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The classic dialectic between Realist and Liberal theories of international politics, as expressed by Robert O. Keohane, ed., in Neorealism and Its Critics and Richard Rosecrance The Rise of the Trading State, can be transcended. Neither paradigm singularly explains international behavior: Realism is the dominant approach, but liberal theories of transnationalism and interdependence help to illuminate how national interests are learned and changed. Keohane and fellow critics argue that Neorealism—articulated definitively in Kenneth Waltz's Theory of International Politics (1979)—elegantly systematizes Realism, but concentrates on international system structure at the expense of system process. Focused tightly on the concept of bipolarity, Waltz's theory tends toward stasis; the unit (state) level unproductively becomes an analytical "dumping ground." As a Neoliberal counterpoint, Rosecrance's argument does not go far enough. In the tradition of commercial liberalism, he argues that an open trading system offers states maneuverability through economic growth rather than through military conquest. He tempers his argument with Realist considerations of prudence, but fails to clarify Realist-Liberal links in his theory, or to explore fully the connections between power and non-power incentives influencing states' behavior. A synthesis of Neorealism and Neoliberalism is warranted: a systemic theory using the former to analyze at the level of structure, the latter more often at the level of process.

Neoliberalism has become a hegemonic discourse with pervasive effects on ways of thought and political-economic practices to the point where it is now part of the commonsense way we interpret, live in, and understand the world. How did neoliberalism achieve such an exalted status, and what does it stand for? In this article, the author contends that neoliberalism is above all a project to restore class dominance to sectors that saw their fortunes threatened by the ascent of social democratic endeavors in the aftermath of the Second World War. Although neoliberalism has had limited effectiveness as an engine for economic growth, it has succeeded in channeling wealth from subordinate classes to dominant ones and from poorer to richer countries. This process has entailed the dismantling of institutions and narratives that promoted more egalitarian distributive measures in the preceding era. [Reprinted by permission of Sage Publications Inc., copyright 2007 The American Academy of Political and Social Science.]