Ruggie, JG. 1995. At home abroad, abroad at home: international liberalisation and domestic stability in the new world economy. Millenium: Journal of International Studies 24, no. 3: 507.
Ruggie presents a brief argument about how Carr and Polanyi, though being polar opposite in much of their thought, agreed about the effect of self-regulating market solutions post WWII. This was termed by Ruggie to be the embedded liberal compromise, where states would protect their domestic policies from external shocks from the market, but would also pursue broadly liberal policies internationally. The success of this system, which promoted fixed exchange rates and autonomous monetary policy, eventually led to the rise of the movement of capital and floating exchange rates.
"In this article, I develop a provisional schematic formulation of this new world economy's key institutional features and consequences. I focus on three sets of issues in particular: the growing role of domestic domains as issues over contention in international economic policy; the denationalization of control over significant decisions regarding production, exchange, and employment; and the growing difficulty experienced by governments in living up to their part of the domestic social compact on which post-war liberalization has hinged" (508).
The Financial Times and the Economist both wrote in late 1990s about how, even while we were experiencing the most robust of capitalist situations, that the reality of welfare capitalism was still quite clear: "These two British publications are among the most irrepressible and articulate advocates anywhere of free markets and free trade. What, then, possessed them to worry about the economic security of workers and sustaining welfare capitalism, and, even more curiously, to suggest that governments have a role to play in achieving those objectives? The answer is surprisingly simple. Both realize that the extraordinary success of post-war international l liberalization has hinged on a domestic social compact between state and society. Both see that this social compact is everywhere fraying; and both fear that if it unravels altogether, so will international liberalization" (523).
"The new world economy that has emerged over the past few decades poses significant challenges to governments because it is disembedded in several key dimensions. The first is in its policy templates: the mental maps of spaces and structures within which policy-makers visualize the basic contours of their world...The second, related source of disembeddedness is the world of policy-making itself. International as well as domestic economic policy targets are increasingly elusive because instrumentalities are no longer as effective. This loss of efficacy, in turn, reflects the fact that the theoretical, conceptual, and statistical bases of policy too often still reflect previous policy templates and the cause-effect relations that pertained in that earlier world. Last, the new world economy is increasingly disembedded from the domestic social compact between state and society on which the political viability of the post-war international economic order has hinged. Policy attitudes towards the new world economy have shifted in the direction of neoliberalism to an extent that is beginning to be of concern even to staunch guardians of market orthodoxies in the leading financial journals of Britain and the United States" (525).
"Constructing a contemporary analogue to the embedded liberalism compromise will be a Herculean task" (525).
Showing posts with label Embedded Liberalism. Show all posts
Showing posts with label Embedded Liberalism. Show all posts
Saturday, March 21, 2009
Tuesday, March 10, 2009
Ruggie: Taking Embedded Liberalism Global: The Corporate Connection
Ruggie, JG. 2002. Taking Embedded Liberalism Global the Corporate Connection. John F. Kennedy School of Government, Harvard University.
Ruggie traces a bit of history regarding embedded liberalism. The core: "...economic liberalization was embedded in social community" (1).
The problem of this new world is that governments are overwhelmed by the size and scope of global capitalism. It is nigh impossible to construct a similar pact with governments as was organized through the Bretton Woods conference. "Embedding the global market within shared social values and institutional practices represents a task of historic magnitude. The reason is obvious: there is no government at the global level to act on behalf of the common good, as there is at the national level. And international institutions are far too weak to fully compensate. Accordingly, this chapter examines the role of certain social processes and movements in triggering the emergence of more inclusive forms of global governance. Specifically, I focus on the contribution of the dynamic interplay between civil society, business and the public sector of the issue of corporate social responsibility" (2-3).
"The burden of my argument, with due appreciation for the irony, is that the corporate sector, which has done more than any other to create the growing gaps between global economy and national communities, is being pulled into playing a key bridging role between them. In this process, a global public domain is emerging, which cannot substitute for effective action by states but may help produce it" (3).
"When we reflect on how hard it was and how long it took to institute the original embedded liberalism compromise at the national level, the prospect of achieving a similar social framing of global market forces seems exponentially more daunting" (27).
"I have argued that, as a result of the expansion of civil society and its engagement with the corporate sector, a global public domain is emerging. I take that to mean an area inhabited by various actors for whom the territorial state is not the cardinal organizing principle..." (28).
"Haltingly anbd erratically, something akin to an embedded liberalism compromise is being pulled and pushed into the global arena, and the corporate connection is a key element in that process" (29).
Ruggie traces a bit of history regarding embedded liberalism. The core: "...economic liberalization was embedded in social community" (1).
The problem of this new world is that governments are overwhelmed by the size and scope of global capitalism. It is nigh impossible to construct a similar pact with governments as was organized through the Bretton Woods conference. "Embedding the global market within shared social values and institutional practices represents a task of historic magnitude. The reason is obvious: there is no government at the global level to act on behalf of the common good, as there is at the national level. And international institutions are far too weak to fully compensate. Accordingly, this chapter examines the role of certain social processes and movements in triggering the emergence of more inclusive forms of global governance. Specifically, I focus on the contribution of the dynamic interplay between civil society, business and the public sector of the issue of corporate social responsibility" (2-3).
"The burden of my argument, with due appreciation for the irony, is that the corporate sector, which has done more than any other to create the growing gaps between global economy and national communities, is being pulled into playing a key bridging role between them. In this process, a global public domain is emerging, which cannot substitute for effective action by states but may help produce it" (3).
"When we reflect on how hard it was and how long it took to institute the original embedded liberalism compromise at the national level, the prospect of achieving a similar social framing of global market forces seems exponentially more daunting" (27).
"I have argued that, as a result of the expansion of civil society and its engagement with the corporate sector, a global public domain is emerging. I take that to mean an area inhabited by various actors for whom the territorial state is not the cardinal organizing principle..." (28).
"Haltingly anbd erratically, something akin to an embedded liberalism compromise is being pulled and pushed into the global arena, and the corporate connection is a key element in that process" (29).
Steffek: Embedded Liberalism and its Critics
Steffek, J. Embedded liberalism and its critics. Palgrave Macmillan.
This text explores the relationship between international and domestic governance of global trade and financial architectures. It argues that the embedded liberalism that arose after WWII was an admission that governance should be both domestic and international. The author goes on to claim that many see this order as being normatively wrong, as it benefits the development of the north and disregards the development of the south. What is needed is a program that is both domestic and international that focuses on "redistributive multilateralism (2).
On embedded liberalism: "This blueprint for the construction of international institutions centers on the idea that international cooperation should be designed in such a way as to achieve a high degree of liberalization at the international level to facilitate the creation of a world market. At the same time it should allow states to maintain a national welfare system that can cushion the adverse effects of global liberalization. Upon closer inspection Ruggie's conception of embedded liberalism has two sides. On the one hand, it is a very general normative framework that defines appropriate goals and scope of international institutions. On the other hand, the term is also used to describe some specific institutional arrangements that were built according to this generative grammar. Embedded liberalism thus became almost a synonym for the original Bretton Woods order and the 1947 General Agreement on Tariffs and Trade (GATT)..." (4).
The author argues that, while the actual structure of this global system has changed, the normative foundations have not. The author argues that embedded liberalism has at least two distinct futures: that of being embedded within governance, ie., through a global Marshall plan, or being embedded in business, as promoted through Ruggie and his Corporate Connection idea.
This text explores the relationship between international and domestic governance of global trade and financial architectures. It argues that the embedded liberalism that arose after WWII was an admission that governance should be both domestic and international. The author goes on to claim that many see this order as being normatively wrong, as it benefits the development of the north and disregards the development of the south. What is needed is a program that is both domestic and international that focuses on "redistributive multilateralism (2).
On embedded liberalism: "This blueprint for the construction of international institutions centers on the idea that international cooperation should be designed in such a way as to achieve a high degree of liberalization at the international level to facilitate the creation of a world market. At the same time it should allow states to maintain a national welfare system that can cushion the adverse effects of global liberalization. Upon closer inspection Ruggie's conception of embedded liberalism has two sides. On the one hand, it is a very general normative framework that defines appropriate goals and scope of international institutions. On the other hand, the term is also used to describe some specific institutional arrangements that were built according to this generative grammar. Embedded liberalism thus became almost a synonym for the original Bretton Woods order and the 1947 General Agreement on Tariffs and Trade (GATT)..." (4).
The author argues that, while the actual structure of this global system has changed, the normative foundations have not. The author argues that embedded liberalism has at least two distinct futures: that of being embedded within governance, ie., through a global Marshall plan, or being embedded in business, as promoted through Ruggie and his Corporate Connection idea.
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