The political economy of development

Every day tens of thousands of workers and 'beneficiaries' toil to make development happen: to feed hungry children, to vaccinate against disease, to build schools, roads and airports, to promote good governance and civic education, and to do a host of other activities on an ever-increasing list. Development competes with the great religions of our time, motivating and disciplining, providing moral leadership and proving a clarion call against the neglect of the poor, diseased and incapable. As a social project it carries all the great meanings of the modern age, from the Enlightenment to now, of human progress and the civilising mission of human intervention. After the eclipsing of the socialist project in the early 1990s, it has also become a harbour and home for radicals of all persuasions, and has provided activities for well-meaning people more generally, who care about the welfare of others, to work, volunteer or donate their money for the greater human good. In short, the common view of development is of a 'great collective effort to fight poverty, raise standards of living and promote one or other version of progress' (Ferguson 1990: 9). In this view progress and 'modernisation' will be the result of all this human effort, because '"win-win" solutions are available to development problems and an inclusive and globalising market economy contains no intrinsic obstacles to a better life for all' (Mosedale 2008: 21).

But an alternative view also exists, where the collective efforts of the mass of development workers can be blighted by relations of power in society. The privileged and wealthy, in short, may not want to give up their position, or share global resources more equitably. This is particularly the case when it comes to those development interventions which affect the economy directly. That is to say, even the wealthy may support greater childhood vaccinations and pay a charitable contribution to see that happen, but will resist a large-scale rise in their taxes. This confirms the gift as a palliative at most, within a global social and economic system which constantly reproduces marginality and destitution: just as one child is helped, another, or two or more, becomes vulnerable. In this view continued poverty is produced by an imperialistic relation between the centre of the global economy and the edges, or periphery (Ferguson 1990: 13), and this imperialist relation is part and parcel of capitalist development (Bernstein 2005: 118; reviewed in Mosedale 2008: 21). This book is in the second tradition. It goes further than is normal practice, however, in explaining the intimacy between the development industry and the promotion of capitalism, through detailing the interventions made in the private sector.

In other words, it is not just that a virtuous development industry exists which is blighted and confounded by immanent processes of capitalism, thwarted by social forces beyond its control. This in itself is a fairly radical position. It is also that interventions in the private sector in particular have come to reproduce and mirror those of the capitalist global economy. A development bank, in short, does very little that is different in meaning than a generic private bank. And it has the bonus of the charitable label. A development project, like the Chad–Cameroon oil pipeline, looks similar to a private sector initiative, and indeed in this case, takes venture capitalism to new boundaries of the possible in negotiating with authoritarian governance structures in order to 'get things done'. In other words, development is intimately connected and implicated in capitalist process and imperialist logic.

This book explains how the development industry and its institutions such as development banks contribute to the governance and regulation of global capitalism. This in turn affects prospects for political and economic development in the South. It contends that mass poverty is a consequence of the system of regulation that development contributes to. After nearly 70 years of effort to 'do development' at an intergovernmental level, Northern states still help capitalism prosper, while simultaneously claiming to help the victims of the inequalities it produces. And development has failed: there are ever more instances of victimhood and blight. Now there is a subtle point to be made here, to distinguish this book from the many other neoliberal economists and neoconservatives who claim that development is a waste of time because it never works. My purpose is to show why the efforts of so many right-minded people are being wasted in a system that channels them wrongly. At present, they can't work hard enough to keep cleaning up after capitalism, and one way of making their job easier is to stop powerful states making more social and economic inequality in the first instance. The cruel irony being, that development institutions often have a particular place in activities in the private sector which take away people's assets and livelihoods, impoverish them, and then stymie the people's efforts, alongside development workers, to help themselves recover. If this remark strikes you as particularly 'off-message', or suggestive of an indefensible tendency to conspiracy theory, you need only take a look at the evidence that has been recorded, against the odds, from people displaced and abused by development, such as the anguish of the people of the Lesotho Highlands who were made destitute by a dam and hydroelectric complex (at 'Mountain Voices' on the internet).

Thus, contrary to most books on development you may read, 'failure' in development will not be assessed here by looking at the so-called deficiencies and absences of various attributes – skills, money, political will, capacity and so on – within the South. This is the bread and butter, and misguided product, of development studies, and has been critiqued before by authors in the post-development and radical development traditions. Instead, the book will examine bilateral and multilateral political economy relations between states, in order to illustrate the nonsense that is the claim of benevolence in the post-colonial practice of international aid. To clarify, individual acts of charity in terms of food or vaccinations may sometimes be worthy of the term benevolent, but the overall system is not. Not least because the larger picture is dominated by transfers of public funds to private companies, not by bowls of food to children. Who has the 'development dollar', and what they choose to do with it, profoundly matters to people's lives. Therefore, the focus of this book is on this larger, mean sibling of the welfarist public face of...