State of the World
by Chris Brazier
New Internationalist magazine, January / February
Every three seconds a child under five dies: a child who would
still be alive had the world taken the same responsibility for
all its citizens as it takes for those born in Toronto, Edinburgh
or Sydney.' This is the kind of terrifying fact which brought
the New Internationalist into being around a generation ago. There
are two possible reactions. The first is to recoil from the immensity
and the awfulness of the idea, feeling you can do nothing else
but hunker down and get on with your own life - cultivate your
garden, as Voltaire had it. The second is to get angry and start
doing your own bit to help change the world that allows such a
state of affairs.
The New lnternationalist arose as a flag ship magazine for
people who responded with righteous anger - but also as a popularizing,
educational bridge that might get people from the first, dispirited,
camp into the second The magazine still broadly aims to perform
both these functions. But the world that we report on has drastically
When the first Nl editors wrote their passionate indictments
of world hunger and the terms of trade they would never have dreamed
that the world 25 years later might have changed as it has. They
were percipient in their early assessment of the environment as
one of the major threats to the world and its people. And they
were certainly skeptical about the ability of the global economic
system, in all its manifest inequality, to deliver social justice
and the basic needs of the poor.
But they were also children of their time who saw themselves
as part of a movement for change and 'progress' that had not only
right but also a certain historical inevitability ', on its side-
'development' was an idea whose time had come. The early 1970s
were still really part of the 1960s, that decade of optimism and
expansiveness in which the Wind of Change that blew through Africa
seemed ready to send a cleansing breeze through the citadels of
power and capital.
Notwithstanding the gulf between rich and poor, the genuine
achievements of development in human terms were starting to be
notched up: people were living longer, levels of infant mortality
were falling and more children were finding their way into the
classroom. The social mood was hopeful and progressive: people
tended to accept movement towards greater justice and equality
as almost a scientific rule. Meanwhile, developing countries took
their place on the world stage full of confidence that they could
use the UN, in which they now formed a majority, as a forum that
might guarantee the basic needs of their citizens. And this high
tide of optimism found expression in a series of landmark UN conferences
in the early 1970s which articulated the potential shape of a
fairer, better world: on Population, Environment and Food the
ideas seemed new and the promises seemed deliverable. In the boldest
of these conferences, in 1974, there was a ringing call for a
New International Economic Order that would transform the outmoded
and unjust trading patterns inherited from colonialism.
In retrospect what seemed then like a grand beginning was
actually a rather sad end. The OPEC oil-price hikes of the mid
1970s plunged the world into a recession which effectively put
a full stop to the expansive atmosphere of the 1960s. Arab potentates
pocketed the proceeds and stashed the money in private banks.
The bankers had no idea what to do with cash on such a vast scale
and started offering it by the barrowload to any old developing
country government they could find. This was the origin of Third
World debt. The money was almost entirely wasted: in very broad-brush
terms we might suppose that a quarter of it went on increased
oil bills; a quarter on rotten, misconceived development schemes
(dams and other sources of prestige for budding megalomaniacs);
a quarter on the military; and that the final quarter found its
way back to banks in Switzerland or the Caymans via the deep pockets
of corrupt leaders. Debt piled up, the repayments turned into
mountains to climb - the more so as the commodity prices that
most developing countries depend on to pay their way in the global
economy sank through the floor (by the middle of 1987 they were
at their lowest level for 50 years).
In the 1980s, now routinely characterized as 'the lost decade'
of development, all thought of funding a radical transformation
of society, of delivering the basic needs of all, came to seem
fantastic beside the grim reality of the bailiffs at the door,
Debt and fashion
These days, starting a magazine article with the idea that
there is a child dying every three seconds is a deeply unfashionable
thing to do. Of course it is outrageous that fashion should play
any part in such matters but it does.
Debt is also an unfashionable issue. Ten years ago this was
an issue of massive moment which would have made anyone's list
of the top problems in the world. Now it barely crawls out of
the ghetto inhabited by specialists and dedicated campaigners.
In 1994 Britain's Lloyds Bank (one of those which had foisted
truckloads of cash on all comers) wrote to its customers that
'the debt crisis that began ten years ago is largely over', quoting
the World Bank as its source.
Yet not only has the core issue not changed - countries in
the Majority World are still massively in debt and running to
stand still - the debt problem is now greater than it has ever
been. Since 1980 debt to multilateral institutions like the World
Bank has increased five times. In 1995 alone, severely indebted
low-income countries paid one billion dollars more to the IMF
than they received from it. Countries are having to fork out a
bigger percentage of their export earnings to repay debts than
they were in 1980 - and the most indebted countries of all see
a debt hulking over them which is many times the size of their
entire annual income.
So why is this such an unfashionable issue? Why is it not
at the top of our agenda as people who care about the state of
the world? Why are we not filling the postbags of our politicians,
demanding that they do something about it?
One explanation is that the mainstream media are bored by
the subject. They have less and less appetite for serious issues,
especially gloomy ones that will put people off their breakfast.
But they also tend to fit in with the agenda of big business and
the free-market establishment.
The reason why debt was such a huge issue a decade or so ago
was that the global bankers were worried about it. The commercial
banks had loaned out so much so unwisely that they were seriously
endangered by developing countries' unwillingness or inability
to pay the debts back. It says something about the instability
of the global economic system that it could have been so easily
threatened. But we were assured that if two or three big Western
banks went down, the whole financial system might go down the
plughole with them.
Amen to that, you might say - unless you were looking at your
own pension pro vision, of course. When, in the mid-1980s, countries
like Mexico and Peru briefly, bravely, started talking about Latin
American debtors standing firm together and refusing to make their
people pay for debts incurred by defunct dictators and given by
foolish financiers, huge shivers ran down the corporate spine.
'The debt crisis' - the media story, the phrase on everyone's
lips - was not the crisis of poor people struggling to find enough
money to feed their families or pay for medical treatment. That
crisis goes on and is, if anything, even more intense and painful
today than it was ten years ago. No, the crisis in question was
that of Western bankers and economists worried that the edifice
they depended on was going to come crashing down about their ears.
But the rebel countries were cowed back into line. Debt payments
were 'rescheduled' rather than reneged on; the Dow and the Nikkei
were saved; and the news agenda could move on to other more fruitful
sources of panic and fear.
The pillars of global capital can now feel more secure since,
in contrast to the trend in just about every quarter of a world
gone mad for 'privatization', the Third World debt problem is
being publicized' -- is increasingly being taken out of the hands
of private bankers and put in the capable, reassuring fingers
of the multilateral organizations: the World Bank, the IMF and
the regional 'development' banks.
But hold on. Wasn't there a news report earlier this year
about a generous cancellation of Third World debt? If you remember
the headline without any of the detail that is exactly what was
intended. You were meant to think 'ah, at last they're taking
care of Third World debt - I don't need to worry about that any
At the joint meeting of the World Bank and the IMF in September
new ground was indeed broken. For the first time all creditors
- commercial banks, governments, multilateral institutions - joined
together in a new framework to relieve the most heavily indebted
poor countries (the HIPCs, if we allow them their awful acronym).
This is the good news. The bad is that nothing will happen for
years and that the initiative applies to far too few countries
- 19 at the most, and only Uganda and Bolivia, who are in particularly
dire straits but are also very 'well behaved', have any chance
of qualifying for remission before the year 2000. Worst of all,
to qualify countries will have to commit themselves to being under
the structural-adjustment yoke for decades to come.
The only reason the Bank and the IMF have moved this far (18
months ago they were adamant that any cancellation of debt was
completely impossible) is that it has become plain even to them
that the most indebted Third World countries have not a hope in
hell of repaying their debts on the current basis. But they have
not moved anything like as far as they should. Mozambique's Finance
Ministry, for instance, predicts that even after it has benefited
from the anticipated relief, its debt-service payments in ten
years' time will be around three times the average in the early
The IMF as colonial governor
Regular readers of the New Internationalist might by now have
come to believe that the World Bank and the IMF are the root of
all evil, so often do we rail in these pages against their influence.
But not to do so would be ourselves to submit to the dictates
of fashion: their power is increasing rather than decreasing.
When the Nl began it was routine in development-aware circles
to talk in terms of 'neo-colonialism'. In colonial times governors
were dispatched from the center of power to act as effective monarchs
-- but governing in the ultimate interest of the, ruling nation
rather than of the colony's people. Now that Third World nations
had, gained their independence the system was more subtle: governors
were no longer required because the economic system required the
poor country to produce exactly the same kind of crops and raw
materials as they had under colonialism - and to use " those
earnings to buy from their former masters the machines and processed
goods which had previously been supplied gratis.
Nobody mentions neo-colonialism any more, just as they don't
usually own up to being Marxist (the source of many of the most
important early analyses of 'development'). The overall structure
nevertheless remains pretty much the same. But there is a startling
difference which nobody seems to have noticed: the colonial governors
have returned, this time in the form of the resident representatives
of the World Bank and the IMF, dispatched from the new imperial
center of power in Washington.
Like the colonial governors of old they have complete power
to dictate what goes on, with the difference that they are ordering
around national governments, elected or otherwise. And like the
colonial governors, the policies they insist on are imposed not
for the benefit of local people but for the greater good of the
world they represent, the West. The analogy goes further: just
like the old imperial administrators they claim their policies
are good for the locals in the modern case the claim is that painful
doses of deflation and savage cuts in public spending will render
the economy more efficient, more rational, more able to 'compete'
in the global market. They may even, like the old India-wallahs,
actually belicve in what they are doing.
But actually of course they are opening up yet another country
for the predatory attentions of the multinational corporations,
twisting yet another country further away from the self-sufficiency
of its own food production and the nurturing of its own industries.
The IMF and the World Bank appear fairly routinely as twin
devils, Tweedledollar and Tweedledosh. But it is worth recognizing
that a certain amount of clear blue water is opening up between
them at the moment.
The World Bank is the development lender: as such it is responsible
for the projects it approves and has to receive the criticism
of the people its policies it affects. It takes much too little
notice of that criticism, but never mind. When it comes to formulating
policy or proposing new programs, its managers cannot help but
be aware of the negative publicity occasioned by the last such
dumb move, the last such relocation of thousands of indigenous
people. Institutionally they are required at least to pay lip
service to partnership with voluntary agencies and UN bodies concerned
about human development. And this is certainly more true under
the Bank's new President, James Wolfensohn, than it has been before.
When the World Bank comes out with a report on Poverty or
the Environment we do well to treat its rhetoric with a consider
able dose of skepticism. But at least it has to present itself
to the world as a body which cares about such things. And after
long years of criticism about adjustment's effects on social spending
it has shown signs of concession over the last couple of years.
Its latest agreements with countries still call for public-expenditure
cuts but try to insist that such cuts should not be in health
or education spending.
The gods of the bottom line
The IMF, on the other hand, could not give a damn what you,
I or the voluntary agencies think. It sets strict monetary rules
and countries must abide by them - or else. It does not have to
bother to think about 'development' since its gods are higher
ones- 'monetary parameters' and 'fiscal overhangs'. Development
is in the mortal domain: its very nature is open to human debate.
But the gods of the bottom line are eternal, immovable and absolute.
The worrying thing is that, of the two institutions, the IMF
is incomparably the more powerful. The Bank actually wishes to
start funding the building of schools in Mozambique as part of
its belated conversion to the cause of human development. But
it cannot because of IMF rules.
More worrying still is that the IMF is now muscling in on
development territory, having persuaded the Western powers that
it should operate its own soft-loan facility. It has no track
record in evaluating development projects, no staff with the expertise
to do so. The whole idea that it could fulfill a useful function
in this area is laughable.
So that in the turf war which is certainly unfolding at the
moment between the World Bank and the IMF anyone with any sanity
will find themselves in the bizarre position of having to defend
the expertise' and 'experience' of the Bank. Now there's a novel
There is now a third pillar of the global economic order:
the World Trade Organization, only launched in 1995 but already
making its mark as Enforcer of the GATT 'free trade' agreements.
Structural adjustment, you see, is only part of the bigger picture
of 'globalization'. The struggling economies of the developing
world are being dragged, kicking and screaming, into a 'free trade'
global economy in which only the fittest will survive - and the
fittest these days are almost inevitably the transnational corporations.
A staggering 70 per cent of all international trade is controlled
by a mere 500 corporations. The state of our world is increasingly
being determined in the board rooms of these companies rather
than by national governments. A fundamental political question
for our collective future is by what supranational means such
corporations are to be regulated.
For now, deregulation is all and corporations can seek their
profit wheresoever they wish in the happy, clappy global market.
All too often thi.s means seeking the workers who can be paid
the lowest wages.
Dave Phillips of San Francisco's Earth Island Institute, an
environmental pressure group, recently told writer Tom Athanasiou
a story about the tuna industry which illuminates the globalization
'In the old days,' he said, 'California had the largest tuna-canning
industry in the world, but today - these are approximate figures
- the wages in California are about $17 an hour. So the industry
moved, first to Puerto Rico, where wages are about $7 an hour,
and then, when they decided that was too much, to American Samoa,
where wages are about $3.50 an hour. From there it moved to Ecuador,
where workers are paid about $1 an hour, and then on to Thailand,
where a great deal of the industry is today, and wages are about
$4 a day! And now, amazingly enough, there is some movement to
Indonesia, where wages are as low as a couple of dollars a day.'
Wages in Indonesia are so low, of course, because union organization
there is weak under the military dictatorship and working conditions
are therefore poor. This points to one of the many big problems
with the GATT tree-trade rules: they operate to the detriment
of all the employment, environmental and safety standards that
you and I would hold dear. They do so because such standards are
considered to be 'non-tariff barriers' to free trade - in other
words one country's higher standards are restricting the ability
of another country to undercut them with more polluting industry,
more dangerous and lower-paid jobs.
Already GATT rules have been used, for example: to challenge
European restrictions on hormone-tainted beef; to force Austria
to abandon its plan for a 70-per-cent tax on tropical timber;
and, most outrageously of all, to overturn Thailand's restrictions
on smoking so as to open the way for US tobacco companies.
Yet still the free-trade enthusiasts are everywhere - their
mantras are repeated endlessly as if they are god-given, incontrovertible
truths. Their faith is that when all barriers are removed the
economy will function at a height of efficiency and benefit all.
It is folly of the most idiotic and (since most such free-trade
prophets live in the rich world) self-serving kind. You only have
to look at which countries have been the main beneficiaries of
international investment in the last ten years of increasingly
unregulated trade (see chart) to see why the process of globalization
is going to result in a world ever more deeply divided between
rich and poor.
There is another mantra endlessly repeated and rarely challenged
which, like globalization, is likely to characterize our age in
the history books of 50 years hence: economic growth. We normally
have great difficulty stepping out of our own time sufficiently
to understand how future generations will regard us. But there
is little doubt that ours will be considered a civilization so
blinded by its own technological brilliance and its mania for
consumption that it could not bring itself to change course.
The beginning of the 1990s saw environmental awareness at
a new height. For a short while it seemed possible that the sheer
awfulness of the phenomena we were contemplating - global warming,
the ozone hole - might force a change. Instead the environment
became another fashionable idea to be hijacked, harnessed, honed
- and then quietly dropped off the political-party program once
the media had moved on to the next flavor of the month. As a result
there is barely a political party with a chance of forming a national
government anywhere in the world which is prepared to challenge
the received wisdom that economic growth is essential to our well-being.
This is more understandable in developing countries which look
askance at the consumption levels of the rich world and feel they
have a right to a piece of the action. But it is nothing short
of monstrous that rich-world politicians who consider themselves
heirs to a radical tradition and who claim to value social justice
are none of them prepared to be the first to say that the Emperor
of Economic Growth is wearing no clothes.
Take the two dominant ideas and trends together -- globalization
and growth-- and it becomes plain that if there is to be a way
forward for the world it will lie in a new union of ideas previously
labeled separately as Red and Green. The battle to be joined with
globalization, the unrestrained market and the transnationals,
is one that will come easily to socialists whose traditions are
those of challenge to capital. Whereas the perception that economic
growth is a dead end has been contributed uniquely by Greens.
It has never been plainer that the two have to join forces
and between them work out a radical new alternative. We are not
talking about a tactical alliance here but rather an entirely
new vision which recognizes that the environmental problem is
now inseparable from the movement of global capital, from the
appalling gulf between rich and poor on this planet which is growing
with every passing second. I cannot tell you how often a billionaire
is being created with the certainty that I can tell you how often
a child is dying but I can tell you that at the last count there
were 358 of them and that they own more between them than countries
containing 45 per cent of the world's people earn in a whole year.
One day the cows will come home. It may be a major environmental
catastrophe that does it - global warming producing a rise in
the oceans that threatens not just the Maldives or Bangladesh
but New York and London, for example. Or it may issue in outright
war between the Majority World and the rich minority. But change
will have to come.
Waiting for the apocalypse to arrive is one of those activities
beloved of fringe groups, whether born-again Christians, environmental
doom-mongers or communists awaiting the imminent collapse of capitalism.
But even if our civilization is unlikely to change course without
some kind of major shock we do not have to sit around waiting
for it to happen.
On the contrary there is much to be done - both to defend
the development gains of which we are proudest and to ensure that
the human family continues to become more healthy and more educated.
But how are we to do it? As we have noted, the writ of the
IMF runs everywhere these days and there is barely a country in
the South which is not under the cosh of structural adjustment.
Governments in developing countries are now given such small room
for maneuver that they can achieve very little. Even once-promising
radicals - Jerry Rawlings in Ghana perhaps (though his star waned
long ago now; or more recently Yoweri Museveni in Uganda wind
up slavishly following the dictates of the men in pinstripes.
In this most unjust of worlds, the level playing field beloved
of the free traders actually has a slope comparable to a line
drawn from the top of the World Trade Center's twin towers to
a pedestrian on the Manhattan sidewalk immediately below.
Partners in defiance
Yet what if, here and now, we started to push the idea of
a 'compact' between people in the rich world and bold, creative
governments in the developing world who would dare to defy the
destructive aegis of the Bank and the Fund? A small group of governments
which rejected adjustment and committed themselves to meeting
the basic needs of all their citizens within ten years - and to
measuring progress properly along the way - would immediately
push themselves into the limelight. At least half the world would
be watching them, thirsting as it is for a good example, an alternative
But they could not stand alone - and would need the direct
financial support of rich countries themselves prepared to put
their heads above the parapet and defy the free-market orthodoxy.
This is where we come in. Of course we should be raising our voices
against the bigger picture, too doing our bit to persuade politicians
and people in general that chasing growth will be ruinous, that
free trade is a false religion, that we care more about the survival
of the poor than about being rewarded with tax cuts or the latest
digital TV set.
But the idea of a compact, a 'partner ship for progress',
would be empowering on both sides of the divide - not least because
it would form so direct a challenge to the Washington agenda.
The chances of success in pushing for such an initiative would
obviously be greater in the most enlightened aid-giving countries
like Sweden, Denmark or Holland. What passes for a left opposition
in most of the English speaking countries has hardly inspired
us with its boldness or its creativity in challenging the current
status quo. But even they might be attracted by the idea of strutting
the world stage like a silver knight of human development.
In such a compact, military spending would have to be abandoned
- or at least drastically reduced. Costa Rica long ago showed
that it was possible for a country to relinquish its army, even
when it is situated in a notoriously explosive and war-prone region
- and it is no coincidence that the UN now assesses it, despite
its low income, as having a human-development rating higher than
almost any developing country and higher than industrialized nations
such as Portugal, Russia and the Czech Republic.
The terms of the compact would encourage home-grown food instead
of cash crops for export; they would boost local labor-intensive
industries, thereby creating jobs and incomes for the urban poor;
and they would rekindle the fires that once burned at the idea
of providing health and education for all.
The threat of a good example - not least of active and progressive
partnership between rich and poor- might just work wonders and
start tilting back into balance a world that is profoundly out
Above all, we must not set our goals too low. We must never
settle for an 'acceptable' level of absolute poverty or hunger.
The world could deliver the basic needs of all its inhabitants
within a matter of a few years if only there was the collective
will. For example, it would cost six billion dollars a year, on
top of what is already spent, to put every child in school by
the year 2000. That is an enormous sum. Yet it is less than one
per cent of what the world spends every year on weapons. That
is one of the New Internationalist's most famous observations.
Yet this kind of comparison between military and social spending
is also now somewhat out of fashion. Fashion be damned! We should
perhaps make it obligatory that we update these figures every
year so as to highlight the skewed priorities involved.
Which brings us back to all the children who have been dying
unnecessarily while you've been reading this article and to the
millions that have been added to the frankly disgusting fortunes
of men like Bill Gates and Rupert Murdoch in the same period.
The gap between rich and poor has never been so large in all the
world's history - and the need for radical change has never been