These Foolish Things: The system dictates (1996)

The Scavenger column from the June 1996 issue of the Socialist Standard

The system dictates

[PilkingtonJ is one of the few UK companies to have accepted that works councils, the elected consultative bodies beloved of the European Union, aree a good way to build consensus on key strategic issues. When it comes to sacking people, however, Pilkington found that the rules governing the release of price-sensitive information to the stock exchange, meant that the first that Pilkington’s workforce knew of this particular strategic decision [to axe 1,900 jobs] was on the radio rather than through any consultative mechanism. Guardian, 28 March.

Are jobs bad for prosperity?

Another healthy rise in American jobs yesterday sent the Treasury bond market into a bout of heavy selling again and appeared to rule out any further cuts in the US interest rates in the short term. The economy created 140,000 jobs in the non-farm sector in March, many more than Wall Street economists had been expecting, this followed a rise of 624,000 jobs in February', revised from last month’s initial estimate of 705,000, which had sent the Dow Jones industrial average into a 171-point plunge and wiped three full points off bond prices. Times, 6 April.

Smoking, poverty and profits

BAT unveiled record pre-tax profits of $2.4 billion for 1994, fuelled by the sales of 670 billion cigarettes worldwide . . . Among the countries where BAT cigarette sales have started to increase are: Poland, Romania, Russia, Uzbekistan, Hungary and Vietnam. Guardian, 7 March.

Capitalism’s iron fist

The International Monetary Fund, the Treasurers of world capitalism, has prescribed even more grinding poverty for the world’s working class. Its recently published World Economic Outlook stated that there would need to be further cuts in spending on health and pension benefits by the governments of industrialised nations in order to reduce the high interest rates which damage the profitability of capital. Tax increases, the report said, would not solve the problem because that would hit capitalists.

Telling figures

Car-makers spent a record £515 million on advertising last year. With 1,945,366 sold in Britain, that made the average spend per new car £265 . . . More than half [the cars] went to fleets, say industry sources, so the cost for every private sale was an incredible £1,800-plus. Financial Mail on Sunday. 14 April.

Both couples remain friends

Carlo Giambrone was “gobsmacked” [at being on the same divorce list as the Yorks). The unemployed mechanic arrived at court No. 1 in Somerset House yesterday in a bomber jacket and jeans to tell the judge he could not afford to pay the costs awarded him after his divorce . . . “I have my kids every' weekend. I shall carry on giving my wife what support I can, though at the moment I’m only getting £74 benefit every two weeks . . ." Few observers believe that the £2 million settlement, £500,000 of which has been set aside for the Duchess, will be sufficient to keep her in the lavish lifestyle she has become accustomed to. Guardian, 18 April.

The Scavenger

World View: Poverty entrenchment (2002)

From the January 2002 issue of the Socialist Standard

"Poverty eradication” programmes in Africa only act to further entrench manufactured poverty

In Africa it has become imperatively fashionable for governments to embark upon “Poverty Eradication” programmes. It is an initiative forced upon them, as usual, by the World Bank and the IMF. And the rapidity with which the programme is gaining momentum is so great that it will be no surprise to see, in the foreseeable future, ministries being created to take charge of Poverty Eradication.

What is “Poverty Eradication”?

It is a term that the “experts” at the IMF/World Bank drawing rooms coined to add to two earlier terms – “Poverty Reduction” and “Poverty Alleviation”. In spite of the semantic differences of the three terms, they are meant to be one and the same and as such they are used interchangeably. By these terms the “experts” in the West and their cronies in the South simply mean helping the poor and vulnerable in society to get out of their poverty. To achieve this goal, they adopt a three-dimensional strategy. In the first place there is what they call “capacity building”. This concerns efforts at reaching out to the poor and sensitising them on their poverty. It stems from an arrogantly elitist and childishly paternalistic notion that the poor do not know that they are poor or why they are poor. So they sink huge sums into organising seminars and workshops during which they try to let the poor “realise their potentials”. But that the organisers are mere parrots repeating their masters’ voice is clearly discerned through the hollow and meaningless phrases they use anywhere in Africa that they meet – “civil society”‘; “grassroots groups”; “gender equality”; “empowerment”; “awareness”, etc.

The second strategy they use is what they call their “social service window”. Under this category such “social services” as erecting waiting sheds at village clinics and health centres; constructing dwarf-walled sheds to be used as classrooms; organising the villagers to dig pits to bury rubbish; periodic clean-up campaigns in and around the market or church or mosque etc, and are what they pursue.

The third component of poverty eradication programmes involves the provision of small-scale loans which they euphemistically call “grants” to groups or individuals. It takes two forms: in cash or in kind. The latter is realised through the provision, on credit, of a milling machine; a kiln (for pottery); a tractor or ploughing services and provision of imported seeds for those in agriculture; or providing biogas facilities to provide household fuel for lighting and cooking, etc.

The kitten gift 

There is a popular parable among the Dagbamba of northern Ghana which is similar to the story of the Trojan Horse. A man wanted to help out a friend who was going through hard times. He gave the poor fellow a kitten so he could sell it when it grew up. The poor man was very happy with the gift but it did not take any length of time for him to realise that the gift was after all a curse. He used whatever little money that came his way to buy milk for the kitten while he himself kept starving.

The poverty reduction/alleviation/eradication scheme tells a similar tale. In the first place the amount of cash and material devoted to the programme is usually appallingly infinitesimal. On the individual level, the amount of money loaned out to a person is always not enough to start a viable business. As such the money soon evaporates into thin air and the beneficiary is now left with the more burdensome task of repaying the loan. I saw this kind of situation myself when as an elected member of the municipal parliament in Tamale (Ghana) in the early 1990s, I organised the women of my constituency into a group. A NGO (the 31st December Women’s Movement) in collaboration with a financial institution in town, approached us with the aim of granting our women soft loans under the Poverty Eradication Scheme. The funds came from IFAD. Ten of our women were to benefit from the programme. However the NGO who were our benefactors would only assist us on condition that the tenth person was one of them (the NGO). Our women agreed. The amount per head was fifty thousand cedis, about US$70.00 at the time.

The whole programme ended with some of the beneficiaries being threatened with court action. None of them benefited from the project.

In Gambia it was recently reported that the micro finance officer, Mr Mohammed Jammeh, boasted that the Social Development Fund which is responsible for poverty alleviation had disbursed 3,022,275 dalasis to 6,129 individuals between 1999 and October 2001. This means that on average each person received less than 500 cedis, the equivalent of about $30. How can one start a business with less than $30?

The story is equally grim with groups or associations who are assisted collectively. Here the funding agencies normally make these groups to contribute an initial amount to which the benefactors add whatever they have to dispose of. The total amount is then used to set up the project – usually kilns for pottery; looms for weaving projects; food processing projects; ploughing services or even tractors, land, imported seeds (cowpea, cotton, cashew, etc). In most cases women are the beneficiaries or target groups. Contrary to the initial hopes that are whipped up by the donors, a good lot of these projects end up as white elephants. Those that get going usually benefit only the leadership of the target groups and the officials of the implementing agencies. But most often than not petty squabbles arise and eventually the projects collapse.

Competitive markets 

Even where a few projects manage to see the light of day, their relative successes are negated by the capitalist globalisation of production and distribution of products. Needless to say the end products of these poor, mostly rural, folk have to compete against goods dumped cheaply from the West. Here again the case of the women at the Nalung Weaving Project in Tamale reveals a lot. These women were trained to weave material for smocks. After the training they were sold looms on credit. Their main input for their business was thread which they could only buy from the capital, Accra, about 500km away. Two problems soon arose. First to sell at a price that would enable them to cover the cost of production meant that no-one would buy as it was seen to be rather exorbitant. Secondly the quality of the thread used, which was even imported, was of an inferior quality and consequently the cloth woven was far inferior to the type produced by the traditional weavers. Added to these was the presence, in the markets, of relatively very cheap second-hand clothes from the West.

In Gambia there is something similar taking place, at the Bakau Women’s Horticultural Project. These women toil morning and evening and produce vegetables. They all harvest at the same time and so prices are very low as a result of glut. Even the onions and shallots they produce are shunned in favour of onions from the Netherlands. No wonder therefore that the women keep marking time economically. As for those who are into cash crops such as cashew, cotton, cowpea, groundnuts etc, the least said about them, the better, considering the pitifully disadvantaged bargaining power of the producers of primary products (in the poor countries) under the current capitalist world economic arrangement.

Wasted energies

One other factor which needs highlighting in this hoax of poverty eradication is the magnitude of human resources deliberately channelled into such unproductive, in fact retrogressive work. Millions of people world-wide are enticed into taking part in this futile venture. Having been made poor by the system, the people, like a drowning man who will cling to a straw, keep flocking to the system only, each time, to be hoodwinked. But more agonising is the fact that people who champion this global ruse are the elite who, most often than not, know they are engaged in an activity which is worthless to the target groups. These elite are the staff of government ministries and agencies (NGOs). They pilfer items and embezzle funds meant for the projects in addition to their bloated salaries. In short they are used as willing tools in the entrenchment of poverty.

Ending poverty 

Experts of development studies are often heard saying that “the poor will always be with us”. That may be why we see the phrases “poverty alleviation”; “poverty reduction” and “poverty eradication” as being the same. Their confused use of terms gives expression to the real nature of the capitalist system – a system of legalised deceit and thievery.

But even what the sentence quoted above, tries to conceal is the fact that these poor that we have with us are growing in number and intensity. As more and more people join the class of the poor, the poverty grows worse and worse. In other words, global poverty is increasing both horizontally and vertically. All this, in spite of the alienation/reduction/eradication propaganda.

Poverty is caused by the unjust economic order prevailing in the world today. The wealth and resources of this world – land, factories, transport and communication, etc – are owned and controlled by a few people, who use these resources to make more wealth. They majority own nothing but their ability to produce. They are therefore forced to work for the few idle owners. These workers are paid wages just enough to keep them alive in order to continue to work.

As long as such production relations persist, more and more people will continue to join the ranks of the poor. For just as the IMF and the World Bank and the West give loans to poor countries in order to get them more into economic crisis, so do the peanuts these institutions trickle down as loans to poor women and groups only serve to deepen their poverty.

The only choice lies in a radical change in the ownership and control of the world’s wealth and resources. There must be collective rather than today’s minority ownership. Control over social wealth must be democratic with all having an equal say in the management, production and distribution of the products of human labour. Under such a system, everybody gets involved in determining what to produce; takes an active part in the production process; and finally has a free and equal access to goods and services. It is only then that poverty will be eradicated (not even alleviated nor reduced – empty phrases). Then there will be no room for some to have more than they need whilst others have less than they need. Attaining such a society is our collective responsibility.

Suhuyini

Tiny Tips (2010)

The Tiny Tips column from the January 2010 issue of the Socialist Standard 

While the world has been devouring reality television shows, many Argentines have been opting this Christmas for reality board games, such as Eternal Debt, involving the International Monetary Fund.

[Paywalled Link.]

For seven years, Jennipher was forced to breastfeed the puppies of her husband’s hunting dogs. After drinking and smoking heavily, Nathan Alowoi would appear at the marital bed, bind his young wife’s legs and hands together and force the mewling animals to her nipple. He had handed over two cows to his father-in-law as part of the “bride price” for his new wife. So, he reasoned, if the cows were no longer around to provide milk then his new purchase would have to provide for the pups. “I had to feed them all through the night; then in the morning he would untie me,” his wife, now 26, explains matter-of-factly.

[Link.]

Israel will begin distributing its entire population with gas masks in two months, though no reason has officially been given by the Israeli government.

[Dead Link.]

Most Britons have little confidence in official statistics and believe that they are distorted by politicians, according to a survey for the Financial Times. Only about 10 per cent of adults believe that official figures are accurate, while a similar proportion think that figures are produced without political interference, according to the survey conducted by Harris.

[Paywalled Link.]

That isn’t stopping some restaurants from putting together the usual intricate New Year’s dinner — and in some cases, charging astronomical prices. At New York’s Aureole, for example, diners will be getting a five-course meal including big-eye tuna sashimi, chestnut ravioli, Canadian lobster, and N.Y. strip loin. The price: a mind-boggling $650.

[Link.]

Financial wizards or great pretenders? (2001)

From the October 2001 issue of the Socialist Standard

In the 1990s when, under the cunning guidance of the IMF and the World Bank, the Ghanaian people were literally being strangled by the Economic Recovery Programme of the Structural Adjustment Programme, the financial advisers to President Jerry Rawlings always managed to conjure figures and statistics which indicated that the economy was doing excellently well. These statistics not only earned Ghana the epithet “darling state” of the West but Rawlings himself was so glad with his economists that he bestowed upon the title “financial wizards”. But the truth is that these accolades were for the purpose of damage control. Rawlings knew deep within his heart that his “wizards” were in reality great pretenders like himself as together they had been stashing away huge sums in foreign banks.

The history of the struggle for economic development in Africa and the forces dictating the pace thereof are not in the least different from the scenario that the West, Rawlings and the economic advisers enacted in Ghana.

Groping in the dark

Immediately African countries were pronounced independent by the colonial masters, the leaders rolled up their sleeves and set to the arduous task of nation-building. Although a few may have seemed to genuinely have the welfare of the masses at heart, many of these leaders and their ministers were deeply engaged in stomach politics. Be that as it may, these leaders, day in day out, saw the plight of the masses getting worse and worse.

A great number of African countries became independent in the sixties. This period also happened to be the peak of the so-called “cold war”. The West and the East struggled to control these newly-independent nations to enhance their (West and East) own economic interests. The result was that these African countries found themselves in a kind of trial-and-error methods of trying to extricate themselves from growing poverty.

At first the state got involved in business by setting up marketing boards. These bought up cash crops from the farmers and exported them. The state thus acted as a middleman. The state also created development boards, authorities and corporations in the hope of making money to move their countries forward. In some extreme cases some governments resorted to outright nationalisation of private business. However all these efforts by no means arrested the downward trend in the living standards of the masses. They still paid dearly for imports and received peanuts for their exports.

To overcome this problem of high prices of imports, the policy of import substitution was introduced. By this, companies producing such imported commodities as milk, beverages, matches, canned foods, bottled drinks, etc were encouraged to come and establish factories and carry out production here in Africa. Many companies responded positively but the outcome of this policy was a deepening impoverishment of the masses. They served as cheap labour in these factories. In fact only a few could afford to furnish their families with the commodities they got involved in producing. African leaders were baffled as what tended to happen was that nothing happened. No wonder there were lots of attempts at and successful coups d’état during the sixties and seventies.

It was during this period of beating about the bush for economic direction that the IMF and the World Bank joined in the fray. They came along with a novel package that was going to miraculously propel African economies to the highest degree of development. This new policy was the Structural Adjustment Programme (SAP). This SAP idea condemned the previous method of development as unworkable and maintained instead that making structural changes, including the expansion and re-orientation of production, was the only way forward. African nations were to put the production of “non-traditional exports” and tourism into a higher gear. Thus in a country like Ghana where the traditional exports were mainly cocoa, timber and gold, under the SAP crops like pepper, pineapples, yams, maize, and oranges were to be turned into cash crops and exported. SAP also stipulated that private capital was to be the “engine of growth” and that “governments have no business doing business”. It did not however take long for the people to understand that they were once again fooled by official policy. Hardship and suffering increased a thousandfold. The masses had been moved from the frying pan into the fire.

Today the SAP is still the invisible hand directing affairs at our finance ministries in the interests of the owners of the World Bank and the IMF and to the detriment of the masses of Africa. However this time around there is a formidable group of foot soldiers preparing the grounds for, facilitating implementation and soothing the pains of these anti-people policies. These are the NGOs. There are hordes of them in every African country. All the misinformation propagated in the form of catchy phrases and slogans by the IMF and WB are picked up unquestioningly by these NGOs and parroted all over the place. The NGOs assist governments in deceiving the people by embarking on projects which are either white elephants or never even take off the ground. Meanwhile the wealthy companies keep selling their obsolete equipment to Africa in the name of appropriate technology.

Socialists or capitalists?

On Thursday 23 August the BBC Focus On Africa programme broadcast the news that Jose Edouardo dos Santos of Angola had announced that he would not be standing for re-election in he next presidential elections. Interestingly the BBC referred to the man as a “former Marxist”. This reminded me of others like Kwame Nkrumah of Ghana, Kenneth Kaunda of Zambia, Julius Nyerere of Tanzania and a host of them who were also said to be “Marxists” by which they meant “communists” or “socialists”. Of course the West and East tagged these people thus for obvious reasons—whereas the West saw the as “dangerous”, the East considered them “good boys”. But the truth is that none of these leaders who championed the struggle for independence actually understood the global system. At best they only had hazy and confused ideas of soviet-style “socialism” (state capitalism). And, sadly, the present crop of leaders are even more bankrupt and myopic than their predecessors. If so, who gave the precursors advice and who advises the current leaders?

On the attainment of independence many African countries still depended on the former colonial masters for advice and guidance. In fact this is true of most of the francophone nations. Others, like Gamel Nasser’s Egypt, Nkrumah’s Ghana and Sekou Toure’s Guinea were so radical (though not revolutionary) that they openly castigated the West and courted the friendship of the former USSR. But in reality they did not escape the domineering influence of the existing global economic system since the East also practised capitalism. The finance ministers and economic advisers thought there were differences between the West and East in their theories and strategies for development and that thinking was partly responsible for the trial-and-error methods of development the newly-independent countries adopted – they were just variations of the same rule of capital.

The situation is different is different today. There are thousands of “experts” working day and night in seemingly harmless institutions and commissions and advising governments on their economic policies. The IMF and WB are still the main determinants of the path African economies must chart. But in order to lend some credence to their nefarious activities, they keep creating, from behind the scenes, economic institutions which are outwardly African in nature. And even if the IMF and WB have no hands in the creation of some of such institutions, they still manage to control them by picking up some of their bills. These bodies serve as economic think-tanks and advisers to governments. Some of them even assist in soliciting loans for governments. These include the Economic Commission for Africa; Economic Commission of West African States (ECOWAS); African Development Bank (ADB); Southern African Development Committee (SADEC);West African Monetary Institute, etc. There are groups spearheaded by individuals like Adebayo Adedeji, Julius Nyerere and others. The experts in these institutions hold regular meetings not to seek genuine ways and means of salvaging the African masses but, pretenders as they are, to wine, dine and go home with per diems which are sometimes higher than the monthly salaries of employees in the high income category. They waste huge quantities of paper-producing volumes of reports which sit on shelves gathering dust. But even if these “experts” are genuinely engaged in helping, their efforts will always come to nil.

The reason is that like their bosses in the IMF and World Bank, they are trying to reform a system which is inherently flawed. The system in operation in today’s world is profit oriented. Every idea put across and every step taken is to make profit not to satisfy human needs. Based on money, the belief is that without money nothing can work. Therefore governments are advised and sometimes coerced to take loans. The few with big money invest in our countries. Since investors are looking for profits the end result is that the human and material resources are mercilessly plundered.

But the truth is that production is carried out by people not money. Problems are solved by human beings, not money. The main problems Africans face are food, healthcare, shelter, education, clothes, and so on. These are produced by human labour acting on natural resources,. Africa has more than enough of these human and natural resources but because they system is based on money, these resources are accessible to only those who have money. These are a negligible minority who own all the means of production and distribution of wealth. But since they will use their wealth to produce only what will fetch them more money, they may produce what people do not need. For instance vast tracts of land are used to cultivate cash crops like tobacco, cashew, and cocoa for factories in the West yet what we need more here are maize, rice and other food crops. These latter are not very profitable so despite their importance, they are not produced. This is capitalism.

Any hope for Africa?

In the increasing problems facing Africans are a result of the economic arrangement in which every action is determined by money and profit, then the surest way of arresting the sorry situation is doing away with money. This is only possible on a global basis. The profit system is universal and so getting it off our backs requires the concerted efforts of the global working class not just in Africa, Asia or Europe. When the means of production and distribution of wealth pass from private ownership to collective ownership then the products will also be collectively shared. People will, in this higher and humane system of ownership, willingly contribute whatever efforts they are capable of providing since they know they can freely take from the produce how much they need. In this new social organisation money will have no place and all institutions and people related to money like markets, banks, credit cards, cheques, tickets, bills, accountants, cashiers, sales-girls, etc, etc will vanish. The people engaged here will be available to get involved in the real work of producing clothes, food, medicines, education, etc. This is socialism.

However, this civilised system of production relations can only materialise when the majority get to understand it and want it implemented. It is only then that Africa and the whole world will rid itself of pretenders posing as financial wizards.

Suhuyini

World View: U.N. Report – No challenge to capitalism (2002)

From the September 2002 issue of the Socialist Standard

But for the damning up-to-date statistics it provides, the recently published 2002 United Nations Human Development report could have been written by any reform-minded political analyst with a knowledge of current and global affairs, for as could be expected there is little here that challenges the functioning of capitalist society and class-based antagonisms. The system itself is not seen as being at fault, but the distribution of political power and the workings of the myriad national and international institutions that operate within capitalism.

United Nations: head in the clouds?

The report tells us that whilst globalisation creates greater interdependence between countries and organisations, the world is far more fragmented, both between the rich and the poor, and between the powerful and the powerless. It informs us that whilst many developing countries are making progress on several fronts, for instance with regard to universal primary education, for much of the world the prospects are bleak, with progress continuing at such a small pace that it will take an estimated 130 years to rid the world of hunger.

Whilst economists hail the growth in new technologies, economic integration and new “economic opportunities”, certain perennial facts are hard to ignore, with 2.8 billion people existing on less that $2 per day and one percent of the world’s population receiving as much income as the poorest 57 percent. And although the proportion of the global population living in “extreme poverty” is said to have fallen from 29 percent to 23 percent – this being accounted for by economic growth in East Asia – the number of people living in extreme poverty has risen in sub-Saharan Africa from 242 million to 300 million, with 20 of these African countries poorer than they were 20 years ago.

To halve the proportion of people living on $1 per day would take an annual 3.7 percent increase in per capita income in developing countries. However, 127 countries with just over a third of the world’s population have not grown at this pace, with their share of the number living in poverty actually increasing.

Formal political equality

In a more interdependent world, argues the report “good governance”, “democracy” and “fair and accountable institutions” are essential for development. It further argues that “democracy helps protect people from economic and political catastrophes such as famines and decent into chaos” . In support of this theory, India is cited where, claims the report, there has been no famine since independence in 1947, in spite of chronic food shortages.

Democracies, it states, also contribute to political stability and wars are more frequent in non-democratic countries. These benefits of democracy are attributable to “a virtuous cycle of development”, with political freedom allowing people to campaign for policies [reforms] that expand social and economic opportunities and, all in all, allowing more people to partake in policy decisions and debates. This said, the report does then point out recent and poignant instances of people fighting for political democracy in the hope of gaining enhanced social and economic opportunities, only to have those hopes dashed. After the collapse of Soviet style capitalism in the 90s for instance, “income inequality and poverty rose sharply in Central and Eastern Europe and the Commonwealth of Independent States. And despite more widespread democracy, the number of people in Sub-Saharan Africa continued to increase”.

To its credit, the report does state that “neither authoritarianism or democracy is a factor in determining either the rate of economic growth or how it is distributed”. It further informs us that “granting all people formal political equality does not create an equal desire or capacity to participate in political processes – or an equal capacity to influence them”. And here the report is critical of the power money plays in politics with the USA in particular, singled out. In the 2000 US election, presidential candidates spent $343 million on their campaigns. Inclusive of spending by their respective parties, an estimated $1 billion was spent on the 2000 US election. A year later, Michael Bloomberg would spend a staggering $74 million just to become New York City mayor, $47 million more than his nearest opponent and close on $99 per vote.

The report is also mindful that politicians are “disproportionately influenced by business interests”. In the 2000 US election, corporations made $1.2 billion worth of political contributions and in India, big business provides major political parties with 80 percent of their funding – perhaps one reason why voter turn out is decreasing across the world with similar decline in political party membership in many countries.

Whilst the world is arguably a more “democratic” place than it was a decade ago, with 140 countries holding multi-party elections (the greatest number in history) only 80 of these, accounting for 55 percent of the world’s people, are “fully democratic by one measure”. Moreover, there are still 106 countries that impose significant restrictions on civic and political freedoms, and in 61 countries there is no free press. Although the number of countries ratifying the six main human rights conventions and covenants has increased notably in the past decade, there still remains 41 countries who are yet to ratify the International Convention on Civil and Political Rights, with 51 countries refusing to ratify the ILO’s Convention on Freedom of Association

The media also comes in for scrutiny in the report, which points out that “commercial and political pressures will always skew the playing field in the marketplace of ideas”. Even so, a free and independent media is seen as an “essential pillar of democracy”. But whilst globalisation has tended to reduce state ownership of the press, it has had the effect of intensifying concentration in private ownership. In Britain, just four media groups control 85 percent of daily newspapers. In the US, some six companies control virtually all the media

Rich and powerful

In the field of health and education, some 800 million have gained access to improved water supplies and almost 60 countries, accounting for half the world’s people have halved hunger or aim to do so by 2015. In the last 30 years infant mortality rate has fallen from 96 per thousand births to 56 per thousand births. On the downside, however, 30,000 children die each day of curable diseases (one every three seconds) and 500,000 women die as a result of pregnancy of childbirth every year (almost one per minute).

When it comes to international trade, the report states: “On average, industrial country tariffs on imports from developing countries are four times those on imports from other industrial countries. In addition, countries that belong to the …OECD provide about $1 billion a day in domestic agricultural subsidies – more than six times what they spend on official development assistance for developing countries.”

This imbalance is further reflected at the WTO. Whilst a lustre of democracy is afforded the running of the organisation, in truth “decision-making occurs by consensus, heavily influenced by the largest and richest countries”. And of almost 740 NGOs certified by the WTO’s 1999 ministerial conference in Seattle, 87 percent of these were from industrialised countries.

Ironically, the more representative global institutions, i.e. the UN General Assembly and the UN Social and Economic Council, are similarly the least potent. “The reality,” observes the UNHDR, “is that powerful countries…tend to gravitate towards institutions that give them the most influence . . . they take their power with them: whether it be to the WTO’s ‘Green Room’ meetings or the meetings on the IMF executive board.” Representatives from the UK, USA, Germany, France, Japan, the Russian Federation and Saudi Arabia account for 46 percent of the voting rights in the World Bank and 48 percent in the IMF.

Although this aims to be an impartial report, about political power and institutions, on the national and global level, and how they shape human progress, and whilst it is often critical of the status quo and postulates how advances in human development lie in improved democratic governance systems, it remains a report that is never going to contribute to the solving of the problems that it identifies for the simple reason that it was never going to query he premises and basic contradictions of capitalist society. The UN, as a capitalist institution itself, was never going to criticise the profit system and how it prioritises profits over real human needs and how, even in the most advanced democracies of the day, the drive to make profit impinges upon every aspect of our lives.

Whilst we would certainly not sniff at such improvements in global democracy – they would, after all, give countless millions the chance to at last determine their own future and further smooth the way for socialism – we are not to be found advocating reform of the present system. If the history of reforms teaches us anything, it is that they can easily be accommodated by the capitalist system. Democracy would thus be used by the master class to their own advantage, giving them the mandate to carry on their injustices, but in a democratic manner, and elected governments would remain as they are at present – the executives of the capitalist class.

In March of this year, at the UN Conference for the Financing of Development in Mexico, the world’s leaders and policy makers assessed moves towards development and poverty eradication goals which were laid down at the UN Millennium summit of 2000, pledging a global effort to realize these goals by the year 2015. The indicators considered, the UNHD report suggests that “without a dramatic turnaround there is a real possibility that a generation from now, world leaders will be setting the same targets again”. We can only comment that even with a “dramatic turnaround” in world-wide democratic procedures, the injustices of capitalism would still prevail and the maxim of capitalism would still apply: “can’t pay – can’t have”.

John Bissett

Latin America: poverty and pollution (1993)

From the August 1993 issue of the Socialist Standard

Latin America has provided many of the striking images of ecological devastation which have fuelled debate on the environment in recent years. Few have been left unmoved by the relentless deforestation of the Amazon Basin or the mercury-polluted moonscapes left by gold prospectors still searching for the mythical Eldorado.

Reactions to the crisis vary. Some view the problems as intractable; the result of overpopulation and a flawed human nature. They retreat into defeatism—mouthing prophesies of the eco-Apocalypse as they go. Others retain their faith in the tired arguments of the reformists; there’s no environmental problem that couldn't be solved with a few more laws, a change of leader, some nature reserves and a little more charity. Socialists, however, reject both reformism and defeatism, recognizing that the roots of environmental destruction lie in the capitalist system and its uncontrollable production for profit, a system incapable of incorporating the rational and democratic decision-making process which will be necessary to ensure an ecologically- sustainable future.

How then has capitalism developed in Latin America, and what have been the consequences for the environment?

Precious metals

Following colonization by European powers in the 15th and 16th centuries Central and South America and the Caribbean were forcibly subjected to the priorities and demands of the fledgling capitalist world market. The new social system imposed on the Americas gradually swept away the technologies, agricultural techniques and cultures of centuries and replaced them with an economic system geared solely to capital accumulation for the few based on the exploitation of the many.

Greed for precious metals led the colonists all over Central and South America. The resultant human misery and environmental degradation was catastrophic. Open-cast mining left wastelands from Mexico to Bolivia, and the timber extracted for mineshafts accelerated deforestation. As the richest seams were exhausted the colonists used mercury from the Peruvian Andes to separate metals from the crushed ore of poorer seams. The waste was just dumped, and poisoned workers and polluted ecosystems bore witness to the new exploitative social system which saw no need to worry about environmental conditions.

The introduction of sugar-cane plantations early in the 16th century, first in the Caribbean and later on the mainland provided the basis for the exploitation of further wealth. However, owing to the genocidal effect of colonization on the indigenous inhabitants of the Americas the ruling class needed a further source of labour.

The African slave trade developed and millions were transported to work on the plantations. The triangular trade routes which flourished between Europe, Africa and the Americas not only strengthened the emerging capitalist class, and left a bitter legacy of racism but led to wholesale deforestation and soil erosion in the plantation areas. The irrigation systems of the plantations also facilitated the spread of infectious diseases such as malaria.

Cash crops

The political map of the continent was reshaped by the nationalist independence movements of the 19th century as local élites freed themselves from the remaining shackles imposed on them from Europe. However, the workers and peasants remained shackled with a class society organized around their exploitation. Environmental problems escalated as new cash-crops such as coffee, bananas and cotton were introduced. By the late 19th century much of the fertile arable land had been taken over by commercial plantations. Cattle ranching and deforestation developed apace.

Those displaced by the plantations and huge estates were forced to find new land on which to grow food. They found it on steep hillsides where rain washed away the topsoil, leading to serious erosion. New land was also found as more and more forest was cleared. The monocultures, deforestation and soil erosion affected the hydrology of many parts of Latin America. Topsoil washed into lakes and rivers causing silting problems and ultimately affecting delicately balanced marine ecosystems. For example, the coastal mangrove swamps of El Salvador were reduced from 300,000 to 6,800 acres and local fish populations dwindled.

As ecologically unsustainable monocultures bled the soil dry and were plagued by pests the owners turned to fertilizers and pesticides to bolster production. Again, it was the workers and the environment who suffered the consequences. Harmful pesticides were, and still are, used with abandon. In many parts of Central America cotton workers are sprayed along with the crop, while their children bathe in and drink polluted water. Mother's milk in parts of Nicaragua reportedly carrries the world’s highest levels of DDT. On the extensive banana plantations on the Atlantic coast of Central America thousands of workers have been sterilized by pesticide poisoning.

Debt crisis

The large-scale borrowing from Western banks made by Latin American governments and private companies during the 1970s and the ensuing debt-crisis have had profound effects on worker and environment alike. With the falling prices of cash-crop and raw material exports such as coffee, bananas, tin etc and the rising prices of essential imports, e.g. machinery and oil. Latin American economies faced serious balance of payments crises. Following the advice of those in power in Western countries many Latin American governments sought to boost their own industrial base in a vain attempt to compete on more equal terms with the more highly developed capitalist economies. Huge amounts were also borrowed to fund the military forces necessary to maintain the status-quo within their borders.

The Western banks were only too keen to lend the “petro-dollars” deposited with them by the oil-producing countries as a result of the OPEC price rises in the early 1970s. The industrial developments financed by the borrowing were often totally inappropriate to local conditions, and incredibly environmentally destructive. For example, huge hydro-electric power schemes in Amazonia necessitated the damming of many rivers flooding vast forested areas occupied by indigenous groups and poor farmers. The dams affected the regional hydrology causing silting problems and the proliferation of floating weeds. Malarial parasites also spread in the artificial lakes.

The Latin American economies borrowed at floating interest rates, so that as interest rates rose in the early 1980s a debt crisis developed when they were unable to keep up with the interest payments. They were also hit by contemporaneous further falls in the prices of their essential exports, and a world slump. Fearing the consequences of large-scale defaulting to the international banking system, the World Bank and the IMF negotiated Structural Adjustment Programmes for those Latin American countries troubled by debt. All the Structural Adjustment Programmes included the slashing of public expenditure, and the boosting of cash-crop exports in order to provide governments with extra revenue for debt repayments.

The benefits to the capitalist class of the IMF and World Bank plans are clear: the stabilization of their economic system. The victims, as ever, are the propertyless majority. The slashing of public expenditure has led to redundancies, wage-cuts, less social services, and less environmental protection. Boosting cash-crop production has led to further deforestation, soil erosion and the increased use of fertilizers and pesticides.

As the region has been progressively immiserated by debt, unemployment and worsening environmental conditions thousands more have flocked to the urban squalour of Latin America’s shanty-towns. The poor sanitation, over-crowding, pollution and disease suffered there is a direct result of a social system which organizes all production around the prospects of profitability for the owning few.

What is the way out of this intolerable state of affairs? As ever reformists offer national solutions, piecemeal reforms and schemes to preserve nature in isolation from humans. What they fail to recognize is that the environmental problems faced are not new or isolated phenomena but intricately linked with the rise to dominance of world capitalism over the last 500 years. It is the uncontrollable nature and ecological unaccountability of capitalist production which must be abolished to rid Latin America and the world of environmental destruction and of working-class poverty. Socialists work to replace a divided world governed by capital with a stateless, moneyless commonwealth under the democratic control of a socialist majority.

Peter Owen

Voice From The Back: Cracks in the dynasty (1999)

The Voice From The Back Column from the June 1999 issue of the Socialist Standard

Cracks in the dynasty

When the gossip columnist Liz Smith announced the Murdochs’ separation in the New York Post last spring there was little sign of the storm to come . . . On the surface, the sticking point is money—whether Murdoch’s lawyers will agree to the rumoured $2 billion settlement Anna is seeking . . . Anna’s interest in the trust arrangement may have less to do with the size of the settlement than the issue of the succession. A director of News Corp since 1990, she was once viewed as a successor herself. And while Lachlan, who heads News Corp’s Australian publishing operations, is considered the front runner, Anna still holds a candle for her eldest child, Elisabeth, the head of BskyB. News Corp is already under fire for shielding profits through a series of complex financial arrangements involving off-shore tax havens—arrangements that have seen News Corp pay no net British corporation tax in 11 years, despite profits here of £1.4 billion. Observer, 28 March.

Progress!

Two out of every five children are born into poverty and are likely to die poor unless urgent action is taken to tackle the effects of Britain’s growing inequalities of wealth, according to a landmark Treasury report. The study, the most in-depth by the government so far, makes clear the way chronic poverty can be passed on from generation to generation, emphasising unemployment as a root cause. It shows the number of people living in relative poverty has trebled since 1979. One of its most striking findings suggests four million children, one third of the total, live in low-income households. The report also confirmed that the gap between rich and poor widened substantially under the Tories, a development that makes the UK almost unique among developed countries in seeing an increase in inequality. Only New Zealand has seen a similar increase. Inequalities in Canada, Ireland, Italy, Portugal, France, Germany and Holland have been reduced or remained stable. The Herald, 30 March.

John Browne’s bodies 

[F]or the cigar-puffing Browne [chief executive of BP], who gained his knighthood last year, the difficult part is just beginning. To justify Arco’s purchase he has to find savings of more than £625 million from the deal over the next two years, slashing 2000 jobs as he goes. At the same time he has to maintain morale at Arco’s Los Angeles headquarters to keep the middle management talent that is crucial to his vision of a lean, mean multinational giant. Financial Mail on Sunday, 4 April.

Cheap wars?

The markets and Mr Milosevic seem to have been making the same calculation, that however much Nato governments huff and puff, at heart they care more about the budget than the Balkans. Before too much money has been dropped out of the sky, the markets seem to have reasoned, Nato will want to declare that it has ‘achieved its aims’ and send the bombers home. The stock market’s indifference also reflects recent experience of short, relatively cheap wars. In 1990-91, the Gulf war added about £1 billion to Britain’s defence [sic] spending, and the defence budget rose sharply in the next couple of years as hardware was replaced and plans revised. But virtually all Britain’s direct costs of war were met by Middle Eastern governments. Financial Mail on Sunday, 4 April.

The new slavery

[T]he International Monetary Fund extracted $1 billion from Africa in the last two years. The IMF received $390 million more in loan repayments from the continent in 1998 than it provided in new finance . . . the figure in 1997 was $643 million . . . international financial institutions and western governments were paid back $13 by developing countries for every $1 they distributed in grants in 1998, up from $9 in 1996 . . . Despite borrowing less than they paid back in 1998, total debt in developing countries rose again—by $150 billion to a new total of almost $2.5 trillion because of the backlog of interest payments. Guardian, 8 April.

Dirty Tricks? 

An investigation into the left-wing political extremists who have infiltrated an 18,000-strong Birmingham Council union branch is being hampered by death threats to witnesses, it was revealed today. Dozens of terrified council employees—mostly women—have told the leaders of Unison, Britain’s biggest union, that they are not prepared to give evidence unless they are given protection. Other council officials who have complained about bullying and intimidation by a group of militant activists with warnings that their homes would be “damaged” if they testified . . . As well as harassment complaints, he [Phil Lenton, national secretary of Unison] is looking into complaints that thousands of pounds of branch funds have been wasted booking the International Convention Centre of illegal meetings and subsidising the Socialist Workers Party. Evening Mail, 14 April.

Pathfinders: Climate Change – Somebody Else’s Problem? (2021)

The Pathfinders Column from the June 2021 issue of the Socialist Standard

In May the International Energy Agency released a report entitled Net Zero by 2050: A roadmap for the global energy sector. The 224-page report describes itself as ‘ the world’s first comprehensive study of how to transition to a net zero energy system by 2050 while ensuring stable and affordable energy supplies, providing universal energy access, and enabling robust economic growth’.

Universal energy access? Stable and affordable? Even someone supportive of capitalism would be inclined to say ‘pull the other one’. If a commodity is to make a profit, it can’t be so cheap that even the poorest can afford it, so the idea of universal affordable energy is already a non-starter before you’ve got past the introductory blurb.

But the roadmap is nothing if not ambitious, ‘setting out more than 400 milestones for what needs to be done, and when, to decarbonise the global economy in just three decades.’ A forest of charts and graphs are there to underline the gigantic strides that capitalism needs to make, each one liable to have the supporter of capitalism once again muttering sceptically, especially given the admission at the start that global state commitments are ‘well short of what is needed to limit the rise in global temperatures to 1.5°C and avert the worst effects of climate change’.

Even if we had socialism – a global society of democratic and cooperative common ownership where the imperatives of profit and commercial growth would be absent – this might be a tall order given the time frame, although doable because we wouldn’t have to battle with private competing interests. More to the point, if we had socialism already, the world wouldn’t be in this situation in the first place. The independent behaviour of private actors seeking profits regardless of ‘externalities’ has driven us to the brink of a global tragedy of the commons that would not have occurred if the commons were truly owned in common. Now, even the International Monetary Fund is starting to talk in shrill terms about a potential extinction-level event: ‘There is growing agreement between economists and scientists that the tail risks are material and the risk of catastrophic and irreversible disaster is rising, implying potentially infinite costs of unmitigated climate change, including, in the extreme, human extinction’.

We don’t take this view, as it’s hard to imagine anything short of a planet-busting asteroid taking out all of humanity, and we don’t subscribe to a counsel of despair because we say there is a solution – urgently getting rid of capitalism and letting socialism off the leash. Failing that, capitalism is going to have one hell of a job slamming on all its brakes simultaneously in order to stop short of the abyss. Can it succeed in doing what looks like the impossible? We don’t know. We’ve learned not to underestimate capitalism’s ability to adapt, and in the past year’s pandemic we’ve seen it do things that previously people would have said was impossible, albeit it at a staggering cost to itself. And that’s just the trouble. Capitalism has been knocked for six, having just paid out the equivalent of a world war due to the pandemic. If you think that’s an exaggeration, the Second World War is thought to have cost around $23 trillion in today’s money. The IMF estimates the cost of the pandemic to the global economy as $28 trillion. So not only does capitalism have to do the seemingly impossible, it has to do it under the worst possible economic circumstances.

This desperate task becomes all the more farcical when you realise that ‘net zero by 2050’ is not actually good enough, because it’s aimed at limiting global temperature increase to 2°C, not the 1.5°C target as specified by the Paris agreement and which would require ‘net zero by 2030’. What difference does half a degree make? Maybe not much, maybe all the difference in the world. The Energy Watch Group, often highly critical of the IEA in the past for being too soft on fossil and for being a poodle of the USA, issued a report last December entitled ‘The path to climate neutrality by 2050 misses the Paris climate targets – The rocky road to truthfulness in climate politics’. It quotes the IMF ‘extinction’ scare cited above and goes on to explain why 2°C might be too close for comfort: ‘It is widely scientifically recognised that a global temperature increase by more than 2°C threatens to lead to a so called Hothouse Earth scenario in which human civilisation as we know it can no longer exist’.

Is that true? Well, it’s true that +2°C ‘threatens’ to do so, because of tipping points and feedback loops following each other ‘like a row of dominoes’, at which point ‘we see that the Earth system tips over from being a friend to a foe. We totally hand over our fate to an Earth system that starts rolling out of equilibrium’ (bbc.in/3bJNAb6). But it’s an unquantifiable threat and nobody really knows for sure. On the one hand, the Earth has certainly been hotter in its history than it is now, without turning into Venus. On the other hand, there have also been five mass extinction events involving upwards of 80 percent of life forms, and climate may have been a factor in some of them. As a researcher from York University reported to Scientific American in 2007: ‘There have been three major greenhouse phases in the time period we analyzed and the peaks in temperature of each coincide with mass extinctions’ (bit.ly/3f9nX5O).

One might wonder then if there is any point in the IEA issuing a so-called roadmap for the Paris Agreement, given that the likelihood of capitalism being able to follow it looks so remote, and given that it’s not ambitious enough anyway. But if there is an agreement, there has to be a roadmap, however rocky and untruthful it is. Whether or not the planet is facing an existential crisis, capitalism is certainly suffering a credibility crisis. It has no answer to the environmentalist’s well-aimed charge of requiring ‘infinite growth on a finite planet’, and more and more people are waking up to that fact. But the policy makers have to say something, and look as if they’re doing something. US climate envoy John Kerry was held up to ridicule recently for saying that the climate would be stabilised using technologies that don’t exist yet (bbc.in/3v7oElE), but he illustrated a fundamental truth about how today’s politicians think about the future. By 2050, all this will be somebody else’s problem.

Paddy Shannon

The Haitian Tragedy (2010)

From the April 2010 issue of the Socialist Standard 

Haiti spent more, in 2008 servicing the country’s debts than it did on health, education and the environment.

In our February issue (Haiti—an un-natural disaster) we noted that the earthquake in Haiti, and similar disasters, are presented as unavoidable disasters; and that, to some extent, this is true. But we stated that it is not a coincidence that the number of victims is clearly related to the degree of their poverty. This was true regarding the Asian tsunami and the Katrina hurricane in New Orleans.

Seumas Milne also says (Guardian, 21 January) that “It is uncontested that poverty is the main cause of the horrific death toll: the product of teeming shacks, and the absence of health and public infrastructure.” In his view, this is the direct consequence of an uniquely brutal relationship with the outside world—notably the US, France and Britain, stretching back centuries. There is some truth in this, although not all Haitians were, or are, poor.

Says Milne:

  Punished for the success of its uprising against slavery and self-proclaimed first black republic of 1804 with invasion, blockade and a crushing burden of debt reparations, only finally paid off in 1947, Haiti was occupied by the US between the wars and squeezed mercilessly by multiple creditors.

For decades, the US backed the dictatorships of the Duvaliers. Just 30 years ago Haiti was self-sufficient in its staple of rice. In the mid-1990s, however, the International Monetary Fund (IMF) forced it to slash tariffs, and the US dumped its subsidised surpluses on Haiti. Most of the peasant farmers were forced out of business, squatted in Port-au-Prince, and many will have died in the earthquake. The United States also imposed lending conditions on the country, forcing the government to privatise the already minimal health, education and public services, and cut back the minimum wage.

The Duvalier Dictatorships and the CIA

From 1957 to 1971 Haiti was ruled by François “Papa Doc” Duvalier and, following his death, by his son, Jean-Claude “Baby Doc”, both “anointed” “President for Life”. The US trained and armed Haiti’s counter-insurgency force, although much American military aid was covertly channelled through Israel.

After “Baby Doc” was forced into exile to France in February 1986 (in a US Air Force jet), the United States continued, now quite openly, military aid, supplying the Haitian Army with trucks, communications gear etc. in order “to maintain order”. Between the departure of “Baby Doc” and the date scheduled for elections in November 1987, the administrations were responsible for the deaths of more civilians than “Baby Doc” managed in 15 years of dictatorship. Meanwhile, the CIA managed to “spring” from prison two of Duvalier’s notorious police chiefs, and send them into exile, saving them from certain execution.

Haiti has never had a mass, reformist working-class party. In 1930 two “intellectuals”, Max Hudicourt and Jacques Roumain, attempted to form a communist party, but it was largely stillborn. In 1946 a clergyman by the name of Félix d’Orléans Juste Constant, founded the Parti Communiste d’Haiti (PCH). It too disbanded the following year. Shortly after a rival quasi-communist party, the Parti Socialiste Populaire (PSP), was founded. It disintegrated rapidly by 1949. But in 1959 Roger Gaillard, a former member of the PSP, founded the Parti Populaire de Libération Nationale (PPLN), which claimed to be a mass, nationwide organisation; it was badly weakened by police harassment and repression by 1965. It was basically reformist, with much in common with Fidel Castro’s 26 July movement.

Aristide the Priest

At the time of “Baby Doc”’s flight to France, there was one man who did have a mass following, particularly in Port-au-Prince. He was Jean-Bertrand Aristide, a Catholic priest and advocate of “liberation theology”; but looked upon by opponents, both in Haiti and in America, as a revolutionary, but in fact a populist reformer. He denounced the upcoming military-dominated elections, and urged his followers to boycott the elections, saying “The army is our first enemy.” He was condemned by the Vatican.

The elections were scheduled for the 29 November 1987—the CIA funded a number of candidates. In the event, the elections were postponed ostensibly because of unrest and violence in the country. According to William Blum in Killing Hope, “…the candidate favored by the military government was declared the winner in balloting widely perceived as rigged”. Writing in 1994, Blum continued:

  There followed more than two years of regular political violence, coup attempts and repression, casting off the vestiges of the Duvalier dictatorship, and establishing a new one, until, in March 1990, the current military dictator, General Prosper April, was forced by widespread protests to abdicate, and was forced by a civilian government of sorts, but with the military still calling the shots. (p. 371)

Pressured by the United States, the Haitian government called an election later in the year. Reluctantly, Aristide became a candidate of a coalition of reformist organisations. Despite intimidation, Aristide was victorious with 67.5 percent of the vote. He took office in February 1991, after a coup attempt against him failed in January.

And so Jean-Bertrand Aristide became President of Haiti.

But he did not even get any reformist legislation enacted by Parliament. Nevertheless, the military was much concerned by the arrest of a number of para-military thugs, his policies against drug smuggling, and his attempts to depoliticise the army. Aristide was, however, not anti-business. He encouraged American capitalists, and to please the IMF, he fired 2,000 government workers.

It was all to no avail. In less than 8 months, on 29 September 1991, Aristide was successfully deposed by a military coup, in which hundreds of his supporters were massacred and thousands fled to the Dominican Republic. He was saved from being murdered by the French ambassador. The new military dictatorship was largely supported by the local bourgeoisie. And the Vatican immediately recognised the government. The Bush Sr administration unofficially gave its blessing. Haiti was back to “normal”.

Aristide’s Return

In the summer of 1993 the United Nations mediated talks between Aristide, living in exile in Washington, and the Haitian military government; the leader of the junta, General Cédras, would step down by October, and Aristide would return as president. But October came and went without the military permitting Aristide to return. Indeed, they stepped up their repression of his supporters, including the assassination of his justice minister, Guy Malary. Meanwhile, the CIA spread rumours in Haiti that Aristide was mentally ill. It was not true.

An organisation of American States (OAS) human rights team accused the Haitian military regime of “murder, rape, kidnapping, detention and torture in a systematic campaign” to terrorise all those Haitians wanting a return to democracy. Amnesty International reported the same. The Clinton administration in Washington wanted the military out of power, but without actually having to do anything, including invading the country. Nevertheless, changing tactics, the CIA, with numerous agents in Haiti, launched a major covert operation to topple the military regime. It was not a success. But change was a’coming.

In September 1994, the Clinton administration told the Haitian military leaders they had just four weeks to resign. The US would have to take control. Yet again. So, on 19 September US forces began to arrive in Haiti. Initially, they were welcomed by the majority of the population; they first arrested, disarmed and also shot many of the former Haitian military; and permitted some of the leaders to escape into exile. And they sealed off, and protected the homes of many of the local capitalist élite, “Washington’s natural allies” (Los Angeles Times, 1 October 1994).

Jean-Bertrand Aristide returned to Haiti in mid-October, courtesy of the US army. He received, in the words of William Blum, a reception of “joyous celebration”. But, unbeknown to a majority of his supporters, he was somewhat different Aristide who had, three years previously, been disposed and exiled to Washington. In the words of the Los Angeles Times (1 October 1994):

Almost every aspect of Aristide’s plans for resuming power—from taxing the rich to disarming the military—has been examined by the US officials with whom the Haitian President meets daily, and by officials of World Bank, the International Monetary Fund and other aid organisations. The finished package clearly reflects their priorities. Aristide has obviously toned down the liberation theology and class-struggle rhetoric that was his signature before he was exiled to Washington.

Indeed, Aristide embraced market economics with zeal and enthusiasm. He also agreed to publicly announce that he would not attempt to stay in office to make up the time he had lost in exile. So much for the firebrand priest—even as a reformer.

Haiti—a Client State

In Killing Hope William Blum claimed that Haiti’s international function will be to serve “transnational corporations” by opening the country up to further investment and commerce, with minimum tariffs and other restrictions; and offering itself, primarily in assembly industries, and as a source of export labour. He added: “What appears to be certain is that the rich will grow richer, and the poor will remain at the very bottom of Latin America’s heap.” Under Aristide’s successor, it can only get worse. As Seumas Milne observed, new IMF loans require Haiti to raise electricity prices, and to freeze all public sector pay, where the majority exist on less than two dollars a day.

Infant mortality rate is about 80 per 1,000 (neighbouring Cuba’s rate is 5.8). Around 50 percent of Haiti’s adults remain illiterate. Former president Bill Clinton wants to build up Haiti’s export-processing zones,. But, as Milne comments, “… more sweatshop assembly of products neither made nor sold in Haiti won’t develop its economy nor provide a regular income for the majority”. Haiti currently owes the IMF around a billion dollars. Gary Young, writing in the Guardian (1 February), reported that Haiti spent more, in 2008, servicing the country’s debts than it did on health, education and the environment.

Meanwhile, the United States pours thousand of heavily-armed troops into the country (yet again). and “The Street”, a US investment website, says that the earthquake provides such American corporations as General Electric, Jacobs Engineering and Flour, with the opportunity and potential to benefit. Of course.

Following the earthquake, a commentator on French television advised his viewers and listeners that “Haiti is not a suitable place to take a vacation.” He can say that again.

Peter E. Newell

Borrowers and Lenders (2005)

Book Review from the August 2005 issue of the Socialist Standard

Noreena Hertz: I.O.U.: The Debt Threat and Why We Must Defuse It. Harper Perennial £7.99.

Hertz is fairly well-known as a commentator on and critic of globalisation. But unlike some, she does not even make the pretence of being anti-capitalist. In her previous book The Silent Takeover, she made it clear that she was advocating another form of capitalism in contrast to a laissez-faire version that sidelined justice and democracy.

The book under review focusses on developing-country debt and its consequences, not just for the Third World but for ‘advanced’ capitalist countries too. For debt and possible defaults can lead to desperation and terrorism, environmental damage and general economic recession. During the ‘Cold War’, loans were often made for strategic reasons, to keep countries friendly, whether US loans to Latin America or Russian and Chinese lending to Africa. The collapse of Eastern European state capitalism brought a sudden end to this, with loans being called in and new lending being on much less favourable terms. Hertz gives a good account of many of the mechanisms by which lending occurs, such as the roles of the International Monetary Fund and World Bank. Many Western countries have export credit agencies that underwrite sales by domestic companies and step in to pay them if anything goes wrong (so much for the risks of entrepreneurship). There are even traders who buy and sell developing-country debt as if it were pork or oil, usually making vast profits in the process.

In 2004, the world’s poorest countries owed $458 billion. The consequences of this seem pretty devastating:

  “Millions of children continue to die every single year because money that could be spent on preserving their health is still being spent on debt service. Millions of children are prevented from attending school because money that could be spent on their education is still being spent on repaying debt.”

Hence the demand to ‘Drop the Debt!’, and Hertz’s proposals for deciding when debt  is illegitimate and should be cancelled, plus her suggestions of ‘new principles for borrowers and lenders’.

The problem is that all such proposals effectively accept the status quo, i.e. global capitalism. They do not even begin to address the question of why people are poor in the first place. The passage quoted above assumes that money spent on repaying debts would otherwise be used for health care and education, but there is no guarantee of this at all: governments in developing countries, like all governments, run affairs in the interests of the ruling class. In a world rooted in ownership of resources by a tiny minority of the population, poverty, famine, and lack of access to decent health care and education are inevitable. Cancelling debt (which is anyway less costly to the lenders than might at first appear) relates to just one aspect of the way in which the basic inequality of capitalism reveals itself. It does not affect underlying causes — which is why, whatever the sincerity of those who support it, it will make no contribution to ending poverty.

Paul Bennett

Free Trade Claptrap (1997)

From the July 1997 issue of the Socialist Standard

In February of this year, a World Bank press release on Africa boldly declared: “Economic performance has improved considerably with over 24 countries posting growth figures of over 4 percent—above the rate of inflation . . . this success has given ground for cautious optimism" (New African, May 1997). "Cautious" indeed.

What the Bank failed to point out is that when you are on the bottom, the only way you can go is up. As always, World Bank reports continue to confirm they suffer what critics have termed the bikini syndrome—what is revealed is interesting; what is concealed is more so.

We are not told, for instance, that of the 174 countries listed on the United Nations Human Development Index, 25 of the poorest 30 are in Africa, and that 44 African countries are ranked below the 100 figure. Neither will you hear of Zambia spending 35 times more servicing multilateral debt between 1990 and 1993 than on primary education.

Again, we are no more likely to hear of the 47 percent of sub-Sahara African children not attending school than we are to hear them report their share of the £400 million in interest and capital repayments transferred from the "Third World” to the West every day between 1982 and 1990. Such revelations will only ever portray the big financial policemen of the World Bank and the IMF as the corrupt and self-serving profit-mongers that they are.

The World Bank and the IMF can often be heard saying that the cause of Africa’s mis-development are its leaders and the failure of its economic policies, neglecting to mention that it is they who make the Mobutus wealthy and that it is their structural adjustment programmes that makes economic stability preclusive. Thanks to the assistance of these multilateral organisations. Mozambique debt in 1994, as a percentage of its GNP, was 450 percent.

Mozambique, still suffering from a devastating civil war and a GNP per capita of £60, the lowest in the world, hardly needed the IMF-imposed privatisation measures which are aimed at reducing inflation of 15 and which the country was advised to adhere to if it wanted further loans.

It is understandable that the IMF and the World Bank have every reason for wanting others to believe their propaganda. The 1980s are painful times to remember. It was then, that having loaned so much, they were faced with a growing unwillingness to repay. When Mexico and Peru threatened to renege on repayments, they were only cowed back into line by having their repayments rescheduled. Today, there are undoubtedly concealed but real fears that many countries might come to the conclusion that being so poor they’d be no worse off for withholding cash earmarked for the IMF and World Bank.

It was perhaps this realisation that brought the IMF, World Bank, various commercial banks and governments together last September to hammer out a new initiative to reduce the debt burden on the HIPCs (heavily indebted poor countries). This might have sounded promising but for the fact that this new venture has been put on hold for a few years. And of course, there are the usual preconditions. Countries wishing to qualify must be "well behaved" and prepared to commit themselves to further structural adjustment programmes. The hair-of-the-dog remedy indeed.

Though they will try to deny it, the power of the World Bank and the IMF is increasing. Like the colonial regimes of old, they have power to influence which government is elected, what is produced and the size of a country’s health service. In short they have power to decide who lives and dies.

In fairness, the World Bank is the lesser evil of late, going so far as to insist that public expenditure cuts should not hit health and education, prepared to accept criticism and supposedly taking heed of voluntary agencies and the UN. Of course, there is method in their madness, so to speak. They are all too aware that in the longer term a healthy and educated workforce means increased profits and an increased chance of debt repayment.

Conversely, the more powerful IMF couldn’t give a damn. It preaches a pay-up-or-else creed, is less accountable and has erected a higher temple to the god Mammon, even going so far as to oppose, in recent months, World Bank plans for the building of schools in Mozambique.

There is a third pillar supporting the global economic order—the World Trade Organisation. As the enforcer of the GATT "free trade" agreement, it is likely that many African countries will be dragged into the mis-named "free trade global economy” by the WTO and in Darwinian fashion only the fittest will survive.

The supposed logic behind this "free trade" clap-trap is that with barriers removed, the world economy functions at the height of efficiency and to the benefit of all. We can immediately ask. however, how African countries are supposed to compete with the 500 mainly western companies who control over 70 percent of world trade, or the likes of Cargill, the giant grain conglomerate whose income is higher than that of the poorest 10 African countries. Already, of the 47 countries deemed to be “too slowly" integrating into the world economy, 21 are African.

It goes without saying that the only real benefactors of free trade are the multinationals.Their power is such that they can control not only the fate of national currencies, but also force governments to tailor their economic policies to their own interest. In addition, they face little host government opposition when they destroy a country’s environment. Witness Shell in Nigeria. Like sharks scenting blood they are drawn to countries where there will be tax concessions and where they will be exempt from local labour laws. And it is not uncommon for them to have non-union policies and to take advantage of low-cost economies with poor health and safety standards.

This then is the reality of the "free trade" Africa will benefit from. This is the reality of the "new dynamism" the World Bank claims is taking hold in sub-Saharan African.

From the Red Sea to the Atlantic Ocean coup and conflict are commonplace. From Mali to Mozambique, homelessness and hunger exist alongside illiteracy and unemployment. This on a continent potentially the richest on Earth. And all of this in the name of profit.

We can at least offer a little consolation to the pessimistic. In the last year the seeds of socialism have been scattered around Africa and are already taking root. Workers in Uganda. Gambia and Sierra Leone have already joined us in our struggle to rid the world of capitalism and to replace it with a world of free access. Others await in Zambia and Namibia. At last something of real world significance is germinating on the fertile land of the poorest continent on Earth.

John Bissett

Voice From The Back: Merciless global capital (1999)

The Voice From The Back Column from the February 1999 issue of the Socialist Standard

Merciless global capital

All over the world capitalists try to reduce workers’ wages as the most direct way of increasing their profits. International competition and the mobility of capital have made this “cost-cutting” more ferocious. In India last year the already low wages and poor working conditions were made worse by the government’s decision to scrap the laws which defended workers’ living standards: “NEW DELHI, Oct 21.—The government has admitted it is considering proposals for amending the country’s labour laws. An official release issued today announced that changes to the Trade Union Act, 1926, Industrial Disputes Act 1947, Payment of Wages Act, 1938 and Contract Labour (Regulation and Abolition) Act 1970, ‘are under consideration’. The statement accepted that the national information and technology taskforce had recommended extending working hours from eight to 12. It denied, however, that the proposal was being considered by the labour ministry. The report on the proposed changes in labour laws has meanwhile drawn strong reactions from the Left and trade union organisations. The move clearly indicated ‘the anti-labour policy of the government,’ said Mr Harkioshan Singh Surjeet, CPI-M general secretary. It was now obvious that the government was being dictated by big business houses,’ he declared.” The Statesmen, Calcutta, 22 October 1998.

No panic but . . .

An unprecedented meeting of world financial leaders is to be convened in Washington next month [January 1999] to implement emergency reforms of the International Monetary Fund and help head off a second bout of global economic turbulence. The move to hold a special session of the IMF’s policy-making interim Committee—the first since it was set up at the Bretton Woods conference in 1944—comes amid signs that the recent recovery in world markets is stalling, with fresh falls on world stock markets, profits warnings and job losses from multi-national companies, as well as fading hopes of restoring order to the Russian economy. The meeting will break the normal pattern of a twice-yearly IMF gathering and emphasises the concern at the fragility of the global economy in both the western countries and the developing world. Guardian, December 1998.

Death is good for business

Reaching a total of 46 billion dollars (270 billion francs), the world arms trade upped 12 percent in 1997 for the third consecutive year, according to the London Institute of International Strategic Studies. The Near and Middle East remain the topmost regional market, with the Far East as runner-up. In possession of 49 percent of these markets, the USA is the biggest supplier, followed by the United Kingdom, France, Russia and Israel. These figures could show a decline in 1998, due to the economic crisis compelling some states to revise their defence budgets. Le Monde, 24 October 1998.

Organise—please!

“On another note people were still throwing things at the cops from too far back and hitting demonstrators. People doing this have to be stopped as serious injuries happen”—from a report of a demonstration in the summer 1998 issue of an anarchist journal called Organise.

Can’t feed—won’t feed 

For several decades the world’s capacity to produce food, for instance, has far exceeded the entire human population’s need for nourishment. Yet the stockpiles of unused foodstuffs pile up unsold each year in producing nations while somewhere else in the world hundreds of millions of others are malnourished, if not actually starving to death. The paradox is explained away easily enough in market terms. Indeed, the market insists that feeding impoverished people would be harmful to them, indulging their backwardness and postponing their eventual self-sufficiency. That answer may satisfy the marketplace, but for humanity it constitutes another great, unanswered social question. Capitalism, for all its wondrous creativity and wealth, has not yet found a way to clothe the poor and feed the hungry unless they can pay for it. One World, Ready Or Not. The Manic Logic of Capitalism, by William Greider.