University of Sussex the Political Economy of Permanent Underachievement
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A University of Sussex PhD thesis Available online via Sussex Research Online: http://sro.sussex.ac.uk/ This thesis is protected by copyright which belongs to the author. This thesis cannot be reproduced or quoted extensively from without first obtaining permission in writing from the Author The content must not be changed in any way or sold commercially in any format or medium without the formal permission of the Author When referring to this work, full bibliographic details including the author, title, awarding institution and date of the thesis must be given Please visit Sussex Research Online for more information and further details University of Sussex The Political Economy of Permanent Underachievement A critique of neoliberalism and neodevelopmentalism in Argentina and Brazil. Felipe Antunes de Oliveira Department of International Relations Submitted for the degree of Doctor of Philosophy January 2018 i I hereby declare that this thesis has not been submitted, either in the same or different form to this or any other University for a degree. Signature: ………………………………………………… ii University of Sussex Felipe Antunes de Oliveira Submitted for the degree of Doctor of Philosophy The Political Economy of Permanent Underachievement: A critique of neoliberalism and neodevelopmentalism in Argentina and Brazil Summary In Argentina and Brazil, the future never seems to arrive. Over the last three decades, successive waves of neoliberal and neodevelopmentalist reforms invariably ended in disappointment. The most relevant question defying the contemporary Brazilian and Argentinian political economy literature is why, despite being repeatedly predicted in economic programs and promised in political discourses, catch-up development never materialises? Neoliberal and neodevelopmentalist authors offer apparently contradictory answers to that question. For the former, economic underachievement is a result of insufficient or ill-conceived pro-market reforms. For the latter, it is a consequence of the lack of state-led national development projects. In this thesis, I challenge both mainstream narratives. I claim that the roots of Brazilian and Argentinian permanent underachievement are intrinsically related to the fragilities of neoliberal and neodevelopmentalist development strategies, which result in inherently inconsistent policies. Although representing themselves as complete opposites, both sides actually share two problematic premises: a narrow view of development, understood as capitalist catch-up, and a simplified opposition between state and market. My critique starts from a radical reappraisal of the very concept of development, informed by Leon Trotsky’s idea of uneven and combined development and its contemporary interpretations. Defining development as the dynamic outcome of the interplay between class disputes and international pressures and opportunities, I argue that the shortcomings of the neoliberal and neodevelopmentalist reforms were determined by the specific responses given by dominant class alliances in the face of successive international crises. The argument is advanced through four in-depth case studies of the state reforms carried out in Brazil and Argentina since the 1990s, with particular attention to macroeconomic and foreign policies. By breaking the oligopoly of narratives about Brazilian and Argentinian development shared by neoliberals and neodevelopmentalists, I aim to contribute to the rise of alternative strategies of development from below. Keywords: Neoliberalism; Neodevelopmentalism; Uneven and combined development; Argentina; Brazil. iii Acknowledgements The writing of this thesis was possible due to a research leave granted by the Brazilian Ministry of External Relations. I am very grateful to the institution itself and to all the colleagues who encouraged me to pursue a PhD. Special thanks to Ambassador Eugênia Barthelmess, and to Secretaries Gregory Beshara, Mayra Saito, Gustavo Raposo, Ligia Garofallo and Mozart Grisi. The thesis was proofread by my friend and long-time collaborator Duncan Crosley. A number of scholars and policy-makers kindly took the time to give me interviews. My gratitude to Pepe Mujica, Claudio Katz, Mariano Féliz, Noemi Brenta, Matias Kulfas, Eduardo Basualdo, Monica Hirst, Marcio Pochmann, Luiz Carlos Bresser- Pereira, Gustavo Franco, Alexandre Schwartzman, Luis Manuel Rebelo and Theotonio dos Santos. I found in the International Relations Department at the University of Sussex the most welcoming and intellectually challenging place to do my research. I am really grateful to my supervisors – Benjamin Selwyn and Earl Gammon – for their thoughtful engagement throughout the whole process. The contact with great scholars such as Cynthia Weber, Justin Rosenberg, Beate Jahn, Patricia Owens, Louiza Odysseos, Benno Teschke, Kamran Matin, Sam Knafo and Julian Germann really had an impact on how I understand and practice critical research. I also would like to thank the incredibly talented Sussex PhD cohort, particularly Sam Appleton, Neil Dooley, Darius A’Zami, Tom Martin, Yavuz Tuyloglu, Frances Thompson, Andrea Brock, Sophie Jung and Felix Buchwald. My undergraduate students were a major source of inspiration with their relentless desire to change the world. A selected group of very close friends helped me with both, emotional support and constructive intellectual engagement. Special thanks to my flatmate and colleague Pedro Salgado. The same applies to Thomas Patriota, Heitor Levy, Eduardo Rotstein, Vinicius Rosenthal and my brother, Vicente Antunes de Oliveira. Fernanda Ayala, Juliana Russar and Charlotte Bilo are important parts of the story behind the writing of thesis. Finally, I am extremely grateful to my parents for their unconditional support. Despite all the help, support and inspiration I received from these and many other wonderful people, inevitable mistakes, omissions and inaccuracies remain in the final text. I take full responsibility for them. iv The Political Economy of Permanent Underachievement A critique of neoliberalism and neodevelopmentalism in Argentina and Brazil. Chapters Introduction – The political economy of permanent underachievement. Part 1 – Neoliberalism, neodevelopmentalism and beyond Chapter 1 – Development through the prism of neoliberalism and neodevelopmentalism Chapter 2 – Uneven and combined development – a radically perspectived concept of development Part 2 – Neoliberalism and market utopia Chapter 3 – Neoliberalism in Argentina – the first world is here Chapter 4 – Neoliberalism in Brazil – ‘A new development project’ Part 3 – Neodevelopmentalism and state utopia Chapter 5 – Neodevelopmentalism in Brazil – the future that never arrives Chapter 6 – Neodevelopmentalism in Argentina – from class conciliation to confrontation Conclusion - Challenging the oligopoly of legitimate development discourses v Detailed Table of Contents Acknowledgements ...................................................................................................................... iii Chapters ....................................................................................................................................... iv Detailed Table of Contents ........................................................................................................... v List of figures, tables and charts ................................................................................................ viii List of abbreviations .................................................................................................................. ixx Introduction – The political economy of permanent underachievement....................................... 2 Part 1 – Neoliberalism, Neodevelopmentalism and Beyond ........................................................ 9 Introduction ............................................................................................................................... 9 Chapter 1 – Development through the prism of neoliberalism and neodevelopmentalism .... 12 1.1 – Neoliberalism as a development strategy premised on the market utopia ................. 13 1.1.1 - Neoliberalism and the Washington Consensus .................................................... 16 1.1.2 – Beyond the Washington Consensus, the political economy of the neoliberal development strategy ...................................................................................................... 19 1.1.3 Neoliberalism and Peripheral Realism ................................................................... 22 1.2 Neodevelopmentalism as a development strategy premised on the state utopia ........... 24 1.2.1 Reformist dependency theory and the forgotten origins of neodevelopmentalism 28 1.2.2 Contemporary expressions of neodevelopmentalism and the ‘Ten Theses’. ......... 32 1.2.3 The geopolitics of neodevelopmentalism............................................................... 37 1.3 – Swallow this bitter medicine: Neoliberalism, Neodevelopmentalism and the disease metaphor ............................................................................................................................. 40 Chapter 2 – Uneven and combined development – a radically perspectived concept of development ............................................................................................................................ 44 2.1 – Why development? .................................................................................................... 47 2.2 From Marx to