The Albania–Kosovo Highway, a four-lane highway constructed from 2007 to 2013 by the American-Turkish consortium Bechtel-ENKA
Western policy has long been shaped by neoliberalism and free-market orthodoxy. These schools of thought are strongly rooted in the concepts of individual freedom and, to a lesser extent, objectivism. Their application can be seen in the Monroe Doctrine statements of non-interference and the Wilsonian belief of self-determination. These values of freedom of action and laissez-faire economics are espoused by the United States and the European Union, yet their application is often lacklustre and frequently harmful. The West cites this ideological framework when convenient, but disregards it when it is no longer so.
The profiteering of US companies and the support given by American diplomats exemplify this ideological duplicity. While diplomats’ tasks include promoting their country’s business interests, they frequently overstep their bounds, interfering in the domestic affairs of sovereign nations.
For example, Bechtel, a large American civil engineering company, recently constructed the 48-mile Kosovo Motorway at a cost of $1.3 billion, roughly $25 million per mile. Christopher Dell, then US ambassador to Kosovo, played a large role in the Kosovar government’s acceptance of the bid, even though it lacked a clear final price. He promoted Bechtel’s proposal heavily, speaking out in support of it despite a “broad coalition” of international agencies, alongside Eversheds, the Kosovar government’s legal advisor on the bid, questioning the economic viability of the project and the competitiveness of the bid. Why did Dell, a US ambassador, defend it in the face of international condemnation? In deciding, consider the fact that he landed a job at Bechtel upon leaving the Foreign Service.
His outsize role in Kosovo’s choice of construction firm is tantamount to meddling in a sovereign state’s affairs. While the US promotes self-determination and freedom of choice, its diplomats have undermined this assertion. Whether involving individual diplomats or, worse, the American government as a whole, these activities are costly and destabilising and directly affect the futures of other nations. In the Bechtel scandal, and in others involving Halliburton in Iraq and Nigeria, America’s hubris has demonstrated the West’s comfort with saying one thing and doing another.
Even international economic policies do not have to jive with free-market orthodoxy if they suit the West. The EU’s Common Agricultural Policy and US farm subsidies and tariffs are both protectionist measures that drastically raise the prices of farm products from Africa, making them uncompetitive with European and American producers. Despite ostensibly supporting free trade, the West deploys tariffs against products from the worst-off economies on the planet, thereby hamstringing their attempts at growth and development. Given these nations’ reliance on agricultural exports, such policies “constitute a roadblock on the path to development for dozens of the world’s poorest populations.”
By doing this, Western countries give with one hand and take with the other — the benefits of financial aid to developing nations are greatly reduced by the effects of domestic agricultural support. Oxfam estimates that if the US were to remove cotton subsidies, West African cotton farmers’ incomes would increase by 8 to 20%. For some of the poorest people on Earth, this is a valuable boost, providing sufficient funds for schooling for two to ten children per household or health care coverage for four to ten people per household. Besides redistributing wealth from Africans to Americans, these protectionist policies directly oppose the ideals of free trade and contrast sharply with American calls for trade liberalisation.
In addition, the actions of international institutions demonstrate the West’s need to dictate policies to other governments. The East Asian crisis of 1997 saw plummeting currency values and rocketing public debt in the region. What started as an economic bubble quickly grew into a financial catastrophe, forcing the International Monetary Fund to provide bailouts for Indonesia, South Korea, and Thailand. At the behest of the Fund’s big players, these bailouts were contingent on reduced government spending and structural reforms. However, these conditions, which included high interest rates, hindered any stimulus-based medicine and instead led to greater damage to already crisis stricken economies.
Demands like these demonstrate the outsize influence of developed countries in the IMF. Instead of being beholden to those it helps, the IMF answers to those who fund it. While this may seem sensible, it enables the West to dictate responses to crises in line with its ideological beliefs, rather than letting countries decide what is best for their own economies.
In a tactic that was fiercely condemned by many Western economists at the time, states such as Malaysia instituted capital controls, greatly reducing the damage done to their economies by speculative currency attacks. Despite their success, the IMF had no room for policies that strayed from a market-based approach. It may seem sensible that creditor countries control the IMF and thus give it an ideological slant, but this influence reduces debtor states’ autonomy. Can a nation truly be considered free under the duress of possible economic collapse?
While the girders of the West’s ideological framework are corroded by its actions, one thing remains constant — the decay is motivated by the greed of the rich. The developing world faces concerted attempts by the West to extract profit and power by economic means. Defences against this scourge, including attempts by nations to develop their own institutions, have faced resistance by America and its allies. They see recent projects that seek to decentralise financial power, like the Asian Infrastructure Investment Bank, as threats to Western influence. Indeed, they may well undercut that power, but alternative lenders will force the IMF and the World Bank to offer more appealing financial packages. Or is the West sacrificing even the sacred ideal of competition in this battle?
Whatever the stance is of Washington and London on projects like the AIIB, the backers of these new institutions must persevere, lest the yoke of Western dominance becomes heavier. Liberalism requires individuals’ freedom of action — states deserve that same freedom. With this hollow ideology, Western policy is sitting upon rusting supports. Those that escape now will be standing when it collapses.
Alex Davies is pursuing an independent major in International Relations and Computer Science at Cornell University.
Image Attribution: “Berat Hoxha 18” by Berat Hoxha, licensed under CC BY-SA 3.0
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