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FREQUENTLY ASKED QUESTIONS ABOUT GLOBALIZATION
AND ALTERNATIVES


 
Ideology
What is "neoism"
Institutions
WTO
IMF
World Bank

NAFTA, FTAA
G8
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Race to the Bottom
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Art Sankey

 

SECTION SIX: THE PROPOSALS


What does the US Democratic party think of globalization?

The democrats believe that while free trade means Americans lose low-skill, low-pay "sunset industry" jobs, with government-funded education and training high-skill, high-pay "sunrise industry" jobs will be created to replace them.

One problem is that the idea of "sunrise" and "sunset" industries is too simple. Farming can be either "sun" if the farmer has enough machines. Probably other industries can become "sunrise" if enough machines are built. However, with lots of cheap workers, nobody will need to buy machines. This is why the American South, with cheap slaves, did not industrialize like the north, with its expensive workers. In the ancient world, the windmill had been invented, but hardly any were built because slaves were always cheaper.

Also, this plan would divide the world into classes - with the third world a giant ghetto and America a giant suburb - but not all Africans are born laborers and not all Americans are born executives. Every nation needs both blue-collar and white-collar jobs, because all nations have both thinkers and doers.

That said, the race to the bottom is even hitting the white-collar workers - for example, CrossComm, a Massachusetts-based company, sent coveted software design jobs to Polish geniuses who make between $7,000 and $18,000 a year. India is another example of cheap information technology workers.


Proposals:

Neos, knowing that they are unpopular, like to say "T.I.N.A.: There Is No Alternative". Of course, there ARE alternatives:


The "fair trade"

The world is in a stange situation

On one hand, the south owes debts to the north,

Yet the north owes reparations to the south for imperialism

A trade aggreement should give the third world nations to the right to protectionism until they have developed. Growth needs to be done one step at a time - you do not teach a child to swim by through them into a wirlpool. Cutthroat competetion will have to wait until all of the competetors have their knives.

Wealthy nations should trade freely with each other, but should have the same standards and regulations, and the same taxation, to prevent fellow wealthy nations from using political policy to steal investment. When trading with the third world, we will have to make sure the third world always has a "comparative advantage" (the best way to do this is to raise our standards) so they can have investment, but not so much that cheap labor replaces industrialization. Growth is done with more machines, not cheaper workers.

The North could provide reparations by paying for education and infastructure (bridges and roads etc.). With enough infastructure and education, the third world will not need comparative advantage to get investment. At this point, we can forgive their debts in return for them ending their protections and raising their standards to the same as ours.

In short, the poor can stay competetive and the rich can keep their high standards. A fair trade.

Guiding Principles: 1. Democracy and Participation

Debates and decision-making on the subject of globalization are controlled by financial, corporate, and political elites.

International agreements like NAFTA or GATT should be given a plebiscite or national referendum. If neos believed that they are right, they would trust the people.

Democracy, our environment, and equality should be guarranteed. Putting them in the preamble to an aggreement is not enough.

Flexible Development. Poor nations should be able to develop how they want. Nobody knows a country better than the people who live there.

The Hope for Africa bill introduced in the U.S. House in 1999 by Congressman Jesse Jackson, Jr., uses this idea.

Replace fast-track with real debate. Right now trade aggreements are treated as foreign policy - congress can only say "yes" or "no" this means that any aggreement is approved as congress chooses bad aggreements over no aggreement at all.

2. Sovereignty and social welfare

The goal of aggreements should be high standards of living, dignified work, healthy communities, and a clean environment for all. Turning millionaires into billionaires does not automatically mean success.

Drugs should be fought by cutting demand, fighting the drug elites, and ending the poverty among peasents that makes drugs worth growing.

3. Reduce inequalities

Agreements should build civilization by creating equal societies. Equality is especially needed between nations, races, and genders.

4. Sustainability

Aggreements must look to the future. Quality development means protection of the environment.

Wealthy nations owe an "Ecological debt" to poor nations. Wealthy nations have mined, clearcut, and poached in poor nations, and have made the climates of poor nations unstable by making greenhouse gases. We need to repay our debt by planting trees and helping fight the spread of deserts, building ecotourism and national parks in the third world etc.

Human Rights

Agreements should raise the standard of democracy, not try to escape responsability. They should ensure the enforcement of civil and political, economic, social, cultural, environmental rights, gender equity and those relating to peoples and communities.

Many human rights treaties need to be signed and ratifiedby all, especially:

Universal Declaration of Human Rights of the United Nations

International Convention on Civil and Political Rights

International Convention on Economic, Social and Cultural Rights

International Convention on the Elimination of All Forms of Discrimination Against Women (CEDAW)

International Convention on the Elimination of All Forms of Racial Discrimination

Declaration on the Right to Development (December 4, 1986)

Core Conventions of the International Labour Organization (ILO) including Convention 169 on the rights of Indian communities and peoples; those relating to migrants and their families; and provisions calling for the elimination of discrimination against women.

Draft Declaration on the Rights of Indigenous People

American Convention on Human Rights

Protocol of San Salvador

Other notes:

The right to free speech should include access to speech (protection against media monopoly, promote independent and public media) and information (public libraries, free internet access).

Economic rights should be defended in the same way as civil and political rights, especially through the (1966) Pact relating to economic, social and cultural rights.

This requires the adoption of a Protocol as requested in 1993 by the Vienna Conference and then the ability to try economic crimes as crimes against Humanity.

Environment

Neos and their aggreements try to escape responsability for enviromental costs.

Enviromental costs should be internalized in the price of their end product. Damaging products should cost more and substainable products less.

Environmental regulations should be governed by the precautionary principle (when in doubt, do the most cautious thing aka "better safe than sorry"), rather than risk assessment (which applies economic cost-benefit analysis to environmental resources).

All countries should have the right to channel investment toward sustainable development.

Foreign companies and investors should be held to the highest environmental standards, and should share technologies that preserve the environment and create jobs.

Countries should maintain their sovereignty over the right to restrict investment that aggravates social or environmental problems and their disproportionate impact on the most vulnerable sectors of society, such as women and indigenous peoples.

Energy

Redirect investment, loans and subsidies from fossil-fuels to research and production of clean, sustainable energy.

End coal, gas and oil exploration.

Enforce the use of environmental impact studies for all energy-related projects.

Biodiversity and Intellectual Property

ILO Convention 169 and the Biological Diversity Convention have many proposals.

Reject intellectual property claims on life-forms etc. Instead, reward the communities that have conserved and bred diverse species for so long.

Sustainable Energy Development

Fossil fuels are obsolete. All exploration should stop.

Use Integrated Resource Planning (IRP). This system is better than the market because it includes enviromental and social costs in calculations. It is also very democratic, calling forpublic consultation at every stage of planning.

Also use "life cycle" accounting when choseing energy technologies. For example, wind-power still has a low life-cycle cost even after calculating the cost of producing windmills.

Make cheap energy availiable to all, with a larger version of the US rural electrification project.

National and International agencies should cooperate to:

create incentives for investment in energy efficiency and renewable energy

Stop subsidizing and encouraging fossil fuels

create an Energy Efficient and Renewable Technologies Consortium to spread new technologies

Labour

NAFTA, and many other trade aggreements side-aggreements (such as the North American Agreement on Labour Cooperation - NAALC) that talk loud about workers but do nothing.

Though all nations of the FTAA are ILO members, most nations never enforced the laws they wrote, and are less willing to today because of the need for competetiveness.

Workers and their organizations have the right to join decision-making at the national and international level. Workers who lose jobs because of globalization deserve retraining.

Since the early 1990s the labor movement has proposed the creation of a working group on labour and social issues as part of the FTAA.

Companies that do not respect workers rights would lose their trade aggreement priviliges, meaning they would have to face tarriffs etc.

The 7 core conventions of the ILO should be included in trade aggreements:

Conventions 29 and 105 on the abolition of forced labour

Conventions 87 and 98 on the rights to freedom of association, to collective bargaining, and to trade-union action, including the right to elect trade union representatives without employer or government interference, and the right to strike

Conventions 100 and 111 on equal pay for work of equal value, and on the prevention of discrimination in the workplace

Convention 138 on the prevention of child labour

Trade aggreements should follow the lead of the European Union (EU) and guarantee retraining for the "losers" of competetion and funds for job creation in poor nations.

Role of the Government

Education

Education is a right - no child should suffer because of the inability of their parents to pay. The American so-called "public" education system, in which poor areas have less funding, is an example of the right to education violated. Post secondary education, for those qualified, is also a right.

Education is more than "training" for work. For democracy to survive it needs questioning, skeptical citizens with a historical memory. Education can also fight drugs, crime, and hate.

Rich nations should help fund the education of poor nations in return for raised work and environmental standards.

Health

As with education, health care is a fundamental right. Special attention is needed for women, workers in the informal sector and indigenous communities planning to develop traditional medicine and age-old knowledge..

Social security systems (including pensions) should be used for high-priority national development projects, not risky speculation for the already rich.

2. Economic Regulation

Regulations must:

be decided democratically

be clear, explicit and bias-proof

be simple and easy to apply

be kept to the minimum needed to achieve their objectives

Special regulations

Nations deserve the right to special regulations for:

Natural resources

Culture

Financial and monetary policy, especially the management of its payment system and short-term investment

Basic food production

Foreign Investment

Poor nations should have the right to

screen out investments that make no contribution to development, especially unstable speculative and short-term investments.

make foreign investment play an active role in the creation of macroeconomic conditions for development

protect small, local, family and community enterprises from unfair foreign competition

allow for legal measures that preserve public or state ownership in some sectors (e.g., petroleum); exclusive national ownership in other sectors (e.g., broadcasting); and obligatory national participation in the ownership of other sectors (e.g., finance)

Performance Requirements

Poor should be able to use performance requirements to:

use local content, workers, and investors

Respect ILO standards and UN treaties etc.

transfer appropriate technology

prevent massive withdrawals of fly-by-night portfolio capital by requiring that portfolio investments or investments in the financial market stay put, for example by making 20-to-30% of portfolio investments be deposited for one with with the central bank.

give warning to local communities of a factory shutting down or moving; and provide retraining and clean-up

license technology for others to use when justified for social or humanitarian purposes, for example, medicine for the poor

provide incentives for the reinvestment of profits

require local permission for the exploitation of natural resources

Dispute Resolution

NGOs and all levels of government should have the right to sue investors for breaking investment laws.

Intervenor funding should be made available to help the poor compete with investors in legal proceedings.

International Finance

The international financial system is a disaster, going from crisis to crisis with endless bailouts to rich investors using the tax dollars of workers. Because of interest payments, poor workers in poor nations are paying to give foreign aid to rich bankers in rich nations.

Investment should be in stable production, not speculation.

Debts created by previous dictatorships are illegitimate and should be cancelled. Debts caused by raised interest rates should be renegotiated.

National and international measures must be taken against speculation and fly-by-night capital flows.

Austerity measures that punish the poor should be replaced with prosperity measures that create substainable growth, allowing for debts to actually be paid.

Interest rates should be lowered. There is no threat from inflation, so interest rates can easily be lowered, helping the debt-crushed third world, and allowing people to get morgages, or loads to start a business. However, because wealthy bond-holders gain from high interest rates, neos hate to lower them.

Financial transactions tax, a.k.a. the "Tobin Tax" (named after James Tobin, a prominent monetary economist and Nobel Laureate.)

The revenues from a Tobin tax (conservatively estimated at US$302 billion a year from a 0.25% tax) should be administered by an independent United Nations agency and used for social and economic development.

This tax hits speculators, who do no actual work. Speculators make economies unstable, yet often get very rich.

It is simple, meaning few bureacrats. The money it raises could help education in poor countries.

When the government of Canada tried to talk about the Tobin Tax at the Halifax G-7 meeting, pressure from the U.S. Treasury quickly squashed the idea.

Every agreement between rich and poor countries should include compensatory financing, as is done in the European Union.

Alternatives to structural adjustment programs are outlined by the UN Economic Commission for Africa in its African Alternative Framework to Structural Adjustment Programs for Socio-Economic Recovery and Transformation.

International cooperation is needed to stop money laundering.

Intellectual Property Rights

No agreement should overrule national laws that make foreign investors transfer appropriate technology to the host country.

Life forms should not be patented.

Require the owners of pharmaceutical patents to grant compulsory licenses (paid by royalties) to producers of cheap generic medicines.

Protect the rights and livelihoods of farmers and communities (and especially indigenous communities) that protect biodiversity. Support the Thammasat Resolution (signed in December 1997 by representatives of more than 40 NGOs) to reinforce "the defense mechanisms of local communities that are vulnerable to 'bio-prospecting' and to the introduction of genetically altered organisms."

Support the February 11, 1998 call by the Consultative Group for International Agricultural Research (CGIAR) for an end to the patenting of all germ-plasm held by CGIAR research centres.

Trechnology should be shared with the poor nations, especially enviromental technologies.

Ensure that copyright laws protect small artists, writers, musicians, crafts producers, and other cultural workers, and not just publishers and the motion picture and recording industries, as is the case in NAFTA's Article 1705. This is very important to indigenous and female crafts producers.

Agriculture

Because food is needed for survival, and international market prices tend to change dangerously, agriculture needs special treatment.

Nations should have the right to protect basic staple foods.

The concentration of land ownership in the hands of a small number of elites and corporations must be reversed. Interestingly, capitalism was started with land reform, as land owned by the Catholic church was seized and sold off cheaply.

Governments should protect the property rights of small producers, including women and landless rural workers, and indigenous peoples on ancestral lands.

Governments should give incentives for substainable forestry development.

Allow Agricultural labourers etc. to form unions

Access to Markets

Articles 2, 4, 17 and 18 of the United Nations Charter of Economic Rights and Duties of States (1974) establish the legal and socio-economic bases for demanding equitable (not equal) treatment. Obviously, equal treatment among unequals continues inequality.

For the poor, the main barriers to trade are technicial barriers, not tariffs.

As trade is freed, once protected industries will need access to consultants and training, technological research and development, and long-term credit. This is especially important in poor nations.

Non-Tariff Barriers VS Standards

Standards, such as labor laws etc. should not be confused with disguised protectionism. The best way to separate them is through a broad and democratic processes of consultation and negotiation.

Poor nations should be able to use "rules of origin"

Enforcement and Dispute Resolution

Poor nations should have funds availiable to enforce rules and participate in dispute resolution.

Enforcement and Penalties

Everything involving enforcement must be fully transparent, with a written public record of all proceedings and open hearings.

There also needs to be a clear appeals process.

Penalties should be imposed on both governments and companies. Prior to the imposition of such penalties, adequate notice should be given to provide opportunity for response and/or compliance.

Immigration

Trade agreements should not try to escape responsibility of immigration issues.

All governments should sign and/or ratify the "International Convention on the Protection of the Rights of All Migrant Workers and Members of Their Families" (1990). It should be included in aggreements.

Immigrant workers should have the same rights and working conditions as the workers in their new country, regardless of their immigration status.

Because employers that take advantage of immigrants not only lower standards for all but also cause racism, they should be severely penalized.

Development programs should especially focus on areas where workers immigrate from. Vigilance Global democracy and aid are good, but we will always need to be vigilant. For example, thesenior official of the Fisheries Agency of Japan, Maseyuku Komatsu, has admittedthat Japan has been using overseas aid to secure support for its campaign to have the current international ban on whaling lifted. In short, aid is being used as bribes to overrule democracy.


Is the movement effective?

The movement is effective, but it could be better and still has a long way to go.

Neos are on the defensive and are changing their rhetoric and making yet more promises. "I hang around a lot with the economists and trade experts and policy wonks who are the intellectual mainstays of the WTO and other open-trade institutions," says Dani Rodrik, a heterodox economics professor at Harvard University's John F. Kennedy School of Government"Four years ago, they would have dismissed out of hand the issues of labor, the environment, transparency, the concerns of NGOs [nongovernmental organizations]. Now practically everybody treats these as something they have to respond to...I get invitations at least once a week from any number of international organizations that are bringing in people from NGOs and others who are hostile to the international financial institutions--to try and create a dialogue."

The richest person in the world, microsoft's Bill Gates, has announced that he was contributing $100 million of his pocket change toward the development of an AIDS vaccine. Perhaps more valuable was his shaken faith in neoism. Describing the shock he felt upon learning how little money was being spent to research diseases that affect the world's poor, Gates said: "There is a real market failure here--a failure of visibility, a failure of incentives, a failure of cooperation that has led to a very disastrous situation." Even James Wolfensohn, president of the World Bank, has observed: "At the level of people, the system isn't working."

In late 1999 the World Bank adopted a new antipoverty initiative that requires all its debtor nations to submit "poverty reduction strategy papers" proposing specific steps they will take to help their poorest citizens. In preparing its World Development Report 2000/2001, the bank drew on interviews with more than 60,000 poor people in 60 countries. It even admits failure: "At times reform programs have failed to deliver as much as expected--and at times reforms have failed entirely." The report calls for land reform, gender equality, income redistribution, and microcredit--all of which were first called for by protestors.

Of course, talk is cheap. Right now all of this is just more promises, and the World Bank continues to push for the same reforms it admits are failures.

One real success if the liberating of the secret FTAA draft text - more than a month after the actual summit.

US Trade Representative Robert Zoellick called the release "an unprecedented effort to make international trade and its economic and social benefits more understandable to the public."

"It's like reading a detective novel," says John Cavanagh, director of the Washington-based Institute for Policy Studies. "Over 50 percent of it is in brackets, but they don't tell you who those brackets represent."


The movement at work: Labelling

A Marymount University study has shown most consumers are willing to pay an extra $1 on a $20 article of clothing if they can be sure that the workers who made the item were paid a livable wage and worked in safe and clean conditions.

In July of 1998, inspired by the Union of Needletrades, Industrial and Textiles Employees (UNITE), and other unions, and after visits to factories in Central America, students formed United Students Against Sweatshops (USAS).

USAS focuses on 200 campuses, with "fashion shows" in which students model clothes while describing how they were made, street theater, and sit-ins to inform and pressure college administrations to be responsable customers.

They research and monitor factories that make university apparel send students tospend the summer with workers in Honduras, Mexico and Indonesia.

Their strategy starts by making universities sign demands for safe and clean working conditions, obedience to national labor laws, the right to organize, living wage provisions, and an end to discrimination, forced or child labor and physical abuse in the workplace.

Another demand is that consumers know exactly where the factories are, so that they can be monitored. The bosses say this is a "trade secret" to protect their "competetiveness". When they have, they remained as competetive as ever. In short, they fear us knowing the truth.

For the next step, the factories must be monitored.

However, the Fair Labor Association (FLA) gives veto powers to the corporations that profit from the sweatshops.

It allows the corporations to choose which factories to inspect, after those factories have been given enough time to destroy evidence. It only inspects 30% of a company's factories, and is only allow to inspect them one every ten years, meaning that once a factory has been inspected, it has the licence to be a sweatshop for a decade. Finally, the FLA is secretive, only sending its useless reports to the corporations.

For these reasons USAS uses the independent Workers Rights Consortium (WRC).

(For information on recent anti-sweatshop victories, see http://www.coopamerica.org/sweatshops/ssvictories.htm )


What is the International Labor Organization (ILO)

(http://www.ilo.org)

Formed in 1919 to give workers an alternative to revolution, this organization has become part of the UN and has drafted 182 conventions on labor standards (so far). It is controlled by government labor ministers, unions, and business. The ILO publishes The International Labour Review, World Labor and Employment Reports, and special studies. All of them are widely respected.

The ILO has set high standards for health and safety, freedom to organize unions, social insurance, and ending abuses like workplace discrimination and child labor. However, it has no power to enforce these standards.

Unlike neo organizations like the decisive, authoritarian IMF, the ILO is slow and cumbersome. Institutions need a balance between being democratic and being effective.


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