STOP NATO: ¡NO PASARAN! - HTTP://WWW.STOPNATO.ORG.UK --------------------------- ListBot Sponsor -------------------------- Start Your Own FREE Email List at http://www.listbot.com/links/joinlb ---------------------------------------------------------------------- -----Original Message----- From: [EMAIL PROTECTED] [mailto:[EMAIL PROTECTED]]On Behalf Of Bob Everton Sent: Monday, July 02, 2001 5:27 PM To: [EMAIL PROTECTED] Subject: san: Marxists and Neolib Economists Debate Globalization in Cuba Subject: What is Globalization? Cuba: Jan 2001 - "In our countries we don't have economic policies", commented the president of the National College of Economists of Bolivia, "we sign annual statements of intent between the government and the IMF." An excellent review of presentations by a range of economists - neo-classical to Marxist and shades in between at the 2nd Meeting on "Globalisation and Problems of Development" held in Cuba, January 24-28th, by the National Association of Cuban Economists and the Association of Economists of Latin America and the Caribbean. Talks focused on "What is Globalization?", Globalization and Crisis, meaning of Seattle, Cuba, and solutions to problems through taxation, regional integration and the future of socialism among other things. fyi-janet ===================================== http://jinx.sistm.unsw.edu.au/~greenlft/2000/392/392p14.htm Globalisation -- understanding and resisting the monster By Dick Nichols HAVANA, Cuba -- What happens when you pour into one pot more than 800 economists from 58 countries representing nearly every viewpoint on the analytical and political spectrum? That's what occurred here on January 24-28 when some bold cooks, the National Association of Cuban Economists and the Association of Economists of Latin America and the Caribbean, held their Second Meeting on Globalisation and Problems of Development. The resulting stew was not as unpalatable as might have been feared when Chilean neo-classical economists are added to Latin American Marxists of various stripes, and dollops of every other school as well. The conference, a direct initiative of Cuban President Fidel Castro, began with a presentation from Ignacio Ramonet, the editor-in-chief of Le Monde Diplomatique. For Ramonet, globalisation represents a new phase in the world economy in which finance capital and the multinational firm dominate, turning "compete or perish" into a universal imperative. In economics, globalisation has "killed the national market" and led to the "takeover of the public by the private", Ramonet said. In politics it has "confiscated democracy", "destroyed the basic values of the bourgeois revolution" and established the International Monetary Fund (IMF) and the World Bank as a "planetary executive". In culture it means the "universalisation of banality and violence". Ramonet was passionate in his support for "global" movements and campaigns, such as the revolt at Seattle, the proposal of US economist James Tobin for a tax on short-term international capital movements, the Campaign to Abolish Third World Debt and the demand that First World governments devote 0.7% of gross domestic product to Third World development. What is globalisation? Ramonet was followed by Jan Kregel of the United Nations Council on Trade and Development, who outlined how development as an issue for the international community had totally dropped off the agenda. However, Ramonet's extreme globalisation thesis was the target of all the subsequent discussion. Globalisation is predominantly a cultural phenomenon, argued Jaime Loring, from Spain's University of Cordoba. Others stressed that there's nothing in recent economic statistics for international trade, foreign investment and even the concentration of capital that hasn't been equalled or topped in previous periods. The most virulent comment was to come from Canadian analyst of the transnational firm, Frederic Clairmont: globalisation was a "vile buzzword" designed to "drug the peoples" with the feeling that struggle against the world-system is useless. However, while less apocalyptic in tone than Ramonet, most of the Marxist analysts present accepted that a qualitative change in world economy has taken place over the past 15 years. They differed, however, in the aspects stressed. For many, including the governor of the Central Bank of Cuba, Francisco Soberon Valdes, the central feature is the ballooning of global financial transactions of all sorts, and the "terrible dangers" posed by a stock market crash, a trading house bankruptcy or loan default by a Third World country. With a candour that no capitalist central banker could permit himself, Soberon told of the response he had received when he asked former IMF director Michel Camdessus and James Leach, the chairman of the banking committee of the US Congress, what measures were in train to control the activities of such operations as Long Term Capital Management. (In 1998 this US hedge fund had to be rescued by the $3.7 billion package from the US Federal Reserve. According to Federal Reserve chairman Alan Greenspan, collapse of Long Term "would have set off a potential decline in the economies of many nations, including our own".) Soberon said, "The replies that I got in both cases can be summed up like this: they understood the seriousness of the situation but as yet they had no clear proposal about how to solve it. "In the end I came away with the sensation of someone who is flying in an aeroplane in which there are several passengers who, if they sneeze, can cause the plane to crash, yet the doctors on board don't know where their medical records are nor what to do to stop them from catching cold." This stress on the financial aspects of globalisation was so marked that Daniel Hernandez, from Venezuela's Institute of Communications Research, was driven to offer this comment to Globalizacion 2000, the conference's daily newspaper: "For the most part the discussion has centred on finance capital and left to one side the central problem, because, at least for Marxist theory, that sector is a reflection of the real, productive sector and when the discussion gets centred solely or mainly on the financial problem one leaves aside the whole problem of the restructuring of the world productive apparatus. It's in the productive process that relations of exploitation and domination materialise, while in the financial sphere this effect is not seen clearly." Defining globalisation caused fewer problems and differences among the non-Marxist economists. Both the outright neo-classical adherents, like Chile's Patricio Meller and Alberto Sepulveda, and the more Keynesian majority saw it as a process of progressive integration of national markets into increasingly uniform global markets. Most advanced in the finance sector, it is seen as spreading to all branches of industry and has been driven by the massive reduction in the cost of communication and the deregulation of global finance markets. As a result firms increasingly have to plan for a world market in which global competition is the rule rather than the exception, and this irrespective of whether their production and investment is concentrated in their home country. Benefits and costs But do the benefits of increased international economic integration outweigh the costs? Meller, the conference's devil's advocate, was in no doubt: for economies which aren't afraid of facing the new world, globalisation can bring access to technology, incorporation of new ideas and "force us to think" in a world economy that will be increasingly knowledge-based. In Chile the opening up of the economy to the world market had boosted exports from 15% to 30% of gross domestic product, changed the mentality of Chilean firms, and "produced a virtuous circle of development" embodied in a 6% growth rate in the 1990s. Yes, there have been costs: exposure to "external shocks" operating through capital flows have increased; income inequality has widened; and labour has had to bear the "brunt of adjustment" through job loss, increased insecurity and casualisation of work, weakened unions and "exacerbated social tension". But Meller asked bluntly: "What's the alternative?" The counterattack came from Arturo Huerta of the National Autonomous University of Mexico (UNAM). The past period of exposure to "globalisation" had all been to the benefit of one economy, the United States. In Mexico in 1999 the rise in exports had been accompanied by a fall in national income, and "Mexican exports" have a low national content anyway -- that of the country's cheap labour. What growth has taken place was totally dependent on continuing capital inflows to take advantage of the country's massive privatisation program. Far from Meller's "virtuous circle", Mexico was experiencing a vicious circle of increasing dependence. In such conditions opening out to globalisation was simply not feasible, and the answer was a program of national economic reconstruction driven by the organisations of the left. The ensuing discussion produced a hailstorm of attacks on Meller. Where in his idealised picture of Chile's gains from comparative advantage was growing monopolisation, access only to yesterday's technology, lack of social investment and continuing decline in the terms of trade? Where was the social inequality and the devastation of a once-pristine land and marine environment? An enraged Theotonio Dos Santos, a well-known Marxist economist from Brazil's Federal Fluminense University, reminded Meller that the 20th century had been one of wars and fascism, rather than "gains from trade". For Meller and Sepulveda all this was missing the point, namely what economy to develop to best adapt to the world as it is. Unlike Mexico the majority of capital inflows were not short-term and speculative but for long-term productive investment; while Chile was certainly a three-class society in which few moved from one class to another conditions for each class, including social expenditure, had been improving consistently. In a barely concealed reference to Cuba (Castro was listening to the entire discussion), Meller asked whether the alternative of equality in poverty was preferable. Globalisation and crisis The presentation of well-known Egyptian economist Samir Amin, represented at the meeting by French researcher Remy Herrera, opened discussion of globalisation and capitalist crisis. For Amin globalisation's most important feature is that, given the end of the Soviet Union, it allows a re-colonisation of the South by the "Triad" of the North (United States, Japan and Europe). This crisis is structural and can only be overcome through establishing a multipolar democratic order which renegotiates spheres of influence, market access, the role of the World Trade Organisation and international financial and exchange rate systems. New international institutions and a democratised United Nations are needed to penalise polluters and oversee world demilitarisation. Amin's paper opened the way to a host of sub-themes. How much is the North exploiting the South? In "Globalisation and imperialism: the transfer of Latin America's surpluses", John Saxe-Fernandez of UNAM produced conservative estimates that showed Latin America being drained of $30 billion annually. How effective have regional arrangements like the Mercosur agreement in the southern "cone" of Latin America been? Monica Yukie-Kumakaha of Brazil's Mackenzie University painted a picture of a rickety oligopoly marked by competitive devaluations and mini-trade wars and truces between Argentina, Chile and Brazil. What is the role of the state in the "new world order"? Little polemic here: most speakers agreed that in the imperialist North the nation-state was as important as ever. In the South the state was losing ground: "In our countries we don't have economic policies", commented the president of the National College of Economists of Bolivia, "we sign annual statements of intent between the government and the IMF." The most thorough presentation of the complex relation between globalisation and crisis came from Jorge Beinstein of the University of Buenos Aires. Beinstein read globalisation and the expansion of the "speculative bubble" historically, as the inevitable result of declining growth and profit rates since the 1970s and showed how the main features of today's world of regional decline (Africa), financial crises in the "periphery" (Russia, Brazil, Mexico), economic stagnation (Japan) and speculative euphoria (the United States) all fitted together and mutually determined each other. Beinstein's prognosis? More of the same in the first years of the new millennium. Seattle, foreign debt and development The conference took place against a background of the Seattle World Trade Organisation protests and the mass uprising of Ecuador's indigenous peoples. For Jean Pierre Cling of the French ministry of finance, the WTO failure at Seattle was a pyrrhic victory for the countries of Latin America, because it would inevitably produce a new wave of US protectionism. Not so, said Eric Toussaint of the Campaign to Cancel Third World Debt and Alfonso Gianni, a member of parliament for Italy's Party of Communist Refoundation. "Seattle was a very important counter-movement", the Italian stressed. "It showed that all-powerful and unaccountable institutions can be made to bend to the people's will." For Toussaint, Seattle was a chance to develop a fair international trade regime that compensates the South. He spoke out in favour of "protectionism of the South", producer cartels of the South and South-South regional agreements. In a presentation on foreign debt Toussaint also explained in detail how much a cancellation of the foreign debt would release for development. He was supported by Sorbonne researchers Carlos Quennan and Pierre Laurent who outlined the catastrophic effects a rise in world interest rates would have on existing debt levels, producing a return to the Latin American debt crises of the 1980s. Quennan said, "The central question is that the present way development is financed -- based on short-term capital inflows and the issuing of bonds on international finance markets -- is scarcely sustainable. Combining that scheme of things with the difficulties that exist in maintaining macro-economic stability is very hard, since the natural reaction of investors is to think that such countries are high risk and so interest rates rise, making the debtors' position unsustainable." Regional integration? Fair taxation? After three days of debate most of the cards were now out on the table, but while the majority had little difficulty in demonstrating both the terrible costs of the "model" and the impossibility of reproducing it generally, there was little agreement as to alternatives. Moreover, the emphasis on the financial aspects of the crisis inevitably saw the re-emergence of old and new schemes to tax the unproductive speculator and rentier. "How to turn back globalisation" was the confident title of a sales pitch by Michael Hudson and Ted Gwartney for 19th century radical Henry George's single tax on unearned income, while the Tobin tax found support among a wide range of those present. The broadest consensus was achieved around the need for regional integration: Latin America had to establish the structures that would enable it to compete best in the world market. Sepulveda noted, "The problem is that our countries have been used since their founding as nations to respond to problems in an individual way. Only now are we learning the road to integration ... To compete we have to create economic spaces that allow the growth of Latin American super-firms. More than 50% of Asian trade takes place among countries of that same region ... In contrast, in South America it barely touches 15%." The fourth day was devoted to various aspects of this theme, with representatives of such international institutions as the World Bank, the Interamerican Development Bank, and the Economic Commission for Latin America and the Caribbean all speaking. This was also the day for the followers of US development theorist Michael Porter, with his theories of how particular locations like Silicon Valley or parts of Northern Italy develop "competitive advantage". One key element received insufficient emphasis in this entire debate -- the massive excess capacity presently existing in all major branches of industry on a world scale. This "overaccumulation of capital" is responsible for the downward pressure on profit rates, the drive to transnational mergers and acquisitions and the elimination of jobs. Thus, while there may be a place for taxes on speculative activity and regional trade pacts, these can never get to the heart of the problem -- the refusal of the capitalist class to invest while it judges that conditions are unfavourable. Socialism? After a day of debate about models of regional integration, many -- and not just the left -- were beginning to yawn. But this was not to be the note on which the conference ended. First, Venezuela's Daniel Hernandez gave an analysis of monopolisation in the global communications industry, such as to eliminate any fantasies about Latin America developing comparative or competitive advantage in that sector. Next, Heinz Dieterich, the chair of the Forum for Emancipation and Identity in Latin America, unleashed a caustic critique of all the main neo-liberal recipes and claims. Integration plans? They have their place, but the most important thing is the struggle of the peoples. Had everyone forgotten that the first time the US actually offered aid to Latin America was after the Cuban Revolution? The most hopeful trend against neo-liberal globalisation was the fact that an entire swathe of Latin America, from Chiapas to Colombia and including Cuba and Venezuela, was now practically out of the control of the United States. By unifying and intensifying these struggles the peoples of Latin America could begin to impose its own terms on the imperialist heartlands. Given the state of the Latin American left, socialism was not an immediate prospect in any country, he argued, but it's critical to understand that socialism as an historic project was alive and well. Dieterich's sketch of what democratically planned economy could achieve in Latin America was vivid and compelling. As for the champions of neo-liberalism, they were "very civil but very implacable" and "we should adopt the same tone towards them". One listener expressed his appreciation of Dieterich's speech -- Fidel Castro. It triggered a two-hour intervention by the Cuban leader in which he laid to rest any ideas that Cuba would join the IMF ("they rather should join us"), recounted with pride what the country had been able to achieve ("so much done with so little"), unleashed a comic attack on the "culture" of globalisation ("universal brainlessness") and scored the hypocrisy of the US Congress in the case of Elian Gonzalez, the hostage of the Miami mafia. The Cuban leader also repeated his message from the first Meeting, namely that the people of the world had to develop their own globalisation: "What sort of globalisation will it be? It can't be other than that of solidarity, communist, or however you want to call it." The Second Meeting was an invaluable initiative which only Cuba could have undertaken, and which will be repeated next year, with the focus on practical proposals. At the same time the National Association of Cuban Economists has decided to set up an institute to study globalisation, an initiative that will also be duplicated in Argentina. For that Third Meeting to take steps forward, we should hope to see a greater presence of European globalisation analysts, a greater use of workshops, and, perhaps, less altruism in accommodating all points of view. One element should definitely be maintained -- the final dance to a fiery salsa band which had even the gawkiest economists on their feet. Dick Nichols http://jinx.sistm.unsw.edu.au/~greenlft/2000/392/392p14.htm -- ______________________________________________________________________ To unsubscribe, write to [EMAIL PROTECTED]
