Lecture 1: Globalisation, inequality from the war state to the welfare state

Wallerstein World Systems Theory (Boyle reading)

A framework for understanding the global economic system and its hierarchical structure, detailing how nations are positioned within a capitalist world economy divided into core, semi-peripheral, and peripheral states.

Karl Polanyi’s embedded economy

Pre-industrial economies were embedded within social relationships and cultural norms. Economic activities were not separate from social life but integrated with it.

Karl Polanyi’s Double movement

First Movement: The expansion of the market economy, where market forces regulate all aspects of life, including the commodification of labor, land, and money. Full self-regulating market!

Second Movement: counter-movement in response to the excesses of the market leading to a democratic revolution or socialism, OR the reaction leads repressive measures aimed at stabilising the market system authoritarianism.

How is Karl Polanyi’s framework relevant to 21st century world order

Polanyi's argument that markets require social stability and trust remains relevant, but different models of governance prove that this can be attained through repressive measures. His idea that over reliance on a free market tends to lead political change (ex great depression 1930s, Latin america 90s-80s, post 2008 right wing movements)

Explain Thomas Picketti’s rate of return on capital > rate of economic growth = more inequality

Alice invests 1 mil gets 15% (capital return rate) growth so gets 1.15 mil

Bob get 100k gets 3% economic growth so gets 103k

Over time the wealth disparity grows (pushes for stronger taxation

The 3 wave of marketisation

1. 1795-1914 - Rise of laissez Faire capitalism in Europe 

2. 1914-1973 - After WW1 collapse of laissez Faire => State takes a bigger role with rise of Keynesism, Fordism, welfare states   

3. 1974- now - Crises of fordism and oil crisis (1974) leads to the crisis of neoliberalism

Fordism

Economic Social system characterised by mass production from organised work places, strong wages and mass consumption (1910’s- 1970s)

keynisanims

Economic theory that emphasizes the importance of  demand as the main driver of economic growth and employment. It advocates for government intervention through fiscal policies, such as increased public spending and tax cuts, to stimulate demand during economic downturns.

Keynisanism in the US

Military Keynesianism (Military Industrial Complex)

Incarceration Keynisanism (Prison Industrial Complex

Dual Concepts of Western Power

Power over/hard power; Sovereign power where a supreme authority rules absolutely through law (similar to ‘hard power’ in international relations which uses military or economic force) 

Power to/ soft power

Governmental power which rules indirectly by shaping behavior and encouraging citizens to self-regulate according to ‘common sense’

Not limited to ruling a country's own population but are also actively deployed by Western states to co-erce and manage foreign countries.