Stripping Down Globalization

By Rebick, Judy | Herizons, Fall 2000 | Go to article overview
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Stripping Down Globalization

Rebick, Judy, Herizons


A single man facing down the tanks in Tiananmen Square is one of our most enduring images of the struggle for democracy. That particular struggle was crushed, but none of us doubts that some day the Chinese people will win the democratic rights that young man was fighting for. What is in doubt is what these rights mean at the turn of the century. What do democratic rights mean in a world where a small elite is imposing its will through instruments of economic domination and cultural assimilation instead of instruments of mass destruction?

In his book When Corporations Rule the World, anti-corporate activist David C. Korten reports that from 1980, which was the beginning of the World Bank-IMF structural adjustment programs, to 1992, the disparity of imports over exports in low-income nations increased from $6.5 billion to $34.7 billion. In that same period, the international indebtedness of those countries increased from $134 billion to $473 billion. According to the Jubilee 2000 Coalition, which sought to eliminate debt for the globe's poorest countries by the year 2000, each person in the Third World now owes about $500 to the West, a sum that is much more than a year's wage for many. Africa spends four times as much money on debt repayment as it does on health care.

What happens in these countries is that more and more money is earmarked for interest payments and government spending on services for citizens decreases. Governments borrow money to pay their debts, racking up even higher debts in the process, and then have to borrow more money to pay the new debts. Instead of spending money on improving the lives of their own citizens, borrowing countries are paying back the banks and other investors.

According to Korten, in Latin America the portion of government spending allocated to interest payments increased from 9 percent to 19.3 percent between 1980 and 1987. In Africa, it rose from 7.7 percent to 12.5 percent. "In their roles as international debt collectors, the World Bank and the IMF have become increasingly intrusive in dictating the public policies of indebted countries and undermining progress toward democratic governance and public accountability," writes Korten. In other words, international bureaucrats are imposing public policy on a host of Third World countries. This policy, called structural adjustment, establishes the kind of economic system we are beginning to become used to in Canada. Cuts in social services, particularly for the poor, privatization, deregulation and fiscal restraint have an even more devastating impact in poor countries than they have in our own. According to Jonathan Cahn, writing in the Harvard Human Rights Journal, "[World] Bank-approved consultants often rewrite a country's trade policy, fiscal policies, civil service requirements, labour laws, health care arrangements, environmental regulations, energy policy, resettlement requirements, procurement rules and budgetary policies." He who pays the piper, in other words, calls the tune.

The famed civil-rights activist and American presidential candidate Jesse Jackson has been quoted as saying, "They [the oppressors] no longer use bullets and ropes. They use the World Bank and the IMF." There is no element of democracy here. According to Korten, "The internal operating processes of the World Bank are so secretive that access to many of its most important documents relating to country plans, strategies and priorities is denied to even its own government directors."

Deepening democracy in the South becomes more and more difficult because of the "solutions" imposed by the World Bank and the IMF, not to mention the even harsher discipline of international investors, who can collapse an economy in an instant if they decide to withdraw their money. The combination of these intrusive monetary policies and the effusive expansion of global consumerism has massively changed the political culture.

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