On 4/11/06, C Ruiz <[EMAIL PROTECTED]> wrote: > Two questions: 1-What is a "nationalist model of growth" and when did this > take place? > 2- How being "nationalist" would lead to debt accumulation? i.e. what would > the mechanism of transmission be? And finally what kind of dependency? Is > there any truly "independent" economy? Are the US or China's? > Cristobal Senior De Ruiz
The "nationalist model of growth" refers to process in which a country aims to promote balanced growth primarily based on its own resources and its own domestic markets, with a nationalistic ideology to back it up. There are a variety of different versions, including the US (after 1860 or so until 1975 or so), the old Soviet Union, Velasco's Peru, and Peron's Argentina, to name a few. It can include import-substituting industrialization efforts (as in Latin America and, I'm told, the Philipines) and even export-led industrialization, if done right (as in S. Korea). A non-nationalist growth process would be that of a totally extraverted country, a trade entrepot, or a country totally dominated by foreign powers. Nationalist growth leads to debt accumulation almost naturally, as does almost any growth process. (If I had my druthers, however, poor countries would eschew debt as much as possible.) Debt accumulation can make a lot of sense, as with the US during the 19th century, when it financed real investment, which increases the ability to pay the interest. The problem is that investment in dependent countries -- most of the world -- is less likely to work because of the conditions of economic dependency. Agencies such as the World Bank have also been known to push loans too hard, encouraging indebtedness by countries that can't afford it. Local ruling elites often favor raising external debt, knowing that their assets will be in foreign banks and that the working class and peasantry will pay the costs. For me, "economic dependency" refers to an economy not having a complete set of industries, typically because it lacks "Department I" (machine tools, capital goods, etc.), so that much of the benefits of even normal capitalist growth are broadcast to the rest of the world. There are no truly independent or autocentric countries, though the US was close during the 1950s and 1960s. Euroland combined with the US and Japan (i.e., the rich countries) may count today, though that bloc lacks some essential natural resources such as oil. These days, the trend is away from economic independence, toward generalized dependency. -- Jim Devine / "There can be no real individual freedom in the presence of economic insecurity." -- Chester Bowles
