A savage war is being waged against the majority of the people on Earth by the governments of the North on behalf of their multinational companies. This war is not being fought with bombs or bullets; it is being fought through neo-liberal economic policies. Its weapons are not being delivered by stealth bombers; they are being delivered by the International Monetary Fund (IMF), the World Bank, and the World Trade Organization (WTO). The consequences of this onslaught are, however, as deadly as any conventional war. Indeed, the policies being pushed by the imperial powers through the IMF, the World Bank, and the WTO have forced billions of people to live in absolute misery. As happens in any war, however, this onslaught has sparked resistance, and this resistance is beginning to turn the tide.
The origins of this global economic war can be traced back to the late 1970s. It was during this period that the United States (US) and the European Union (EU) started to use the IMF and World Bank to pry open the economies of Africa, Latin America, and Asia. This was done through forcing these countries to adopt neo-liberal economic policies, which included the poisons of privatization, financial liberalization, trade liberalization, and labor market flexibility. Through these neo-liberal measures, the countries of the South have been turned into profit-making havens for huge multinationals. This is because multinational companies can now swoop into the countries of the South with impunity. They can buy up ex-state owned assets in Africa and Latin America at a steal; destroy any environment that they wish in order to extract raw materials and oil; speculate on any stock market or currency in the South; and set up sweatshops whereever the cheapest labor is available. Under the guise of “free” trade, multinational companies can now also flood the South with goods that are subsidized by the governments of the North.
Since the 1990s, the US and the EU have also been using the WTO as a weapon to further the interests of their multinational companies. This has been done to the point of absolute absurdity. For example, the WTO protects the intellectual property rights (IPRs) of multinational companies internationally. This protection of IPRs even prohibits states from producing cheap generic pharmaceuticals, to improve people’s health, as the imperial powers in the WTO believe that this would undermine the interests of their multinational pharmaceutical companies. The message being sent by the US and EU: the interests of our multinationals are more important than people’s lives. Added to this, the US and the EU are trying to use the WTO to remove all “barriers” to profit making, including the few workers’ rights, environmental laws, and free public services that exist in the countries of the South. If the US and EU are successful in this ploy, it would mean that all countries would have to remove “barriers” to “free” trade, profiteering, and pillaging, such as environmental laws.
The consequences of these neo-liberal policies on a global scale are familiar: the rich are getting richer and the poor are getting poorer. While the US and EU are now richer than ever under neo-liberal globalization; as many as 80 other countries are now poorer than they were in the 1970s. In 1980, the richest countries had an average income 44 times higher than the poorest countries; today under neo-liberal policies their income is 75 times higher than that of the poorest countries. Trade between the richest countries has also increased under the global neo-liberal “free” trade regime. The portion of exports from the poorest countries has, however, declined markedly. In fact, the poorest 48 countries now only account for 0.4% of global exports. This is because the industries in these countries have been destroyed by imports flooding in under the banner of “free” trade. All of this translates into a world of growing inequality: a world where the richest 400 people now have more money than the poorest 3 billion people combined.
While companies have made massive profits due to neo-liberal policies, the people of the world have suffered. Due to privatization, billions of people have lost all access to social services, such as education, water, sanitation, and healthcare. This is because, in most countries, these services are now being sold by private companies as commodities: if you can’t afford to pay for such services, you don’t get them! The macabre result: over 1 billion people have lost access to clean drinking water; 2.6 billion people lack basic sanitation; over 1 billion people are totally illiterate; 820 million people suffer from malnutrition; over 1 billion people lack access to any form of healthcare; and 30,000 children die everyday from poverty. This takes place in a world where the amount of money spent by American and European companies on entertainment each year could give every person in the world access to enough food, proper healthcare, basic education, and clean water.
Due to these gross inequalities and injustices, hundreds of millions of people have resisted the neo-liberal capitalist policies that are being imposed by the US and EU through the IMF, World Bank, and WTO. Their resistance, which is often dismissed as illogical or ineffective, has started to cause cracks in the system. For example, from Bolivia to South Africa to Mexico, people have fought against privatization. In Bolivia, the government that tried to enforce the privatization of the country’s water, at the behest of the US, was overthrown by the people. Needless to say, privatization has thankfully ground to a halt in Bolivia. Similarly, the APPO in Oaxaca City, Mexico, took control of the city for over four months as part of its resistance to neo-liberal economic policies and accompanying state repression. Millions of people have also marched upon and blockaded WTO meetings, which has contributed towards the current impasse in the WTO negotiations. Similarly, the Zapatistas in Mexico have defied the US’s imposition of a regional free trade agreement. In the province of Chiapas, they have at times physically stopped cheap imported goods from the US from flooding into the areas that they control. The Zapatistas have also created an alternative local economic model, which now partially exists outside of capitalist globalization.
Perhaps one of the biggest threats to the imperial powers’ desire for a global profiteering haven for their multinational companies has come from progressive governments, such as Venezuela. Indeed, Venezuela has shunned neo-liberal capitalism almost entirely. This has seen the Venezuelan state nationalizing a number of companies. Most of the profits derived from these companies, especially in the oil industry, have been spent by the Venezuelan government on improving people’s lives. This has seen free education, healthcare, and other social services being offered to the people. Through such measures, illiteracy in Venezuela has been eradicated. Added to this, Venezuela has established a regional agreement with Cuba, Nicaragua, Ecuador, and Bolivia that aims to counter the devastating effects of neo-liberal “free” trade. This alternative agreement is known as the Bolivarian Alternative for the Americas (ALBA). It is based on meeting the regions social needs. Under ALBA, Venezuela has swapped oil for the services of Cuban doctors and teachers; Venezuela has assisted Cuba to improve its public transport; Venezuela and Cuba have helped Ecuador and Bolivia roll out public hospitals and schools; and Venezuela and Cuba have created a market for Bolivia’s soy industry, which was threatened when the US stopped buying soy from that country. Venezuela has also gone so far as to reject and withdraw from the IMF and World Bank. In fact, Venezuela is in the process of establishing an international lending institution, the Bank of the South, with other countries such as Ecuador. The plan is that the Bank of the South will lend money to governments, with no neo-liberal strings attached, to meet people’s needs.
Due to the actions of the millions of people involved in the anti-capitalist movements, a glimmer of hope is appearing for the people of the world. Cracks are starting to show in the global imperial system. Of course, the imperial powers of the US and EU will try to smother these movements and progressive governments. This is because the most dangerous thing in the world for the US government and the EU, along with their corporate cronies, is for the people to realise that another, more just and equal world is possible.
Shawn Hattingh works for the International Labour Research and Information Group (ILRIG) in Cape Town.