Neoliberal economic globalization as a solution to world poverty

Neoliberal Economic Globalisation

The subject of this paper is "Neoliberal economic globalisation is the solution to world poverty." This paper will choose to support this statement. It consists of three parts: a definition of neoliberal economic globalisation, a look at the evidence of the improvement in world poverty, and a prediction on the future of world poverty and its interaction with economic globalisation.

Defining Neoliberal Economic Globalisation

Neoliberalism" is simply the revitalisation of "liberalism" in the sense used in Great Britain in the late 1700's and early 1800's. This term is best embodied by the economic philosophers of Great Britain and the United States, who postulated that all would benefit from improvements in wealth due to innovation and specialisation. In Adam Smith's work (Smith, 1909), he sided with the labourer, who increased his wages over time:

It is not the actual greatness of national wealth, but its continual increase, which occasions a rise in the wages of labour. It is not, accordingly, in the richest countries, but in the most thriving, or in those which are growing rich the fastest, that the wages of labour are highest.

Liberalism was refined as religious and philosophical theory by Hobbes, Locke, Thomas Paine and John Wesley. Religion, economics and culture followed the growth of rationalism as characterized by the English and French in the 1700's, and following tremendous increases in agricultural wealth which created both capital for investment and surplus labour available for urban industrialisation.

Neo-liberal" has emerged in the past 25 years as a resurrection of the old "liberal" term. It stands for freer global trade, reduction of government's role in the formation of new business, freedom to hire and fire and to found new businesses.

In reaction to the ideas of Say, Marx and Galbraith, the neoliberal ideal was forged during the 1960's in the Chicago School of economics, and pushed further by the clear association between technological progress and jobs and income growth (Burkett, 2005).

Neoliberalism, which was first an epithet amongst the global left, became popular with three "proofs" of the 1980's: the fall of communism, the continued growth of the United States from 1982 forward, and the similar freeing and successful growth of the United Kingdom. By the 1990's, the strength of neoliberal reforms was demonstrated in the freeing of nearly 3 billion people -- 40% of the world's population, due to neoliberal reforms which had begun in the 1960's.

Conclusion

With China's and India's population at 2.5 billion, and an additional 300 million Eastern Europeans joining the European Union or (in Russia) attaining freedom, 3 billion people have seen significant increases in per capita income. These changes have of course resulted in increased income disparities in these countries, but the freeing of trade, government policies and the ability to grow companies has resulted in a broad-based economic revival which has reached all income levels.