International Political Economy

The three main theories used in international political economy are constructivism, realism and idealism or liberalism. Scholars commonly use the theories to explain economical events in the international political economy. Liberalists are concerned about private enterprise while constructivists are much concerned about wealth, political and material interactions of actors in the system.

This paper uses realism theory to explain relationships among state and non-state actors in the international system. Realism is based on the idea that the international system exists according to the Hobbestian state of nature, which is anarchic and brutal. There is no centralized authority in the system.

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The influential states have powers that they use to subjugate the poor and powerless in the system. The paper evaluates three supranational regimes in order to understand the theory in detail. States agree to form governments that control internal affairs. It is not surprising that any sovereign state has the power to enforce and prescribe laws. These powers are limited in the international system because there is no Leviathan that controls the activities of all members.

The first argument is that the US and other major powers use supranational organizations to further their interests ((Wolf 87). WTO is a world body that is charged with the responsibility of overseeing how countries conduct trade globally. Liberalists argue that the body is beneficial to all states that subscribe to it because they benefit from free markets and business opportunities.

In the liberalists’ view, the world organization in charge of trade is supposed to arbitrate on conflicts emerging from trade and commerce. Nearly all states in Africa, Europe, South and North America are members. Member states are required to follow the laid down rules and regulations if they are to benefit from the organization. In this regard, the organization ensures that the interests of all states are catered for. Managers are answerable to states whereby they are called to explain inconsistencies during hard economic times.

In the realists’ perspective, the organization is the property of the rich nations, which is used to enforce compliance. The headquarters of the organization is in the United States meaning that everything is operated from there.

States are usually forced to come into terms with unfavorable policies in order to be members. The Chinese case would serve as an example. China was requested to adopt some policies that would favor the West in order to be incorporated in the system.

Less developed countries do not actually benefit from the organization. The organization allows US manufacturers to exploit markets in the third world but not vice versa. The third world is incorporated in the system as underdogs meaning that they assist the rich nations in producing goods. This is why the gap between the rich and the poor is widening day after another.

The organization ensures that the poor states do not pursue interests that seem to contradict with those of the US. The organization is quick to slap economic sanctions to states that do not conform to the set rules. In the late 1980s to early 1990s, Libya was barred from exporting fuel to Europe, US and other friendly countries (Wolf 90). Oil trade nearly collapsed in Libya, which had caused sufferings due to lack of basic needs.

This proves that states are usually in pursuit of their selfish interests not universal ideas. The US could have allowed Libya to sell its fuel to other states because citizens were suffering. This was never an issue to the US and WTO because Libya was non-compliant. Economic sanctions have been slapped to nations not because of misconduct but because of going against the wishes of the US and other major world powers.

The second argument is that the US uses donor agencies to enforce compliance. IMF is a world organization that was established after the Second World War mainly to reconstruct Europe. This was an attempt to restructure European financial system after it was worst hit by the war. The organization offered assistance to European states that cooperated.

After completion of its mission, the organization was turned into political tool that would subjugate and dominate developing countries. The US used the organization to restructure institutions of developing countries for its own interests (Milner 845). The organization forced many developing countries to restructure their governments in order to qualify for loans and other monetary assistances. For instance, the organization was effectively utilized in Kenya to boost American investment.

The government, under Daniel Moi as president, was urged to privatize key national industries such as Kenya Airways, Rift Valley Railways and Kenya Ports Authority. Furthermore, the state was not supposed to interfere with the market meaning that prices of commodities could be determined by market logics (Milner 851). The Kenyan government suffered a lot because it had to retrench some of its employees in order to qualify for the IMF loan.

The IMF program introduced in many countries was referred to as structural adjustment program (SAP). Liberalization of the economy benefited the US and other developed nations because they exploited the poor with cheap goods.

Finished goods were imported from developed countries while raw materials were exported to the US and other developed nations. This was seen as unbalanced trade because Kenyan citizens could not afford processed goods, which were originally Kenyan.

To ensure political compliance, the US used IMF to request third world leaders to accept multiparty politics (Stone 346). Accountability was demanded from leaders before they could qualify for monetary assistance. This ensured that US joint ventures were managed well. The US entered into contracts with governments of the third in order to construct expensive projects such as Geo-thermal power plants and ports.

Such projects could not yield needed profits without proper management. This is why accountability became a pre-requisite of assistance. The organization was effectively used to further the interests of Americans because US firms took over major investments in Kenya and the whole of East African region after the introduction of SAPs (Stone 349).

The third argument claims that developed nations relate with developing countries in terms of natural resources. It is true that the US and other major powers in the international system are led by their selfish interests not world ideas.

The US and other powers have been reluctant to intervene in Somalia militarily because national interests would not be achieved. Somalia does not have oil and gas that may attract foreign powers. This can be compared to the Middle East where each world power is camping there mainly because of oil and gas (Gholz and Daryl 465).

The US has been planning to sell military radar to Saudi Arabia mainly to strengthen diplomatic ties. The US would reap maximally from the deal meaning that national interests drive a country to participate in world affairs actively. The US could not intervene militarily in El Salvador to save the lives of many people who were undergoing brutal treatment from an autocratic regime because national interests would not be achieved.

The European gas crisis also proves that a state cannot participate in world politics without an interest. In Europe, there are two competing pipelines that is, Nabbuco and Nord. Nabbuco is owned by the Russian government and has a backing of the EU. Britain and the US have been supporting the construction of Nord pipeline because it would benefit them in future.

Nabbuco cannot be wrestled from Russia because it is also a major power (Rosato 54). The British government and the US have justified the erection of Nord conduit claiming that Nabbuco cannot effectively supply gas to Europe. Such arguments are based on the Turkish gas conflict where Russia delayed supply because of diplomatic reasons.

Critics of realism theory argue that states offer assistance to the needy out of goodwill. This could be witnessed in times of catastrophes where countries in conflicts help each other (Rosato 53). For instance, the US offers humanitarian assistance to some Middle East and Asian states during earthquakes but gets nothing in return.

This could be witnessed during the Japanese nuclear accident. The US was in frontline offering technical assistance to Japan. This argument could be valid but the reality is that the US intervenes to further its interests. In the Japanese case, the US intervened to gain political mileage in the world political arena. Hegemonic powers are strengthened by participating in important events.

It can be concluded that national interests drive a state to act in the international system. Constructivists and idealists are misplaced by believing that states act to restore order and justice in trouble regions. Somalia case would act as an example, where major powers are silent because they would not get anything by intervening.

Kenya has been forced to intervene militarily because its national security is in danger. Tourists have been abducted more than once, which has greatly affected the tourism industry. It should not be forgotten that Kenya generates more than 20% of the total revenue from tourism. Al shabaab militiamen are therefore a threat to Kenyan interests.

Works Cited

Gholz, Eugene and Daryl, Press. “Protecting the ‘Prize’: Oil and the U.S. National Interest”. Security Studies, 19.3, 2010, 453-485.

Milner, Helen. “Globalization, development, and international institutions: Normative and Positive Perspectives”. Review Essay, 3.4, 2005, 833-854.

Rosato, Sebastian. “Europe’s Troubles: Power Politics and the State of the European Project.” International Security, 35.4, 2011, 45-86.

Stone, Randall. “How to Reform the IMF”. Current History, 109.730, 2010, 342-348.

Wolf, Martin. Why Globalization Works. 1st ed. Sydney: Yale University Press, 2004.

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