my paper on the new Development as Derisking paradigm, or #WallStreetConsensus, or Washington Consensus updated for age of financial globalisation, is now out!
it all started here, a life time ago, when evidence of the portfolio glut chasing development assets in the Global South was not so difficult to come by
every time you read 'gap' or 'partnership' in climate/development conversations, these are code-words for derisking state
this creates safety net for holders of development assets, protecting their profits from
demand/political/climate/liquidity and currency risks.
paper develops the concept of 'green financialization': 1. Financiers as epistemic guardians of green/dirty taxonomies - greenwashing! 2. Strategies to arbitrage dirty finance regulations 3. Strategies to transfer the costs of greenwashing to the state via de‐risking
WSC is also a claim to power - @BJMbraun 's infrastructural power - that private finance wields to new areas of social life
#WallStreetConsensus in @FT today - António Guterres, secretary-general of the UN, calling for Derisking to mobilise private finance for development as a solution to the incoming debt crisis (h/t @AnnPettifor )
we shouldnt assume that ideas baked in Global North travel seamlessly to countries down South - what are local strategies for rolling out derisking state, what role for political elites?
It is no coincidence that 'Liquidity' is now at the core of global debates on debt vulnerability and debt relief
and president of @el_BID calls for derisking to mobilise private finance for development
you know we're in post Trump times when WB president calls for G20 countries to push private creditors in their jurisdictions into debt negotiations, as 'voluntary participation doesnt work'
Speaking of varieties of, and resistance to, derisking
Green(washed) conditionality/structural adjustment is coming soon to a debt distressed country near you, and it will be drawn from the Wall Street Consensus repertoire!
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Two amazing Global South progressives and a Nobel prize winner walk into an Oxfam panel on post-neoliberalism
Stiglitz: w neoliberalism, the growth of financial markets changed the political game tremendously
Lula 's special advisor @AAbdenur - clear mismatch - Global North openly exposing industrial policy but pushing IMF/World Bank to continue with austerity and partnerships for hyper-financialisation
missing from this @FT account of the rapid rise of infrastructure as an asset class is the sustained effort that G20 governments have put into derisking infrastructure assets for institutional capital - this is the derisking state in action #WallStreetConsensus
@FT with @BJMbraun we've termed this a weak derisking macrofinancial regime - a set of policies (as in the G20 Infrastructure as an Asset Class agenda, or World Bank Maximising Finance for Development) that seeks to mobilise private capital into infrastructure osf.io/preprints/soca…
BlackRock 's recent acquisition of GIP is a bet that governments - under ideological or real constraints on fiscal space - will not pursue public infrastrucuture projects but instead continue to derisk private capital
I did not expect this, but Rachel Reeves' Mais lecture is a lot more interesting - and dare I say, promising - than either the commentariat focused on fiscal rules or the past weeks of 'maxxed credit cards' would have us believe
some parts are taking a direct swipe at us advocates of Big (Green) State, but it's a careful articulation of the alternative rather than the empty austerity ideology of 'maxxed out credit cards'
1. We're getting climate politics back at the Bank of England.
Remember, under Carney, it became a world leader in climate policy making, not the greenwashed US Fed version of 'disclosure'/single materiality that Bailey prefers.
it is a strategic and tactical mistake for progressives to centre the superrich in climate politics.
Tactics - global tax system is organised to enable rampant tax avoidance + evasion for both high net worth individuals & corporations.
Recent efforts to reform have been far less successful than we'd have expected a decade after Piketty made inequality politically salient at global level. Fighting for global solutions around taxes is important, but shouldnt be the key front.
Global South voices - here the President of Colombia - read in the European/US support of the genocide in Gaza a blueprint, an experiment for ecofascism that 'treats us as disposable lives'.
'we are heading to barbary. Humanity, especially in the South, depends on the road we choose to address the climate crisis produced by the Global North. Gaza is the first experiment to treat us as disposable lives.'
Clearer European minds anticipated this response to von der Leyen - but the damage is done
the @ecb hiked rates to highest level ever today, but this matter less.
@Lagarde promised European Parliament to return ECB to Paris climate commitments but still nothing!
in a new report we show it can do Green Unwinding @AuroreLalucq @henrikehahn greenpeace.de/publikationen/…
we are in the middle of a climate emergency, and the @ecb has stepped back from cleaning its portfolio of dirty bonds -
for no other reason except the (imagined) danger that @lagarde may be seen as 'Mme Climate' instead of fighting inflation.
but fighting inflation & pursuing its 'within mandate' climate rules are not at odds with each other - the opposite.
Mme @lagarde should remind her PR team that subsidising fossil capital, as ECB continues to do via its portfolio of corporate bonds, amplifies supply pressures