Global Economics Classes

Global Economics Classes

The Politics of Freeing Markets in Latin America: Chile, Argentina,and Mexico by Judith A. Teichman and Managing Mexico by Sarah Babb

At the end of a debate over congressional ratification of the North American Free Trade Agreement in 1994, a lobbyist for a multinational corporation, exasperated by my opposition to NAFTA, shouted at me: “Don’t you understand? We have to help Salinas [Carlos Salinas, then president of Mexico]. He’s been to Harvard. He’s one of us!”

It struck me as an odd remark. She and I were clearly not on the same political team. A year’s fellowship at the Kennedy Institute of Politics hardly made me a Harvard man, and she hadn’t gone to Harvard at all. It took me a little while to understand her point, which was that all of us were members of an increasingly global “policy class.”

The Politics of Freeing Markets in Latin America and Managing Mexico are about the role of the policy class in bringing neoliberal economics to Mexico, Argentina, and Chile. They raise the intriguing possibility that had it not been for a conscious, business-financed political strategy to change the ruling economic paradigm, the history of the last twenty years in these three countries-and perhaps elsewhere-might have been different. Both books also bring important information and insights into the evolving cross-border class politics that lies under the radar screen of the debate over globalization.

Because all markets run on an accepted set of rules, all markets generate a politics over the setting and enforcement of those rules. Indeed, politics has been famously defined as “who gets what.” The global marketplace is no different. Yet, although it is widely understood that the major actors in the global drama are companies, banks, and workers busy obliterating national boundaries, the analysis of the international political economy-both popular and academic-is largely focused on the relationships among nation-states.

This framework simply cannot capture the cross-border realities of the global market. To give one concrete example, asking whether Canada, Mexico, or the United States “won” or “lost” from NAFTA cannot give you a useful answer, because the benefits were captured and the costs were borne by similar groups throughout the continent. Investors in all three countries largely gained, and workers in all three countries largely lost. Even if you do not agree with that particular assessment, it is hard to argue that the determination of winners and losers from the creation of a continental economy does not have to ...