ECONOMIC RATIONALISM HAS NOT FAILED.
I am increasingly annoyed at people concluding that economic rationalist policies, or the World Bank's Structural Adjustment policies, or the free market or financial deregulation have failed. If that's what you think then you fail to understand the economic world. You must be assuming a) that the policies were intended and designed to meet the needs of people and the environment, b) that those framing and implementing them are bungling idiots because their strategies somehow always end up devastating the lives of most people and the ecosystems of the planet.
The patently obvious fact is that these policies have been stunningly and astronomically successful. The world economy is run by and for the benefit of a tiny group of extraordinarily rich and powerful people. They determine what will be done primarily through their capacity to invest in those ventures that will be most profitable to themselves. They have no interest whatsoever in the welfare of the people in general or of the planet . (Indeed as David Korten explains in When Corporations Rule the World, any corporation that devotes resources to good causes risks a lower rate of return and therefore opens itself to hostile takeover.) In the past 20 years they have been able to grab unprecedented power and freedom to go anywhere and do anything they wish, greatly assisted by governments whose advisers have had their minds warped by the study of conventional economic theory which takes it for granted that increasing business turnover and the GDP is all that matters.
Structural Adjustment Packages, the rules of the World Trade Organisation, the Multilateral Agreement on Investment proposals, and the economic rationalist philosophy in general are simply the arrangements which suit the big corporations and banks (and their well paid lackeys who do the technical, legal and managerial work). SAPs for example dismantle an economy, junk the unprofitable bits, and enable foreign investors to come in and take over the juicy bits at bargain basement prices, while ensuring the banks get their reckless loans repaid, and that there is increased freedom to get at cheaper labour and forests etc now freed from protection. The corporations can buy Third World resources at devalued prices and more productive capacity can be taken from the poor majority.
Even without SAPs conventional development is little more than an elaborate, legitimised and automatic form of plunder. When development is driven by what will maximise profits and business turnover the inevitable result is that local land, labour and capital are put into producing for the benefit of local elites, transnational corporations and rich world supermarket shoppers. Conventional development is almost totally inappropriate to the basic needs of most people and their ecosystems. We should therefore not be surprised that the UN's Human Development Report for 1966 states that now 1.6 billion people are actually getting poorer each year.
Were you thinking that all this is some kind of unfortunate mistake, that those responsible were really trying to do what benefits people and the environment, but somehow they just keep innocently getting it wrong? The fact is that conventional economic strategies are designed to and succeed brilliantly in delivering most of and an increasing proportion of the world's wealth to the rich few. Globalisation is a process of restructuring the system to give them far greater access to the world's wealth than they had before. The failure is not in economic rationalism; we are the ones who have failed, because we have let them get away with it!