Global governance: political and economic II Flashcards
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What is NATO
- North Atlantic Treaty Organisation
- A political and military alliance formed in 1949 consisting of 30 member countries primarily from Noth America and Europe - its purpose is to ensure the colective security of its members - Article 5 - an attack on one is an attack on all
- Orginally established as a counterbalance to the percieved threat of Soviet expansion and communist ideology in eastern Europe during the early years of the Cold War (Warsaw Pact same second)
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Why does NATO still exist
- Collectve defense and reinforces political cohesion as a forum to coordinate defense and security policy
- Adaptation to new threats like terrorism (The War on Terror), cyber threats and rise of non-state actors - flexible model allows to act in different global contexts such as peacekeeping missions or humanitarian assistance
- Expansion of membership particularily in Eastern Europe - those previously in the Soviet sphere of influence - Poland, Hungary and he Baltic States have joined and risen their influence- Russia threatened by this as annexation of Crimea in 2014 and ongoing military action in Ukraine
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How does NATO work
- Work through a system of collective decision making and military collab
- US funds 22%
- They have councils such as NATO military command with a supreme allied commander Europe, paternship with UN and EU and North Atlantic Council
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Trump’s attidue to NATO and how many members are paying their fair share
- Critical - arguing that emmebr countries on’t sapend enough on defense and rely too heavily on the US - has called ro allies to increase ther defense spending
- Mark Rutta is concerned about his commitment to the defensive alliance
- 9/30 NATO members meet the target of spending % of GDP on defense
- 2nd presidential term he said he may encourage Russia to attack NATO countries which don’t pay 5% - ‘they can all afford it’
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3 arguments why NATO should be disbanded
- Still viewed in a hostile matter by Russia
- Dominated by the US and is in reality merely a tool for American foreign policy
- Few of the countries in NATO meet the required spending, showing a lack of genuine unity within it
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3 arguments why NATO shouldn’t be disbanded
- Aims have now changed and it is now laying a key role in combatting terrorism
- For Baltic states and Eastern Europe, the threat of Russia remains
- In the 1990s it provd to be one of the most effective ways ofdeploying a military force to resolve an issue - 1995 Operation Deliberate Force where the Bosnia Serb army performed massacre in UN safge zones like Serbia (8000 Bosnian Muslims died) and 1999 Operation Allied Force - huamnitarian mission to protect Kosovo Albanians from armed forces of Federal Yugoslav Republic
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Realist view on global economic governance
Assume states will act in a mercantilist way - try to maximise their own wealth at the expense of others through protectionist policies with little scop for cooperation
Exception is if a hegemon arises whose interests require a stable liberal economic order (open markets, free trade) and which is able to enforce the rules because of its military and economic dominance
Liberal view on global economic governance
Believe that the free market and unrestricted competition will produce the most effecient economic outcome and that in an interdependent world, states will recognise that they will benefit from agreed rules
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Liberal view criticism from left wing for global economic governance
Many Marxist critics challenge the idea that economicx governance has been conducted in a neutral way to benefit all states
They claim that it instead has operated in the interests of the leading capitalist states (US), transnational corporations, financial and banking conglomerates
The Bretton Woods system
Southt o ensure that the world avoded the economic problems causing tension that contributed to WW2. Great Depression in 1930s has led to the rise of aggressive natinalist movements - ‘beggar my neigbour’ policies:
- High tariffs stranging trade
- Competitve devaluations of currencies
Made the World Bank
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The impact of the Bretton Woods system
- Body has provided overal coordination since 1970s - G7
- Members are leading rich capitalist countries who also continue to dom IMF and World Bank as a result of a weighted voting system
- Attracted protest demanding action on tackling global povvo, debt, environmental
- G20 became the main economic decision body - legit of global issues decided by a small group of rich countries challenged
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Principles of the WTO
- Non-discrimination - most favoured national principle ensures that all members recieve equal trade adv
- Reciprocity - mutual concessions to achieve mutual gains
- Transparency - states required to publish their trade regulations and practices to ensure opennes and predictability
- Safety Valves - states can take measures rto protect domestic industries under specific circumstances
6 features of the WTO
- Succeeded the General Agreement on Tariffs and Trade
- Negotiates trade agreements and multilateral trading system
- Dispute Settle mechanism
- Trade policy review
- Technical assistance and capacity building
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Boeing v Airbus (2004-2020)
- USA and EU engaged in a long running dispute over subsidies provided to their respective aerospace companies - both accused each other of providing illegal subsidies that violated international trade rules
- Over the years, WTO issued several rulings in favour of both parties, finding that each had providd improper subsidies
- July 2020 - US and EU aanounced resolution to suspend tariffs related to the issue and work towards a fair aviation trade enivronment
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How does the UNSC rotate
- Has 5 permanent members that remain every rotate
- Additional 10 members on the Security Council, every year 5 members swapped out and 5 remain in
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World Health Organisation
- Network of scientists act as a key defence against SARS, SwineFlu, Ebola
Can be drawn into political disputes between states - Arab countries refuse to allow Israel to participate inn WHO regional activities in the Middle East
- Can be held back by a lack of resources and reliance on gov to support its campaigns. AIDS campaigns depends on national governments to spread info about AIDS and implement policies to limit its spread - richer countries that give South assistance prefer to gie it directly to governments they approve of.
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UNESCO
- Became a North-South battlefield and was criticised for being ineffecient and wasteful with excessive spending on its HQ
- Argued to be too political, prmoting diarmament and anti-Israel attitudes in educational work
- Adopted the G77 Countries’ proposal for a ‘New World Information and Communication order’ supposedly meant to correct distorted reporting of the South in Western-dominated global media
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Why US accepted Bretton Woods system
- Reflected USA’s global hegemony and depended on its economic strength - sustained international monetary order between 1940s-1970s and US capital revived Europe and Japan - allowed to impose protectionist barriers against US exports while having access to their market
- Benefitted from its ability to pay for its overseas spending in dollars
- Exporters would gain in the long run from a recovery in Europe and Japan - prevents spread of communism
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Why did the Bretton Woods system collapse
- Unsustainable for the US - massive spending in Cold War meant 1971 abandoned convertavbility of dollars to gold and exchange rates collapsed
- Japan and Europe no longer willing to accept US leadership, while they resented the costs of the system
- Massive growth of private capital increasingly meant that governments were less able to set exchange rates
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What does the WTO do?
- Responsible for agreeing the rules of trad between states - including trade disputes, checking that states are following trade agreements, and producing research on global trade and econ. policy
- Key goal is to reduce barriers on trade in both goods and services, which may include tarriffs that states may impose on imports
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WTO strengths and EG
- Alongside its 6 main principles, they have the right to export to other countries
- Kennedy Round
- Uruguay Round
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WTO weaknesses
- Doha Round failure
- Political power falls between western powers - they tend to gain the most out of deals and decision making is biased towards countries with larger representation in Geneva
- Unable to make decisions quickly - ministerial conferences are too infrequent and there is a need for consensus from all member states
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What does the International Monetary Fund (IMF) do?
- Structural adjustment programmes
- Provides economic stability by giving financial support or loans to suffering states
- Monitors economic outlook of both the world economy and individual member countires - includong forecasting and commentating on potential threats
- Advises member countries how best to manage their economies, particualrily less developed member countries in which experience is lacking
IMF strengths
- Saved many financial crises such as the Eurozone crisis, Asian financial crisis and emergency lending to Brazil and Argentina
IMF weakness
- Undemocratic - voting power is weighted according to how much states contribute financially in the quota - therefore US dominance and if you’re more economically powerful, you have more decision making power
Is IMF a force for good in the world economy - YES
Main role is to respond to financial emergencies, its original role in operating the Bretton Woods system of stable exchange rates and helping countries in the developed world with balance of payment programmes has gone - is a forum for collective action to tackle problems affecting the global economy
Is IMF a force for good in the world economy - NO
Has also taken on a role similar to that of a development institution, particualarily responding to the debt crisis in the South from the 1970s - Loans are offered to countries with serious balance of payment problems however like the World Bank, these are conditional on recpeients reforming their economies along neoliberal lines such as free market
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What does the World Bank do?
- Its International Bank for Reconstruction and Development provides loans and assistance to middle income countries
- International Development Association - provides loans to poorest countries - these tend to have very low rates of interest
- Allocates 20bn annually
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World Bank development projects
There is a growing emphasis on reducing poverty, linked strongely to MDGs and now Sustainable Development Goals
- Funds development programmes like in South Africa, spending 140M in Higher Education Centres of Excellence, and in Afrghanistan, spending 3.3B on reconstruction
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World Bank strengths
- Voting power is weighted according to the amount states contribute to loans - US has 16% - no other state has more than 5%
- Programmes have contributed to the success of MDG 1 to reverse world poverty
- Focuses on direct grants to poorer states, rather than loans so there is less debt pressure
World Bank weaknesses
- Contributions are dwarfed by private investors whioch amouned to 900B for China and India in 2011 - meanwhile the World Bank’s resources only reached 8B in the same year - they should focus on ONLY conflict-ridden states unattractive to private investors
- There is an imbalance of voting power as it is outdated in an increasingly globalised world - in an economy where powers like Brazil, India and China have less than 1/3 of the voting powers of the USA
