Revisiting neoliberalism and new developmentalism: lessons from Turkey and Argentina

Abstract

This article contributes to ongoing efforts to clarify and differentiate between neoliberal and new developmentalist strategies pursued in the early twenty-first century by shifting the focus of analysis away from the ‘degree’ to the ‘form’ of state activism. Relying on a case-based strategy of enquiry, it compares the development strategies pursued in Argentina and Turkey in the aftermath of the devastating economic crises that erupted in both in 2001. It argues that while both neoliberal and new developmentalist strategies rely on state interventionism, they differ in the role they assign to the state (1) in distributing the social costs linked to the processes of capital accumulation and wealth creation, and (2) in incorporating labouring classes into structures of governance.

Keywords:

• Development strategy
• neoliberalism
• new developmentalism
• Argentina
• Turkey

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Acknowledgements

I am grateful to Ali Riza Gungen, Galip Yalman, Mert Karabiyikoglu, Firat Durusan, Gerardo Otero and participants in the research colloquium organized by the School for International Studies at SFU for their comments on earlier drafts, which significantly helped me improve this work. Any shortcomings and errors, however, are mine alone.

Disclosure statement

No potential conflict of interest was reported by the author.

Notes

1 I use the terms subordinate classes and labouring classes interchangeably and to refer to various segments of the population including formal and informal workers, unemployed workers, small peasants and Indigenous peoples.

2 This is not to ignore that under neoliberal regimes, more and more spheres of social life have been colonized by market relations, and governments adopting this strategy have sought “to make existing markets wider and to create new markets where they did not exist before” (Connell, 2010, 23–24). It means that ensuring ‘free’ competition in those markets has not been the utmost priority. The neoliberal strategy has rather been characterized by a “selective application of market logics” which “are strictly enforced in some areas (e.g. social services), and yet actively suppressed in others (e.g. corporate welfare)” (Ryan, 2015, 95).

3 In this article, I refer to new developmentalism more as a development strategy informing policymaking processes than as a thought-collective or a perspective in development economics. For a detailed examination of the ideological roots of new developmentalism as a school of thought see Leiva (2008).

4 Some observers have emphasized the need to refrain from a narrow dichotomy between neoliberalism and new developmentalism, pointing out significant continuities. (Castorina, 2014; Grugel and Riggirozzi, 2012; Féliz, 2014; Wylde, 2016). A few others have stressed that new developmentalism refers to a hybrid model which - in the words of David Trubek (2013, 12) - adds “new-developmentalist aspects” to neoliberalism. While I agree that these two strategies are sometimes combined in practice, it is important to distinguish them conceptually to gain a better understanding of how their features are merged to create hybrids.

5 The global commodity boom – driven mainly by the extraordinary growth of the Chinese economy and increase in China’s commodity imports roughly between 2003 and 2013 – led to a significant rise in demand for primary commodities and their prices. It fueled economic growth in resource-rich Latin American countries and provided a favorable ground to carry out progressive income redistribution policies without changing existing accumulation strategies (i.e. mainly through accelerating production and export of primary commodities).

6 Between 1996 and 2001, the two largest union confederations in Argentina, the CGT (Confederación General del Trabajo - General Labour Confederation) and the CTA (Central de los Trabajadores Argentinos - Central of Argentine Workers), organized a number of general strikes (Féliz, 2014). That strike wave, together with rising workers’ mobilization at the grassroots level signaled what Féliz calls “a multi-pronged movement of opposition” (Féliz, 2014, 57).

7 During our interview, one of the top representatives of the Argentine Industrial Union (Unión Industrial Argentina – the leading business association and organization of employers in Argentina) expressed this imperative. She identified the 2001 crisis as a disaster, the possibility to return to which had to be hindered at all costs in the subsequent period. (Interview with María Victoria Giulietti, Buenos Aires, April 26, 2016; María Victoria Giulietti was then the Head of the Department of Social Policies of the UIA.)

8 See Saad-Filho (2011) for a similar conception of a crisis in neoliberalism and a crisis of ­neo­liberalism.

9 To better understand state-capital relations, including how certain fractions of capital benefitted from macroeconomic policies in Turkey and Argentina, see Bozkurt (2021) and Rivera-Quiñones (2014) respectively.

10 This strategy is widely referred to as ‘neo-extractivism.’  While extractivism is broadly defined as the dependence of economic growth on primary exports (such as petroleum, mining and agricultural products), neo-extractivism refers to the strategy of promoting extractivist activities and using tax revenues from these sectors to fund social programs (see North and Grinspun (2016) and Svampa (2015)).

11 For a detailed analysis of how the relationship evolved between the governments and different representatives of labouring classes in Argentina, see Felder and Patroni (2011).

12 Trade unionism in Argentina has historically been stronger and more influential than in Turkey. Following Juan Domingo Perón’s election as president in 1946, trade unions gained significant organizational strength, and a centralized union structure developed with close ties to Peronism (see James 1988 for a detailed analysis). Even during the military dictatorship (1976-1983) and the 1990s - when a radical neoliberal development strategy was pursued in Argentina – the leadership of the largest trade union confederation, CGT, retained close relations with the state. Yet under the neoliberal program implemented before the 2000s, trade unionism suffered a major setback due to declining collective bargaining coverage and trade union membership. The post-2001 era witnessed the reversal of this trend (see Cook and Bazler 2013).

13 Household debt as a percentage of GDP raised in Turkey from 1.8% in 2002 to 19.4% in 2013 (IMF, 2021). See Karaçimen (2014) and Akçay and Güngen (2022) for the consumer credit ­expansion and the rise of household debt in Turkey.

Additional information

Funding

This research received no external funding.

Notes on contributors

Sumercan Bozkurt Gungen

Sumercan Bozkurt Gungen is Lecturer and Adjunct Professor in the School for International Studies at Simon Fraser University.