Friday 8 July. Stuart Hodkinson in Edinburgh. When the news of the bombs hitting London broke on our campsite in Craigmillar, we all immediately reached for our mobile phones in the hope that friends were ok. In that moment, the G8, Africa, the protests and the police all became irrelevant. As good news filtered through, political minds inevitably began to drift back to the wider political implications. "This will definitely mean ID cards,” one sighed. "Iran will be next for the neo-cons," said another. "And Muslims are going to be hammered." Debates and disagreements broke out but on one thing everyone was agreed: this was “a good time to bury bad news”. And yesterday's announcement of the G8 deal on Africa and climate change contained a lot of bad news, whatever those idiots Geldof and Bono say.
Since February of last year with the launch of Blair's Commission for Africa, the expectations that the UK presidency of the G8 summit would finally deliver a new political and economic settlement for Africa have been steadily built up to levels of near-hysteria by New Labour's captured coalitions of rock star campaigners and development NGOs in the form of Live 8 and Make Poverty History. Millions of people were duped into joining the 'white band-wagon' in the genuine belief that Blair and Brown were going to 'make poverty history'. They were seduced by the politician's impassioned moral rhetoric of which Blair is a modern master. When the Africa Commission report was released in March this year, Blair declared that its recommendations meant:
There can be no excuse, no defence, no justification for the plight of millions of our fellow human beings in Africa today. There should be nothing that stands in the way of our changing it.
With a clutch of handpicked (neoliberal) African leaders on Blair's Commission nodding enthusiastically, and reputed celebrity campaigners like Bono, Geldof and Richard Curtis joining Oxfam and other co-opted aid agencies in singing the UK government's praises, how could middle England – the backbone of the Make Poverty History campaign – doubt New Labour's sincerity on this great 'moral crusade'? Well, now the truth is finally out. The G8's self-proclaimed “comprehensive plan to support Africa's progress”, heralded by Bono and Geldof, is an unmitigated disaster for the continent. To understand why, we only have to look at the huge gap between the conservative demands of the pro-government Make Poverty History (MPH) coalition and what the G8 actually delivered.
MPH wanted a mild form of 'trade justice' – the end of forced liberalisation and privatisation on poor countries as part of aid, trade deals or debt relief, and the abolition of Northern agricultural export subsidies that leads to dumping of cheap goods on southern producers, wiping out their local economies. Then there was more and better aid – rich countries should immediately increase aid by $50bn per year and meet 35-year old promises to spend 0.7 per cent of national income (collectively worth $125bn a year) in development aid by 2010. Perhaps the most important demand was to 'drop the debt', or rather 'some of the debt' through the cancellation of the ‘unpayable’ debts of the world’s poorest countries through a ‘fair and transparent international process’ that uses new money, not slashed aid budgets. To ensure that such reforms would work, MPH also called for the regulation of multinationals, the democratisation of the IMF and World Bank and the end of all economic conditionality imposed on the South by the rich North as part of global trade, debt and aid structures.
Whatever we might think about MPH's own political failings, the inability of the G8 to get anywhere near the coalition's demands sounds a death knell to millions of people across Africa. On trade, the G8 failed to set any deadlines or targets to eliminate agricultural subsidies. Its general promise “to ensure Least Developed Countries have the flexibility to decide their own economic strategies” was of course then contradicted by the announcement on debt relief that those 18 countries chosen for special dispensation would still have to complete the IMF/World Bank HIPC programme, which makes debt cancellation conditional upon completing neoliberal economic reforms.
It is important to remember that Africa alone has repaid over $500bn in debt servicing over the last 30 years yet still has a debt stock of roughly the same amount – the original debt was only worth around $50bn. In other words, the debt has been repaid and is now illegitimate. MPH, which failed to champion African voices calling for total and immediate debt cancellation for all poor countries and reparations for 300 years of colonial plunder, was to its credit still calling for at least 60 countries to be given 100% debt cancellation worth over $45.7bn a year in saved debt repayments. The G8's headline debt deal to cancel $40bn of debt is actually worth just $1bn a year. The only crumbs coming from the top table were on aid and treatment for AIDS and malaria– the G8 promised to spend an additional $50bn a year in poor countries. Unfortunately for millions of sick and starving Africans, this will only begin in 2010, knowingly condemning them to death when such genocidal loss of life could have been prevented.
In return for this slap in the face, African governments must commit themselves to a decade of political and economic reforms under the mantra of "good governance". The IMF and World Bank remain untouched; corporations' rights to roam the world for profit have been enhanced, not limited. And when you consider that the only real agreement on climate change, which is currently causing huge devastation in Africa in particular, was the vague recognition that “climate change is happening now” and that carbon emissions need to “slow, peak and then decline” at some point, Bob Geldof's claim that "[t]his has been without equivocation the greatest G8 summit there has ever been for Africa" is criminal. He should be politely asked by African social movements to "f#$k off".
For those naive enough to buy the wristband and swallow the age-old lies, the release of the G8 communique yesterday afternoon with no deal on trade, no new deal on debt and a small package of new aid that won't be seen until 2010, will have come as a cruel blow. Many may now be so disillusioned that they'll quit a movement for global justice they've only just joined. Others may get angry and look for more radical explanations and solutions. Whatever happens, everyone is about to get a very sharp education in the realities of power and wealth. With the smashing of hope also comes the dismantling of any illusions that the G8's illegitimate grouping of imperial powers and their corporations will ever voluntarily release Africa and other peoples of the neo-colonised Global South from the profitable shackles of debt bondage just because a few pop concerts ask them to.
The government's job has been done - Blair's Africa agenda was an ingenious smokescreen to distract middle England away from the carnage in Iraq and get him through the election. MPH, which played along with the government and helped its betrayal, is now in total disarray. Those radical NGOs like War on Want and WDM who warned Oxfam and co not to get too cosy with Richard Curtis and Gordon Brown, have been vindicated. With their complicity, the G8 has this week condemned millions of people to a painful death but unlike London, we won't be seeing their faces and life stories printed across our newspapers. It is the duty of campaigners across the world to tell the truth about this G8 without equivocation. The G8 called their deal on Africa “an historic opportunity”. The reality is that it was an historic betrayal.
Excellent article
'We must demand the abolition of the World Bank, the IMF and the WTO'
That's like asking Billy the Kid to hand over his gun, it will never
happen.
"African governments must commit themselves to a decade of political and economic reforms under the mantra of "good governance"
That's the whole point of the debt, so relieving some of it changes nothing of substance in the long term.
Posted by: Eric McCay | Sunday, 10 July 2005 at 12:27
Excellent Article,
Especially the part stating "He should be politely asked by African social movements to "f#$k off". The point being that everything that civil society movements, trade unions and NGO's within Africa are striving for and even in many cases making gains are in opposition to what Bono and his counterparts are demanding. MPH demands more and better AID which is unfortunately represented by increased conditionalities and trade liberalization but within Africa "homegrown" initiatives and solutions are taking place and one should look to South Africa's Anti-Privatization Forum and South Africa’s Treatment Action Campaign to see some of the positive gains that have been made by the Africans not by some wealthy white men with Albums and Images to sell.
Posted by: Caitlin Watkins | Thursday, 27 April 2006 at 21:25
I believe any hope that the problem of climate change can be solved within the existing economic framework of Neo-liberal capitalism will prove to be utterly unfounded. To try to put this right without rectifying the clapped out global financial system won’t work and environmentalists doing so will carry on coming up against a brick wall. They need to look at the way this system works and intellectually grow beyond the conditioning that economics and finance can only be understood by economists and financiers. Of course its true that they are doing something very useful in highlighting to the unaware the “elephant standing in the corner” but we’re all locked in to an international economic system that blocks substantial change. **New Para**
Let me try to explain. The two main cornerstones of Western economies are usury and speculation. Usury in that the vast majority of money in circulation has been electronically created by the commercial banks and is called by them “credit” and is lent to Governments and individuals for quick profit not for a particular motive of world betterment. Nothing moves when electronic money circulates when you use your debit card, direct debits, cheques etc and when Governments borrow money- all that happens is that the drawer’s account’s data entry is debited (decremented) and the payee’s is credited, (incremented). So this money can be created at negligible cost to the banks because it is created and exists only as a DATA entry in our electronic bank accounts and is exchanged between them as such only. The stuff in your wallet/purse created by the Royal Mint for the Bank of England (whose revenue DOES accrue to the state) represents a tiny fraction of the ‘money’ that exists, the vast majority originated as loans mostly created by the commercial banks under this “fractional reserve banking system”, circulates electronically and the vast profit (interest) accrues to bankers not Governments. For more information on how this amazing system has evolved (which one could be forgiven for thinking has been deliberately designed with a main aim to enrich private financial elites) in the UK and many, many countries I refer you to the expert writings & books at www.jamesrobertson.com. Even pretty low corporation tax is often avoided by the use of foreign tax havens, (At least £20 Billion total in the UK per annum avoided at 2003 figures- [War on Want pamphlet]). The need for the continuing increase of the assault on the world’s resources substantially stems from the imperative of “economic growth” which is necessary to keep up with the ever spiralling overall interest payments due on the explosion of different types of loans created by commercial banks and other private interests. I read that the exponential growth in private credit has been allowed to occur with all its wanton increase in the consumption of resources and debt hardship because of outsourcing by corporations of huge amounts of skilled & unskilled jobs to developing countries with cheap labour and minimal regulations under globalisation (“corporate flight”). With the generally decreasing availability therefore of properly paid quality jobs, to make ends meet governments and individuals in richer nations have had to be allowed to borrow more and more. I recommend the reading of the website and books by the US professor of economics Ravi Batra who has a lot of hard hitting and extremely interesting things to say on this matter, www.ravibatra.com. **New Para**
I refer to the ‘cornerstone of Speculation’ in that National economies and their populations are utterly dependant on the $2 Trillion or so (equivalent) that changes hands electronically every DAY- untaxed- around the world on the “financial markets” in search of speculative quick profit unrelated to any exchange of real goods or services. Utterly dependant because National Governments create hardly any of the money that is in circulation at all as I have already explained and they need to compete internationally to keep on attracting this privately created & transmitted globally mobile electronic money which has become the lifeblood of all our economies. Financiers and corporations increasingly trade IN money not WITH money, since deregulation in the 1980s- eg Removal of foreign capital exchange controls (and credit controls) which happened then. Why did we multi-nationally cede so much control over our economies then to those which to many might seem like a load of locusts? Are the ones (IMF, WB?) who inspired our national leaders to do this still in positions of influence? In this “liberalised” regime why create, innovate and trade in cumbersome goods when one can make far more far quickly and with far less risk just by moving money (data) and money instruments between computers around the world? Almost all the global financial institutions and even many corporations are at it. A “monstrous global casino” in the words of sustainable economics columnist Hazel Henderson. Any government that even publicly SPEAKS of restricting it, or taxing it, or significantly environmentally regulating the stock market listed business that it invests in, or getting off the absurd merry-go-round of competing with other nations to clamp down on corporation tax so as to attract employment and capital, or creating their OWN electronic money, or even threatening tax havens, faces economically disastrous capital flight to nations NOT doing so within hours on the trading computers on the stock markets and the derivatives computers of the international corporations and banks. You see how the financier oligarchy has got us all over a barrel? No Government dare even publicly consider democratically demanded change to the status quo. No corporation dare significantly reduce the current quick profit return to its international capital investors by SIGNIFICANT investment in alternative forms of energy & transportation as to do so invites a declining share price and capital flight to corporations not doing so. The intellectual economist Lyndon LaRouche in Executive Intelligence Review (see below) actually uses the term “Financier Oligarchy” referring to the way our ‘democracies’ are going under the economic & corporate globalisation I have already described. If you think carefully about it you might realise that under neo-liberalism what we as nations are all having to do is compete to make often fabulously wealthy owners of international capital- grow even richer- for no effort. (Before anyone pulls the “pension funds” ‘old chestnut’ on me let me retort that I recently heard on a BBC money programme that only 20% of shares are owned by pension funds). A POSSIBLE SOLUTION to re-establish control over international capital and corporations by electorates and governments is proposed by “The Simultaneous Policy” at www.simpol.org and I believe progressives might feel their strategy warrants consideration. **New Para**
Most mainstream media outlets are owned by stock market listed corporations. Does anyone believe such a corporation will allow SERIOUS debate in its pages or TV stations, of reform to the international financial system when it is this system that is the investment hand that feeds it, both owning the shares and placing the corporate adverts? Does anyone seriously believe that one example tabloid and TV/news station owning international corporation that currently pays no corporation tax in the UK by the use of tax havens will seriously allow such debate in its media outlets? I’m not suggesting columnists and editors are directly told what to say and what not to, but they know there are limits which they must not cross if they are to retain their jobs which are mostly in the form of shortish term renewable (or not) contract posts. And most of them seem never to have asked themselves what money really is, who creates it, who administers its circulation, who profits from it and why no Government of left OR right credentials strangely refuses to reinstate fair corporate taxation and environmental regulations ONCE IN POWER despite the obvious dire financial state of our public services, worsening annually, and the developed countries still paltry overall help to the developing ones whose populations are starving to death in their millions monthly for the want of the huge surplus of food per capita that exists worldwide (Some 10%- look up UN Statistics). It should be surely obvious that there’s a CHRONIC lack of money for foreign aid and public services for all our government’s pathetic obfuscation that the latter still need “modernising”, ie. another round of cuts. The neo-liberal free movement of capital & corporations is leaving the competing nations’ governments with a chronic lack of cash for public spending on virtually everything- from palaces to prisons.**New Para**
I believe that Planet Earth’s environment is in a sad and perilous state which each day brings it nearer to the critical, and that even the most dire prophecy falls short of the calamity facing the world today, (this quote from www.share-international.org). Anyone who seriously believes that humanity can burn off gigantic amounts of carbon into the atmosphere daily over some 200 years (in the form of greenhouse gases from fossil fuels) that had been gradually accumulated beneath the earth over hundreds of MILLIONS of years, and while annually cutting down tens of millions of acres of atmosphere purifying tropical forests- all of this without incurring MAJOR upheaval and destruction to the earth’s life supporting natural climate systems- is conditioned and deluded indeed. **New Para**
I believe that only a total and systemic collapse of the world’s financial system will bring humanity to its senses and- (even though I know this itself would cause major trauma for a while because we have allowed stock market listed corporations to take over most food and energy production and distribution worldwide)- it is my belief and hope that this is coming to pass. (I refer again to the writings of economics professor Ravi Batra). The men of money’s selfish greed and competition is over-reaching itself at long last and the frantic efforts to prop up the system behind the scenes are at long last crumbling. “The REAL economy has fallen out from under the markets which have been artificially propped up by accounting tricks, enormous and unpayable debt loads, and mass delusion on the part of the markets and the public” (John Hoefle banking columnist, and refer also to the writings of economist’s Lyndon LaRouche’s Executive Intelligence Review for more information, www.larouchepub.com). The signs of the oncoming collapse are obvious for those who look beyond their own narrow interests and look below the surface at powerful people’s MOTIVES- not what they SAY but what they DO and WHY that might be- with objectivity. People who bother to READ & STUDY widely. Anyone who thinks that substantially unrestrained powerful people in today’s out of democratic control globalised capital/corporate world will not try to manipulate to retain and enhance their own selfish interests, and who denounces those who highlight this as “conspiracy theorists”, is deluded and conditioned indeed. They have just not reflected seriously on the sad condition of greed and fear of loss as well as spiritual poverty and poverty of intellect that dominates the natures of many, many of our fellow human being financier oligarchs in power. We live in a competitive economic culture which makes a VIRTUE out of greed and it's essential we realise it, detach from it and peacefully protest against it. As a species we’ve got some major waking up to do if we are to survive.
Posted by: Tony Harvey | Monday, 03 July 2006 at 12:10
"African governments must commit themselves to a decade of political and economic reforms under the mantra of "good governance" that's very true. thanks for sharing!
Posted by: Hungry child | Friday, 16 May 2008 at 20:41