Category Archives: neoliberalism

The Contradictions of Neoliberalism

Over at Balkinization, Bernard Harcourt has a great post on the contradictions of neoliberalisim in the context of the American penal system. Similar contradictions are relevant in the African context as well as some African states continue to wield coercive military and police force even while curtailing the role of the state in providing basic social services. Harcourt’s post is highly recommended.

The Effects of Privatization in Zambia

“For Whom the Wind Falls: Six Problems with Privatization in Zambian Copper Mines” by Professor John Lungu and Alastair Fraser.

I found this really informative website called Fatal Transactions. It says it’s “a network of different European and African NGO’s and research institutes.” Their website offers a list of publications on the practice of resource extraction and its effects on local communities here. Professor Lungu and Alastair Fraser’s work, which was introduced to me in an excellent seminar can be found on the website as well.

Since 1991, government, heavily in debt, moved towards privatization with pressure from the IMF and World Bank. The consequences have been quite devastating; the report calls what has happened in the Copperbelt a “social crisis”. The authors identify six problems with privatization:

1) Deals were made in unequal circumstances. Because the Zambian government was heavily in debt, they had to make concessions in the “Development Agreement” that significantly benefited private investors at the expense of workers.

2) The Zambian government’s regulatory powers have been undermined; thus, it seems unlikely they will be able to govern the behavior of foreign investors to ensure that workers receive proper social services.

3) Nearly half of the workforce is casual labor, which means while this scheme is profitable for mining companies, temporary workers are unjustly deprived of health care, pension and other social services.

4) Pension funds continue to dwindle. There’s a tragic story on page 34 about a mineworker who was promised pension for his labor since 1981 and was cheated out of the money after he was retrenched as a worker for a privatized mine. At the time of the report, he was living hand to mouth.

5) Something I had not thought about and this article points out is the loss of businesses, suppliers and manufacturers tied to the mines. The report argues for industrial policy concentrated on building more copper smelters and manufacturing bases so that local Zambians will benefit from these investments. However, the government is held in a bind due to restrictions by the IMF and World Bank.

6) Companies failing to provide social services. Zambia Consolidated Copper Mining (ZCCM) used to provide health care, housing, HIV-AIDS and malaria prevention programs. The article states: “according to free-market ideology, and the Development Agreements, these goods and services should now be provided either by the local authorities or by market forces.” Free market ideology complete misses the point. How will locals provide social services when they cannot afford them? Certainly, some workers were retrenched after privatization but many were not. Those who were retrenched have received meager pay and no social services, since free market ideology also dictates that hiring casual labor is cheaper for the companies. Thus, stating that it’s up to the free market to provide social services is really an evasion of the problem at best and most definitely, a rejection of responsibilities incumbent upon the mining companies to provide for the well-being of workers and local community members.

Karen Transberg Hansen has written about the detrimental effects of neo-liberal development in Lusaka, Zambia. In her article, she observes that since the housing market was privatized, most people are forced to live in informal housing with inadequate electricity, water or transportation. From 1992 to 1999, formal employment declined from 17 to 11 percent. IMF policies such as the removal of food subsidies have engendered adverse effects. Some of the adverse effects are most evident in the expansion of the informal economy and the black market.

The Neoliberal University

“From San Diego to Rome, from San Juan to London and Amsterdam, 2010 will be remembered as the year of student protests internationally,” commented Antonio Carmona Báez, Ph.D., a political science lecturer at the University of Amsterdam. “Not since 1968 have university students stood up around the globe — simultaneously — against authority, this time to save public education.” (UC Davis Bicycle Barricade Blog)

David Harvey expounds upon neoliberalism as a hegemonic mode of discourse that above all, values the free market, free trade and strong property rights. Neoliberalism exhorts workers to be more efficient, productive, leading to greater profits for corporations and lower costs for consumers. Universities in the US have become more and more corporatized — an argument advanced by Chandra Mohanty in an extremely insightful book I read years ago called Feminism without Borders: Decolonizing Theory, Practicing Solidarity. What does the neoliberal university look like in the US?

1) Small number of stellar faculty, but the majority of faculty are overburdened with overly populated classes for less pay. Faculty are usually so busy publishing, preparing for lectures, serving on multiple committees, and advising their graduate students. Minority and women faculty members face additional demands placed on them as the “token” faculty member.

2) Administrators making ludicrous decisions to hire adjuncts or temporary faculty to maximize profit. The result is that adjuncts tend to account for nearly half of the teaching force. Teaching assistants are part of the cheap labor force, which is not to say that the experience is not a valuable one. I have always learned just as much, if not more, as a teaching assistant in graduate school. However, graduate students are woefully underpaid, as demonstrated by an article on the “evolution” of TAs and unions

3) In the UK, research shows the annual cost of a degree has risen by 300% in two decades by the government. The situation parallels what happened in California, as governments on both sides are raising tuition fees (in the name of the “deficit” while they cut taxes for the rich) in an attempt to completely privatize public education. Reductions in public spending have precipitated student strikes around the world from Manila to Santiago to Jakarta. Check out these excellent blogs for more details, Reclaim UC and UC Strike.

A colleague of mine, Alex Posecznick captures this dilemma in a recent panel session invitation. We must be critical of the neoliberal university and strategize ways to resist.

“ABSTRACT As anthropologists in the 21st century, we are trained to be sensitive to our own positionality in the field and the ways that knowledge production is necessarily embedded in a social, political and economic milieu. And yet, many of us, as academics, remain less critically aware of our own ambiguous, contradictory positions in the commodification of education, the fetishizing of intellectual achievement, and in the projects of the neoliberal university. We decry the marginalized other in our fieldwork, but our departments rely on under-employed and under-appreciated adjunct instructors and exploit the labor of teaching assistants, who are heavily relied upon! to teach the undergraduate masses. This session invites papers that both reflect on the ways that scholars and academics collude with and creatively resist oppressive practices in the University. It challenges academics to engage the institutional rituals, policies and practices that reproduce inequity in their own departments and institutions, while theorizing the historical and contemporary relationship between individual agents, global systems of knowledge production, institutions of higher education and the state.”

The Perils of Free Market Ideology

In a recent Google-chat conversation with the brilliant David Welker:

David:
Under such a hypothesis, “bubbles” are not even conceptually valid. Actually, Clinton balanced the budget. It was George W. Bush and his tax cuts for the rich that broke the bank. Do you believe Greenspan was actually warning of the “risk” of paying down the debt too fast?


Janny:
That was a matter of lenders lending out subprime loans


David:
The housing bubble occurred during the Bush administration. In large part because Bush appointees did not believe in their mission to regulate the banks.


Janny:
Yes I see. That’s why many were out to make big bucks


David:
The banks are supposed to take care of themselves. The free market “works”


Janny:
Or loan out money to people at variable rates


David:
Yeah. Anyway, also Glass Steagall, which in the past prevented banks from making risky bets was repealed. So, we have this huge crisis when the bets that the banks made go bad. And then, we bail these rich people who invested in banks out.


Janny:
Exactly.


David:
We spend trillions. Yes, you heard that right, trillions, bailing them out. But then, we can’t even spend more than 800 billion bailing out the economy. And over 1/3rd of that was ineffective tax cuts that in the past have proven not to work very well as stimulus. So, you see where our priorities are. Bailing out rich people MUST be done to “save the system” (where one supposed the “system” is the thing that makes sure that the rich benefit more than anyone else)

Bailing out the economy to lower an unemployment rate that hurts young college graduates and those without any college education, well, that just isn’t important. It really is perverse. The Obama administration is the one that proposed an inadequate tax cut. I mean stimulus. It is the Obama administration who made it 1/3rd tax cuts, even though those are ineffective stimulus.
It is the Obama administration who directed the money to projects that take a long time to get going; a big portion of the stimulus still hasn’t even been spent! It was the Obama administration that came up with HAMP. Which is completely voluntary. Instead of making the banks, who we spent trillions bailing out, modify home loans to get the housing market going again.


Janny:
HAMP, Making Home Affordable Act. It gives servicers financial incentives to modify home loans for a very narrow set of home borrowers. It is completely voluntary. And lenders are given vast discretion under HAMP. And there tend to be few consequences for violating HAMP guidelines.


David:
THIS was the Obama administrations pathetic plan to get us out of the housing crisis.
And we wonder why the recession goes on and on and on. Inadequate stimulus. Inadequate relief for homeowners (heave forbid that we “bail out” an “undeserving” homeowner – but I guess the banks we bailed out were all “deserving” And now cuts to Pell Grants? I don’t know what Obama is thinking.

Janny:
Yeah, I just signed a petition against the cutting of Pell Grants by an additional $56 billion in the next 10 years. I also signed another petition against the UCs cutting $500 million. Not to mention, just got an email from Sojourner ranting against Obama and his administration. It said, Obama should have fought on taxes. The richest 2 percent of the country just got an extension of tax cuts they didn’t need at great cost to us all. There was GOP opposition, and Democrats battling with one another, but President Obama should have been fighting against the self-interests of the wealthiest Americans long before this. He allowed those who benefit from these tax cuts and the political allies they have bought in Congress to frame the debate and set the terms of engagement.”

Now, I ask you, reader, where is the justice? How does the “free market” benefit the collective? How can politicians say they value education when they endorse drastic cuts? Reductions in public spending, inspired by neoliberal ideologies and policies, have created inequality and suffering not only in the US, but in many African countries as well. We cannot call ourselves a democracy when as of 2007, research shows the top 1% of households (the upper class) owned 34.6% of all privately held wealth, and the next 19% (the managerial, professional, and small business stratum) had 50.5%. Now more than ever, we face perilous times.