{"id":215640,"date":"2021-01-02T15:45:48","date_gmt":"2021-01-02T10:15:48","guid":{"rendered":"https:\/\/www.colombotelegraph.com\/?p=215640"},"modified":"2021-01-07T04:22:48","modified_gmt":"2021-01-06T22:52:48","slug":"economic-rightism-versus-economic-nativism-alien-versus-predator","status":"publish","type":"post","link":"https:\/\/www.colombotelegraph.com\/index.php\/economic-rightism-versus-economic-nativism-alien-versus-predator\/","title":{"rendered":"Economic Rightism Versus Economic Nativism: Alien Versus Predator\u00a0"},"content":{"rendered":"

By Dayan Jayatilleka<\/a> –\u00a0<\/span><\/b><\/span><\/p>\n

\"\"<\/a>

Dr. Dayan Jayatilleka<\/p><\/div>\n

The economic crisis of 2021-2022 is inevitable because the regime\u2019s economic doctrine of a \u2018self-sufficient national economy\u2019 is the equivalent of the \u2018Dhammika Paniya\u2019, the syrup of the Shaman from Kegalle.\u00a0<\/span><\/p>\n

It is inevitable also because of the intellectual poverty of the economic debate in the political sphere.\u00a0<\/span><\/p>\n

The government\u2019s doctrine of \u201cself-sufficiency\u201d is constantly invoked but has no internationally recognized intellectual authors or texts invoked as points of reference. The only references from the Government ranks are strictly local: former Prime Minister Sirimavo Bandaranaike<\/a><\/span> and former Finance Minister, Dr NM Perera<\/a><\/span>. That\u2019s like invoking the Titanic as a model for sailing.\u00a0<\/span><\/p>\n

The Sri Lankan economic policy debate among the political elite takes place in a time-warp, with the references dating back to the 1970s and 1980s. There is no grasp of the pandemic, its economic consequences and the changes in economic thinking the world over.<\/p>\n

Progressive economic thinkers and policy makers have responded to two shocks, firstly that of the neonationalist-unilateralist backlash against neoliberal globalism, a backlash which weakened the old globalist model, and secondly the Covid-19<\/a><\/span> pandemic. The pandemic broke the global supply chains, necessitating nationalist economic strategies centering on domestic production. The pandemic also proved that the model which leaves much to the market and private profit, exposed its weaknesses in protecting public health and safety and therefore the economy.\u00a0<\/span><\/p>\n

Thus, there has been much new thinking and suggestions for rational, progressive reforms of the domestic economic orders and the global economic order.<\/p>\n

Typically, Sri Lankan politicians, academics and ideologues have been behind the curve. Some make the error of regarding domestic production not as a necessary adaptive policy and desirable corrective to and within globalization, but as a model in and of itself. The Sri Lankan government belongs in that category. Others in politics, think-tanks and respected websites, hanker after the restoration of the old model of neoliberal globalization.\u00a0<\/span><\/p>\n

While the neoconservative Alt-Right Gotabaya regime<\/a><\/span> has no international intellectual underpinnings or examples for its \u2018Jathika Arthikaya\/self-sufficiency\u2019 doctrine, the neoliberal globalist Right in Sri Lanka, as I have noticed from its spoken\/published\/posted discourse, absurdly spends its firepower today attacking the policies of an intellectual giant, Raul Prebisch.\u00a0<\/span><\/p>\n

The neoliberal Economic Right is unaware that the place of a thinker in any realm, including development economics, depends on what he meant in his \/her time and place, how he\/she advanced the state of thinking and policy at that time; the contribution he\/she made to the history of thought in that particular discipline or domain. That assessment must not be confused with the issue of whether that economic doctrine should have been continued beyond a certain period, still less with the question of whether or not it should be returned to under very different circumstances. \u00a0<\/span><\/p>\n

So it is with Raul Prebisch, a titan of development thinking; a man whose ideas emancipated and revolutionized thought. He brought into view the fundamental phenomenon of dependency of the Latin American and other Third World economies which functioned as the \u2018periphery\u2019 of the world economy, on the \u2018centers\u2019 of the global system, the North; dependency that had been created by violent colonialism and neocolonialism; dependency that ensured a continued outflow of \u2018surplus\u2019 through multiple means to the North thereby causing the loss of surplus necessary for industrialization and resulting in underdevelopment as a continuing process. \u00a0<\/span><\/p>\n

The policy intervention of Prebisch and the Economic Commission of Latin America (ECLA) was intended to reduce the outflow of surplus and retain it for industrialization, which it did with relative success for a period. In some cases, it was overthrown after rightwing military coups and in others grew outmoded as does any economic policy regime. However, the great positive contribution to the history of ideas\u2014in contradistinction to the continued relevance as policy– of Prebisch and ECLA is recognized by every serious economic thinker, teacher or student.\u00a0<\/span><\/p>\n

What makes the demonization of Raul Prebisch by the Sri Lankan neoliberal Economic Right which persists today despite the fall of the Ranil-Mangala administration, a cause for sadness and incredulity, is the sheer ignorance of the history of the serious development policy debate in Sri Lanka and the internationally recognized contribution of Sri Lanka to the development policy debate. \u00a0<\/span><\/p>\n

The two Sri Lankans most respected internationally in the realm of development thinking were both very conscious of the path-breaking contribution of Raul Prebisch and ECLA to the struggle against underdevelopment.\u00a0<\/span><\/p>\n

These two personalities did not by any means belong to the United Front administration of Prime Minister Sirimavo Bandaranaike and Dr NM Perera. These two Sri Lankans were the brains of the economic planning process of the UNP government of Prime Minister Dudley Senanayake– though it was the top politicians rather than they who decided the dominant economic policy overlay.\u00a0<\/span><\/p>\n

I refer to Dr. Gamani Corea, later Secretary-General of UNCTAD and later still, head of the South Center in Geneva and his cerebral deputy, Godfrey Gunatilleke.\u00a0<\/span><\/p>\n

At UNCTAD and the South Center, Gamini Corea<\/a><\/span> continued in the great tradition of Raul Prebisch who had been the founder Secretary-General of UNCTAD, grappling with the issue of \u2018unequal exchange\u2019 (Arghiri Emmanuel) through the terms of trade. Upon return from Geneva, Dr. Corea was founder-chairperson of the Institute of Policy Studies (IPS) in Colombo while Godfrey Gunatilleke had founded the MARGA Institute for development studies in the 1970s.<\/p>\n

Many international roundtable conferences on development thinking were initiated by the MARGA Institute and presided over by its chairperson Godfrey Gunatilleke<\/a><\/span>, including a conclave which had luminaries from the global South, Rodolfo Stavenhagen and Juan Somavia. This effort resulted in an intellectually path-breaking volume standing in precise paradigmatic contradistinction to the thinking of Milton Friedman and the Chicago Boys who were advising the Pinochet military dictatorship and advocating policies of which the contemporary Sri Lankan rightwing economists are descendants. This landmark volume was unambiguously entitled \u2018Another Development: Approaches and Strategies\u2019 (1977) edited by leading \u2018dependency\u2019 economist Fernando Henrique Cardoso, who as President of Brazil went on to establish a stellar economic record of macroeconomic stability.<\/p>\n

Sri Lanka\u2019s neoliberal Right takes unwarranted pride in the UNP\u2019s economic track-record. Unwarranted, because the polarizing character of the economic policies of UNP governments taken together with the no less polarizing ethnic and economic policies, combined in a toxic cocktail which always caused a populist backlash which was often, but not always nationalist or even xenophobic. The UNP in 1952-1956 triggered a mass uprising (the 1953 Hartal) and then, Sinhala Only<\/a><\/span>. In 1965-1970 it caused the rise of the JVP and an electoral landslide for the SLFP-Left coalition. In 1977-88, it contributed to a violent Southern uprising. In 2001-2003 it led to the ouster, electoral defeat and the first Rajapaksa victory. In 2015-2019, it produced Gotabaya Rajapaksa<\/a><\/span> and a parliamentary tsunami which drowned the UNP. \u00a0<\/span><\/p>\n

The weight of evidence shows something radically wrong in the UNP\u2019s economic orthodoxy. The sole exception to this rule was the Premadasa Presidency<\/a><\/span> which achieved the economic miracle of combining high growth, high foreign investment, a vibrant stock market, reduced inequality and a real transfer of income to the lower income groups. Radically course-correcting the Open Economy while based upon it, Premadasa scornfully rejected the SLFP\u2019s Closed Economy model. His was an alternative development discourse.\u00a0<\/span><\/p>\n

Here\u2019s an example:<\/p>\n

\u201cThe exploitation which leads to poverty is endemic in the structure of international economic relations today. That is why this structure has to be changed. That is why we talk of a New International Economic Order. It is an order where human rights are respected; where economic inequalities and poverty are eliminated; where malnutrition and illiteracy are removed.\u00a0<\/span><\/p>\n

I am not talking of a new order which must exist between nations and nations only. We have to institute this order in our own countries\u2026We cannot have a New International Economic Order abroad and an Old Economic Order of exploitation at home. We cannot ask for the removal of exploitation and inequalities among nations and allow economic oppression and disparities to flourish within our nation.\u00a0<\/span><\/p>\n

The emancipation of mankind from exploitation must take place both nationally and internationally. The structural imbalances and inequalities within nations are linked together. That is as true for the South as it is for the North.\u201d<\/p>\n

(Ranasinghe Premadasa, Udagam Udanaya, June 23rd<\/sup> 1987)<\/p>\n

This extract from a speech by Prime Minister Premadasa contained in Udagam Udanaya, the publication distributed at the commencement of every Gam Udawa to the hundreds of thousands who attended. The discourse sounds to me much more in the tradition of Raul Prebisch and the school of thought he founded, than Hayek, Friedman and Hausmann. Premadasa was the policy practitioner par excellence of the paradigm of \u2018Another Development\u2019.\u00a0<\/span><\/p>\n

Ranasinghe Premadasa\u2019s pitch for an equity-based new domestic economic order also accords perfectly with the ideas urged on Prime Minister Wickremesinghe in 2015 by Nobel Prize winner for Economics, Prof Joe Stiglitz, while sharing a platform in Colombo. His presentation on taking equity as the key link of a post-conflict economic development strategy for Sri Lanka was reproduced on his website at Harvard. The UNP and its supportive civil society economists ignored this economic doctrine in 2015 and adopted a contrary economic vision which contributed to the party\u2019s extinction. Even today, para-UNP economic ideologues avoid reference to the Stiglitz episode.\u00a0<\/span><\/p>\n

Columnists have remarked on restiveness on the neonationalist flank of the Opposition, signaling a possible New Right \u2018spoiler\u2019 presidential bid. This is a reflex-action of impatience, frustration and (typically) ego-centric adventurism provoked and permitted by the stubbornly persistent free-market fundamentalism of some Oppositionists.\u00a0<\/span><\/p>\n

The new Opposition must educate itself about the history of the development discourses in Sri Lanka, including those of our finest developmental minds, all three of whom either served under a UNP administration or headed one: Gamani Corea, Godfrey Gunatilleke and of course, Ranasinghe Premadasa\u2014whose son leads the UNP\u2019s successor party and the new Opposition.\u00a0<\/span><\/p>\n

A good start would be \u2018Towards a Sri Lankan Model of Development\u2019 a collection of writings (1975-2015) by Godfrey Gunatilleke, especially Part 5, entitled \u2018A Vision for Sri Lanka 2025 & 2035: Sri Lanka\u2019s Transition from High Human Development to Very High Human Development\u2019. Given that today\u2019s New Opposition should aim to win the Presidency and the Parliament by 2025, this text would outline a progressive goal and roadmap.\u00a0<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"

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