Economic constitutionalism, liberalism and the new welfare governance

Abstract

At the beginning of the twenty-first century the neo-liberal market model that had so dominated economic and social policy making during the later decades of the previous century appears to be under increasing pressure. This arises not only from anti-globalization movements such as the World Social Forum, but also from the populist politics of elected governments in the newly industrializing countries. For example, in Latin America, the election of leaders such as Lula Da Silva of the Brazilian Workers Party, Nestor Kirchner in Argentina, and Hugo Chavez in Venezuela, appears to have reversed the trend of some of the main tenets of the ‘Washington Consensus’. In East Asia too the election of Thaksin Shinawatra on a platform that championed Thai nationalism in opposition to the austerity policies advocated by the IMF suggests that even on the ‘home turf of the Washington Consensus, the ‘miracle’ economies of East Asian neo-liberal economic policies that so dominated the 1990s are facing mounting pressures. Compounding these trends has been the development of a raft of policies and programmes that focus on issues such a poverty reduction and social safety nets1 promoted by international financial institutions (IFIs), and especially the World Bank. These developments would seem to provide clear evidence of a growing concern with awareness of the social dimensions of economic development that were absent in the era of the hard-edged neo-liberalism of the Washington Consensus.