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Big_Bird
Joined: 31 Jan 2003
Location: Sometimes here sometimes there...
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 Posted: Tue May 31, 2005 6:25 am Post subject: Free Markets Kill |
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| jaganath69 wrote: |
| Free Markets Feed |
One of these days I'd like to argue with you why this is not true (unless you mean "free markets feed the rich."
Just coming across this article now reminded me that I wanted to raise that with you. Actually, the article doesn't go hand in hand with my subject title, but it's kind of related.
Unfortunately, I'm what's known these days as 'time poor' and I'll have to stop at posting this juicy article and see if anyone will take the baton.
Bear in mind that it was protectionist policies that enabled countries like the US, Japan and even Korea to develop. Free markets destroy the economies of developing countries.
A game of double bluff
The UK and EU are keeping the poorer nations exactly where they want them: beholden to their patrons
George Monbiot
Tuesday May 31, 2005
The Guardian
Rejoice! The world is saved! The governments of Europe have agreed that by 2015 they will give 0.7% of their national income in foreign aid. Admittedly, that's 35 years after the target date they first set for themselves, and it's still less than they extract from the poor in debt repayments. But hooray anyway. Though he does not become president of the EU until later this year, Tony Blair can take some of the credit, for his insistence that the G8 summit in July makes poverty history. It's inspiring, until you understand the context.
Everyone who has studied global poverty - including European governments - recognises that aid cannot compensate for unfair terms of trade. If they increased their share of world exports by 5%, developing countries would earn an extra $350bn a year, three times more than they will be given in 2015. Any government that wanted to help developing nations would surely make the terms of trade between rich and poor its priority.
This, indeed, is what the UK appears to have done. In March it published the most progressive foreign policy document ever to have escaped from Whitehall. A paper by the departments of trade and international development promised that: "We will not force trade liberalisation on developing countries." It recognised that a policy that insists on equal terms for rich and poor is like pitting a bull mastiff against a chihuahua .Unless a country can first build up its industries behind protectionist barriers, it will be destroyed by free trade. Almost every nation that is rich today, including the UK and the US, used this strategy. But the current rules forbid the poor from following them. The EU, the paper insisted, should, while opening its own markets, allow poor nations "20 years or more" to open theirs.
But two weeks ago the Guardian obtained a leaked letter showing that Peter Mandelson, the European trade commissioner, was undermining the UK's new policies. His most senior official complained that the policy document was "a major and unwelcome shift... Mandelson is taking up our concerns and will press for a revised UK line".
We are being asked to believe, in other words, that a man who owes his entire political career to Tony Blair, and who has repaid him with nauseating sycophancy, was conspiring to destroy his cherished policy. It doesn't look likely, and it doesn't take a great imaginative effort to see a double game being played. Before the election, Blair makes one of his tear-jerking appeals for love, compassion and human fellowship, and gets the anti-poverty movement off his back. After the election he discovers, to his inestimable regret, that love, compassion and human fellowship won't after all be possible, as a result of a ruling by the European commission.
This outcome was predicted by the World Development Movement when the remarkable paper was published in March. "Time will tell if the UK ... will put real political capital into this announcement, or if they will hide behind the European commission and claim inability to affect the negotiations." Nostradamus had nothing on these guys.
The idea that Blair had no more intention of introducing fair terms of trade than I have of becoming a Catholic priest gains credence from the UK's support for the bid by Pascal Lamy, Mandelson's predecessor, to become head of the World Trade Organisation - a post he won on Thursday. Making Lamy head of the WTO is as mad as making, say, Paul Wolfowitz... er, satire doesn't really seem to work any more.
Everyone seems to have forgotten that Lamy was the man who destroyed the world trade talks in Mexico in September 2003. He tried to force through new rules on investment, competition and procurement, which would have allowed corporations to dictate terms to the poor world's governments. He persisted with this policy even when he had lost the support of European governments, and when it became obvious that his position would force the poorer nations to pull out. For cynics like me, it wasn't hard to see why. For the first time in the WTO's history, the poor nations were making effective use of collective bargaining and demanding major concessions from the rich. By destroying the talks, Lamy prevented a fairer trading regime from being introduced. He left the rich countries free to strike individual treaties with their weaker trading partners. And the UK and the rest of Europe hid behind him.
So the poor world is going to need the extra aid, in 2015 and far beyond. This means that it will remain obedient to the demands of countries with an interest in its continued exploitation. Those demands have done more than anything else to hold it down. As the World Bank's own figures show, across the 20 years (1960-80) before it and the IMF started introducing strict conditions on the countries that accepted their loans, median annual growth in developing countries was 2.5%. In the 18 years after (1980-1998), it was 0.0%.
The British government has made its own contribution to the poor world's misery by tying aid disbursements to the privatisation of essential public services. It has been paying the Adam Smith Institute, a rightwing lobby group, up to �9m a year to oversee privatisation programmes in developing countries. Last week Tanzania pulled out of a deal our government had rigged up for the British company Biwater to privatise water supplies in Dar es Salaam.
Again the government admitted, before the election, that its critics were right. The Department for International Development (DfID) published a long mea culpa in which it promised: "We will not make our aid conditional on specific policy decisions by partner governments, or attempt to impose policy choices on them (including ... privatisation or trade liberalisation)." It looks great, until you read the whole document. On privatisation, DfID admits that there was "concern that in the 1980s and 1990s donors pushed for the introduction of reforms, regardless of whether these were in countries' best interests." The 80s and 90s, eh? What about the privatisation it was demanding in 2004 and early 2005? What about its recent assault on the public services of Tanzania, South Africa, Ghana and the Indian state of Andhra Pradesh? What about the money it is still paying the effing Adam Smith Institute?
DfID goes on to say that it will decide whether to give money to a country by looking "to the IMF to provide an assessment of a country's macroeconomic position". It knows full well that the IMF continues to judge countries by the degree to which they embrace privatisation and liberalisation. Yet again the British government is outsourcing its ethics, using the policy of an international body to make justice history.
While using the right language and flattering their critics, the UK and the EU are keeping the poorer nations where they want them: beholden to their patrons. Suddenly, an increase in aid doesn't look like such good news after all.
And if you (as I'm sure many of you do) disagree, please explain - in detail - how free trade helps feed the poor. Come on, convince me! |
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Nowhere Man
Joined: 08 Feb 2004
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| Posted: Tue May 31, 2005 6:33 am Post subject: ... |
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And I'll head them off at the pass.
It doies feed the poor, but it locks them into their current economic condition. Which is: poor for the poor, rich for the rich. |
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Joo Rip Gwa Rhhee
Joined: 25 May 2003
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| Posted: Tue May 31, 2005 7:02 am Post subject: |
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I don't know about that in look at Asia.
Free trade made Korea and Taiwan and Singapore rich. And it seems to be doing the trick in China and India. |
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bucheon bum
Joined: 16 Jan 2003
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| Posted: Tue May 31, 2005 10:46 am Post subject: |
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| Joo Rip Gwa Rhhee wrote: |
I don't know about that in look at Asia.
Free trade made Korea and Taiwan and Singapore rich. And it seems to be doing the trick in China and India. |
Exactly.
My religion? Free trade.
Honestly. |
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Wangja
Joined: 17 May 2004
Location: Seoul, Yongsan
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| Posted: Tue May 31, 2005 12:50 pm Post subject: |
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| Joo Rip Gwa Rhhee wrote: |
I don't know about that in look at Asia.
Free trade made Korea and Taiwan and Singapore rich. And it seems to be doing the trick in China and India. |
I am a free trader too.
But it is disingenuous to say that free trade made Korea etc rich. Korea at least of the three (don't know about the others) did not and even now does not practice free trade, with tariff barriers on a number of products. Just as does the USA.
What would be more true to say is that the free trade policies of countries like US, UK etc, opened the door. Thus, a kind of "one-way" free trade was exisiting. |
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soviet_man
Joined: 23 Apr 2005
Location: Seoul
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| Posted: Tue May 31, 2005 1:06 pm Post subject: |
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* Half the world - three billion people - live on less than two US dollars a day.
* 20% of the population in developed nations, consume 86% of the worlds goods.
* The 48 poorest countries account for less than 0.4 per cent of global exports.
* The GDP (Gross Domestic Product) of the poorest 48 nations, is less than the wealth of the world's three richest people combined.
SOURCE: www.globalissues.org
"Free Markets" don't feed. |
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Ya-ta Boy
Joined: 16 Jan 2003
Location: Established in 1994
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| Posted: Tue May 31, 2005 1:26 pm Post subject: |
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| Quote: |
| It doies feed the poor, but it locks them into their current economic condition. |
This is not necessarily true. In the early 60's Made in Japan meant the product was cheap and shoddy. But the Japanese took their income from that kind of industry and leap-frogged into making high tech. The Koreans have done much the same thing.
The lesson is: Ya gotta start somewhere. |
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jaganath69
Joined: 17 Jul 2003
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| Posted: Tue May 31, 2005 2:20 pm Post subject: |
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The problem for most developing nations is finding export markets for their products, which are mainly agricultural. The problem is, Europe, the US and other first world countries impose restrictive tarrif barriers on developing nations' agricultural products mainly due to domestic pressure from farm lobbies. To imply that we now live in a world of free trade is nonsense, I would posit that 'free-ish' trade is a better term. Only when these states have access to rich markets will they realize their true economic potential.
On a different point, as for shielding domestic industries behind protectionist barriers, it worked for some, but others following this model became by-words for shoddyness and ineficiency. Just take a look at India in the period from independence to 1993 when free market reforms started to kick in or Nyrere's Tanzania. Import substitution and protectionism were marked failures in creating strong national industries.
My avatar also hints at the fact that famine and pestilence in the modern era have largely been the products of dictatorial regimes and the closed economic situations that go with them. Famine in Ethiopia? Marxist regime. Stalinist Russia, Mao's China, Pol Pot's Cambodia, Burma under the SLORC, need I go on? Where in the capitalist world have we seen similar suffering? Nowhere, why? Its only when people have an interest in their own economic well being and can make decisions for themselves based on their own rational self interest that they can thrive.
PS, As for the poster 'Socialism Works' are you serious, or is this an elaborate troll. Being the inheritor of an ideology that has killed over 26 million in China and the former USSR alone should make you stop in your tracks and think. Any wonder that the few marxists that are left are reduced to selling crappy newspapers and shouting empty slogans around university campuses these days. I hope you see the light soon. |
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Cthulhu
Joined: 02 Feb 2003
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| Posted: Tue May 31, 2005 3:23 pm Post subject: |
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| jaganath69 wrote: |
My avatar also hints at the fact that famine and pestilence in the modern era have largely been the products of dictatorial regimes and the closed economic situations that go with them. Famine in Ethiopia? Marxist regime. Stalinist Russia, Mao's China, Pol Pot's Cambodia, Burma under the SLORC, need I go on? Where in the capitalist world have we seen similar suffering? Nowhere, why? Its only when people have an interest in their own economic well being and can make decisions for themselves based on their own rational self interest that they can thrive. |
That's a damn good point. |
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Big_Bird
Joined: 31 Jan 2003
Location: Sometimes here sometimes there...
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| Posted: Tue May 31, 2005 4:18 pm Post subject: |
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| bucheon bum wrote: |
| Joo Rip Gwa Rhhee wrote: |
I don't know about that in look at Asia.
Free trade made Korea and Taiwan and Singapore rich. And it seems to be doing the trick in China and India. |
Exactly.
My religion? Free trade.
Honestly. |
This is typical bucheon bum. In your post you have written.......nothing.
I asked for posters to explain - in detail - how free markets work in such a way that they benefit the poor.
Joo's examples include countries which have used protectionist policies to nurture their economies. They did not offer free markets, and have benefitted from the freer markets of other countries. Let's look at China for example. China employed tarrif barriers and import quotas to protect its own industries. It also has a fixed exchange rate to keep the value of the yuan down which makes China's exports more marketable and makes imports very expensive for its domestic markets. China knows that laissez faire economics are bad news for its practitioners.
The countries trying to shove "free markets" down the throats of developing nations do not offer free markets themselves, and they benefitted (and still do) from protectionist policies which allowed their economies to develop in the first place.
What we want are free for all markets in which we can rape and pillage the resources and cheap labour of vulnerable countries. Their economies will never develop to benefit the majority of their populations.
The US is certainly not going to give up its own protectionist policies that easily. |
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bucheon bum
Joined: 16 Jan 2003
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| Posted: Tue May 31, 2005 4:24 pm Post subject: |
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Wrong about singapore big bird. I'm not sure about Taiwan. But as others have mentioned, Korea did protect its market. Want another example? Hong Kong.
Look, everyone who bashes free trade never has facts to back it up. Want facts?
Look at vietnam since 1990. Look at Indonesia. Its poverty has shot down enormously the last 4 decades. Chile as well.
What facts do you have? none really. I have read a number of books against "free trade" and I'm always frustrated. They claim NAFTA bombed yet don't say how. Mexico is in better shape now than when it had a closed economy.
And when i mean free trade, I mean free trade. I don't pretend the USA follows it, or any nation. Chile and Singapore come the closest. Hong Kong unfortunately isn't a country so doesn't qualify. |
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Kuros
Joined: 27 Apr 2004
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| Posted: Tue May 31, 2005 7:03 pm Post subject: |
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Big_Bird, don't you mean imperialist neo-liberalism kills? Free markets, truly free markets, don't have an agenda. They don't have strategic tariffs or corporate welfare.
And the fact of the matter is, even imperialist neo-liberalism has a better track record on supplying food than most 'socialism' (properly, authoritarian leftist/rightist regimes combining populist with nationalist rhetoric). |
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soviet_man
Joined: 23 Apr 2005
Location: Seoul
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| Posted: Tue May 31, 2005 7:51 pm Post subject: |
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| Quote: |
| Being the inheritor of an ideology that has killed over 26 million in China and the former USSR alone should make you stop in your tracks and think. |
There is more than enough food to feed everyone in the world.
Yet free-markets and massive third-world debt are precisely the reasons that food is prevented from getting to the people who need it the most.
Currently 5 billion people (out of 6.39 billion) live in the developing world, most in poverty and without adequate food.
That has nothing to do with socialism. It has everything to do with laissez-faire capitalism that has been imposed all around them. |
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jaganath69
Joined: 17 Jul 2003
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| Posted: Tue May 31, 2005 8:00 pm Post subject: |
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| soviet_man wrote: |
| Quote: |
| Being the inheritor of an ideology that has killed over 26 million in China and the former USSR alone should make you stop in your tracks and think. |
There is more than enough food to feed everyone in the world.
Yet free-markets and massive third-world debt are precisely the reasons that food is prevented from getting to the people who need it the most.
Currently 5 billion people (out of 6.39 billion) live in the developing world, most in poverty and without adequate food.
That has nothing to do with socialism. It has everything to do with laissez-faire capitalism that has been imposed all around them. |
Yeah, I see people rising up every day to demand an end to capitalism!  After all, those people in Eastern Europe in the late 80s and early 90s were so happy with it, they decided they wanted more, not! You talk about an imposed system, yet fail to realize the unpopularity of a nasty scheme such as Marxism-Leninism-Maoism-callitwhatyouwantism. How often do the people of Cuba, Vietnam, Laos and North Korea have the right to exercise universal suffrage for the candidate of their choice? Capitalism is not perfect, as utalitarian market liberal I realize that, but at least it does not promise utopia. Wake up, smell the coffee and realize that life is not easy and there is no grand solution to everything, just a system that works better than others. |
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Wangja
Joined: 17 May 2004
Location: Seoul, Yongsan
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| Posted: Tue May 31, 2005 8:29 pm Post subject: |
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Well, 'ere's a conundrum.
In the Economist, there is an article about Chinese textile exports, with fimrs both sides of the pond screaming for protection.
So, do we continue the imports, and let some Chinese eat?
Or stop them and let US and Europeans eat?
The link is here http://www.economist.com/agenda/displayStory.cfm?story_id=4010991 but it may not work as I think the article is premium coontent. |
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