Washington Consensus

Basic Definition The Washington Consensus is a set of 10 economic policy prescriptions considered to constitute the "standard" reform package promoted for crisis-wracked developing countries by Washington, D.C.–based institutions such as the International Monetary Fund (IMF), World Bank, and the US Treasury Department.

Williamson’s 10 points Fiscal discipline A redirection of public expenditure priorities toward fields offering both high economic returns and the potential to improve income distribution, such as primary health care, primary education, and infrastructure Tax reform (to lower marginal rates and broaden the tax base) Interest rate liberalization A competitive exchange rate Trade liberalization Liberalization of inflows of foreign direct investment Privatization Deregulation (to abolish barriers to entry and exit) Secure property rights

Does it work??? On inspection, there appears nothing wrong with these wonderful tenets.However, this is just on the surface, but if you take a peek under the hood and ask questions and investigate - you will realize that it very much depends on how these tenets are interpreted and applied. These so-called tenets were incorporated very quickly - much to the glee of the US Treasury and without any voting or "consensus" at all - into other US economic agency tentacles such as the WTO, IMF and World Bank. And these tenets were not just simple mission statements - suddenly they had become the rules. Read more: http://www.digitaljournal.com/article/266389#ixzz3xKkFBu9b

Williamson Defends against Neo-Liberals It is often used interchangeably with the phrase “neoliberal policies.” Williamson’s response “I of course never intended my term to imply policies like capital account liberalization...monetarism, supply-side economics, or a minimal state (getting the state out of welfare provision and income redistribution)”

Three Issues Not an ideology, need also to avoid crises Incomplete or Neglected: Need to fully address things continuously first and second generation Too narrow – need to concentrate more on poverty reduction and distribution & less on just higher GDP

Consensus 2.0??? Dani Rodrik argues that there now exists an “Augmented” Washington Consensus, which in addition to the items listed above, adds: Corporate governance Anti-corruption Flexible labor markets WTO agreements Financial codes and standards “Prudent” capital-account opening Non-intermediate exchange rate regimes Independent central banks/inflation targeting Social safety nets Targeted poverty reduction

Leftist Critique in Kerala State of India

http://nickthorkelson.com/neolibintro.html "The Comic Strip of Neoliberalism" is a series of informational comics which you can read by clicking here http://nickthorkelson.com/neolibintro.html

Little broader review of Washington Consensus Op-Ed: The Washington Consensus: Sharks Feasting By Bill Jencks     Feb 5, 2009 in World Read more: http://www.digitaljournal.com/article/266389#ixzz3xKl5KYjz

Very Good overview in 12 minutes https://www.youtube.com/watch?v=X_uuIGfm-Wo

20 minutes – Pretty good but no Images INS 200 The Washington Consensus https://www.youtube.com/watch?v=zDNWC5SlSsc 20 minutes – Pretty good but no Images

Good Audio Review of Washington Consensus but quite long https://www.youtube.com/watch?v=zOCUraWzf2Y