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Neoliberalism

Globalisation in the twenty-first century is pre-eminently neoliberal, the adoption of which has given a major boost to globalisation, both de facto and ideologically. Martinez and Garcia (2000) have identified five defining features of the global phenomenon of neoliberalism (see also Hill 2003, 2004, 2005a, b):

  • 1. The Rule of the Market
  • • the liberation of ‘free’ or private enterprise from any bonds imposed by the state no matter how much social damage this causes;
  • • greater openness to international trade and investment;
  • • the reduction of wages by de-unionising workers and eliminating workers’ rights;
  • • an end to price controls;
  • • total freedom of movement for capital, goods and services.
  • 2. Cutting Public Expenditure
  • • less spending on social services such as education and health care;
  • • reducing the safety-net for the poor;
  • • reducing expenditure on maintenance, e.g. of roads, bridges and water supply.
  • 3. Deregulation: reducing government regulation of everything that could diminish profits
  • • less protection of the environment;
  • • lesser concerns with job safety.
  • 4. Privatization: selling state-owned enterprises, goods and services to private investors, e.g.
  • • banks;
  • • key industries;
  • • railroads;
  • • toll highways;
  • • electricity;
  • • schools;
  • • hospitals;
  • • fresh water.
  • 5. Eliminating the Concept of‘The Public Good’ or ‘Community’
  • • replacing it with ‘individual responsibility’;
  • • pressuring the poorest people in a society to by themselves find solutions to their lack of health care, education and social security.

Global neoliberalism was given a major boost in 1994, with the signing of the General Agreement on Trade in Services (GATS) at the World Trade Organisation (WTO). The aim of this agreement, which came into force in January 1995, is to remove any restrictions and internal government regulations in the area of service delivery that are considered to be ‘barriers to trade’. The list of services of the GATS includes 12 types, subdivided in many others: [1]

  • 6. Environmental (sewage, sanitation, disposal, etc);
  • 7. Financial (insurances, banking, leasing, asset management, etc);
  • 8. Health and related social services (hospital, other human health services, social, etc);
  • 9. Tourism and travel related (hotel, restaurant, travel agencies, etc);
  • 10. Recreational, Cultural and Sporting (news agency, libraries, archives, museums, theatre, sports, etc;
  • 11. Transports (maritime, aerial, railway, railroad, passenger, freight, maintenance and repair, towing, pipelines, warehouses, etc);
  • 12. ‘Other services not mentioned in any other place, (WTO 2003, cited in de Siqueira 2005)

Since February 2000, negotiations have been underway in the WTO to expand and ‘fine-tune’ the GATS. As GATSWatch (undated) has pointed out, these negotiations have aroused concern worldwide. A growing number of local governments, trade unions, non-governmental organizations (NGOs), parliaments and developing country governments are criticising the GATS negotiations and call for a halt on the negotiations. Their main points of critique are:

  • • Negative impacts on universal access to basic services such as healthcare, education, water and transport.
  • • Fundamental conflict between freeing up trade in services and the right of governments and communities to regulate companies in areas such as tourism, retail, telecommunications and broadcasting.
  • • Absence of a comprehensive assessment of the impacts of GATS-style liberalisation before further negotiations continue.
  • • A one-sided deal. GATS is primarily about expanding opportunities for large multinational companies (GATSWatch undated; see also Devidal 2008; Verger and Bonal 2008; Waghorne 2008).

  • [1] Business (accounting, computer science and related subjects, legal,marketing and correlated, medical and dental services, architecture, etc); 2. Communication (telecommunication, mail, audiovisual, radio,motion picture etc); 3. Construction and related engineering services; 4. Distribution (franchising, retail and wholesale, etc); 5. Education (primary, secondary, higher, adult education and others);
 
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