Checking the Assumption that Free Markets Leads States on the Path to Democracy
12/10/2019 6:30 PM - 9:00 PM
Event Description
It has long been an assumption, underlying the Bretton Woods Conference towards the end of WWII, that competition within an open market system would encourage countries to become more democratic in order to harness their nations resources most effectively to participate in the global economy. The downturn in socialist economies and the seeming triumph of capitalism seemed to validate this supposition until the 80s and 90s of the last century.
Key questions:
What is the meaning of “life, liberty, and the pursuit of happiness,” in a contemporary context?
Does the choice of a market-orientation influence a country’s commitment to democratic principles?
What is the interaction, if any, between a country’s economic achievements and its domestic priorities?
How can a country like the US with a relatively open market economy compete effectively against countries with “managed” economies that are able to enable “winners” among their companies while reducing competition from other countries?
Readings:
The Smart Globalist’s Agenda: A Plan for Responsible U.S. Economic Engagement in the World, by Clyde Prestowitz. 2009 Undermining Democracy, page 9
There are also growing reasons to question another promised benefit of globalization: That it strengthens democracy worldwide. Far from spreading democracy, globalization seems to have the opposite effect in some places. The state capitalist autocracies of Russia, China and the oil producing nations have grown in power as globalization has gained momentum. These nations are financing the United States while increasingly challenging it on the international stage. They are also intimidating and to some extent guiding global corporations. For example, many companies accept Chinese censorship on their websites and even turn employees over to the Chinese police upon request. Many also readily assist the Chinese Internet Police with equipment and technology. Indeed, it is striking that Washington has raised no human rights fuss about this. But the reason is not too hard to find. All these major corporations are big political players with significant lobbying operations in Washington.
“The key problem is an asymmetry of power over corporations between democratic and authoritarian regimes that disadvantage the democracies.” https://www.demos.org/sites/default/files/publications/The%20Smart%20Globalist's%20Agenda.pdf
Is capitalism compatible with democracy? Wolfgang Merkel Z Vgl Polit Wiss DOI 10.1007/s12286-014-0199-4, 2014
“Capitalism and democracy follow different logics: unequally distributed property rights on the one hand, equal civic and political rights on the other; profit oriented trade within capitalism in contrast to the search for the common good within democracy; debate, compromise and majority decision-making within democratic politics versus hierarchical decision-making by managers and capital owners. Capitalism is not democratic, democracy is not capitalist.” https://projects.iq.harvard.edu/files/mobilized_contention/files/merkel_-_is_capitalism_compatible_with_democracy.pdf
Our speaker, Clyde Prestowitz is founder and President of the Economic Strategy Institute. He has played key roles in achieving congressional passage of NAFTA and in shaping the final content of the Uruguay Round, as well as providing the intellectual basis for current U.S. trade policies toward Japan, China, and Korea.
Prior to founding ESI, Mr. Prestowitz served as counselor to the Secretary of Commerce in the Reagan Administration. There, he led many U.S. trade and investment negotiations with Japan, China, Latin America, and Europe. Before joining the Commerce Department, he was a senior businessman in the United States, Europe, Japan, and throughout Asia and Latin America. He has served as vice chairman of the President's Committee on Trade and Investment in the Pacific and sits on the Intel Policy Advisory Board and the U.S. Export-Import Bank Advisory Board.
Clyde Prestowitz regularly writes for leading publications, including the New York Times, the Washington Post, Fortune, and Foreign Affairs. He is the author of the best-selling book on U.S.-Japan relations, Trading Places, and co-author and editor of several other books on international trade and business strategy including Asia After the Miracle; Powernomics; Bit by Bit; The New North American Trade Order; Rogue Nation; and Three Billion New Capitalists. His latest book, The Betrayal of American Prosperity: Free Market Delusions, America's Decline, and How We Must Compete in the Post-Dollar Era, addresses how we can restore our economic leadership and excellence.
Mr. Prestowitz has a B.A. with honors from Swarthmore College; an M.A. in East-West Policies and Economics from the East-West Center of the University of Hawaii; and an M.B.A. from the Wharton Graduate School of Business. He also studied at Keio University in Tokyo. He is fluent in Japanese, Dutch, German, and French.
