Anti-WTO Organizing



 



The demonstrations against the WTO in Seattle were probably among the most
effective protests in modern American history. The sequel—on April 16 in
Washington DC, at the IMF/World Bank spring meetings—may have an even greater
impact on the world.



The main reason that these demonstrations can be so effective is that U.S.
foreign economic policy cannot withstand the kind of public scrutiny that
is brought to bear when protest reaches a certain critical mass.



The point was brought home when President Clinton made his speech endorsing
the concept of labor rights enforceable by trade sanctions, the day after
Seattle protesters made good on their promise to “shut down the WTO.” That
speech effectively ended the millenium round of WTO negotiations, at least
for some time.



And it did more than that. Hand-wringing by the world’s financial and economic
elite dominated the World Economic Forum in Davos a month later. “Those
who heard a wake-up call in Seattle got the right message,” said Clinton.
Others expressed similar views—they had discovered that they would have
to make some concessions to the opposition if they were to proceed with
their project.



These pronouncements represent an important development, but not because
any substantive reforms are on the agenda. Clinton’s plan for including
labor rights in the WTO would take decades to implement—anything that far
off in the future can hardly be taken seriously enough to be called reform.
Indeed, the WTO is not set up to regulate trade in the interests of the
environment or labor, and it would surely be scuttled before it took on
responsibilities so completely alien to the goals of its creators.



The globalizers’ new willingness to talk to their opposition is important
because it represents an impasse in the process, and one that they have
now been forced to come to terms with. This shows the power of a united
opposition, and what it can accomplish if it continues along its present
path.



Now another wake-up call has been scheduled, this time directed to the
IMF and the World Bank, with large-scale protests planned for April 16
(see www.A16.org). The Fund and the Bank are many times more powerful than
the WTO, in that they actually dictate the most important economic policies
adopted by more than 50 countries. The damage that these institutions do
is incalculable. Their programs have caused and worsened economic crises,
and toppled governments. (Lacking a sense of irony, the Fund actually tried
to claim credit for helping to bring down Suharto in Indonesia; which they
did do, in their own roundabout way, by wrecking the economy to the point
that the country became ungovernable). They have exacerbated unemployment
and poverty, and perhaps most harmful over the long run, they have helped
to prevent most of the underdeveloped world from pursuing the economic
strategies that they would need to pull themselves out of poverty.




But the same relations that make the IMF the most powerful institution
in the world are also the source of its vulnerability. Its power rests
on a mostly informal arrangement in which nations that are poor or in economic
crisis must agree to implement the Fund’s economic policies, or be denied
credit from the World Bank, other multi-lateral agencies, and often private
sources as well. If the IMF is subjected to the kind of public criticism
that followed the Seattle protests, this agreement will surely begin to
unravel.



Readers of this magazine do not need to be reminded of our government’s
long and sordid history of destroying scores of movements or governments
that were dedicated to democracy or national economic development. But
the violence that Washington has used to snuff out these flames of hope—from
Sandino’s Nicaraguan resistance in the 1930s to Haiti’s first democratically-elected
government in 1991—is their last resort. The IMF is the CIA and Pentagon
of international finance.



Moreover, the Fund is also by far the most powerful and damaging adversary
of the labor movement in the United States. For all the reasons that labor
opposed NAFTA and the WTO, the IMF is even more threatening to the direct
needs and interests of American workers.



The IMF imposes NAFTA-like conditions on countries wherever it can. Just
as NAFTA made it easier for U.S. corporations to move their operations
to Mexico, the IMF makes it easier to them to move almost anywhere in the
world. It forces governments to rewrite their laws, as NAFTA did to Mexico,
so that they are more favorable to foreign investors. This drives down
wages everywhere, and especially in countries like the U.S., where businesses
can threaten to move when workers try to unionize or demand higher pay.
It also leads to job losses when these employers actually move their operations
out of the country.



The IMF also pressures countries to produce for export rather than for
domestic markets. This can cause a glut of manufactured or agricultural
goods on world markets, driving down prices, encouraging “dumping,” and
putting more downward pressure on wages. Many of the thousands of steelworkers
who lost their jobs over the last two years are casualties of IMF policies
in countries like South Korea, Russia, and Brazil.



Many union activists are aware of the damage that the IMF does to labor,
and there is a great deal of support for the April 16 actions especially
among those unions who were most strongly opposed to the WTO, such as the
Steelworkers and Teamsters. The protests will help to highlight these issues.




As the IMF gets dragged into the spotlight, the nature of the discussion
will change. This is what happened with the WTO: although much of the press
coverage of Seattle missed the point of the protests, there were also advances
in the way some of the issues were framed. The New York Times, for example,
ran articles that explained the protesters’ point of view on labor and
environmental issues. The WTO’s aggressive attempts to expand the monopolistic
protection of intellectual property rights (e.g., pharmaceutical patents),
as the WTO does through its TRIPS (Trade Related Aspects of Intellectual
Property Rights) agreement, was increasingly noticed to be inconsistent
with its supposed commitment to free trade and international competition.



The IMF will be more difficult to defend than the WTO. While the rich countries
dominate the WTO, power is even more concentrated in the Fund, which is
mainly run by the U.S. Treasury department.



Currently, the press still treats the Fund as though it were an international
lender of last resort that “bails out” countries in trouble, encouraging
them to adopt “sound macroeconomic policies.” But its fiascoes on three
continents over the past two and a half years—in Asia, Russia, and Brazil—have
already begun to undermine this myth. In Asia, the Fund’s major accomplishment
was to force the governments of major borrowers like South Korea and Indonesia
to guarantee the debt of private banks and corporations. Its macroeconomic
policies were anything but sound, and roundly criticized by prominent economists
such as Joseph Stiglitz (who, not coincidentally, was forced to resign
from his position of Chief Economist at the World Bank last December).
The Fund’s expensive, counter-productive, and ultimately futile attempts
to fix the exchange rates of the Russian ruble and the Brazilian real also
raised further questions about its competence.




These cracks in the consensus that has shielded the Fund and the Bank from
public criticism will widen after April 16. Since Washington is the leader
of the effort to remake the world according to the needs of global corporations,
protests on the home front have an enormous impact. It is also possible
that the dissension among the developed countries, which was a significant
factor in the collapse of the WTO’s ambitious agenda in Seattle, will increase.
Europe and Japan have long wanted to have more of a voice in the Fund;
at present they have very little, despite having a combined voting power
that is formally greater than that of the U.S. North-South conflict within
the IMF and the Bank may also widen, as it has within the WTO, with Southern
governments increasingly challenging the colonial nature of these institutions.



The World Bank has also become the target of a newly launched international
campaign to boycott its bonds, through which it raises 80 percent of its
capital. Organized on the model of the divestment movement that helped
bring down apartheid in South Africa, the movement has already attracted
more than 100 organizations from 29 countries. “Our intention is to turn
the weapon of denial of funds—the same weapon the Bank uses so frequently
and with such destructive effect— against the Bank,” announced 50 Years
is Enough
, the U.S. coalition that has been fighting IMF and World Bank
policies since 1994. The April protests will also be a rallying point for
this promising campaign.



There will be other battles in Washington that week, many of whose participants
and leaders are working closely with the April 16 coalition. One is the
movement for Third World debt relief, which will bring thousands of people
to Washington on April 9 to form a symbolic human chain around the Treasury,
the Capital, the IMF, and the World Bank.  Led by Jubilee 2000 organizations
through- out the world, this movement has been gathering increasing support
for canceling the debt of the world’s poorest countries. The mobilization
this spring will boost this worthy cause as well. A word of caution, however:
debt relief administered by the IMF and the Bank, in which poor countries
are forced to submit to years of “structural adjustment programs” in order
to qualify for limited debt relief, could easily do more harm than good.
That is the current arrangement under the IMF/WB’s Heavily Indebted Poor
Countries (HIPC) program, and most of the organizations fighting for debt
relief in the global South have gone on record against it.



The other major battlefront will be over China’s entry into the WTO, and
here there is again enormous overlap and joint events with the IMF/WB protests.
Although there have been concerns raised from within the progressive community
that this opposition not degenerate into “China-bashing,” there is no reason
that it should. There was a solid coalition of labor, environmentalists,
and other progressives against expanding the U.S.-Canada Free Trade Agreement
to include Mexico. It was not a struggle against Mexico—quite the contrary,
Mexican trade unionists and progressives allied with their U.S. counterparts
to fight an agreement that now appears to have lowered real wages (and
increased environmental destruction) on both sides of the border. Similarly,
this is not a battle against China, but rather against an enormous and
downward-harmonizing expansion of the WTO. Business groups are spending
millions of dollars to lobby for this expansion, in the hope that it will
breathe new life into the gravely wounded WTO.



The weakening of the stranglehold that the IMF, World Bank, and WTO now
have on economic policy in much of the world will open up new possibilities
for countries to pursue the many paths to economic development that are
currently blocked. If history is any guide, even one or two successful
examples will inspire many others. The deathly slogan, “There is No Alternative,”
that Washington made the epitaph of the last two decades may well give
way to a new century of hope.




      



Mark Weisbrot is co-director of the Center for Economic and Policy Research
in Washington, DC.