The Struggle for Development valuably debunks the statistics of neoliberal development, but an analysis of imperialism is needed too, argues Dominic Alexander

For a long time now, it has been the overwhelming orthodoxy that the only way to lift countries of the global south out of poverty is through an intensive course of capitalist development. During the last few decades, this orthodoxy has been narrowed to the dogma that specifically neoliberal policy prescriptions are the only way that such development can be achieved. Moreover, it has been claimed triumphantly that these policies have been, and are being, successful in reducing poverty in the world. Statistics heralding that so many millions have been brought above the $1 a day income level make easy headlines that carry a spuriously factual certainty. That facticity is designed to head off any doubts that the road out of poverty is exclusively found in increasing participation in and integration into global markets.

The manifest failings in the operation of ‘global markets’, from the debt crisis of the 1990s to the catastrophe of 2008, to name just two of the most memorable events, has not dented the convictions of the purveyors of free-market fundamentalism. It is not surprising, therefore, to find the latest tendentious tome by the high priest of neoliberal complacency, Steven Pinker in Enlightenment Now: The Case for Reason, Science, Humanism and Progress, being enthusiastically reviewed in the Times Higher Education (22-28 February 2018, pp.54-5). Capitalism, or ‘modernity’ is the only ‘progressive’ game in town, and its result is that ‘on average, people live longer, are better fed, better educated and more secure than previous generations’.

These averages hide a great deal of misery and suffering, but in any case, an odd doubt creeps into the argument: ‘Resources are unequally distributed, and in some contexts, inequalities may be increasing; but it is only through the development and redistribution of wealth that poverty can be reduced’ (my emphasis). Blink and you’d miss it, given the rest of the review, but the neoliberal argument just collapsed in that sentence. Importantly, the acknowledgment that capitalism requires measures of redistribution if it is to have a ‘progressive’ impact, does not lessen the commitment to capitalist ‘development’ itself. As Benjamin Selwyn would point out, what lies behind this is a commitment to capital accumulation as a process, and measures of redistribution or no, it is that process which is the problem, whether neoliberal free trade, or other forms of capitalist development are dominant during any given period.

Still, it is the insistence that neoliberal policy has been in any way successful over the last few decades which needs challenging in the first instance. One of the merits of Selwyn’s short and accessible book on theories of development is his very handy critique of the assumptions and exclusions behind the validating statistics that reinforce the common sense of neoliberal developmentalism. In fact, counter to the often quoted figures of millions being lifted out of poverty through global free trade, there have, been notable increases in global hunger trends (p.6). Both measures cannot be correct, and Selwyn shows why it is the former that are at fault.

The misleading claims about $1 a day

Firstly, the $1 a day formula, admitted by its own creator to be ‘frugal’ and ‘deliberately conservative’ is simply far too low a level for any kind of decent human existence (p.23). Moreover, the measure ‘does not actually tell us if a person could stay alive at this consumption level’ (author’s emphasis, p.25). It does not include considerations such as the number of hours someone would have to work to achieve this income, or the health consequences of the labour they would be required to do. The measure does not consider the quality of diet this wage could sustain, nor does it consider health or education costs, or even housing (p.26). The World Bank’s definition of poverty that is used to sustain the $1 day measurement, in the trenchantly expressed observation of one study that Selwyn quotes, ‘assumes food to be the sole human need, leaving all other needs fully unmet … thus adopting a conception that reduces human beings to the status of animals’ (p.27).

In terms of sheer statistics, the optimism of the neoliberal mantra can be challenged quite easily. If the poverty line were to be raised to $2.50 a day, this would reveal an increase in poverty between 1981 and 2005 of 13%, not the 27% decrease claimed by the proponents of free-market integration (pp.4-5). None of the statistics consider the ways inequality is structured. Thus, statistics from the Food and Agriculture Organisation show that, for people undertaking ‘intense’ work, as opposed to white-collar labour, ‘the numbers suffering from hunger increased from around 2.25 billion in the early 1990s to approximately 2.5 billion in 2012’ (p.5). This measure indicates that while certain kinds of work may have been quantitively increased by neoliberal development, the circumstances of manual labour have declined.

Further observations are possible along the same vein. There is, for example, a differential impact of poverty on women, who are systematically paid less than men. Moreover, the measurement of $1 a day is clearly racist, since this inhuman absolute level is used for developing countries, while ‘governments in rich countries use relative poverty measurements to calculate national poverty levels and to formulate policy’ (p.28). When the statistics are fully unpacked, it becomes clear that far from improving the standard of living of people in the global south, the era of neoliberal developmentalism has had a clearly detrimental impact on a huge number of lives.

Global poverty chains

The policies that have been imposed on developing countries are designed to lock their economies into international markets, which means being integrated into ‘global value chains’. However, far from raising people out of poverty, women working in globally integrated industries are ‘systematically paid less than their subsistence cost’ while ‘transnational corporations use their global market power to capture the lion’s share of value created within these chains’ (pp.49-50). The international structures of the transnationals mean that they are able to outsource risk and costs of production to poor countries, such that their impact is actually to increase poverty (pp.53-4).

The argument that these countries suffer from low wages due to low productivity also does not hold water, as the globalised industries themselves are likely to be the more highly productive sectors in developing economies. The scale of exploitation is underlined by various cases, including that of Bangladesh, where ‘the average labour cost to produce one T-shirt is between 2 and 3 cents’ while one worker in a textile factory was found to have ‘earned just 1.36 euros per day based on a 10-12-hour day. The machine she works with produces a target of 250 T-shirts per hour’ (p.60). The global value chains exercise downward pressures on wages, not only in the global south, but also, as a direct result, in developed countries (p.72). The global value chains are therefore actually ‘global poverty chains’ (p.75).

The initial target of Selwyn’s analysis is what he calls the ‘anti-poverty consensus’ which subscribes to neoliberal nostrums that integration into globalised free-trade networks is the only viable path for capitalist development, and therefore the only route out of poverty. Resistance to these policy strictures, however, began to build from the early 1990s, and engendered some mild criticisms in response. This revision of the original programme, Selwyn terms the ‘Post-Washington Consensus’. Representatives of this new tendency, like Joseph Stiglitz, admit that ‘market failures are pervasive, especially in developing countries’, creating a sort of ‘social neoliberalism’ (p.86).

Capital versus labour

Selwyn’s critique, from this point onwards, moves beyond neoliberalism itself, to the underlying structures of capitalist developmentalism in general, in the course of which he usefully distinguishes various different schools. Even the most ‘social-democratic’ of these approaches, the ‘decent work’ approach advocated by the International Labour Organisation, still emphasises ‘state support for the market, and measures to “include” the poor and workers in economic growth’ (p.90). Ultimately, these strategies all take for granted capitalist social relations in which, necessarily, labour is exploited by capital to create profits. Therefore, ‘development’ is always a process that proceeds according to the interests of capital, as opposed to what might be socially useful.

This section includes a discussion of ‘Statist Political Economy’, and ‘Modernisation Marxism’. The former includes the case of South Korea, a low-wage economy where trade unions have suffered severe repression. The discussion of the latter usefully exposes how the statist models of the Soviet Union under Stalin and his successors, and Communist China, were in effect capital-centred growth models. Like the statist model, they do not offer a satisfactory alternative to the various shades of neoliberal policy discussed in the earlier parts of the book.

In search of this alternative, the final chapters move away from the typology of developmentalist theory into a discussion of historical and contemporary workers’ resistance as models of ‘labour-led development’ and ‘democratic development’. The former opens with the ten-hours movement in nineteenth-century Britain, on the undeniable premise that a reduction in working hours is a real sign of actual development as it is an improvement in living standards. The point is not to provide a history of workers’ struggles across the world and the centuries of capitalism, but to illustrate the argument that the class struggle represents ‘the potential existence of a rival political economy’ (p.103).

Quoting Michael Lebowitz, it is argued that collective inroads on capital, ‘negating competition, … infringing on the “sacred” law of supply and demand and engaging in “planned co-operation”’, constitute an alternative development through the building of democracy and welfare states (p.103). Illustrating this tendency is a range of examples of contemporary struggles, from the landless labours in Brazil, to strikes in China, via recuperated factories in Argentina and rent-strikes in South Africa (pp.109, 112, 118-19, 121).

There are many useful and interesting suggestions and examples of how labour could achieve its own ‘development’ here, although there is the occasional misfire. One of these is the suggestion that a universal basic income would be accompanied by a duty on the part of individuals to perform ‘some unpaid household work within their community to support and care for those who are unable to take care of themselves’ (p.140). This seems ill thought through, since it would require an immense, and probably authoritarian bureaucracy, to enforce. Why not have a national social care service, on the NHS model, instead? This would provide a huge boost to employment, without the need for a Speenhamland-style system, a subsidy for employers to pay low wages, which is all a universal basic income is likely to amount to being.

The role of imperialism

This book is a sketch of development issues, and as such is a very useful and clear introduction to the field and the problems. While one short book cannot do everything, some of the omissions here do pose problems, nonetheless. Since the later chapters, unlike the main body, are structured more around the actual history of capitalism and class struggles, the limitations of the typological analysis earlier in the book become clearer. There is no real analysis of how the different development theories represent distinct imperialist strategies, which are often enough in competition with each other. Some strategies represent national resistance to more powerful centres of capital accumulation, as in the Stalinist and Chinese cases. An understanding of the impact of competing imperialisms would create a more complex picture of the circumstances where workers’ resistance is mobilised effectively, and where movements run up against political limitations.

The absence of the imperialist dimension leads to an oddly ‘localist’ understanding of the possibilities for a revolutionary transformation of society. Selwyn sternly advises us that ‘it is erroneous to expect the conquest of political power by the labouring class in one country to be the catalyst for an instantaneous wave of “permanent revolutions” across other countries’ (p.129). The best that can be hoped for, instead, is for workers’ revolutions to be isolated for a time, during a period of ‘intermittent revolution’. This conceptualisation leads to some less than convincing suggestions for labour’s ‘democratic development’, such as the investment of pension funds into ‘activities that will further our transformative agenda’ (p.148).

The reality that imperialist centres would use all their power and viciousness to destroy any kind of workers’ state (as they do any kind of state, Iran for example, that merely challenges the dominance of existing centres of capital accumulation), seems to have disappeared from the calculus. Socialism in one country did not work the first time, and it seems strange to want to re-invent it as a model.

The problem lies in a conceptualisation which, by default in the absence of a seriously developed understanding of imperialism, imagines each country as following an independent line of development, with an internal class struggle effectively unconnected to any wider dynamics. This is the position effectively adopted by Neil Davidson, as a result of his unwarranted dismissal of the continuing importance of Trotsky’s theory of combined and uneven development (Davidson is quoted approvingly here on the stages of neoliberalism, p.87). Even so, on the basis of the history of revolutions in the capitalist era, it is actually unrealistic to imagine that revolutions will appear in one state only, and that such a state could exist successfully for any length of time without the revolution spreading.

Since the wave of revolutions that swept Europe in 1848, the pattern has in fact been one where revolution in one locality sparks a wave across a whole region, if not even more widely. After 1848, the next major revolutionary surge came in the years 1917-21, where the reach was truly international. Both regional and international waves of unrest and revolution have swept the world ever since, from 1968 to the ‘Arab Spring’ more recently. Perhaps the greatest demonstration of the international scale of resistance that imperialism can provoke was the world-wide eruption of protest in 2003 against the invasion of Iraq. Resistance to imperialism, both in its economic and political guises, is sure to be a central source of future revolutionary and transformative actions by the international proletariat.