The global economic jargon of the corporate world
New Internationalist magazine, August 1993
by Doug Smith
Level playing field
The argument for a 'level playing field' sounds like an argument
for simple justice. International trade is a game played on a
sports field. If the field slopes in one direction, one team has
an unfair advantage. The field is thought to be tilted, for example,
by a state that provides a subsidy to an industry, allowing it
to reduce the price of its exports. Since states can't change
ends every quarter the solution is to do away with these subsidies.
'Subsidies' are very broadly defined to include things like
regional development programs, generous unemployment insurance
benefits and even publicly-funded health care. Trading partners
can argue that because these benefits are provided by the state,
employers receive a hidden subsidy. To level the field these programs
must be bulldozed.
During the 1 980s advances in telecommunications coupled with
extensive deregulation created a seamless international web through
which money flows at the touch of a computer key. This high-tech
global finance system allows investors instant access to the best
investments. An unregulated marketplace allows each nation to
develop its competitive advantage and provides the Third World
with the investment it needs to develop.
By some estimates nearly a trillion dollars now changes hands
every day on the foreign-exchange markets. The hands remain the
same but they control more and more of the world's resources.
The globalized market is highly volatile, national governments
have lost much of their ability to control it. Unable to meet
social demands they become prey to disorder as people look to
their ethnic, religious or regional group for the protection the
state once provided. In this sense globalized money markets contribute
more to global fracturing than to integration.
In the weight-conscious West employers speak of shedding well-paid
unionized jobs the way dieters speak of losing unwanted pounds.
By 'downsizing' (making production 'leaner' and 'more efficient')
companies are supposed to be getting smarter. They use the latest
technologies to keep their inventory as low as possible and increasingly
depend on outside suppliers. Sometimes this is referred to as
a 'creative web of corporations'.
Downsizing is simply another word for capitalism's drive to
reduce labor costs. Computer inventories make worker layoffs and
recalls more frequent. Companies now recall people on a temporary
basis rather than lay them off on a temporary basis. Whether in
Singapore or Silicon Valley, the web is repressive and low-paying,
not creative. 'Downsizing' is an admission that economic growth
and high unemployment can exist at the same time.
Total quality management
This is a management approach championed by Western business
consultants who see it is as the secret behind Japan's economic
success - a shift away from scientific management ('Taylorism')
which treated workers as mere automatons. Under TQM workers
are treated as partners who are committed to the firm's quality.
They are promised more autonomy and more variety in their work.
TQM and the variety of other names that it parades under -
such as 'Quality of Working Life' - is designed not to enhance
workplace democracy but to increase productivity and erode or
eliminate unions. According to Japanese trade unionist Tsuzuku
Ken, TQM has helped to pit workers
against one another and ostracize dissidents. At Toshiba,
he says: 'Workers are encouraged to inform against each other,
and thus the entire workforce succumbs to the despotic rule of
Structural adjustment programs
Commonly called 'SAPs', these programs imply working together
with Third World countries to create economic structures which
will help them regain control over their own communities. There
may be 'structural' problems with their national economies now,
but once they are 'adjusted' things will be a lot better.
Structural adjustment is neo-colonial rule imposed by international
banks on behalf of Western and Japanese corporations. The plans
demand reduced government services, lower taxes on high income
earners, privatization of state-owned industries, increased agricultural
exports and lower tariffs on imports. International Money Fund
loans are withheld if a country does not accept the terms of these
The movement to reduce government regulation hit full stride
under Ronald Reagan and Margaret Thatcher. Reagan's treasury secretary
William Simon claimed that 'regulation has slowly strangled key
sectors of our economy'. Freed of Government red tape, industry
was supposed to unleash a competitive frenzy of innovative high-quality
We have seen the Exxon Valdez and the (appropriately named)
Spirit of Free Enterprise disasters - there is no letup in the
toll that industrial disease and accidents take every year. Deregulation
of the airline industry led to an initial reduction in prices,
but now the industry is in near-permanent crisis. Some airlines
are so weighed down with debt that they have had to cut wages,
lay off staff and scrimp on safety to stay aloft. In other cases
airlines have gained near complete control of certain routes and
can literally charge what the traffic will bear.
The Third World has SAPs, the West has 'deficit reduction'.
Editorial cartoonists traditionally depict the national deficit
as a malevolent octopus, threatening to crush taxpayers so impoverished
that they have been reduced to wearing barrels. Because of the
spendthrift ways of past liberal governments, we are told, all
governments must decrease their levels of social spending.
The deficits of most Western governments are the legacy of
punitive interest-rate policies rather than government spending.
Interest rates are hiked to dampen demand and lower inflation.
As a result currency values fall and overall debt payments increase.
Cutting back government spending rarely does much to decrease
the deficit since it weakens consumer confidence and increases
demand for social services. Cutting government spending also creates
a 'social deficit' as it reduces educational, social and health
services; and an 'infrastructure deficit' as highways, schools
and airports crumble.