Recent events have been unkind to a doctrine that defined global economics and politics during the 1990s. That doctrine, often termed “neo-liberalism” or “the Washington Consensus,” was defined by the belief that free markets and international economic integration would lead the world toward prosperity, liberal democracy, and peace. The failure of neo-liberal development policies in countries such as Indonesia and Argentina, and the new prominence of elite and popular nationalism and fundamentalism whose most vivid expression is terrorism, have together shown the insufficiency of the neo-liberal program. In Part I of this essay, I present the major features of neo-liberalism, as a program and as a view of development, and argue that it embodied a distinctly optimistic and rationalist theory of modernity. After sketching the events that led to the decline of neo-