FROM FREE-MARKET RHETORIC TO FREE-MARKET REALITY - THE FUTURE OF THE US SOUTH IN AN ERA OF GLOBALIZATION

Over the last two decades, the South has been the second fastest growi ng region in the United States. By turning the region's longstanding d ependence on low wages into an asset, southern states created a busine ss climate emphasizing deregulation, low social overhead charges, and lax environmental and business standards. This so-called free market a pproach has been recommended as a development model for other developi ng regions/countries. But how laissez faire has the policy environment actually been and how replicable is the US South's development experi ence? This article demonstrates to the contrary, that beginning in the 1930s, southern political leaders successfully garnered more than the region's share of national resources and targeted them toward investm ents to rectify differences in regional factor costs while maintaining the region's low-wage status. After the second world war, the South's low-wage, low-skilled industries successfully sought tariff and quota protection from international competition. But during the contemporar y period, such policies may come back to haunt the region as trade lib eralization forces out low-skilled jobs and ushers in demands for bett er trained workers. The contradiction between the contemporary politic al rhetoric, calling for less government, and the region's long standi ng dependence on federal resources, may precipitate a new crisis in th e South as the region's free market rhetoric confronts free market rea lity.