Letter today to Financial Times:
Investment law decisions supporting multinationals show that libertarian politics is far from dead
From Prof Robert Hunter Wade. Sir, Michael Lind says: “The libertarian moment has passed. It will not come again, and its defeat . . . will change the definitions of right, left and centre - not just in the US but also, the world” (”The unmourned end of libertarian politics”, August 17). He is partly right, and in the field of international development we have already seen how agenda-defining organisations such as the World Bank have been articulating a less hard-edged free market/small state agenda over the past decade.But he is also partly wrong, because what these organisations say is not the same as what they do. The revolutionary libertarians succeeded in hard-wiring their anti-government world view into the nuts and bolts of the international economy, such that the rules and procedures of, for example, international aid and international investment are derived from and reinforce the libertarian world view even as policy declarations suggest something else.
For example, the formula the World Bank uses to allocate its very soft International Development Association loans, based on the Country Policy and Institutional Assessment, scores countries according to their compliance with a neoliberal development model. The emerging body of international investment law coming out of the dispute settlement tribunals of the World Bank’s International Center for the Settlement of Investment Disputes tilts strongly in favour of the rights of multinational companies and against the rights of national governments. Inspection of other international regimes would show the same thing. Reports of the death of libertarian politics are greatly exaggerated.
Robert Hunter Wade,
Professor of Political Economy,
Development Studies Institute,
London School of Economics
