Contemporary Capitalism_new - PED HI UGM - 2009

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Contemporary

CapitalismDevelopment, Dynamics and Issues

[Recap by Riza N. Arfani]



Regime Continuity

• Legacy of the post-World War II international political economic system

• Regulated capitalism: Legacy of the Bretton

Woods System• The Global Trinity: IMF, World Bank & WTO

• Shock therapy plans, IMF Austerity Plans, Washington Consensus

• WTO as a product of GATT’s Uruguay Round

• New Institutional Trinity –IMF, the World Bank & WTO– asabsolute monarchs of yore

• Rich-poor nations, developed countries (DCs)-LessDeveloped Countries (LDCs) gaps

• Strategies: UNCTAD (United Nations Conference on Trade andDevelopment), NIEO (New International Economic Order), etc…

• Institutions: North-South Dialogue, OPEC, G77, G15, etc.



Washington Consensus [1]

Adoption of neo-liberal policies in the 3rd World by

way of IMF-guided structural reform

Recipes [1]:Price Decontrol, i.e. penghapusan kontrol atas harga komoditi, faktor

produksi, dan matauang

Fiscal Discipline, i.e. pengurangan defisit anggaran pemerintah/bank sentralke tingkat yang bisa dibiayai tanpa memakai “inflationary financing

Public Expenditure Priorities: i.e. pengurangan belanja pemerintah, dan pengalihan belanja dari bidang-bidang yang secara politis sensitif, seperti

administrasi pemerintahan, pertahanan, subsidi yang tidak terarah, dan berbagai kegiatan yang boros ke pembiayan infrastruktur, kesehatan primer masyarakat, dan pendidikan




Recipes [2]:Tax Reform, i.e. perluasan basis perpajakan, perbaikan administrasi perpajakan, mempertajam insentif bagi pembayar pajak, pengurangan penghindaran dan manipulasi aturan pajak, dan pengenaan pajak padaasset yang ditaruh di luar negeri.

Financial Liberalization [tujuan jangka-pendek: menghapus pemberiantingkat bunga bank khusus bagi peminjam istimewa dan mengenakantingkat bunga nominal yang lebih tinggi dari tingkat inflasi] [tujuan jangka-panjang: penciptaan tingkat bunga bank berdasar pasar demimemperbaiki efisiensi alokasi kapital]

Exchange Rates, i.e. tingkat nilai tukar matauang yang tunggal dan

kompetitif untuk meningkatkan ekspor dengan cepatTrade Liberalization, i.e. mengganti pembatasan perdagangan luar negeri melalui kuota (pembatasan secara kuantitatif) dengan tarif (beacukai), dan secara progresif mengurangi tarif sehingga mencapai tingkatyang rendah dan seragam (kira-kira 10% sampai 20%).




Recipes [3]:Domestic Savings, i.e. penerapan disiplin fiskal/APBN, pengurangan belanja pemerintah, reformasi perpajakan, dan liberalizasi finansialsehingga sumberdaya negara bisa dialihkan sektor-sektor privat dengan produktivitas tinggi untuk mencapai tingkat tabungan yang tinggi.

Foreign Direct Investment, i.e. penghapusan hambatan terhadapmasuknya perusahaan asing; perusahaan asing harus boleh bersaingdengan perusahaan nasional secara setara; tidak boleh ada pilih-kasih…

Privatization, i.e. perusahaan negara hrs diswastakan

Deregulation, i.e. penghapusan peraturan yang menghalangi masuknya perusahaan baru ke dalam suatu bidang bisnis dan yang membatasi

persaingan; kecuali kalau pertimbangan keselamatan atau perlindunganlingkungan hidup mengharuskan pembatasan itu.

Property Rights, i.e. sistem hukum yang berlaku harus bisa menjamin perlindungan hak milik atas tanah, kapital, dan bangunan.



Dynamic Development

Recent developments in international economy indicatesnew ways, techniques in international economic modesof production Capital mobility – export processing zones

Stateless money – globalization of finance Lean production, downsizing, outsourcing, extensive

production networks – restructuring the corporation Proliferation of regional ‘free trade’ agreements and

institutions – AFTA, APEC, CACM, ANCOM, MERCOSUR “Maquiladoras”– Mexican free trade zones

New corporate strategies – capital mobility, restructuring thecorporation, corporate agenda EU as regional economic and political institution Multilateral Agreement on Investment (MAI)



Issues to be Addressed

• Cheap Labor, repressive social control, rapid economic

growth, especially in the context of Newly

Industrializing Countries (NICs)

• Polarizing the Population, growing inequalities, sectorsof low-wage, ‘contingent’ workers, need for

restructuring the corporation

• Corporate agenda: monetarism, deregulation, laissez-

faire, neo-liberalism, supply-side economy• Reduce costs for labor and government in order to be

more competitive in global economy



What’s on the Table?

What should be done on:

International Production?

International Distribution?

International Allocation?• Upon world wealth, i.e. Goods, services or other intellectual

properties

---------------

How actors interact in the process?How its power relations (political context) affect the process?



International Production

International investment, foreign nvestment: how investment modelsare developed? How its power relations?

Multinational enterprises, transnastional corporations: how theyoperate? How they employ the existing power relations?

International industrialization, internasional development, globalfordism: how international development models are developed? Howits political context?

Global production chain: how global production chain develops? Howit affects issues on multinational corporations, foreign investment,international industrialization, etc.? How we benefit from the chain?

How state or national/local governments should respond? What kindof policies are needed?



International Distribution

International trade, world trade regime/WTO: how

international power relations affect the global

trade regime? Is WTO the final form of a global

trade regime and therefore should be responded asfinal?

Protectionism, economic regionalism, btrade

blocks, policy discrimination: how these issuesaffect the existing model/regime? How we deal

with them?



International Allocation

Internasional finance, international monetary regime/IMF: how themodel is developed? How its political context?

Foreign aid, foreign debt, World Bank, Asian Development Bank,Islamic Development Bank: what kinds of financial and monetary

scheme are being developed to allocate world financial resources?What are the implications?

Collective alliance among Third World/Developing Countries: howthe actors/states design their collective bargaining strategies?

Strategic actions, strategic bargaining: what policy strategies andmodels are developed by the state/national/local governments to

survive & get the benefit from the regime?

Documents

Contemporary Capitalism_new - PED HI UGM - 2009