Whither
Globalisation?
By Bal Patil
22 February, 2007
Countercurrents.org
Abstract
The world today is embroiled in an economic turmoil caused by the globalisation
process. It is a veritable confusion worse confounded by the North versus
South polarities of trading policies, developmental disparities and
stark reality of opulence contrasted with destitution. These are increasingly
brought in close encounters of an unforeseen variety in an inter-connected
global environment with unprecedented, unpredictable and unnatural fusion
of economic systems mixed in a strange brew of socio-ethnic and cultural
cross-currents buffetted hither and thither by perennial human greed.
An unprecedented global dilemma posed by the merciless process of globalisation
with all its ostensible benefits and built-in evils.
The natural resources of
the earth are not inexhaustible. Oil is fast depleting. The last barrel
of oil is not too far. A new energy future has to be worked out. Nearly
2.2 billion people in more than 62 countries, one-third of the world's
population, are starved for water. Global population has tripled in
the past 70 years while water use has grown sixfold due to industrial
development, widespread irrigation, and lack of conservation. It is
feared scarcity of water may lead to third world war.1 To top it all
there is a projected 3C jump in global temperature caused by global
warming which in turn would include a loss of up to 400 million tonnes
of cereal production and put between 1.2 billion and three billion people-
half of the current world’s population- at risk of water shortage.
It is a case of double jeopardy. This is a wake-up call for the developed
industrial nations.
In “a terrible indictment
of the world in 2007” the UN said 18,000 children die every day
of hunger and malnutrition and 85 million go to bed every night with
empty stomach, 100 mm. Indian kids are malnourished. The spectre of
global warming is knocking at the door. With the US poised for a MAD
nuclear adventure the mankind is in for a future shock as never before
in human history. It is truly all this and hell too scenario.
‘Oh, yes, the time
has come, my little friends To talk of food and things Of peppercorns
and mustard ... The time has come,' as the Walrus said.2 Can the world
really afford to hanker after opening this Pandora’s box? Isn’t
this an appropriate time to think about the basic economic ideology
of social justice? Equality is neither outdated nor is it the enemy
of freedom. The voices of the voiceless, disadvantaged, the diseased
and the destitutes, the less privileged in large parts of the world
should not be lost in the clamouring sophistry of debates in the cloistered
splendour of IMF and World Bank citadels.
>>>>>>>>>
I am not a trained economist, but a free-lance journalist and writer.
I was provoked to study economics by reading Gunnar Myrdal's Asian Drama
in the sixties, and also was inspired by the Keynesian observation in
his Essays in Persuasion in The End of Laissez-Faire:
"Let us clear from
the ground the metaphysical or general principles upon which, from time
to time, laissez-faire has been founded. It is not true that individuals
possess a prescriptive "natural liberty" in their economic
activities. There is no compact conferring perpetual rights on those
who Have or on those who Acquire. The world is not so governed from
above that private and social interest always coincide. It is not so
managed here below that in practice they coincide. It is not a correct
deduction from the Principles of Economics that enlightened self-interest
always operates in the public interest. Nor is it true that self-interest
generally is enlightened; more often individuals acting separately to
promote their own ends are ignorant or too weak to attain even these.
Experience does not show that individuals, when they make up a social
unit, are always less clear-sighted than when they act separately."3
This is the politics and
economics of social justice. And hence it was natural for the Father
of the Indian Nation, Mahatma Gandhi to give a dire warning: "Economic
equality is the master key to non-violent revolution. A non-violent
system of government is clearly an impossibility so long as the wide
gulf between the rich and hungry millions persists.The contrast between
the palaces of New Delhi and the miserable hovels of the poor, labouring
class cannot last one day in a free India in which the poor will enjoy
the same power as the richest in the land. A violent and bloody revolution
is certainty one day unless there is a voluntary abdication of riches
and the power that riches give and sharing them for the common good."4
But, alas, even after more
than half century of freedom the gulf is ever widening and with all
the glitter of globalisation hunger, starvation and suicide deaths are
increasing amidst agricultural surplus, and sometimes fifty million
tonnes of grain in godowns rots but cannot be sold at subsidised prices
for fear of pushing the market prices down. That is the harsh economic
reality!
The spate of farmer suicides
in the State Of Maharashtra, India is a pointer. There have been about
400 farmer suicides due to agricultural indebtedness during the year
2005. Farmer indebtedness in Maharashtra jumped from 29% in 1991-92
to 88.97% in 2003 against the all-India average of 87.64%. The extent
of indebtedness (debt in rupees per household at 1986-87 prices) between
1991-92 and ’03 increased by 232%. All-India average rise 210%.
(The Times of India, April 17, 2006)5
Child malnutrition is rampant
in Maharashtra and elsewhere in India . Not just tribals but, 47 per
cent of India’s children below the age of three are malnourished.
This is higher than in sub-Saharan Arica (30 per cent) which has a lower
per capita income. More than 10,000 children are believed to have died
of malnutrition in this State in the last couple of years. And such
dehumanising deprivation occurs in the fastest growing State of India.
What is ironical is the fact that children continue to die here not
because of scarcity of food but because of rampant corruption and theft
in the food distribution system. 6
As noted by David Gordon,
Professor in Social Justice in Radical Statistics Annual Conference
Global Child Poverty 26th February, 2005
“The world's biggest
killer and the greatest cause of ill health and suffering across the
globe is listed almost at the end of the International Classification
of Diseases. It is given Code Z59.5 -- extreme poverty. World Health
Organisation (1995)”7
In stark contrast to this
horrendous picture of poverty and starvation is the BBC News Published:
2006/04/15 as to how Britain is now 'eating the planet' by Mark Kinver
“The UK is about to
run out of its own natural resources and become dependent on supplies
from abroad, a report says. A study by the New Economics Foundation
(Nef) and the Open University says 16 April is the day when the nation
goes into "ecological debt" this year. It warns if annual
global consumption levels matched the UK's, it would take 3.1 Earths
to meet the demand.”8
Food wastage is also high: In the United Kingdom, “a shocking
30-40% of all food is never eaten;” In the last decade the amount
of food British people threw into the bin went up by 15%; Overall, £20
billion (approximately $38 billion US dollars) worth of food is thrown
away, every year.In the US 40-50% of all food ready for harvest never
gets eaten;... (Anup Shah, http://www.globalissues.org/TradeRelated/Poverty/Hunger/Causes.asp.)9
It is not a different story in America. Samana Siddiqui ( in her article
“Statistics on poverty & food wastage in America” notes
“According to the US Census Bureau, 35.9 million people live below
the poverty line in America including 12.9 million children. This is
despite abundance of food resources. Almost 100 billion pounds of food
is wasted in America each year. 700 million hungry human beings in different
parts of the world would have gladly accepted this food.”(http://www.soundvision.com/info/poor/statistics.asp)10
Every third person will be a slum dweller within 30 years, UN agency
warns. Biggest study of world's cities finds 940 million already living
in squalor (John Vidal,October 4, 2003) The Guardian. 11
The report, from the UN human
settlements programme, UN-habitat, Nairobi, found that urban slums were
growing faster than expected, and that the balance of global poverty
was shifting rapidly from the countryside to cities.
The report found that some slums were now as large as cities. The Kibera
district in Nairobi, classed as the largest slum in the world, has as
many as 600,000 people. The Dharavi area of Mumbai and the Orangi district
of Karachi have only slightly fewer people, while the Ashaiman slum
is now larger than the city of Tema in Ghana, around which it grew.
But the authors roundly blamed laissez-faire globalisation and "neo-liberal"
economic policies imposed on poor countries by global institutions such
as the International Monetary Fund and the World Trade Organisation
for much of the damage caused to cities over the past 20 years.
The authors conclude that as "cities have become a dumping ground
for people working in unskilled, unprotected and low-wage industries
and trades... the slums of the developing world swell".
In an Interview to Greg Ross, American Scientist’s, Managing Editor,
(The American Scientist www.americanscientist.org/ template/AssetDetail/assetid/50434)
Lester Brown of the Worldwatch Institute sees signs in the present global
economy of what the ecologists call an “overshoot-and-collapse”
mode in which demand exceeds the sustainable yield of natural system
which effect has toppled earlier civilizations and which is now occurring
at the global level.12
Is this globalisation a mad rush to serfdom? In his “Development
as Freedom”, 1999, Amarya Sen sees development "as a process
of expanding the real freedoms that people enjoy." Hence, "development
requires the removal of major sources of unfreedom: poverty as well
as tyranny, poor economic opportunities as well as systematic social
deprivation, neglect of public facilities as well as intolerance or
overactivity of repressive states."13
This perspective leads Sen to place special emphasis on basic health
care, especially for children, and basic education, especially for women.
Such economic vision has an unmistakeable Rawlsian perspective of the
maximisation of the well-being of the poorest member of a community
subject to the preservation of liberty.
The World Bank and the IMF are also targetted in Michel Chossudovsky's
The Globalization of Poverty, (Zed Books Ltd. London and New Jersey.
1997).14 Chossudovsky's thesis is that-- that Bank and Fund loan programs
create economic strait jackets which feeds on human poverty and the
destruction of the environment, generates social apartheid, encourages
racism and ethnic strife.
This topsyturvy economics leads me inevitably to Herbert Marcuse's classic
indictment in his One Dimensional Man (ABACUS, Sphere Books, 1972)15
of the modern technological society which is even truer today than in
the sixties: That in a modern technological society so called "free"
institutions and "democratic liberties" are used to limit
freedom, repress individuality, disguise exploitation, and limit the
scope of human experience. One wonders if it would be ever possible
to find a glimpse of light in this ever darkening tunnel. Even Plato
would be stumped for an answer.
I doubt if there can be a
straight answer to this trillion dollar question. Globalisation, oursourcing,
the entire chain of deficit, scarcity, inflation suddenly conjures up
images of a horrendous global depression. One wonders if the humanity
is going in the right direction? Are we not all like the tethered prisoners
in the Platonic cave?16 The Platonic image of the tunnel can perhaps
give a clue to the global dilemma we are confronted with.
I am afraid the question
:Should developing nations be allowed to ‘poach’ skilled
professional labour from countries who have helped pay for this experitse?”
is not quite fair. Isn’t it the other way round? Hasn’t
the Western world imperialists and colonial powers indulged in it to
their heart’s content? Isn’t this a case of pot calling
the kettle black?
A glance at the devastating
retail havoc let loose by the Wal-Mart and its decimation of the American
manufacturing jobs and enslavement of the labour abroad is enough to
show how as a result of the Wal-Mart model, combined with the depression,
more than 1 million manufacturing production jobs producing consumer
goods have been lost since July 2000 alone.
“Wal-Mart Is Not a
Business, It's an Economic Disease” by Richard Freeman and Arthur
Ticknor the Nov. 14 issue of Executive Intelligence Review.17
“The Wal-Mart department store chain, ...is levelling economies
of the U.S., industrial nations, and the Third World...Not since the
days of the British East India Company as the cornerstone of the British
imperial system, has one single corporate entity been responsible for
so much misery “Wal-Mart imports 10% of all America's total imports
from China. If Wal-Mart were a country, it would rank ahead of Great
Britain and Russia in total imports." Which reminds one of British
East India Company as the cornerstone of the British imperial system,
as one single corporate entity responsible for so much misery.
The situation has became
so outrageous, that it drew international attention. On Nov. 19, 2003
the Observer of London carried an article on the destruction of the
City of Buffalo, New York, mentioning the role of Wal-Mart. The article
tells the story of Buffalo Color, a manufacturing plant where indigo
dye for denim was produced. Once employing 3,000 workers, Buffalo Color
lost business to plants established in China, which produce the indigo
dye at half the cost that Buffalo Color does. Wal-Mart drove down the
price of the indigo dye used to color the denim for clothing.18
On Nov. 18-19 2003, the City of London's mouthpiece, the Financial Times,
ran four articles on Wal-Mart, centered on Wal-Mart's practices of hiring
and directing cleaning companies that employed foreign illegal workers
who cleaned Wal-Mart stores, seven nights a week, under hideous conditions.Ibid.
Remember the Opium war of
1839-1842, the first of Chinese conflict with the West precipitated
by the Chinese Government’s efforts to stall the British traders
from selling opium to the Chinese people? In this unconscionable trade
Britain was the major foreign dealer but Americans, French and others
also participated. This eventually culimnated in war between China and
England.
The Chinese Commissioner
Lin Tse-hsu vainly appealed to Queen Victoria: “Let us ask, where
is your conscience. I have heard that the smoking of opium is very strictly
forbidden by your country;… Since it is not permitted to do harm
to your own country, then even less should you let it be passed on to
other countries- much less to China!..Is there a single article from
China which has done any harm to foreign countries?”19
Queen Victoria was unmoved.
The war ended with the Nanking Treaty of 1842 forcing China to cede
Hong Kong and among other humiliating terms pay an indemnity to compensate
the British for lost opium and for expenses incurred in the war!!
Aren’t the US, Europe
engaged in similar economic trading and hegemonic wars with the rest
of the developing world? The global economic problem, outsourcing to
low wage countries or the brain drain and vice versa could easily turn
out to be a Pandora’s box. Conversely it might let loose in the
open a veritable revelation like the dazzling light at the end of the
Platonic tunnel to the unfortunate humanity at large in the developing
world tethered to the hunger disease, starvation and death amidst islands
of garish opulence.
Such globalisation has been
argued as the “pluricentral global order...But this apparent pluricentrality
poorly disguises the global political hegemony of the US government”
as Barbara Harriss-White notes. (Globalization and Insecurity: Political,
Economic and Physical Challenges, p.6, ed. Palgrave, Wolfson college,
Oxford, 2002)20 As explained by Harriss-White this US hegemony “operates
through appeals to liberal democracy as being superior to other forms
of political organization, appeals backed materially by conditions attached
to loans from the IMF and UN economic institutions, which are dominated
by US interests.” (Ibid.)
Joseph Stiglitz has categorically
pronounced that the IMF has failed in its original mission of promoting
global equality. He calls the policies of IMF as anti-democratic., lacking
in a basic sense of decency and social justice. …Those whose lives
would be affected by the decisions about how globalisation is managed
have a right to participate in that debate, and they have a right to
know how such decisions have been made in the past.” p.xvi, Preface,
Globalisation and Its Discontents21
The process of globalisation
set in motion by such lop-sided institutions based on so-called Washington
Consensus has degenerated in a devstating caricature of what Stiglitz
calls “global governance without global government one in which
a few institutions,-the World Bank, the IMF the WTO- and a few players…in
which many of those affected by their decisions are left almost voiceless.”Ibid.
The world is sorely in need
of a consensus based in the least developed country. Only then it can
realise “what the thoughtful rich people call the problem of poverty,
thoughtful poor people call with equal justice the problem of riches”
as noted by R.H. Tawney.22
Keynes, godfather of the
IMF, identified the market failures and why markets could not be left
to themselves and called for global collective action. That is why as
far back as in 1933 in his essay The End of Laissez-Faire he declared:
“Many of the greatest
economic evils of our time are the fruits of risk, uncertainty, and
ignorance. It is because particular individuals, fortunate in situation
or in abilities, are able to take advantage of uncertainty and ignorance,
and also because for the same reason big business is often a lottery,
that great inequalities of wealth come about.”23
The trouble with globalisation
with its inbuilt market system dictated by the IMF, WTO occasionally
jerked into an unwelcome sharp brake and detour as in the case of cotton
and sugar subsidies recently is that it is desperately in need of moral
legitimacy. Market rewards merit is the common refuge of its policies.
But it is fatally undermined by the advantages gained from inherited
wealth and windfall gains: an essential feature of the market system.
Remember Keynesian observation: big business is like big lottery?
Market by its very nature
is predictable so to say that those who go into the market system with
most are likely to come out of it with the most. Which is what made
Margaret Thatcher proclaim: that the godly prosper and the sinful go
bankrupt. Perhaps Hayek may not wholly approve of this precept because
according to him markets allocate benefits according to only one principle-unpredictability.
But there is a makebelieve or a curious split in his economic assumption
vis-à-vis its political application.24
I think the theme globalisation
has a weird air about it of a new-fangled economic voodoo, just as there
has been for long in operation in America of what Senator Fulbright
called in his Arrogance of Power “That there is a kind of voodoo
about American foreign policy. Certain drums have to be beaten regularly
to ward off evil spirits-for example, the maledictions regularly uttered
against North Vietnamese aggression” (p.32)25 In place of ‘North
Vietnamese aggression’ one can replace WMDs of Iraq and international
terrorism. And there is no doubt that this too would prove in course
of time a Bushgate.
Prof.Gunnar Myrdal was perhaps
unwittingly more prophetic than he envisaged when he conjectured a scenario
that “Indeed, if the whole Indian subcontinent with what will
soon be a population of one billion people should sink into the ocean
tomorrow, this would cause only minor distrubance to the curves of international
trade, production and consumption, wages and other incomes, values of
financial stocks, etc., in the developed world.” p.389, The Challenge
of World Poverty, Penguin 1970.26
In view of the aforesaid
dismal context of globalisation one is not enamoured of copybook phrases
like ‘globalise or perish’, but would rather opt for the
good old precept of Voltaire: Il faut cultiver notre jardin27 till the
world at large, North as well as South is inspired en masse to engage
in economic activity in the age-old spirit of the ancient Indian maxim
vasudhaiva kutumbakam- world as a family.
But when? One cannot help
recalling wistfully Keynes’ Economic Possibilities For Our Grandchildren
(1930) wherein he perorates almost in a poetic vision: “But beware!
The time for all this is not yet. For at least another hundred years
we must pretend to outselves and to every one that fair is foul and
foul is fair; for foul is useful and fair is not. Avarice and usury
and precaution must be our gods for a little longer still. For only
they can lead us out of the tunnel of economic necessity into daylight.”
(Essays in Persuasion, p.372)28
References: Seriatim
1Roots of conflict : Don't blame environmental decay for the next war
by Nils Petter Gleditsch and Henrik Urdal International Herald Tribune
Monday, November 22, 2004,
Ibid.Our water, Their Profits
by Jonathan Leavitt Znet July 08, 2003, http://www.countercurrents.org/glo-leavitt090703.htm
Ibid.When the last oil well
runs dry by Alex Kirby BBC News Online environment correspondent, Monday,
19 April, 2004,
2 Carroll Lewis, Alice in
Wonderland
3 Keynes J.M., The End of
Laissez-Faire: in Essays in Persuasion, p.312 Macmillan 1933,
4 Myrdal Gunnar, quoted in
Asian Drama II, p.787
5 Volume 3, No. 2, February
2002 Death, Hunger and Destitution Haunt the Indian Countryside by Arvind
http://www.peoplesmarch.com/archives/2002/feb2k2/death.htm
Ibid (The Times of India, April 17, 2006)
Ibid The Declaration of the
People's Science Congress on Food and Agriculture Growing stocks and
growing hunger, http://www.1worldcommunication.org/transgenics.htm
6 47 pc of India’s
children malnourished: UNICEF, Newsitem in Deccan Herald, December 12,
2005,
Ibid Sub-Saharan malnutrition
worse than 10 years ago David Fickling, Guardian Unlimited, November
22, 2005
7 Gordon David, Professor
in Social Justice in Radical Statistics Annual Conference Global Child
Poverty 26th February, 2005
8 the BBC News Published:
2006/04/15 as to how Britain is now 'eating the planet' by Mark Kinver
9 In the US 40-50% of all
food ready for harvest never gets eaten; (Anup Shah, http://www.globalissues.org/TradeRelated/Poverty/Hunger/Causes.asp.)
10 Samana Siddiqui ( in her article “Statistics on poverty &
food wastage in America” notes “According to the US Census
Bureau, 35.9 million people live below the poverty line in America including
12.9 million children. This is despite abundance of food resources.
Almost 100 billion pounds of food is wasted in America each year. 700
million hungry human beings in different parts of the world would have
gladly accepted this food.”(http://www.soundvision.com/info/poor/statistics.asp)
11 UN-habitat, Nairobi, found that urban slums were growing faster than
expected, and that the balance of global poverty was shifting rapidly
from the countryside to cities. John Vidal, Saturday October 4, 2003,
The Guardian
12 In an Interview to Greg
Ross, American Scientist’s, Managing Editor, (The American Scientist
www.americanscientist.org/ template/AssetDetail/assetid/50434) Lester
Brown of the Worldwatch Institute
13 In his “Development as Freedom”, 1999, Amartya Sen sees
development "as a process of expanding the real freedoms that people
enjoy." Hence, "development requires the removal of major
sources of unfreedom: poverty as well as tyranny, poor economic opportunities
as well as systematic social deprivation, neglect of public facilities
as well as intolerance or overactivity of repressive states." The
Road From Serfdom: Amartya Sen Argues that Growth Is Not Enough, Richard
N. Cooper From Foreign Affairs, January/February 2000
14 Michel Chossudovsky's The Globalization of Poverty, (Zed Books Ltd.
London and New Jersey. 1997). Reviewed by Leo Vox, www.worldhunger.com
15 Marcuse Herbert, One Dimensional Man (ABACUS, Sphere Books, 1972)
16 Plato's Allegory of the
Cave by Plato, circa 360 B.C., Translated by Benjamin Jowett,
The Republic, Book VII.
17 “Wal-Mart Is Not
a Business, It's an Economic Disease” by Richard Freeman and Arthur
Ticknor the Nov. 14 issue of Executive Intelligence Review.
18 Wal-Mart `Eats' More U.S.
Manufacturers
by Richard Freeman, November 28, 2003 issue of Executive Intelligence
Review. Nov. 19, 2003 the Observer of London carried an article on the
destruction of the City of Buffalo, New York, mentioning the role of
Wal-Mart.
Ibid http://www.larouchepub.com/other/2003/3046wal-mart_pricing.html
Ibid Deliver Us from Wal-Mart?
by Jeff M. Sellers http://www.christianitytoday.com/ct/2005/005/17.40.html
19 Fullbright, Senator, J.William
The Arrogance of Power, pp.143-44
20 Harriss-White, Barbara
notes. (Globalization and Insecurity: Political, Economic and Physical
Challenges, p.6, ed. Palgrave, Wolfson College, Oxford, 2002)
21 Stiglitz Joseph, Preface,
Globalisation and Its Discontents, p.xvi
22 R.H. Tawney, quoted in
Choose Freedom The Future of Democratic Socialism, p.74, by Roy Hattersley,
Michael Joseph, London, 1987,
23 Keynes J.M., The End of
Laissez-Faire Essays in Persuasion,
24 Hayek Law, Legislation
and Liberty, p.61 Routledge & Kegan Paul, London, 1982, vol.2, Ch.9,
p.61 ‘Social or Distributive Justice’, p.74, quoted in Choose
Freedom The Future of Democratic Socialism, p.74, by Roy Hattersley,
Michael Joseph, London, 1987
25 Fullbright, Senator, J.William,
Arrogance of Power p.32
26 Myrdal Gunnar, The Challenge
of World Poverty, p.389, Penguin 1970.
27 Voltaire, Candide (1759),
ch. XXX,
28 Keynes J.M., Economic
Possibilities for Our Grandchildren in Essays in Persuasion, p.372,
Macmillan 1933,