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Keeping The Rabble In Line Essay Research (стр. 3 из 4)

Combine that with the other document. What it says is that the Third World should stop producing and protecting its own population because that’s irrational. We should send our polluting industries to them because that is rational. Summers in this memo points out that you might have counterarguments to this based on human rights and the right of people to a certain quality of life. But he points out that if we allowed those arguments to enter into our calculations, then just about everything the World Bank does would be undermined. That’s quite accurate. That’s supposed to be a reductio ad absurdum. Obviously we can’t undermine everything the World Bank does, so obviously we can’t allow such considerations to enter. We consider only economic rationality, of course geared to the interests of the World Bank. That’s what you do with pollution. Try to convince the Third World to stop producing and to stop protecting their own population and to accept our pollution. It’s all perfectly explicable on rational economic grounds. Any graduate student in economics can prove it to you.

DB: Apropos of this blindness of the planners: you have a fantasy …

It’s not blindness. I think it’s very reasonable on their part.

DB: Within their framework.

Yes.

DB: You tell of a fantasy that involves the Wall Street Journal and the greenhouse effect.

Someone asked me once and I simply said that if I had the talent, which I don’t, I would write a short story about the Wall Street Journal. I suppose their offices are on the seventeenth floor of some New York skyscraper. They’re sitting there in that office putting out an issue of the Wall Street Journal claiming once again that the greenhouse effect is just a fraud invented by left fanatics. As the issue goes to press the water level would have risen to that point and you could hear them gurgling as they start the printer running. That’s about what it’s like.

DB: Let’s talk about organized labor unions in the United States. Only fifteen or sixteen percent of the total U.S. work force is now unionized, far below, perhaps by half or even more, what it was decades ago. This is the era of givebacks, benefits reductions, skipping, deferring or eliminating raises. Does organized labor really have a positive, progressive role to play?

It should, but it’s in a very weakened state. It’s been weak for a long time, but it was smashed during the 1980s. It started with Reagan’s success in breaking the air-traffic controllers’ strike, and it’s continuing until today. The UAW just lost a serious strike at Caterpillar. Their strategy has been so overcome by class collaboration — We nice guys work together with management — that when the crisis came at Caterpillar they were probably unprepared. They were simply wiped out. At this point Caterpillar probably won’t even live up to the terms of the latest agreement. It seems to be continuing to lock them out. These are serious blows to the labor movement, and that means to American democracy, but they’re much to the benefit of the small sectors that are enriching themselves. Does labor have a part to play? It depends on whether working people can get their act together and rebuild the labor movement and turn it into a powerful force for both people’s rights and democracy as it once was. It’s going to have to be rebuilt from the bottom up. Labor’s role has declined significantly since the 1940s. They’re not unaware of it. Doug Fraser, the former head of the UAW, pointed out almost fifteen years ago that there has been a bitter, one-sided class war led by American capitalists fighting against labor, while labor, meaning labor bureaucrats, have been seduced by class-collaboration slogans. They’re not fighting a class war. The effect of a bitter, one-sided class war is very evident.

DB: The New York Times, in talking about the economic woes, says “There is little mystery about what caused the economic problems. The country is suffering a hangover from the mergers, rampant speculation, overbuilding, heavy borrowing and irresponsible government fiscal policy in the 1980s.” How well did the Times and its brethren in the media during this period of economic dislocation and decline actually cover the events and give the American people information that they could act upon?

The Times isn’t in the business of giving the American people information they can act upon. They hailed the Reagan revolution and its achievements. There were sectors of the population that profited marvelously, including the corporate sectors, of which the Times is a part. They couldn’t fail to see that there are social costs. You can’t walk around New York City and not see that there are severe social costs, so they probably saw it too. But this was considered as a glorious period of success. There were people who were upset about it. Take a look at, say, Mondale’s funding in 1984: a lot of it was from fiscal conservatives who were worried about the long-term effects to their own interests of this kind of mad-dog Keynesianism, wild crazed spending, and government stimulation of the economy through borrowing that was going on through the Reagan years. People could see that that was going to be very problematic for the economy. Take what’s just happened in Chicago. The estimates of the costs of fixing those leaks in the underground tunnels might have been at the level of $10,000. They didn’t fix them because they wanted to save the $10,000 as part of the cutback in civic services. The net effect will be a loss of maybe over a billion dollars or more. That’s a loss to private capital, too.

DB: But compared to the S&L bailout that’s peanuts.

Yes, the S&L bailout is much bigger than that. Chicago is just one piece of a growing disaster. Spending on infrastructure has declined radically in the last ten years, and that’s going to have its costs. What happened in Chicago is going to happen all over the place.

DB: It can’t help but affect even the elites. The area that was flooded …

And it’s hurting them in Chicago. Chicago businesses are suffering. Insurance companies are going to suffer.

DB: They’re not going to like that.

No, but there’s not a lot that they can do about it except to accept more long-term, integrated state corporate planning. There are other possibilities, like democracy, but nobody’s going to talk about that.

DB: Yeah, right. And maybe there will just be more slogans like “belt-tightening” and “austerity” and “biting the bullet” as opposed to genuine economic policy.

There is genuine economic policy, but it’s geared to the short term economic interests of the rich. It’s very genuine. And there’s plenty of state intervention for that purpose. Take the Pentagon budget. That’s massive state intervention in the economy for the benefit of the rich. That’s what keeps the electronics industry going, for example.

Go to the next section.

Bibliography

Keeping the Rabble in Line Copyright ? 1994 by Noam Chomsky and David Barsamian

Introduction | Next section | Contents | Archive | ZNet

The World Bank, GATT and Free Trade

April 20, 1992

DB: In 1944 at the Bretton Woods conference in New Hampshire the World Bank and the International Monetary Fund (IMF) were both created. What function do these two major financial entities play?

Their early role was in helping to carry through the reconstruction of the state capitalist industrial societies that had been wrecked by the Second World War. After that they shifted to what is called “development,” which is often a form of controlled underdevelopment in the Third World, which means designing and supporting particular kinds of programs for the Third World. At this point we move into controversy. Their effect, and you can argue about their intention, is overwhelmingly to integrate the South, the old colonial areas, into the global society dominated by concentrated sectors of wealth within the North, the rich society.

DB: You know that old song, “Where Have All The Flowers Gone”? Well, where have all the billions gone? The World Bank has lent tens of billions of dollars. Who lent what to whom exactly? What did it do there?

You can’t answer that simply. In the advanced industrial societies [that money] helped carry out a reconstruction from postwar damage. In the Third World [lending has] had mixed effects. It’s had effects in changing the nature of agriculture, developing infrastructure, steering projects towards particular areas and away from other areas. It’s been part of the long process of trying to undercut import substitution and move toward export oriented agriculture. By and large [World Bank loans have] been a subsidiary to the policies of those who control it. The United States has an overwhelming role in the financial institution because of its wealth and power. And the United States and its immediate allies have designed programs of what they called development throughout the world. The money may have gone into anything from dams to agro-export producers to occasionally some peasant project.

DB: The International Monetary Fund has been vilified in the Third World for the draconian measures that it has imposed on those developing countries.

Take a Latin American country today. There is a huge debt crisis. Remember that the Bretton Woods system basically broke down in the early 1970s. The Bretton Woods system involved regulation of currencies, convertibility of the dollar for gold, all sorts of other rules which essentially made the United States an international banker. By 1970 or so the U.S. could no longer sustain that. It was very advantageous to the United States in the 1950s and 1960s. It allowed enormous overseas investment by American corporations. But by 1970 the U.S. was unable to sustain [the role of international banker]. President Nixon dismantled the system in 1971. That led to an enormous amount of unregulated currency floating around in international channels. The world was awash with unregulated capital, particularly after the rise in the oil prices. Bankers wanted to lend that capital, and they did. They lent it primarily to Third World countries, which means to elite elements. For example, Latin American dictatorships would go on huge borrowing binges. The results were praised in the West as “economic miracles,” like the Brazilian “miracle” under the generals which left that country saddled with huge indebtedness. When the 1980s came along, U.S. interest rates went up and started pulling money toward the United States and increasing interest payments on the debt. The Latin American economies started going into free fall. Capital flowed out of them at a rapid rate. They were unable to control their own internal wealthy classes. The capital export from Latin America may not have been at the level of the debt, but it probably wasn’t very far below it. There was a flow of hundreds of billions of dollars from south to north, partly debt service, which far outweighs new aid by the late 1980s — payment of interest on the debt, and so on, and other forms of capital flight. By now, deeply impoverished African countries are even exporting capital to the international lending institutions.

The net effect of this is what some people jokingly call a program in which the poor in the rich countries pay the rich in the poor countries. That’s approximately the way it comes out. Then the IMF comes along, run by the wealthy countries, which have certain rules for the weak. They are that if you have a high level of inflation and the currency isn’t stable and various other economic indicators aren’t satisfied, then you impose extreme forms of austerity: balance the budget, cut back services, control the currency, etc. That’s neoliberal free market economics. That’s typically disastrous for the general mass of the population. That’s why the rich countries themselves will never accept those rules unless they’re forced to. For example, there was a time in the late 1970s when Britain was forced to adopt certain IMF rules because of its weakness. But no country rich or powerful enough would ever do it, like the U.S., for example, which has incredible debt but doesn’t accept IMF “suggestions”. We’re too powerful to follow those rules. Third World countries, which are much weaker, especially those which are under the control of Western-oriented elites anyway, who often benefit by it, do follow the rules and there’s disaster for the population. That’s why you get vilification. The same thing is happening in Eastern Europe now. The whole neoliberal free market story is basically designed for the benefit of the people who are going to win the game. Nobody else follows those rules. The West doesn’t follow them either when it’s not going to win. For example, the World Bank estimates that right now protectionist measures imposed by the rich countries cost the Third World more than twice as much as total aid going from the North to the South — and that “aid” is mostly a disguised form of export promotion.

DB: To whom are the World Bank and the IMF accountable?

To the people who put the money in, which means a bunch of rich countries, primarily the United States, which is the dominant element there. It’s mainly funded by the wealthy states, and the U.S. has the largest vote, so that’s who they’re beholden to.

DB: Where does the General Agreement on Tariffs and Trade, GATT, fit into this economic picture? One commentator has called it the “economic teeth of the new world order.”

GATT is the international trading system, also set up in the 1940s. It’s in the news now because for the last several years the Uruguay Round of GATT negotiations has been going on with an effort to achieve some new form of freeing up international trade. Freeing up international trade in itself, in a general sense, is not a bad thing. It’s often a good thing. The point is, nobody goes into that game, if they have the power, without ample protection for their own internal needs. So for example every one of the Western powers, including the United States, is entering the GATT negotiations with a certain agenda, a mixture of liberalization and protectionism geared to the particular strengths and weaknesses of that economy. When we speak of “that economy” we mean the people in the dominant positions in it. So the European Community wants high level protection for the aerospace industry and agricultural production. The United States has a mixture of policies. It’s calling for liberalization and free trade in many areas. On the other hand, it’s also calling for enhanced protection in areas where the U.S. is strong. Take so-called services like banking. The U.S. is calling for a liberalization of services in the Third World, which would have the instantaneous effect of swamping and overwhelming all Third World banks and financial institutions by western ones, since they’re so much richer and more powerful. That would eliminate the possibility of any national industrial development programs within the Third World. That’s the kind of liberalization that the U.S. is in favor of. It means that Third World economies would be managed by western banks and those who run them and the governments that are tied to them.

On the other hand, the U.S. is calling for more protection in other areas, particularly intellectual property rights, which includes anything from pop music to cinema to software to patents. Right now the U.S. is racing ahead in patenting what may turn out to be parts of genes. The idea is to patent the genes of corn, or for that matter humans, so that future biotechnology, which will involve various kinds of genetic engineering, will be in the hands of mainly U.S. private firms. They will control that field, and they want to make sure it’s protected. So they want long patent rights and so on. That means that drugs, software, new technology, new agricultural forms, any form of biotechnology that may involve health will be in the hands of Merck Corporation and others like them who will make tens of billions of dollars in profits. It means that India, which could duplicate a lot of this much cheaper, duplicate Merck drugs at a fraction of the cost, will not be permitted to do it. The U.S. also demands product rather than only process patents, to insure, say, that India’s pharmaceutical industry doesn’t invent a cheaper way to produce some drug — a barrier to efficiency and innovation, but a boon for profits. That’s understandable on the part of the rich. They want to control the future, naturally, and that means control technology. The biotechnology aspect, the patenting of genes, has been causing an international furor in the scientific world. It can have a huge impact in the future. One shouldn’t minimize it.

The U.S. (like others) also insists on a high level of protection for U.S. shipping. Shipping between U.S. ports has to be in U.S. ships. If Alaskan oil comes down to California, it has to be in U.S. ships. The U.S. insists that anything involving U.S. goods be done to a very high percentage in U.S. ships, which benefits the U.S. maritime industry.