The third way and the third world: poverty reduction and social inclusion in the rise of 'inclusive' liberalism

In the wake of frank neo-liberalism, and in the context of rising security fears, ways are being found to provide market liberalism with a more inclusive face. The Poverty Reduction Strategies currently prominent in international development, and Thirdway OECD 'Social Inclusion' policy frames claim common purpose to promote 'opportunity, empowerment and security' for people and places on the peripheries of global economies and societies. They share commitments to global economic integration and openness, market led growth, 'good' and 'joined up' governance, local and social partnerships, and wide-ranging activation of 'capacities'. But the high rhetorical aspirations of liberalism to social 'inclusivity' have so far overreached empirical gains for the poor. Drawing on developing country examples of Poverty Reduction Strategy and public policy in New Zealand's current Labour government, this paper sketches salient features of 'inclusive' liberalism. It critically examines its status as a Polanyian turn within a wider liberal project, which seeks to re-embed and legitimate a liberal social and economic order.