The “Structural Adjustment Team” II

“The WTO has rapidly accumulated a sordid record. Binding decisions from its enforcement tribunals have undermined consumer and environmental protections around the world. TNCs have used the threat of WTO action to roll back or block countless rules designed to benefit workers, consumers and the environment, and to promote human rights and development in the world’s poorest countries. But all this has been predicted long before the WTO came into formal effect. From the outset GATT was seen as a “rich man’s club” dominated by Western industrial countries.”

Znet / Z mag.org, 12/28/04


wtoThe World Trade Organisation slithered into view much later in 1995 replacing the General Agreement on Tariffs and Trade (GATT). The WTO’s mandate is to make sure that the free market has unfettered access to all and everything under the banner of free trade. International trade restrictions are to be reduced or done way with completely. This means a free ride for corporations once they claim their country.

The World Bank does exactly what its name implies: an international institution that gives loans to developing countries in order to improve their socio-economic standing and eradicate poverty. At least, that’s the official line if you believe the BBC and other MSM outlets. At the most basic level of interpretation, the interests which dominate the bank are drawn from Neo-liberal economic perception rooted in the Establishment classes which means that their interests dominate over all else. Though the World Bank represents 186 countries it is governed and funded by a powerful few, namely the United States and the G8 nations. It is thus tied to the formation of an economic order that conforms to their reality and no one else’s, the evidence of which is obvious for all to see. It is an immediate contradiction in terms that the reduction of poverty is formulated from an economic order which can only increase it.

One only has to look at the past and traditionally American presidents of the World Bank to understand the biased economic and corporate beliefs behind the dispensing of loans. These have included from 1991-1995: JP Morgan bank executive Lewis T. Preston; from 1995-2005: corporate lawyer and banker Sir James Wolfensohn; 2005-2007: Neo-Conservative and Iraq war strategist, US Deputy Secretary of Defence Paul Wolfowitz and from 2007: the present incumbent Robert Zoellick former Bank executive with Goldman Sachs, Deputy Secretary of State and US Trade Representative. The eight international development goals that 193 United Nations member states and over 23 international organizations have agreed to achieve by the year 2015. The World Bank has also agreed to commit itself to these goals which are to:

  • Eradicate Extreme Poverty and Hunger
  • Reduce Child Mortality
  • Improve Maternal Health
  • Combat HIV/AIDS, Malaria, and Other Diseases
  • Ensure Environmental Sustainability
  • Develop a Global Partnership for Development [1]

Tragically, (though certain members of the World Bank are entirely cognizant of this fact) eradicating poverty long-term is unlikely to be achieved because the World Bank actively creates it. That is not to say that great gains have not been made before the Global Economic Crisis. (GEC) According to the UN fact sheet “…the world is on track to meet the MDG target of halving the proportion of people living on less than $1 a day between 1990 and 2015.” While this is great news, to make sure this is a lasting change leading to the eradication of poverty and hunger and not just a peak in the overall trough of global economic fortunes, the very nature of economics has to change so that the crises such as we have witnessed in 2008 and onwards do not send the achievements plummeting back to former figures.

Since these achievements, by the UN’s own admission is largely due to the “extraordinary success in Asia, mostly East Asia” based on exactly the same banking and economic model of the West then it can only offer the same eventual boom and bust scenarios which have long been part of Western capitalist “growth” and the environmental and social problems attached to them. Thanks to the GEC global unemployment has rocketed as it does with any crisis. Consequently, while extreme poverty has been reduced, halving the levels of hunger is proving much more difficult, with only intermittent change.

Similarly, reducing child mortality, combating HIV/AIDS, Malaria and other disease cannot hope to have lasting results because the World Bank cannot recognise that all related problems largely stem from the economics has largely been absorbed into the underworld of systemic crime which has effectively become the “overworld.”

To ensure environmental sustainability the World Bank must redesign its economic framework to such an extent that there would be little reason for it to exist. The millennium goals are a world class oxymoron for most if not all institutions and organisations shackled by the very same myopic mind-set seen from those who inhabit the leather chairs of World Bank offices. A “Global Partnership for Development” under World Bank terms can only mean a continuing strategy for corporatism. If their basic economic directives do not change then neither do the consequences for most of the global population, despite G8 countries being willing to cut billions of owed debt from their books. [2]

All this may sound desperately cynical on my part. But you see, if you the UN is still encased in the same economic box, then any long-term alleviation of poverty, hunger and mortality rate will logically be dependent on the those highly unstable fluctuations which characterise the financial architecture of the globe. Nothing less than a radical overhaul of the very concept of banking and commerce is needed. Micro-credit and micro-banking is one example and a great step forward in this direction. [3]

The World Bank is the largest source of development finance in the world and has an impressive (or iniquitous depending on your view) record of large-scale engineering, reconstruction and infrastructure projects in developing countries. More regional and local projects have also been financed including roads, bridges, dams and pipelines which often go hand in hand with the extraction of natural resources and the presence of corporations lingering in the background.

The World Bank, The IMF, the WTO and the United Nations have helped to create, augment and sustain the current global financial architecture and its various social iniquities while offering occasional bursts of short-term relief in the guise of numerous social programs and initiatives. Seldom do they address the root causes of national and international socio-economic problems. Counter to the prevailing view that these post war institutions offer at least a partial amelioration of global problems, we can see that they are in fact, representatives of a Global Official Culture dressed up in humanitarian goals.

The above is the standard interpretation of the organisation which is enough in itself to petition for change. However, it goes deeper than that.

Former insider and one-time Senior Counsel Karen Hudes knows how the World Bank lies to run things. A graduate of the Yale Law School with over 20 years of experience in the legal Department at the World Bank and founder of the Non-Governmental Organization Committee of the International Law Section of the American Bar Association and the Committee on Multilateralism and the Accountability of International Organizations of the American Branch of the International Law Association, Hudes knows about her subject extremely well.  During a May 2013 interview with journalist Alex Newman of New American magazine she was explicit as to how the mechanism of corruption is allowed to keep functioning and who is responsible. The article, entitled: ‘World Bank Insider Blows Whistle on Corruption, Federal Reserve’ reports that the domination of the global financial system, according to Hudes is sourced from: “…a small group of corrupt, power-hungry figures centered around the privately owned U.S. Federal Reserve. The network has seized control of the media to cover up its crimes, too, she explained.” The New American continues:  “Hudes said that when she tried to blow the whistle on multiple problems at the World Bank, she was fired for her efforts. Now, along with a network of fellow whistleblowers, Hudes is determined to expose and end the corruption. And she is confident of success.”

The article goes on to describe the basis of this control system:

“Citing an explosive 2011 Swiss study published in the PLOS ONE journal on the ‘network of global corporate control,’ Hudes pointed out that a small group of entities — mostly financial institutions and especially central banks — exert a massive amount of influence over the international economy from behind the scenes. ‘What is really going on is that the world’s resources are being dominated by this group, she explained, adding that the ‘corrupt power grabbers’ have managed to dominate the media as well. “They’re being allowed to do it.’

According to the peer-reviewed paper, which presented the first global investigation of ownership architecture in the international economy, transnational corporations form a ‘giant bow-tie structure.’ A large portion of control, meanwhile, ‘flows to a small tightly-knit core of financial institutions.’ The researchers described the core as an ‘economic ‘super-entity’ that raises important issues for policymakers and researchers. Of course, the implications are enormous for citizens as well.

[…] ‘I realized we were now dealing with something known as state capture, which is where the institutions of government are co-opted by the group that’s corrupt,’ she told The New American in a phone interview. “The pillars of the U.S. government — some of them — are dysfunctional because of state capture; this is a big story, this is a big cover up.’

At the heart of the network, Hudes said, are 147 financial institutions and central banks — especially the Federal Reserve, which was created by Congress but is owned by essentially a cartel of private banks. ‘This is a story about how the international financial system was secretly gamed, mostly by central banks — they’re the ones we are talking about,” she explained. ‘The central bankers have been gaming the system. I would say that this is a power grab.’ ” [Emphasis mine]

Rather than seeing this as a case of conspiratorial fever or a left-right political agenda being played out, it is far better to simply accept that Hudes – as have so many other whistleblowers in recent times – simply stated the objective reality of what she experienced, confirming what so many outsiders suspected after witnessing first-hand the trail of devastation it has produced.

If we know, then we may change it.

Perhaps we can see why the psychopath in society has played a large part in creating and maintaining the economic architecture which is still ruining lives. Psychologist and leading authority on the psychopath Dr. Robert Hare stated that if he could not study psychopaths in prison, his next best choice would be a Stock Exchange. If people are no more than units of labour consumption and values have no meaning at all when set against the personal power and corporate greed then it goes some way to explaining why such consistently toxic systems continue to ravage humanity and its home. As normal human beings try to compete in a system that is favoured towards the human predator it is inevitable that they are pushed to the periphery to become the minority rather than the majority. If there are four times more psychopaths at the head of large corporations than in the general population it means they immediately have a huge advantage in obtaining whatever it is they want, which is usually everything.

 


Notes

[1] http://www.un.org/millenniumgoals/pdf/MDG_FS_1_EN.pdf
[2] “G8 Finance Ministers agreed in June 2005 to provide enough funds to the World Bank, the International Monetary Fund (IMF), and the African Development Bank (ADB) to cancel an additional $40–55 billion debt owed by members of the Heavily Indebted Poor Countries (HIPC) to allow impoverished countries to re-channel the resources saved from the forgiven debt to social programs for improving health and education and for alleviating poverty.” United Nations Millennium Development Goals website, 16 June 2009. This is an example. One can cancel 100billion of debt but if the same directives remain in place then so too will the next generation of victims. They will re-channel their resources so that they can be ready to take the next set of measures to keep them dancing to the WB, IMF and WTO tune.
[3] Microcredit or Microfinance: United Nations declared 2005 to be the International Year of Microcredit and the founders of the microcredit movement were awarded the Nobel Peace Prize in 2006. For more articles see: New York Times: ‘Tiny Loans Make a Big Difference in Lives of Poor’ | http://www.nytimes.com/2004/03/29/technology/29venture.html | USA Today/Associated Press: Microcredit pioneers win Nobel Peace Prize – http://www.usatoday.com/news/world/2006-10-13-norway-nobel_x.htm | Wall Street Journal: A new way to do well by doing good – http://www.post-gazette.com/pg/06005/633114.stm | BusinessWeek: ‘Microfinance funds lift poor entrepreneurs—and benefit investors’| http://www.businessweek.com/magazine/content/05_19/b3932134_mz070.htm | The Economist: ‘Microcredit in India, High finance benefits the poor’ – http://www.economist.com/displayStory.cfm?story_id=2413549

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