01 May The Pendulum Swing of Nationalizations
Bolivia’s President Evo Morales announced today the nationalization of Bolivia’ oil industry:
In a May Day speech, he said foreign energy firms must agree to channel all their sales through the Bolivian state, or else leave the country.
He set the firms a six-month deadline, but the military and state energy officials have already started taking control of the oil fields.
Although this is not an immediate issue for the U.S.– Brazil’s Petrobras, the Spanish-Argentine company Repsol YPF, British companies British Gas and British Petroleum and France’s Total are the major international players in the Bolivan oil economy—it is nonetheless an occurrence of some importance. The previous round of nationalizations-from the 1960’s and 1970’s—of course led to a rise in international arbitration as a means of dispute settlement among multinational corporations and sovereigns–a trend which profoundly changed transantional dispute settlement–and then to the era of privatizations in the 1980’s and 1990’s, undoing the earlier privatizations.
With these actions in Bolivia and similar moves in Venezuela, it seems in some countries the pendulum may be swinging back. How much of a swing this will be and whether there will be long term effects on topics as disparate as the oil economy, the politics of Latin America, and the shape of international law remains to be seen. In any case, it is a reminder that globalization is not unstoppable and that economic liberalization is a political decision, not a historical inevitability. What may be most interesting in all of this is how Bolivia, Cuba, and Venezuela are taking techniques used by the U.S., such as trade liberalization pacts, and re-imagining them to address illiteracy and unemployment as well.
More than possibly giving a rise to some interesting new ICSID cases, or imaginative new treaties, perhaps we should take this as a reminder that it is time we started paying a bit more attention to the effects of the rich-poor gap between and within nations.
Yes, absolutely ‘it is [high] time we started paying a bit more attention to the effects of the rich-poor gap between and within nations.’ Toward that end, I will be so impertinent as to suggest the following titles are essential to an intelligent ethical, economic and political grasp of the fundamental issues intrinsic to its causes and effects and, more importantly, to what might be involved in addressing it (i.e., closing the gap): Anand, Sudhir, Fabienne Peter and Amartya Sens, eds. Public Health, Ethics, and Equity. New York: Oxford University Press, 2004. Barry, Brian. Why Social Justice Matters. Malden, MA: Polity Press, 2005. Barry, Brian and Robert E. Goodin, ed. Free Movement: Ethical Issues in the Transnational Migration of People and of Money. University Park, PA: University of Pennsylvania Press, 1992. Barry, Christian and Thomas W. Pogge, eds. Global Institutions and Responsibilities: Achieving Social Justice. Malden, MA: Blackwell, 2005. Cohen, G.A. Self-Ownership, Freedom and Equality. Cambridge, UK: Cambridge University Press, 1985. Cohen, Stanley. States of Denial: Knowing about Atrocities and Suffering. Cambridge, UK: Polity Press, 2001. Dreze, Jean and Amartya Sen. Hunger and Public Action. Oxford, UK: Clarendon Press, 1989. Dreze, Jean, Amartya Sen and Athar Hussain, eds. The Political… Read more »
Erratum: in first title, ‘Amartya Sen.’
Please add to the above, the works of Ha-Joon Chang, Reader in the Political Economy of Development, Faculty of Economics, University of Cambridge: http://www.econ.cam.ac.uk/faculty/chang/
In addition, Professor Anwar Shaikh, of the Dept. of Economics at New School University, has a couple of papers that critique core elements of the so-called Washington Consensus, otherwise known as neoliberal economics. In particular, he explains why wholesale trade liberalization is not the answer to closing ‘the gap.’ See, for example, ‘Globalization and the Myth of Free Trade,’ and ‘The Economic Mythology of Neoliberalism,’ available at his homepage: http://homepage.newschool.edu/~AShaikh/index.html
Finally, see Vandana Shiva’s take on the Doha round at the WTO: http://www.zmag.org/content/showarticle.cfm?ItemID=9308
and
http://www.zmag.org/sustainers/content/2005-12/26shiva.cfm
Finally, see too Roger’s post of March 21: ‘Trade Liberalization Winners and Losers,’ with its link to the report of the Carnegie Endowment for International Peace on the impact of trade liberalization on developing countries, so-called LDCs (not the most felicitous phrase insofar as it usually assumes the model of development to be emulated here is that of the more affluent nations of the northern hemisphere; i.e., that there are not alternative models of industrial development and economic growth sensitive to regional historical, political and cultural conditions).