Unholy trinity

The IMF, World Bank and WTO by Richard Peet and 17 others. London and New York: Zed
Books, 2003

This is a terrific book – although it maybe less terrifying, in the original sense of the word, to the objects
of its critiques than it is stimulating for those who make critiques, or for “people who are far from being
experts” (vii) but are uncomfortably aware of the need for thoroughgoing critical commentary. It is
politically committed, theoretically sophisticated, analytically incisive, empirically rich, thoroughly
engaged and full of devastating one-liners which greatly enliven its reading. The energy of the book is
reminiscent of that in a live performance by a group of highly talented musicians fully on song. And, in a
sense, it is a live performance. Live, not only in tackling a dynamic set of issues and institutions of
enormous contemporary significance, but as the outcome of a collaboration between Richard Peet and 17
undergraduate and graduate authors (all either current or immediate past graduates) at Clark University.

Six chapters explore the hegemonic relations by which and through which the IMF, the World Bank and
the WTO - which began institutional life at Bretton Woods NH in July 1944 – regulate and govern the
contemporary global economy. The introductory chapter explores how the dreadful contradiction between
the “beautiful opportunities” (2) of the “humanitarian potential of globalization” and “the actually
existing neoliberal globalization that cannot know its faults, no matter how disastrous their consequences”
(4) came about. An imaginative and sensitive reading of Marx, Gramsci and Foucault is put to very
effective use in exploring the emergence of globally hegemonic neo-liberal policy discourse which, the
authors show, “takes the form of the conquest of practicality by a committed expertise.” (18) Such
conquests have perpetually to be re-enacted, not least because of the inherent contradictions of regulatory
institutions operating within a neo-liberal economy. These contradictions have not only to be played out
in day-to-day and strategic practice but leave institutions open to critiques from both left and right.

An especially intriguing feature of this opening chapter is the exploration of what I would call ‘circuits of
discourse production, dissemination and performance’ and the geographies - “[H]ierarchies of centres of
persuasion [which] organize spatial flows of policy discourse that result in a series of articulations
between universal and regional and discursive formations” (21) - through which the construction of the
circuits takes place. A theme which runs throughout the book is the power of finance. And, again, its
geographies are crucially formative: “the dominant hegemony [is] produced in leading cultural-political-
economic centres of symbolic production … located in financial rather than political capitals.” (21).
Another underlying theme of the book is that of (the circuits of) counter-hegemony and their disciplining
by “translation from popular narrative into formal discourse” (22).

Chapter 2 offers a critical interpretation of the conditions – the concentration of power in, and common
interests of, powerful north American and western European states and the willingness of the US to
assume leadership - for the establishment and political practices of the Bretton Woods process. The
“regime” (28) that emerged had, amongst many other things, to work out how to transpose ‘national’
Keynesianism to an international stage. This is a detailed account. It shows how US hegemony was
asserted and sustained in, for example, insisting on the issue of conditionality in the Bretton Woods
institutions - an insistence and practice of geo-political and geo-economic power which has since proved
to be so damaging to global development - and, against Keynes’ wishes, in locating the IMF and IBRD in
Washington and not New York. Nevertheless, this chapter dismisses conspiratorial, if not masculinist,
theories of change. Such theories “do not see that conspiring men represent interests by employing
persuasive ideas … ‘Great men’ are effective in the construction of hegemony only when they marshal
great ideas or, more sceptically, ideas that seem as though they might work to resolve crises.” 54

The three substantive chapters - on the IMF, World Bank and WTO respectively - take up two thirds of
the text of the book and all offer very detailed historical, political and economic critiques across a wide
range of issues and practices. As “probably the single most powerful non-state (governance) institution in
the world” (56) - which, nevertheless, “should be disbanded” (222) unless it reverts to its original role as
a place for the deposit of surpluses that can be withdrawn in hard currencies during economic
emergencies and discontinues its escalating role as a lender imposing austere and damaging conditions -
the IMF is given the most extended treatment. But this is closely followed by the WTO – “a nasty
organization run by directors and a secretariat that propagate rightist elitism in the guise of consumer
populism” (222). Such relativities also reflect the intensity of critique of each institution. Nevertheless,
the “direct loans and the setting of policy conditions … make the World Bank the most important
development institution in the world” (111) for which the authors “see some hope” (222) but only if it is
democratized – with power given to those whose lives it attempts to influence - and distanced from the
IMF.

A common theme throughout the book is the emergence of what Jagdish Bhagwati calls the “Wall St-
Treasury complex” (83) and what, in chapter six, the authors call the “Washington–Wall Street alliance”.
Their emphasis on the “Bankers’ View of the World” (105) is very much to be welcomed but a
consideration of the interests of bankers (“where do policies come from and whose interests do they
serve” (204)) and finance does not go far enough. The global economy is, at present, increasingly
regulated, controlled and, above all, evaluated, by what Joseph Schumpeter calls the ‘headquarters of
capital’. So the involvement of finance in the IMF, the World Bank and the WTO is part not merely a way
of looking after its own interests but of shaping and evaluating a globalizing economy based on capitalist
financial relations.

As such, finance is not only evaluative but its theories are simultaneously performative. In discussing
(211) “the most difficult question of all – what about ‘The Market?’” the authors quote from George
Soros.

Each market participant is faced with the task of putting a present value on a future course of events, but
that course is contingent on the present values that all market participants taken together attribute to it.

The attribution of putting a value to markets is informed by influential financial theory which, thereby,
performs the very financial processes that it purports to explain. Similarly, the utterances and actions of
the IMF, World Bank and WTO do not merely reflect prevailing neo-liberal economic theory: they
perform it. And such performances raise complex questions about the relations between ‘theory’ and
‘reality’.

Thus the attention given in the book to what (above) I termed the circuits of discourse production,
dissemination and performance is entirely appropriate. Not only does it begin to “bridge the other wise
yawning gap between highly generalized political and economic interests, policy regimes and specific
policy practices” (201) but an understanding of such questions is resolvable only through the kind of
critically informed empirical work represented in this book. And critical understandings are vital in
attempting to deal with the conditions underlying the “hateful attack” of 11 September 2001 which
created the potential “for even more radical change than was previously thought possible.” (221)

The book does not contain any original research although it does incorporate a wide range of detailed
empirical material and events. It is at times dense and would be a difficult to read for those without prior
knowledge of its conceptual and political framings and an understanding of globalisation as a complex
tendency. It also seems as though every last example unearthed in researching the book has somehow to
be included. The book is over long – the authors themselves comment at one point that they have “spent
too much space elaborating” (26) – but, whilst it is long on effective critique, it is short on alternatives. Its
structure – organised institution by institution - enables discussion of the circuits of discourse production
dissemination and performance but limits exploration of the links between the institutions –
notwithstanding the excellent opening and closing chapters.

But this is carping; snapping at heels. The detail contained in the chapters on the IMF, World Bank and
WTO is highly revealing and an enormous strength of the book. Its framing by a carefully considered and
coherently applied way of thinking critically is exemplary, and the innovative way in which the book was
produced shows, in all sorts of positive ways, in its content.

Resistance necessarily involves collaboration and this book demonstrates such a maxim extraordinarily
well.

Roger Lee

Department of Geography
Queen Mary, University of London