“The Old Washington Consensus Is Over.”
Now that Obama has handed over all US influence, it might help to understand what he and Gordon Brown meant by “The Old Washington Consensus Is Over”
The term Washington Consensus was initially coined in 1989 by John Williamson to describe a set of ten specific economic policy prescriptions that he considered to constitute a “standard” reform package promoted for crisis-wracked developing countries by Washington D.C based institutions such as the International Monetary Fund (IMF), World Bank and the U.S. Treasury Department.
Subsequently, as Williamson himself has pointed out, the term has come to be used in a different and broader sense, as a synonym for market fundamentalism; in this broader sense, Williamson states, it has been criticized by writers such as George Soros and Nobel Laureate Joseph E. Stiglitz.
The Washington Consensus is also criticized by others such as some Latin American politicians and heterodox economists. The term has become associated with neoliberal policies in general and drawn into the broader debate over the expanding role of the free market, constraints upon the state, and US influence on other countries’ national sovereignty.
Stabilize, privatize, and liberalize” became the mantra of a generation of technocrats who cut their teeth in the developing world and of the political leaders they counseled.
Dani Rodrik, Professor of International Political Economy, Harvard University
Many countries have endeavored to implement varying components of the reform packages, with results that are much debated. Some critics focus on claims that the reforms led to destabilization. Some critics have also blamed the Washington Consensus for particular economic crises such as that in Argentina, and for Latin America’s economic inequalities. Criticism of the Washington Consensus has often been allegely associated with — or been accused of being associated with — socialism and/or anti-globalism. However many American scholars, such as Dani Rodrik, Professor of International Political Economy at Harvard University, in his paper Goodbye Washington Consensus, Hello Washington Confusion?, have recently joined their criticisms .
At least we know that the move to the US becoming socialist is now openly admitted by their community organizer.
photo credit: Steve Punter
April 4th, 2009 at 6:15 pm
So since the United States no longer has the power, can we please stop having to send money and supplies to every earthquake, tsunami or famine ridden corner of the world. I mean, it was a great gig when we were the powerful ones, but Team Obama says that the EU is the great power of the world and I think THEY should take up the responsibility. Oh, and while they are at it, they can handle Afghanistan, Ruwanda, the Indo-Pak border war and countless other regional squabbles that the world used to get us to mitigate. Have a nice time, Europe. And BTW, feel free to keep Team Obama over there. The market does better when he’s gone.