Consequences of the Changing Global Political Economy

By Harry Targ
(1728 words)

This Commentary is Unpublished

The economic crisis that is growing in rich and poor countries alike in 2008 directly rersults from years of unbridled, unplanned capitalist expansion on the world stage. We can plot the transformation of the global political economy, that is the parallel and combined development of economic and political institutions, since World War II to understand how and why the crisis of today emerged. And, after reflecting on that history, we can begin to see what needs to be done to overcome the crises that befall us.

World War II ended with death and destruction rampant across the Eurasian land mass. Some 60 million people died, 27 million alone in the former Soviet Union. The United States experienced an economic boom resulting from war production. Industrial productivity rose by a factor of three. Trade increased fourfold. At the war's end, the U.S. controlled 2/3 to ¾ of the world's industrial plant and productivity. With this power, the United States played a fundamental role in reestablishing the economic and political institutions that would govern the world over the next 60 years. During the period from 1945 and 1968, the so-called "golden age" of the U.S. economy, multinational corporations and banks spread across the globe as domestic consumption soared....

....In the twentieth century we saw various political movements and ideologies offering a vision of "positive government," that is a vision that says that political (and economic) institutions can and should be created by and for the vast majority of people. While many experiments in positive government failed, for a variety of reasons, the global movements of our own day are saying that we can establish new institutions that represent us all, and not just the rich and powerful. That is the continuing challenge of the 21st century.

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Harry Targ teaches United States foreign policy and international political economy at Purdue University.