Political Economy of International Crisis

\ Political Economy of International Crisis

Political Economy of International Crisis

Economics 357L

Section I

THE RISE AND FALL OF THE KEYNESIAN ERA (1944-1971)

This section begins with a series of lectures on basic aspects of the post-WWII international economic order: the social factory, growth and capital accumulation within national economies and on a world scale; international linkages among national economies (trade, capital and labor flows); international monetary system of Bretton Woods and its system of fixed exchange rates.

Background reading: *Part I of my essay "The Rise and Fall of the Keynesian State," plus a review of any chapters in any introductory or intermediate text you find necessary to understand this essay. (The first part of Richard Cooper's article below also contains a useful brief survey of the international monetary system operative in the Keynesian period.) You will find a careful reading of this essay extremely useful as a guide to the kinds of materials we will be covering and the kinds of background you need to have to get the most from the materials of the course.

These initial lectures will be followed by others on the breakdown of the international monetary system through chronic balance of payments disequilibrium and the failure of adjustment mechanisms, with some discussion of the national economic problems underlying the international collapse. We will then turn to the heart of the kind of analysis on which this course is based: an examination of the socio-political roots of these macroeconomic phenomena. The object is to learn how to read through the "economic" crisis to discover the social and political conflicts which underlie both the various crises and the attempts to resolve them. Read *Part II of my essay "The Rise and Fall of the Keynesian State." The last section of this part gives an overview of several other sections of the course.

The other readings for this section, listed below, primarily concern the forces at work in the period during which the Keynesian era was pitched into crisis. The first section provides analyses of those forces by mainstream economists and political scientists. The second section provides parallel analyses by their radical critics, often activists whose actions contributed to the crisis being discussed.

NB2: At a minimum, read those materials prefaced by an asterisk. Those will be scanned in and uploaded by me, or by you or someone else in the class.

NB3: If you have problems reading pdf files, Adobe Acrobat has various, more or less competent, converter programs that will convert pdf files into html files.

1. Analysis of the Crisis from the top down

*Richard Cooper, "The Dollar and the World Economy," Agenda For The Nation(Brookings, 1968) Available through ERes. (Student Summary)

Article typical of the period before complete breakdown which analyses the old international system and its growing instability and examines various policy recommendations that had been made to correct those problems - including the piecemeal measures that had actually been undertaken and the broader proposals for the reorientation of US monetary and fiscal policies and for systemtic changes that had been proposed, such as a collective global shift to flexible exchange rates or sliding parties. Cooper was professor at Yale and government advisor, then, in the early 1970s, the US contributor to the Trilateral Commission's report on international monetary policy (see the bibliography for the section of this course on the international monetary crisis) and from 1977-81 Undersecretary of State on Economic Affairs. More recently he has also been Chair of the National Intelligence Council (1995-97) He is now professor at Harvard.

IMF logo If you are not familiar with the workings of the International Monetary Fund you should consult the Fund's own self description. "A Global Institution: The IMF's Role at a Glance"

The role of the Fund has changed somewhat since the switch in the early 1970s from fixed exchange rates to floating exchange rates, and the page gives you a brief description of those changes. But the basic role, of coordinating and enforcing the international monetary rules of the game is still the same.

*Harold VanBuren Cleveland, "How the Dollar Standard Died," Foreign Policy, #5 (Winter, 1971-72). Available through ERes (Student Summary)

Like it says. Early reaction and analysis of 1971 collapse which brings in political factors. By a vice president of First National City Bank and a member of the CFR.

*Samuel P. Huntington, "The United States," The Crisis of Democracy, 1975. Available through ERes, (Student Summary)

In this essay, one of three written for the Trilateral Commission, Huntington provides an analysis that goes to the national roots of the international crisis. He examines the political economic crisis in United States that underlay its inability to continue with fixed exchange rates - although he is not concerned with the national - international linkages. He concludes, in an opinion that was highly controversial at the time -even among elites, that the problem was too much democracy.

2. Analysis of the Crisis from the bottom up

The Crisis in the Streets

Photo of four black students sitting-in at lunch counter

Jim Schlosser, "The Story of the Greensboro Sit-ins," that took place in 1960. (1998).

A short restrospective on the student lunch-counter sit-ins that many credit with triggering the black civil rights movement, includes some audio interviews with principles involved. Sit-ins led to creation of the Student Non-violent Coordinating Committee.

Brief Sketch of History of SNCC, the Student Non-violent Coordinating Committee. See also the brief sketch of the issues SNCC was involved in.

Brief introductions to the organization born in the aftermath of the Greensboro Sit-ins that went on to play important roles in the development of the civil rights movement and would gestate later struggles including black power and the anti-Vietnam war movements. You would do well to explore the materials available at both of these sites.

Martin Luther King, Letter from a Birmingham Jail, 1963.

A key document in which Martin Luther King lays out, for the edification of skeptical clergymen, his reasons for embracing non-violent civil disobedience including sit-ins, demonstrations, marches, boycotts, and so on.

The image of an
advancing black panther that was the logo of the Black Panther Party Black Panthers, Black Panther Party Platform and Program, October 1966

From Civil Rights movement to black nationalism and black militance the revolt in the streets became more radical as the sixties progressed. The Panthers, like the Civil Rights activists they followed would have considerable influence on university campuses as well as in their neighborhoods.

*Paolo Carpignano, "U.S. Class Composition in the Sixties," Zerowork, #1, 1975.

The Crisis of Democracy

Zerowork

Summary of article

The Crisis in the Schools

SDS button that
says Stop the War & Racism, Washington, D.C., Jan 20

SDS, The Port Huron Statement, 1962.

This was the original statement/manifesto of the SDS, the Students for a Democratic Society, a loosely knit organization that was primarily local in nature and was often the early vehicle for student mobilization on hundreds of campuses. It also mostly disolved into the movement organizations it catalyzed.

picture of Free Speech Movement Button that says FREE SPEECH, FSM Committee of Graduate Political Scientists, The Berkeley Free Speech Controversy, December 1964.

site

Anne Bauer and Harry Cleaver, "Student Minority Report on the Stanford Research Institute, 1969.

This is the key analytical and historical section of a report written by two Stanford students, appointed by the president of the university to a special committee to study the activities of the Stanford Research Institute that stood accused of engaging in research of direct aid to US counterinsurgency efforts in Indochina. It is typical of the kind of investigative research done by students contesting the role of their universities or colleges in the prosecution of the Vietnam War. It not only explores that role but ties it to other capitalist strategies, elsewhere, including the relationship between universities and industry more generally. This excerpt, with accompanying notes from the editor, was published in Charles Perrow, The Radical Attack on Business: A Critical Analysis, New York: Harcourt Brace Javanovich, Inc., 1972, pp. 136-152.

*George Caffentzis, "Throwing Away the Ladder," Zerowork #1, 1975.

The International Circulation of Crisis

Cover of the first issue of the journal Zerowork, black and white lettering on
orange background

*Mario Montano, "Notes on the International Crisis," Zerowork #1, 1975. This article is reprinted in Midnight Notes Collective, Midnight Oil: Work, Energy, War, 1973-1992, Brooklyn: Autonomedia, 1992, pp. 115-142.

The Crisis of Democracy