the nation state system
These three features of the post WWII (decolonization, cold war and universalization of the nation
state model) consolidated the idea and practice of development as national development.
The UN recognized self determination (for former colonized state) and sovereignty
The late 19th and early 20th system of nation-state is generally understood to have rested on the
acknowledgement that sovereign states were subordinate to no other authority.
At the end of the cold war: failure of the national development project based on nation state system.
It comes from profound contradictions of the nation state model
- States did not overcome the external and internal contradiction of capitalism.
- End of the post war boom
- American globalization
- gap just widen between powerful and weak nation state.
3- The cold war and the nation state system in the Bandung era.
During the cold war era, politically diverse sovereign national development projects flourished.
During the 1950s to the 1970s the developing nations debated on the best national development
model to adopt (European, soviet, Chinese, Japanese, a combination etc.).
History of the movement:
- 1955 Bandung conference: non-aligned position of the developing countries in relation to
the USA and the Soviet Union. The aim was to steer national development between the
capitalism of the US and its allies and the communism of the Soviet Union.
→ Laboratory for progressive national development (combination of parliamentary
democracy, economic planning and socialist principles)
India played an important role in this process. It promoted the need for greater co-operation
between the leadership of the emergent nation-states (third world). However the complex dynamics
and conflicting goals of national movements in Asia and Africa undermine the efforts to unite the
governments.
- 1970s Second generation of Bandung regimes (Chile, Tanzania, Jamaica) inspired by the
Cuban revolution. It reflected a much more radical agenda. This generation is directly linked
with the tri-continental conference radical and anti-imperial agenda that located participants
firmly in the socialist camp.
However, at that time, the limits of national development in many parts of the world has
been reached and the problems of unity between governments of the third world were
increasingly apparent. At the same time the 1970s have seen the beginning of the
cooperation between first and third world government through the UN.
- By the early 1980s, the governments of developing nations in the Third World and the state
national development projects world-wide came under growing pressure from internal
contradiction, the rise of neoliberalism and the fall of the so called golden age of capitalism
and the development of the cold war.
At this time and until the Asian financial crisis in 1997, the four Asian tiger states were increasingly
seen as possible models of nation states and national development for the rest of the third world
III- the Unmaking of the Third World/ from developing nations to emerging markets
1- The Nixon doctrine and the reorientation of the political economy of the Cold War.
In the 1970s the US changed its approach to foreign policy (Nixon doctrine): it reoriented the political
economy of the Cold War and participated to the rise of globalization and the unmaking of the Third
World.
- The Vietnam War: protection and security of the First World
- Balance of power calculations took precedence over ideological rivalry (US overtures to the
government of China)
- Dismantling of the formal and informal aspect of the Bretton Woods system of fixed
exchange rates, international financial regulations… this politic had four main results:
- Private banks began to play a much greater role in the global finance
- It weakened governmental supervision of global financial organizations
- The currency exchange rates were increasingly by trends in the financial markets in
the USA.
- It allowed the US government to more or less determine the shape of the regulatory
framework for global financial system.
These changes had been followed by Reagan and Thatcher (deeper financial deregulation, trade
liberalization and privatization. The deepening of the globalization project has been accelerated
further at the end of the Cold war.
2- Third worldism, regionalism and the nation state system in the post cold war era
In the 1990S, the idea of a Third World has lost whatever political, intellectual value and unity it once
had. Idea reinforced by the emergence of newly industrializing nation states in Asia and Latin
America in the 1870 and the economic decline of sub Saharan countries.
The Idea of the Third World served at this time to generate an implausible image of homogeneity
over a large and diverse area of the world.
One of the main problems with the idea of the Third World is that it is based on the assumption that
nation-state, often involved in the repression and exploitation of their own citizens, could serve as
vehicle for progress and liberation. This is one of the reasons why the Third Worldism did not arise
as people’s movement.
In the post cold war era, where the sovereignty of nation states is even more constrained than
previously, the idea that this model can bring progressive change is even more problematic.
The end of the cold war and the deepening of globalization also marked the strengthening of new or
reconfigured regional economic and political organizations.
Conclusion: the nation-state and the challenge of global capitalism
Since the 1970s the rise of neo-liberalism and globalization have increasingly challenged flawed state
guided national development projects and dramatically reconfigured the role of the state in the
global political economy.
The nation state model has always had serious limitations as an instrument of liberation and progress
but the changes of the past 20 and 30 years have aggravated those limitations. The progressive
capacity of the new or reconfigured regional initiatives of the post cold war era is seriously
constrained. These initiatives are not instruments of democratization of regional or global politics
and do not move sovereignty downwards.