avatar
Unsustainable Non Development


Noam Chomsky

At

a recent talk Chomsky was asked “What are the motivations of the U.S. push for

sustainable development in the developing world?” Here

was his answer…

Its

the first time I ever heard of that–does the U.S. have a push for sustainable

development? As far as I know, the U.S. push is for unsustainable nondevelopment.

The programs that are built into U.S policy, take a look at the World Trade

Organization rules, like, say, TRIPs and TRIMs–Trade-Related Intellectual

Property and Trade-Related Investment Measures are designed to impede

development and impede growth. So the intellectual property rights are just

protection of monopolistic pricing and control, guaranteeing that corporations,

in fact, by now, megacorporations, have the right to charge monopolistic prices,

guaranteeing, say, that pharmaceutical production drugs will be priced at a

level at which most of the world can’t afford them, even people here. For

example, drugs in the U.S. are much more expensive than the same drugs as close

as Canada, even more expensive than say, Europe, and for the third world this

just dooms millions of people to death.

Other

countries can produce the drugs. And under earlier patent regimes, you had

process patents. I don’t even know if those are legitimate, but process

patents meant that if some pharmaceutical company figured out a way to produce a

drug, somebody smarter could figure out a better way to produce it because all

that was patented was the process. So, if the Brazilian pharmaceutical industry

figured out a way to make it cheaper and better, fine, they could do it. It

wouldn’t violate patents. The World Trade Organization regime insists instead

on product patents, so you can’t figure out a smarter process. Notice that

impedes growth, and development and is intended to. It’s intended to cut back

innovation, growth, and development and to maintain extremely high profits.

Well,

the pharmaceutical corporations and others claim they need this so they can

recoup the costs of research and development. But have a close look. A very

substantial part of the research and development is paid for by the public

anyway. In a narrow sense, it’s on the order of 40-50%. But that’ s an

underestimate, because it doesn’t count the basic biology and the basic

science, which is all publicly funded. So if you get a realistic amount, it’ s

a very high percentage that’s publicly paid anyway. Well, suppose that went to

100%. Then all the motivation for monopolistic pricing would be gone, and

there’d be a huge welfare benefit to it. There’s no justifiable economic

motive for not doing this. There’s some economic motive, profit, but it is an

effort to impede growth and development.

But

what about Trade-Related Investment Measures? What do they do? TRIPS is straight

protectionism for the benefit of the rich and powerful, through publicly

subsidized corporations. TRIMs are a little more subtle. What they require is

that a country cannot impose conditions on what an investor decides to do.

Suppose General Motors, let’s say, decides to carry out outsourcing, to have

parts made in some other country with non-union cheap labor, and then send them

back to General Motors. Well, the successful developing countries in Asia, one

of the ways they developed is by blocking that sort of thing, by insisting that

if there was foreign investment, it had to be done in a way that was productive

for the receiving country. So there had to be technology transfer, or you had to

invest in places they wanted you to invest in, or some proportion of the

investment had to be for export of finished goods that made money. Lots of

devices like that. That’s part of the way in which the East Asian economic

miracle took place. Incidentally, it’s the way all the other developing

countries developed too, including the United States, with technology transfer

from England. Those approaches are blocked by Trade-Related Investment Measures.

Superficially they sound like they are increasing free trade, but what they are

in fact increasing is the capacity of huge corporations to carry out central

managemnent of cross-border transactions, because that’s what outsourcing and

intrafirm transfers are –centrally managed. It’s not trade in any meaningful

sense. And they again undermine growth and development.

In

fact, if you look across the board, what’s being instituted is a regime which

will prevent the kind of development that has taken place in the countries that

today are rich, industrial countries—not the best kind of development we can

imagine, to be sure, but at least development of a sort. If you go back from

England to the United States, to Germany, France, Japan, Korea–every one of

these countries developed by radically violating the principles that are now

being built into the World Trade Organization. These principles are methods of

undermining growth and development and ensuring concentration of power. The

issue of sustainable development doesn’t even arise. That’s another question

altogether. Sustainable development means, for example, paying attention to what

are called externalities, the things businesses don’t look at.

So

take, say, trade. Trade is supposed to increase wealth. Maybe it does, maybe it

doesn’t, but you don’t know what it does until you count in the costs of

trade, including costs which are not counted, like, for example the cost of

pollution. When something moves from here to there it’s creating pollution.

It’s called an externality; you don’t count it. There’s resource

depletion, like you deplete the resources of agricultural production. There’ s

military costs. For example, the price of oil is kept within a certain band, not

too high, not too low, by a very substantial part of the Pentagon directed

toward the Middle East oil producers, not because the United States likes desert

training or something, but because that’s where the oil is. You want to make

sure it doesn’t get too high, doesn’t get too low, but stays where you want

it. There hasn’t been much investigation of this, but one investigation by a

consultant for the U.S. energy department estimated that Pentagon expenses alone

amount to maybe a 30% subsidy to the price of oil, something in that range.

Well,

you look across the board, there’s lots of things like this. One of the costs

of trade is that it drives people out of their livelihoods. When you export

subsidized U.S. agricultural products to Mexico, it drives millions of peasants

out of farming. That’s a cost. In fact, it’s a multiple cost, because those

millions of people not only suffer, but they are driven into the cities where

they lower wages, so other people suffer–including, incidentally, American

workers, who now are competing with even lower paid wages. These are costs. If

you take them into account, you get a totally different picture of economic

interactions entirely.

Incidentally,

that’s also true just of something like Gross Domestic Product. You take a

look at the measures of Gross Domestic Product, and they ’re highly

ideological. For example, one of the ways to increase the Gross Domestic Product

in the United States is to do what, in fact, it’s doing, not repair roads. If

you don’t repair roads and you have a lot of potholes all over the place, that

means when cars drive, they get smashed up. That means you’ve got to buy a new

car. Or you have to go to mechanic and get him to fix it, and so on. All of that

increases the Gross Domestic Product. You make people sicker by polluting the

atmosphere. That increases the Gross Domestic Product because they have to go to

the hospital and they have to pay doctors and they have to have drugs, and so

on. In fact, what increases the Gross Domestic Product in societies aas they are

now organized is often not a measure of welfare in any meaningful sense.

There

have been efforts to construct other measures which do take account of these

things and they give you very different stories. For example, the United States

is one of the few industrial countries that does not publish regular “social

indicators”–measures of social welfare, like child abuse, mortality, all

kinds of things. Most countries do it. Every year they have a social indicator

measure. The United States doesn’t, so it’s kind of hard to get a measure of

the social health of the country. But there have been efforts to do it.

There’s

one major project at Fordham University, a Jesuit university in New York. For

years they’ve been trying to construct a social health measure for the United

States. They just came out with the last volume a couple months ago. It’s

interesting stuff. According to their analyses of the kinds of measures of the

sort I’ve mentioned, up until about 1975, that is, through the “golden

age,” as it’s called, social health went up, more or less, with the economy.

It kind of tracked the economy. As that got better, social health got better.

From 1975 they’ve diverged. The economy has continued to grow, even though

more slowly than before, but social health has declined. And it’s continuing

to decline. In fact, they conclude that the United States is in a recession, a

serious recession, from the point of view of measures that matter. That’s when

you’re beginning to look at questions like sustainable development, meaningful

development. But that requires a completely different perspective on all of

these issues of economy and consequences, etc., one that definitely should be

undertaken. And those are the issues that arise when people are talking about

sustainable development, but the U.S. certainly has no such program. It should,

but it doesn’t.