What Role for Global Finance in a Course on International Trade Law?

David Singh Grewal –

Most years, I teach an introductory course on International Trade Law. And every year since I began I’ve included a session on the international financial architecture, on the view that this architecture is intimately bound up with the functioning of the trade regime.

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I begin the course predictably enough with a series of sessions on the history and political economy of international trade before we get into what I call the “guts of the GATT.” Here, we study the key articles of the General Agreement on Tariffs and Trade (GATT) and the main disputes that have arisen concerning their interpretation, both before and after the establishment of the World Trade Organization (WTO). Any course on international trade law would have to introduce core elements such as “most favored nation” status (Art. I), “national treatment” (Art. III), key exceptions (for example, as elaborated in Article XX), and the main “annex agreements” of the WTO (such as the TRIPS agreement, which Amy Kapczynski has discussed on this blog), as well as the various remedies and safeguards available to states facing disruptions from international trade. But toward the end of the course, I bring my friend and colleague, Robert Hockett, to discuss the international financial architecture underpinning economic globalization as a whole.

I suspect few international trade law courses address international finance as an integral part of an introduction to trade liberalization. Given the evolution of international economic law, this choice is probably unsurprising. Neither in the treaty text of the GATT (nor in the other “annex agreements” that make up the WTO) is financial architecture explicitly regulated. By contrast with international trade law, international financial law is elaborated through a different set of governing texts, institutions, and international monetary practices—prominently, the IMF Articles of Agreement, the IMF itself, and the practices that have developed among affiliated national central banks and finance ministries. Trade law scholars may be understandably wary of bringing such complex or seemingly extraneous considerations into a course that will already be full enough.

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The Crisis of Progressive Neoliberalism

Nancy Fraser –

How should we understand the crisis of the current moment? Is the election of President Trump a temporary aberration or does it reflect deeper political trends—both in the United States and elsewhere?

In a recently published essay in American Affairs, I argue that the defining features of Trump’s agenda did not come out of nowhere. What enabled his ascent was first, the rise, and then, the unraveling, of what I call progressive neoliberalism. Progressive neoliberalism tied a finance-centered political economy to a progressive politics of recognition. Grafting neoliberal economics onto mainstream liberal currents of apparently egalitarian social movements, such as feminism, anti-racism, multiculturalism, and LGBTQ rights, it forged a hegemonic bloc that dominated American politics for several decades. Beyond the United States, progressive-neoliberal formations governed many other liberal democracies through center-left parties that made similar deals with bankers and bondholders to gain or maintain power.

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Progressive neoliberalism’s main competitor was what I call reactionary neoliberalism, which tied an exclusionary politics of recognition to the same neoliberal political economy.While reactionary neoliberalism was defeated by progressive neoliberalism, it offered no alternative to the latter’s project of Goldman-Sachsifying the US economy. Absent any organized opposition on a national scale, progressive neoliberals from Bill Clinton to Barack Obama were free to promote policies that metastasized finance and gutted manufacturing.They eviscerated unions and drove down real wages, proliferated precarious service-sector jobs and promoted predatory debt to enable the purchase of cheap stuff produced elsewhere. The result was to dramatically worsen the life conditions of the bottom two-thirds of Americans, especially (but not only) in rustbelt, southern, and rural communities, even as soaring stock markets fattened not just the one percent but also the upper reaches of the professional-managerial class. In due course, many harmed by these policies came to reject not only neoliberal political economy, but also the more inclusive view of recognition they associated with it.

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