Globalisation and Ideology in Britain

Neoliberalism, free trade and the global economy

Craig Berry

• Publisher: Manchester University Press
• Year: 2013
• Print ISBN: 9780719084881
• eBook ISBN: 9781847797957
• Edition: 1
• Topic: Social Sciences
• Subtopic: Criminology
• Index: Social Sciences

Examines the impact of globalisaton across the ideological landscape of British politics by profiling the discourse on globalisation of several political groups involved in making and contestign British foreign economic policy.

1
Globalisation studies, the materialist bias and the ‘third wave’

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In surveying globalisation discourse, this book’s main purpose is to analyse the idea of globalisation and its invocation by real-world political actors. As such, the term itself is appraised as an ideological concept. However, the idea of globalisation has a second life; that is, in the less-real world of academic research. In the social sciences, globalisation functions as an analytical concept, whether as shorthand for something discovered in the socio-economic universe, or as something that must itself be sought, tested, theorised and so on. This has given rise to what has been termed narrowly as ‘globalisation theory’, more broadly as ‘globalisation studies’ or more diplomatically as ‘the globalisation debate’. It is arguable whether this book falls within any of these analytical realms; indeed, there are ideational analyses of globalisation which engage reflexively with this body of work, constructing a ‘wave thesis’ to demonstrate theoretical progression.

Yet the purpose of engagement here is not simply to valorise this book’s approach. Instead, the main aim is to explain why the ontological foundations of globalisation studies curtail the analysis of ideas in political economy through a bias towards materialist and structuralist explanations. And even where structuralism is mitigated with reference to actual political actors, materialism tends to remain. This counts against the analysis of globalisation as an ideational phenomena: agents may influence their structural context and may even have ideas about it, but globalisation is the macro-context of their actions, not an ideological resource used to provide meaning to their experiences of material life.

After a brief note on the wave thesis, this chapter considers the main articulations of globalisation as a material structural reality. It argues that neoclassical and Marxist political economists converge around this orientation – but so too do a range of ostensibly more nuanced ‘spatial’ approaches to globalisation. It then assesses a range of political economy approaches to globalisation that seek to uphold structure/agency synthesis by ‘reclaiming the state’ analytically, arguing that, unless materialism is also eschewed, agency remains beneath structure in the analytical hierarchy. The discipline of international political economy (IPE) – one of the main disciplinary homes of globalisation studies – is most culpable in this regard, although other forms of contemporary political economy also exhibit a materialist bias. Finally, the chapter turns attention to the ‘third wave’ of globalisation theory, that is, analysis of globalisation as a discursive phenomenon conducted or inspired by Colin Hay. Other theorists, such as Angus Cameron and Ronen Palan, have also associated their work with the third wave label. This body of work, which implicitly or explicitly eschews the materialist bias, is discussed to outline the book’s most immediate intellectual context, but also for critical review; while third wave theorists contribute much to globalisation studies, in different ways they do not fully overcome its materialism and/or structuralism.

A note on waves

There are two main ways of categorising different approaches to globalisation theory in the social sciences. The main cross-disciplinary textbook, Global Transformations, written by David Held, Anthony McGrew, David Goldblatt and Jonathan Perraton (1999), posits three approaches: hyperglobalisation, the sceptical thesis and transformationalism. Hyperglobalisation is characterised by theorists that believe the world economy has been rapidly globalised, undermining the capacity and legitimacy of states. The sceptical thesis argues that the hyperglobalisation viewpoint is inaccurate or exaggerated and that the nation-state retains power in the economic sphere. Transformationalism argues that there has been significant change on a global scale, albeit across multiple dimensions – such as geography, as well as economics – and that this has both empowered and undermined the state in contradictory ways. For what it’s worth, Held et al. are fully paid-up members of the transformationalist club.

The main alternative is Colin Hay’s wave thesis (see in particular Hay & Marsh, 1999). It is worth noting that the wave thesis was first concocted by Eleonore Kofman and Gillian Youngs (1996), although they posit only two waves. Hay’s ‘first wave’ is largely commensurate with hyperglobalisation – although he includes theorists such as Anthony Giddens, classified as a transformationalist by Held et al., because he does not focus exclusively on economics. The ‘second wave’ is largely commensurate with the sceptical thesis. The third wave, of which Hay is the main inspiration, ostensibly adds to the second wave by arguing that although the first wave’s understanding of globalisation and the state is exaggerated, governments now actually use first wave depictions of change to bring about the reality it describes.

Both approaches are problematic. They uphold the view that globalisation theory has proceeded in a linear fashion, with each subsequent approach building upon and correcting its predecessor in important ways – the wave thesis does this explicitly. They also both radically over-simplify globalisation studies. For instance, not only does neither approach find a distinctive home for the other’s main arguments about globalisation, they also both fail to acknowledge neo-Gramscian scholarship as one of the most important contributors to globalisation studies. Below, I will group neo-Gramscianism with other Marxist approaches in an overview based on ontological foundations. Yet the neo-Gramscian position on globalisation is distinctive from Marxism in general – in classification systems based on the notion of competing ‘theses’ about globalisation, silently marginalising neo-Gramscianism is not plausible.

Luke Martell (2007) has offered an alternative thesis which presents transformationalism as the third wave. While arguably far more plausible than grouping transformationalists with a first wave/hyperglobalisation thesis, Martell actually defines Hay as a transformationalist. Nicola Smith (2005), whose work is heavily influenced by Hay, moves away from a classification system based on different views about the extent of globalisation’s impact on the state. Instead she defines different theoretical viewpoints according to what globalisation is for different scholars. As such, she provides a thorough and credible run-through of globalisation studies. Yet the approach here is slightly different. While accepting that some form of classification is necessary for logistical reasons, this book eschews all chronological connotations and the notion of theoretical progression. As suggested above, it groups various approaches to globalisation according to key issues of ontology. Therefore, it first reviews presentations of globalisation as a material structure. It then reviews the various forms of analysis that have sought to mitigate structuralism and therefore ‘reclaim the state’. Finally it looks at approaches that attempt also to overcome materialism under the ‘third wave’ banner.

Globalisation as material structure

There are several identifiable political economy approaches which treat globalisation as a material structure. Whereas most reviews of globalisation studies assume that this is synonymous with globalisation as an economic structure, this section also includes ‘spatial approaches’ which treat globalisation as a transformation of our experience of space. Before discussing these approaches, however, it first discusses approaches influenced by neoclassical political economy and then those associated with the Marxist tradition.

More than any other approach discussed here, neoclassical political economy has been associated with the views of globalisation of real-world political actors. As such, neoclassical political economy is strongly associated with neoliberalism, in terms of both policy prescriptions and a priori assumptions (see in particular the work of Martin Wolf, 2005). This is not to say that its relationship with neoliberalism disables its capacity to contribute to theory (as claimed by some critics), but it nevertheless must be noted. While critiquing the neoclassical position is a regular departure point for other studies of globalisation, the influence of neoclassical political economy probably abides more than its critics are willing to acknowledge.

Neoclassical theory is based on the presumption of perfect markets. Commodities are exchanged, and capital is invested, via market mechanisms. The ontological and epistemological bases of neoclassical theory rest upon the atomistic, rational individual, endowed with pre-ordained material interests in an environment of scarce resources. Markets both exist because of and operate according to this human nature. The neoclassical approach to globalisation, then, assumes the realisation of a global competitive marketplace, or rather argues that the realisation of such an economy is inevitable and that its emergence is now apparent. This conception has led to the charge that the neoclassical approach has an unnecessarily simplistic view of the economic processes associated with globalisation. However, although relatively straight-forward, the way that neoclassical globalisation theorists understand the operation or emergence of the global marketplace is not necessarily simplistic.

The main progenitor of the neoclassical approach is Kenichi Ohmae. Ohmae’s work – particularly his book The Borderless World (1993) – more so than the work of any other theorist, seemed to encapsulate much of the thinking that had occasioned the rise of globalisation as an analytical concept. Ohmae’s most familiar argument, then, concerns the redundancy of national borders. In short, countries are becoming less different or, more precisely, differences between countries matter less. Economic activity has become global and much less susceptible to the interventions of nation-states. This activity is assumed to constitute a marketplace, and it is the inexorable logic of market competition that has caused economic processes to transcend national or local circumstances. Essentially, however, Ohmae’s work is a narrative about the transformed nature of corporate organisation – Ohmae worked for 23 years as a management consultant and business strategist before entering the academic arena. It is therefore transnational corporations (TNCs) in particular, embodying the norms of post-Fordism, that are deemed to have become global. TNCs are the exemplary institutions of the global marketplace, as both architects and architecture of globalisation. The extent to which the transformation of TNCs is the essence of globalisation, or merely epiphenomenal of the development of a global economy, is open to interpretation, but this perspective has certainly been fleshed out beyond Ohmae’s original narrative – not least by Ohmae himself (1995) – to comprise the more general argument. There is some room within the neoclassical approach for reference to non-market or non-economic factors in explaining globalisation. Theodore Levitt (1986), for instance, believes that technological change is a determining vector of globalisation, or more precisely the post-Fordist business model that produces globalisation, and that it is this, alongside market logic, that has contributed to the redundancy of differences between countries. Of course, it is global competition which necessitated the shift towards post-Fordism. This is not an uncommon argument among theorists influenced by neoclassical political economy; indeed, it is present to a lesser extent in Ohmae’s work. Economics, as conceived by neoclassical theory, is still the central driving force of globalisation, but neoclassical globalisation theory argues, additionally, that factors such as corporate organisation and technological development help to give contemporary market relations their specifically global character.

The neoclassical approach to globalisation theory is obviously strongly biased in favour of both structuralist and materialist explanations. The global or globalising economy is presented as a structure with determining force, exogenous to agents, reproduced by its own logic; that is, the logic of the competitive marketplace. Agents are not conceived as possessing any significant capacity to author, control or even alter its constraints; the marketplace and rationality are universal notions, assumed not to be variegated at the micro- or meso-levels. Even nation-states lack instrumentality beyond conforming to a mode of behaviour determined by the logic of material structure. Above all, agents are not conceived as having different conceptions of their structural environment or of change within that environment (that is, of globalisation) – only different interests derived from different material circumstances. Ironically, the neoclassical approach has no capacity to understand the agency to which it contributes seemingly more than any other theory of globalisation.

It would be unfair to imply that the neoclassical approach has a large number of adherents among contemporary political economists. However, its influence remains strong, particularly in the United States, where the boundary between academia and policy-making institutions is not as rigid as in countries like Britain (see Phillips, 2005b, and Watson, 2005, for important critiques). As such, we see labels such as ‘the American school’ or ‘the IO school’ (after the leading IPE journal in the United States, International Organization). As Nicola Phillips (2005a) has argued, much of the influence of neoclassical theory is now sedimentary; rather than explicating what globalisation is, scholars influenced by neoclassical theory concentrate on how to address the outcomes of globalisation, without considering whether their view of the process and its inherent utility is at fault (see for example Bhagwati, 2004).

In contemporary social science, classical Marxism exists largely as caricature; most Marxist theorists can be more appropriately classified as neo-Marxist. Defined broadly, neo-Marxism is a densely populated intellectual territory among today’s political economists. However, as perspectives on the meaning of globalisation as a material process of structural change, the differences between neo-Marxism and classical Marxism are not large. Nevertheless, whereas Held et al.’s assessment of the Marxist position on globalisation is based on the work of classical Marxist Alex Callinicos (see 2001, 2002), here the assessment is based on a range of neo-Marxists, such as William Robinson (2001), Barry Gills (2005), Peter Burnham (Burnham & Elger, 2001), Kees van der Pijl (1984, 1998) and Stephen Gill (1995). Callinicos is actually a leading member of the Socialist Workers’ Party in Britain, and therefore his perspective will be discussed in more detail in Chapter 7.

The Marxist and neoclassical approaches are strikingly similar in some regards, particularly in that they both maintain that globalisation is primarily the realisation of a global economy and that this economy has a determining effect upon subsequent social and political changes. They both also point to the emergence and power of global corporations as a key element of globalisation; this argument is probably the central feature of Marxism’s approach to globalisation. Of course, Marxists conceive of the global economy as a system of capitalism, rather than a marketplace. A crucial difference between the neo-classical and Marxist approaches is their conceptions of agency, or of who exercises power in capitalist societies/economies. Marxists refer almost exclusively to agency in terms of class. Therefore, one’s agency is a product of one’s location in the material structure of capitalism, in relation to others. However, the Marxist assumption that political action can be examined using the same conceptual lens as economic action resembles neoclassical theory – in both cases this serve to reinforce the charge of structural determinism. There has of course been a debate in Marxist theory about how much independence political action (in terms of power), particularly that of states, has from the economic structure or, in other words, the extent to which superstructure functions independently of base. Nevertheless, Marxists generally relate agency only to given material interests. Ideas are seen as either functional of those interests or, for some theorists, devices employed in service of those interests. Marxists disagree on a range of propositions, such as the extent of variegation within the global capitalist system and, importantly, the extent to which nation-states are complicit in globalisation. But there is fairly widespread consensus that there exists a global elite which incorporates the (neoliberal) leaders of nation-states, institutions of ‘global governance’ and TNCs, and which acts to reproduce and entrench the globalisation as the expansion and entrenchment of capitalism. And crucially, despite the variety among different empirical accounts of globalisation, the ontological foundations of analysis are fairly uniform.

In conjunction with the emergence of a global elite, Marxists tend to interpret resistance to globalisation as the emergence of a global proletariat. Most neo-Marxists tend to uphold a highly nuanced view of the responses of labour and other disadvantaged groups to capitalist globalisation, yet agree that it is the experience of the material structure of global capitalism that provides the main rationale for these responses (see Robinson, 2001). However, the actual or potential instrumentality of these class-based actors in opposing global capitalism does not mean that Marxism accepts structure/agency synthesis. Marxist theorists generally imagine that such agents are destined to form projects of collective action due to their location in the global system of production, and not on the basis of their subjective interpretations of their material structural context.

Arguably a form of neo-Marxism, neo-Gramscianism offers a slightly different theoretical perspective to others influenced by the Marxist tradition among contemporary political economists. Ostensibly neo-Gramscians, inspired by Italian revolutionary Antonio Gramsci, offer greater analytical weight to ideational phenomena. As such, it will be discussed in more detail on the next chapter, with a particular focus on apparent attempts to analyse the ideational dimension of globalisation. However, it warrants discussion here, precisely because its analysis of globalisation is generally regarded as its main contribution to political science. In this way, neo-Gramscian scholarship has been instrumental in establishing IPE as a distinct discipline within political science.

Despite this introduction, it is not clear that neo-Gramscian theorists offer an ontological advance on their neo-Marxist relatives. Stephen Gill’s article ‘Globalisation, market civilisation and disciplinary neoliberalism’ (1995) is a seminal statement of neo-Gramscianism. Gill argues that a (variegated) global class elite, in possession of the ideology of ‘disciplinary neoliberalism’, has established a ‘market civilisation’ which favours its own interests by rendering elements of neoliberalism normal or legitimate:

The structure and language of social relations is now more conditioned by the long-term commodity logic of capital. Capitalist norms and practices pervade the gestes répétés of everyday life in a more systematic way than in the era of welfare-nationalism and state capitalism (from the 1930s to the 1960s), so that it may be apposite to speak of the emergence of what I call a ‘market civilisation’. (Gill, 1995: 399)

Crucially, however, the material structural change – globalisation – comes first:

These representations are associated with the cumulative aspects of market integration and the increasingly expansive structures of accumulation, legitimation, consumption an...

Table of contents

• Front Cover
• Title Page
• Copyright Page
• Dedication
• Contents
• Preface and acknowledgements
• List of abbreviations
• Introduction
• 1 Globalisation studies, the materialist bias and the ‘third wave’
• 2 Political economy and ideology
• 3 Competition and change: the case of New Labour
• 4 Serving the ‘offshore’: the case of International Financial Services, London
• 5 The free trade dilemma: the case of the Liberal Democrats
• 6 Trade justice and development: the case of Oxfam
• 7 Capitalism’s final phase: the case of the Socialist Workers’ Party
• Conclusion: towards a new understanding of globalisation in the ideological landscape of British politics
• Index