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Globalization and poverty
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John Perkins
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Sep 22, 2003 19:53 PDT
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This is the text of a small item I have submitted to Victorian Humanist, in
response to some anti-globalization reviews and presentations:
Sometimes a little knowledge can be a dangerous thing. Therefore one would
have to commend those commentators who are willing to venture well outside
their areas of competence in order to offer advice on matters of global
economics. However when their comments appear to cast organizations such as
the World Bank, the IMF and the WTO as like menacing malevolent demons,
stalking the earth and wilfully causing widespread environmental
destruction, inequity and poverty, their ideas pass well and truly into the
realm of fantasy.
The basic purpose of the IMF is to facilitate financial transactions
between countries that would otherwise be unable to trade. The purpose of
the World Bank is to provide finance for development projects in poor
countries that are too risky for any commercial bank to undertake. These
are beneficial functions. Without them, developing countries would
unambiguously be worse off. With no IMF, many countries would be forced to
cease trading causing gross hardship to their already impoverished
populations. With no World Bank, developing countries may be deprived from
all hope of economic improvement and thereby relief from poverty.
Economic failure in developing countries occurs in spite of, not because
of, the IMF or the World Bank. It is caused by corruption, incompetence,
ignorance and lack of opportunity. The latter is in large part due to the
trade restrictions on agricultural goods and subsidies thereon imposed by
developed countries. This amounts to over US $300 billion annually, which
is six times the global aid budget. The rules that currently govern world
trade have developed over the last fifty years, mainly as the product of
agreements between developed countries. The refusal of the EU, USA, Japan
and Korea to extend free trade to agricultural goods amounts to a
conspiracy by the world's richest countries to deprive the world's poorest
countries of income. The situation can reasonably be described as one of
venal extortion. Currently it is not illegal; otherwise it could be and
should be described as a crime against humanity.
It has been estimated that extension of free trade could benefit developing
countries by more than US $200 billion, generating 100 million jobs and
lifting 400 million people from poverty (defined as earning less than US $2
per day). Repeated attempts at WTO meetings to address this egregious
situation have so far always been sabotaged by rich country vested
interests. Incredibly, the failure of WTO talks is often encouraged and
celebrated by presumably well-meaning middle-class rich-country
anti-globalists. In reality, their demonization of the WTO is like a modern
day witch-hunt, and their behaviour may be likened to that of ignorant
medieval peasants celebrating the burning of witches at the stake.
It is difficult to imagine how a humanist could support policies that
condemn hundreds of millions of people to poverty of less than US $2 per
day. Yet that is implication of the position adopted and supported by
anti-WTO anti-globalists. They have been described as "rebels without a
clue", yet their influence as an excuse for inaction by policy makers in
not insubstantial.
The solution to the world's problems lies in strengthening global
institutions, not abolishing them. In particular, common national laws that
govern the behaviour of companies, for taxation, competition and consumer
protection, should be granted international jurisdiction. This will only be
achieved with greater dedication to the implementation of a universal
ethic, based on meticulous and knowledgeable application of principles such
as non-malevolence, benevolence, honesty and justice - a greater love of
and care for humanity.
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