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The two members of ATTAC’s scientific committee describe the global financial system. This last needs to be mastered by the peoples. ATTAC association studies this question. There are pertinent and realistic remedies but it is more a question of the united will of associative movements, citizens and policies exerting their influence on the authorities so that the financial system is forced to respect the elementary rules of harmonious economic development. This is what the representatives of the international movement, ATTAC, will explain below.

Financial globalization increases economic insecurity and social inequalities. It bypasses and undermines popular decision-making, democratic institutions, and sovereign states responsible for the general interest. In their place, it substitutes a purely speculative logic that expresses nothing more than the interests of multinational corporations and financial markets.

In the name of a transformation of the world depicted as a natural law, citizens and their representatives find their decision-making power contested. Such a humiliating proof of impotence encourages the growth of anti-democratic parties. It is urgent to block this process by creating new instruments of regulation and control, at the national, European, and international levels.

Experience clearly shows that governments will not do so without encouragement. Taking up the double challenge of social implosion and political desperation thus requires a dramatic increase in civic activism.

The total freedom of capital circulation, the existence of tax havens, and the explosion of the volume of speculative transactions have forced governments into a frantic race to win the favor of big investors. Every day, one hundred billion dollars pass through the currency markets in search of instant profits, with no relation to the state of production or to trade in goods and services. The consequences of this state of affairs are the permanent increase of income on capital at the expense of labor, a pervasive economic insecurity, and the growth of poverty.

The social consequences of these developments are even more severe for dependent countries that are directly affected by the financial crisis and are subjected to the dictates of the IMF’s adjustment plans. Debt service requires governments to lower social service budgets to a minimum and condemn societies to underdevelopment. Interest rates much higher than in the countries of the North contribute to the destruction of national producers; uncontrolled privatisation and denationalization develop in the search for the resources demanded by investors.

Everywhere social rights are called into question. Where there are public retirement systems, workers are asked to replace them by a pension fund mechanism that subjects their own employers to the sole imperatives of immediate profitability, extends the sphere of influence of finance, and persuades citizens of the obsolescence of institutions of solidarity between nations, peoples, and generations. Deregulation affects the labor market as a whole, and the results include degradation of working conditions, the growth of workplace insecurity and unemployment, and the dismantling of systems of social protection.

Using economic development and job creation as a pretext, the major powers have not given up plans for a Multilateral Agreement on Investments (MAI) which would give the investors all the rights and leave national governments with all the responsibilities. Under the pressure of public opinion and mobilization of activists, they had to abandon plans to negotiate this agreement in the framework of the OECD, but discussions will resume in the framework of the World Trade Organization. At the same time the USA as well as the European Commission continue their free trade crusade, pushing for the creation of new zones of deregulation at the continental or intercontinental level (the PET project between Europe and North America, the extension of NAFTA into Latin America, etc.)

There is still time to put the brakes on most of these machines for creating inequalities between North and South as well as in the heart of the developed countries themselves. Too often, the argument of inevitability is reinforced by censorship of information about alternatives. Thus international financial institutions and the major media (whose owners are often beneficiaries of globalization) have been silent about the proposal of the American economist and Nobel Laureate James Tobin, to tax speculative transactions on currency markets. Even at the particularly low rate of 0.1%, the Tobin Tax would bring in close to $100 billion every year. Collected for the most part by industrialized countries, where the principal financial markets are located, this money could be used to help struggle against inequalities, to promote education and public health in poor countries, and for food security and sustainable development. Such a measure fits with a clearly antispeculative perspective. It would sustain a logic of resistance, restore maneuvering room to citizens and national governments, and, most of all, would mean that political, rather than financial considerations are returning to the fore.

To this end, signatories propose to participate or to cooperate with the international movement ATTAC to debate, produce and disseminate information, and act together, in their respective countries as well as on the continental and international levels. This joint actions have the following goals: to hamper international speculation, to tax income on capital, to penalize tax havens, to prevent the generalization of pension funds, to promote transparency in investments in dependent countries, to establish a legal framework for banking and financial operations, in order not to penalize further consumers and citizens; the employees of banking institutions can play an important role in overseeing these operations, to support the demand for the general annulment of the public debt of dependent countries, and the use of the resources thus freed in behalf of populations and sustainable development, which many call paying off the social and ecological debt. More generally, the goals are: to reconquer space lost by democracy to the sphere of finance, to oppose any new abandonment of national sovereignty on the pretext of the “rights” of investors and merchants, to create a democratic space at the global level.

It is simply a question of taking back, together, the future of our world.

What are the main directions of the alternative program proposed by Riccardo Petrella, Charles-André Udry and Christophe Aguiton? This is the subject of the second part of their text.

Let us take control of our future. The world and all of life belong to all the inhabitants of the earth. Faced with the power of the social forces which dominate the global capitalist archipelago, appropriation of the future of the planet by its inhabitants will not be easy and neither will it happen overnight.

The expropriated people of the world have experienced this truth and are progressively becoming aware that they must focus their efforts, experience and innovation on another agenda of priorities to the one followed by the “Men of Davos”. They are realising that they need an autonomous method of thought and action to construct and promote their view of the world, of society, of ethical principles, of the economy, of the social institutions. Finally, they are discovering that they have to prioritise their action, by identifying short-, medium-and long-term working areas (and objectives to achieve). The authorities don’t need to work like this. For them it is simpler: to ensure the longevity of their privileges, it is sufficient for them to be organised to exist.

1 .The Priority: the right to life for eight billion human beings who will inhabit the world in 20 years or more from now and for a sustainable global ecosystem; through a globalised welfare system.

The most significant and hardest social struggles taking place throughout the world are those concerned with access to life, to sources of life for the satisfaction of individual and collective needs for existence. This reality is borne out by the real conditions of the 5.8 billion people currently living on the earth and by the reports published in recent years by UNDP, UNEP, FAO, WHO, the World Bank, Amnesty International, Greenpeace, Oxfam and the ILO.

These struggles are also coping with occupation, use and distribution of the earth, the right to eat, access to drinking water, to be kept warm. They deal with housing, having a habitat fit for human beings. They deal with the right to work, the conditions of work, the level of pay and more generally on the right to an income suitable for a ‘citizen’. The struggles include fighting for the rights of the child (International Convention of 1989) and in particular the right to organise and educate the growing number of children in work, for the freedom of trade unions, the right to strike, against company closures due to the search for greater profitability. They seek access to healthcare and to a basic education for all and everybody. They seek with the right to exist and to enjoy a minimum of security in the case of illness and accidents and the right to live in an acceptable fashion m old age.

Other issues fought for are democracy, life within a community, the respect and recognition of the basic human rights of immigrants and refugees. They should fight for the rights of the emancipation of women, against the very many types of discrimination between the sexes (male-female) linked, among other things, to the gender-based division of work and tasks, and for the equality of rights between male and female. And, finally, people are struggling for the protection of the environment and the right of future generations to inherit an inhabitable planet.

In short, this is not an exhaustive list; the priority agenda concerns living, the right to live and the right to life. And within 20 years from now there will be two billion more people in the world than today. There will be eight billion people inhabiting this earth. But, the population on the islands of the global archipelago will not increase. The two billion extra people will increase the population of the zones and regions outside of the archipelago, i.e. the cast-off, disinherited regions. Even today, the richest 20% of the population of the world accounts for 86% of global consumption compared to 72% in 1970. What percentage will this be in 20 years from now if the priorities of the ‘Men of Davos’ prevail?

Through the struggles they are engaged in, the expropriated people of the world are creating a definition of a new anthropology for global life in the 21st century. The recognition of water as being of common ownership by humanity is the most immediate and evident symbol of this new definition. It also constitutes the first concrete landmark. In the same logic can be found the capital struggle to put (once again) financial resources at the service of globalised social welfare and the creation of common wealth in terms of goods and services necessary and indispensable for the satisfaction of basic individual and collective needs.

In the framework of the other ‘agenda’, we can thus see the strategic importance of a profound revision of the debate over intellectual property rights (biotechnology, seeds, informatics) which have become key instruments, through the use of which the owners of capital and particularly finance have succeeded over the past thirty years in taking ownership or control of almost all available material and immaterial resources. It is imperative that we define a new generation of public patrimonial rights covering goods and services considered indispensable for survival and the fair and efficient functioning of society and the earth’s ecosystem.

It is clear, therefore that there is one priority, composed of three closely linked components: access to goods and services required for the satisfaction of basic vital needs (water, for example); finance at the service of globalised social welfare and the revision of intellectual property rights and the definition of public patrimonial rights.

2. The method: start by networking innovative experiences and political, social and economic struggles for another “globalisation

Some such experiences and actions can be seen in the successful action to re-conquer the earth by the farmers in Brazil or Madagascar, the initiatives for education and rural training of women in Senegal or in the exemplary battles of the South-Korean workers who demonstrated the possibility of constituting efficient inter-professional trade union organisations in the so-called emerging countries. They can be seen again in the efficient use of the internet by the Zapatist movement in Chiapas or by Amnesty International or yet again by the wives/mothers/daughters of the ‘disappeared of Pinochet’s Chile and by the mothers of Argentina’s ‘May Square’. They show in the halt which was put to the water privatisation project in Montreal by the water co-ordination and in the foundation of a city of 30,000 inhabitants in the surroundings of Lima (Villa San Salvador), inspired by the principles of full employment, housing for all and a priority for public transport. They are seen in the struggle against the MAI for the cancellation of Third World debt, the struggle against embargoes imposed by an imperial power, the United States, on entire populations who are paying the price. They exist in the campaigns for the elimination of ‘tax havens’, in new initiatives for a real change in the role of banks (eco-banks, neo-mutual banks). These are just a few examples. All of these initiatives should be joined to work alongside one another. For all of this, it is essential to learn to write’ the story of globalisation by the expropriated people, by those who are in the process of constructing a future of solidarity and sustainability.

Networks working in this direction are many and diverse in nature, ranging from radical political militancy to forms of moderate, reformist or humanitarian voluntary civil associations. Each network plays an important role, but it is time to tighten the links, to concentrate the common goal and to reinforce the community of objectives, priorities and modes of action. The development of an effective and democratic world trade union movement constitutes an essential element of the convergence process.

In terms of methodology we should give priority to the pooling of innovative experiences and struggles centred overcoming the capitalist archipelago and implementing a system of world political regulation. This should be entirely new in relation to the United Nations’ system of inter-state relations and the economic and technocratic logic of the Bretton Woods system (WB, IMF, GATT-WTO).

Starting from this pooling of synergy (of which The Other Davos is only a start) in a relatively short space of time we can achieve the objective of the definition and implementation of the story of the other globalisation. Within three or four years, it will be possible to operate, with growing political force, ‘the planetary première’.

3. Action : short-, medium- and long-term future action areas

A.   In line with the priorities of the Other Agenda’, the principle action areas for the short-term on which we should continue to work while strengthening our synergy are:

-           the finance action area, including mobilisation around projects from the ATTAC network; continuation of the struggle against any return, in any other form, of the MAI; the strengthening of action for the cancellation of Third World debt; the battle against the political independence of the central banks and the sovereignty of monetary policy; the action for the development of a “new bank”, local exchange rate systems and against the defiscalisation of enormous wealth concentrations;

-           the work and employment working area pursues action to help children and working women in Asia, Latin America, Africa as well as immigrants and the long-term unemployed in the islands of the world archipelago. In this perspective, whilst battling for the radical reduction in working hours, the major objective remains full employment across the world and on a world level;

-           the privatisation working area: this is a relatively weak group where campaigns remain limited and insufficient. Priority must be given to mobilisation against the privatisation of public transport, electricity, gas and above all water. Opposition must be urgently strengthened against the privatisation of education and social security systems as well as health. Various experiences in many continents of the world show that mobilisation in favour of the reaffirmation or recognition of water, gas and electricity, of education, health, urban transport, rail as common public goods and services, pays off over time.

B. The principal medium- and long-term working areas are:

-           The world political regulation working area or the globalisation of politics, of the state is the logical extension of the working areas on finance and privatisation. The involvement will be required around the United Nations (reorganisation), the role of continental, supranational political integration and possible regional continental economic synergies, responding to the priority needs of the population. In this respect, the risk is that the only veritable supranational continental integration in twenty years time will be European integration, which may well never realise its democratic, supranational political nature. The problem of the sovereignty of the nation state will be at the heart of this working area and, closely linked to sovereignty will arise two other questions: that of citizenship (over and above nationality) and of property (struggle against the private appropriation of material and immaterial resources by ‘intellectual property rights’; the redefinition of state property; the development on an inter-national, supra-national and world level of new forms of socialisation, of public ownership, and of mutualisation of the property).

-           The collective, global social security working area works on the dissociation between income and work, world taxation, minimum community income and universal allocation: a collection of concepts, choices and orientations which, though all dealing with the same problem, express different realities and solutions, even opposite ones. The variety of local historical situations require respect for diversity, but it demands great clarity on the part of the promoters of the other globalisation. Lack of clarity has never been the basis for coherent and effective action.

-           The media and education working area. As far as the media is concerned, this is an area where the dominant forces continue to accumulate “victory upon victory” (whether it is TV privatisation and programming, the concentration of shares, the growing commercialisation of the internet...). It is time to get organised. The success of action to guarantee the editorial independence of Le Monde Diplomatique and Alternatives Economiques in France through the creation of two Associations shows that solutions exist. It requires the promotion of increased creation of similar associations for a growing number of newspapers throughout the world. Concerning the link between media and education, it is necessary to prepare to anticipate and direct the changes, which risk exploding in the coming 5 - 10 years. We must not leave it to the logic of industry, trade and/or stato-nationalists to define and govern these changes; it is indispensable to create an alliance of citizen actions between the world of education and the world of media. The future of sustainable development largely depends on this.

-           The denuclearisation, demilitarisation and peace working area: the peace movements of the 1970s and 1980s have run out of steam. A new generation of pacifists is being born, at a time when the United States is relaunching plans for massive military investment.

We need to promote and strengthen actions supporting denuclearisation, demilitarisation and peace. In this perspective, one of the most significant tasks should deal with the implementation of rules and of peaceful economic behaviour, beyond that of competition/ rivalry/ warfare/ struggle to conquer markets and for survival. The demilitarisation of the economy as a basis for the demilitarisation of states and of society.

Mr. Samir Amin already informed us of the dangers constituted by the false deregulations and the degradation of the democracy. He brings here a plea in favour of a globalization of the social struggles.

Increasing conflicts and social struggles

We have entered a new phase in history, which does not have an end; it is a phase where conflicts are exacerbated and social and political struggle is rising. The crisis has already worsened contradictions in the dominant classes within the countries of the European Union, in Russia and in the countries affected by the crisis developing (Korea, South-east Asia, tomorrow it will be Latin America, Africa and the Arab world and India). There are no guarantees that these contradictions will be resolved through democratic means. In a general fashion the dominant classes are trying to avoid a situation where the people take part in debates so that they can manipulate opinion (thus maintaining the appearance of democracy), or by planning outright violence.

These conflicts are beginning to take on international dimensions becoming struggles between states and between groups of states. Already we can see a conflict brewing between the United States, Japan and their faithful Australian ally on the one hand and China and the other Asian countries on the other. The screaming reception awaiting Vice-President Al Gore at the last OPEC summit in Kuala Lumpur is sufficient witness of this. It is not difficult to imagine the rebirth of a conflict between the United States and Russia if the latter manages to emerge from the involution, which Eltsine engaged them. The conflicts between the European Union (or certain of its members), Japan and the United States which have until now been diplomatically managed, will also take on greater importance and to express their unhappiness with those who oppose the Triad, namely Russia, China, India and the third world continents in general. Far from having contributed to reducing chauvinistic nationalism, neo-liberal globalisation has actually contributed to its increase.

At the same time the new phase is already characterised by the rise in the struggle of the working class victims of the system, whether these struggles be limited to particular sectors of these classes or encompass them in their entirety. The list becomes longer every day: the landless farmers in Brazil, salaried workers and the unemployed in some European countries, trade unions uniting the vast majority of salaried workers (such as in Korea or South Africa), the young and students encouraging the people of the towns (like in Indonesia), all are involved in the struggle.

The development of these social struggles is certain. They will certainly be characterised by wide-scale pluralism which is a characteristic of our century (and a positive one for most of us). At the roots of this pluralism we should recognise the accumulation of results gained through what is sometimes called ‘the new social movements: women, ecologists, democracy. The challenges confronting this development are of various kinds depending on the time and the place but can possibly be classed under a few large rubrics.

We need to define the elements of an alternative that is capable of uniting the struggles on a national level, where the political choices are on the table. Associating aspirations to democratisation of society with those aiming to give the management of the economy accessibility to the popular classes is probably the main concept around which the struggles can unite. This is such an important topic that the opposing forces (the political defenders of neoliberalism) will not hesitate to use their power to deflect the anger of the people and to lead them into an impasse such as represented by ethnicism or certain religious integrist attitudes.

But we also need to define the elements of popular internationalism, which is capable of giving a world scale to the struggle, and thus too positively contributing to the elaboration of a new globalisation rather than that proposed by liberalism. The framework within which this has to be done is defined by the need to defend the autonomy of the nations, to increase its acceptance and to avoid becoming shut into dead-ends of nationalism. It is clearly on a regional level that this will pose the least problem for such construction, whether is on a pan-African level, Arab unity, a Latin-American front or the European construction; they will be provided with a social progressive agenda and other regional projects.

However, we should not neglect action on a world level. The struggle is different at this level. On a political level the aim is clearly to fight American dominance and its military arrogance. In this perspective reviving the role and the functions of the UN should be one of the common objectives for the struggle of democratic political forces operating on a world level. On the level of reorganisation of the economic systems from negotiated and governed interdependence we should branch out from the old trodden paths and the enclosing corsets created by liberal globalisation (World Bank, IMF, WTO). The challenge consists in articulating in new ways the commercial interdependence (by, for example, giving a major new role in international negotiation of these problems to UNCED), monetary and financial interdependence (with a view to channeling available capital in directions which would allow the expansion of productive systems).

In this framework the construction of particular regional interdependence which could be of interest to the region (Europe, Arab world, Africa) could contribute to the construction of a pluricentral and non-imperialist world, opening up to the South (considered to be on the margins) and enabling them improved development. This would work on condition that political evolution in the north and the south of the Mediterranean and the Sahara strengthens the potential for democratic and social affirmation of the people concerned.

The objective of our intervention at this Davos (Globalization of social struggle) is not to define action programmes to be set up to achieve human, democratic, social and equal development for the people of the world. The ambition of the World Forum for Alternatives and all the organisations and individuals who wish to be associated with it is to set up working groups on each of these themes, drawing together a great diversity of analysts and social and political leaders.

Following his argument, Mr. Perry Anderson tells us why the domination of the neo-libera power is not fatal if its opponents are really determined.

1. Three lessons given by neoliberalism

Deliberately, I have emphasised the intellectual as well as the political force of neoliberalism, in other words, its energy and its theoretical intransigence, its dynamism that at the moment is not exhausted. I believe that it is necessary to bring out these lines if we want to reply efficiently to them in a short term. It is dangerous to have the illusion that neoliberalism is an anachronistic or fragile phenomenon. It is a formidable adversary that has obtained many victories in the course of the last years, even if it is not invincible. If we try to draw the perspectives that could emerge beyond the current neoliberalism, if we try to have an orientation in the ideological political, cultural struggle against neoliberalism, we do not have to forget three essential lessons that neoliberalism itself offers us.

Do not be afraid of opposing the political dominating current in a certain period. Vo Hayek, Friedman and their friends have had the merit - merit for all intelligent bourgeois today - to do a radical critique of the socio-institutional and economic dominant situation in a moment where doing this critique was absolutely unpopular. They have nevertheless persevered in a position of marginal opposition during a long period while the recognised ‘wisdom’ and “science” treated them as eccentrics, not to say lunatics. They have done it until the moment when the historical conditions have changed and when the historical possibilities to implement their program have appeared.

Do not make compromises concerning ideas. Do not accept to sweeten principles. The neo-liberal theories have been extreme and characterised by their lack of moderation. They were iconoclastic for good thinkers of that time. Nevertheless, they have not lost their efficiency. On the contrary, the radicalism and the intellectual firmness of the neo-liberal program are precisely what have guaranteed it such a vigorous life and such an overpowering influence. Neoliberalism is the opposite of a weak thought, using a terminology in fashion invented by some post-modern currents ready to swallow eclectic theories.

The fact that no political regime has implemented in its totality the neo-liberal program is not a proof of its practical inefficiency. On the contrary it is precisely because the neo-liberal theory is so intransigent that the governments of the right could implement such drastic policies. The neo-liberal theory provides, in its own foundations, a kind of master program in which the governments can choose the most adapted elements to their circumstances and to their institutional context. The neo-liberal maximalism in this sense is highly functional. It provides a very large repertory of radical measures, possible to be implemented and shaped by the circumstances. At the same time, it shows the very large reach of its ideology, its capacity to cover all aspects of society and to work as a vector of a hegemonic vision of the world.

Do not accept as immutable any established institution. When neoliberalism was a marginal and depreciated current, in the course of the ‘50s and 60s, it appeared inconceivable in the dominant bourgeois circle of this period, to create an amount of unemployment of 40 million people in the rich countries without provoking social explosions. It appeared unthinkable to be able to say openly that the redistribution of the poor people income of the rich had to be made in the name of the positive value that the inequality carries for the dynamics of corporations. It appeared as inconceivable to privatise not only the oil, but also the water, the post office, the hospitals, the schools and even prisons.

Nevertheless, as we know, all this became achievable when the social and political correlation of forces changed in the course of a long period of recession. The message of the neo-liberals has shocked in a certain way the capitalist societies. No institution, no matter how holy and familiar it can be, is in principle untouchable. The institutional landscape is much more malleable than one could believe.

2. Beyond neoliberalism

Once the lessons that one can extract from the neo-liberal experience have been drawn, how can one contemplate its overcoming ? The theme is huge. I will indicate here only three elements of a possible post neoliberalism.

Values

It is necessary to lead an aggressive and solid attack on the terrain of values by bringing out the principle of equality as a central criterion for every society truly free. Equality does not mean uniformity as the neo-liberals maintain, but on the contrary, the only authentic diversity.

The formula of Marx preserves all its pluralistic force “...when, with the universal development of all the individuals, the productive forces will grow and all sources of the cooperative richness will gush forth, only then we will be able to escape from the narrow-minded horizon of the bourgeois law, and the society will be able to write on its banners :from each one according to his capacities, to each one according to his needs!” The difference of demands, characters and talents of persons are expressly inscribed in this idea of a fair and egalitarian society.

What can this mean today ? It means a real equalisation of possibilities of each citizen to live a life according to the chosen model, without deficiencies and disadvantages provoked by the privileges of others. This equalisation begins of course with the equal access to medical care, to education, to housing and to work. In each of these areas, there is no possibility that the market could insure even a minimum of the demand for universal access to these indispensable goods. Only a public authority can guarantee the universal access to a medical care of quality, the development of knowledge and the certainty of a job as well as social protection for all.

In this sense, it is absolutely necessary to defend the principle of the Welfare State. Nevertheless, it is not only necessary to defend the achievements but also to spread the social protection system, not necessarily entrusting its management to a centralized State. To reach this objective, it is necessary to implement a different fiscal system than the one existing today in the developed countries as well as in countries “in process of development’. The moral and financial scandal of the fiscal system in countries as Brazil, Argentina or Mexico is known. But the tax evasion practised by fortunate social sectors is not an exclusive phenomenon of Third World countries. It is also -and more and more -a fact in the privileged layers of the so-called First World countries. If it is not always wise to attribute the supply of services to a centralized State, the obtaining of the necessary resources for these services has to remain a function of this State. In that order it is necessary to have a State capable to break the resistance of the privileged and to block the evasion of capital that will provoke the fiscal reform. An anti-State speech that ignores this necessity is demagogic.

The property

The main historical feat of neoliberalism is certainly grounded in the privatisation of the industries and of the service of the State. On this terrain, the anti-socialist crusade has reached its objective. Paradoxically, while launching such ambitious privatisation projects, it has been necessary to invent new types of private property. One can quote, for example, the gratuitous good distribution to the citizens in the Czech Republic of Russia, giving them the right to obtain shares of the new private enterprises. These operations have been and will be a joke. The shares distributed m an equitable way are in fact acquired by foreign speculators or by the local mafia. Nevertheless, these operations show that there exists no such immutability in the traditional form of bourgeois property as it exists in our countries. Then, new forms of popular property can be invented, forms that separate the functions linked to the rigid concentration of power in the typical capitalistic enterprise.

There exists currently, in the left, a discussion within the western countries about the theme of new forms of popular property. But this theme is not limited to the developed countries, it also exists in countries like China or in countries of the Third World.

Democracy

Neoliberalism has the audacity to assert openly the representative democracy that we have is not the supreme value; on the contrary, intrinsically it is an inadequate instrument that can easily become excessive (and in fact becomes it.) The provocative neo-liberal message is we need less democracy. From there, for instance, comes their insistence on the importance of a central bank legally and totally independent of all governments or again on the inscription in the constitution of the prohibition of any budgetary deficit.

Here, we have also to take and invert this “liberating” lesson. The democracy that we have - as far as we have it - is not an idol to adore as if it would represent the ultimate perfection of human liberty. It is a defective and provisional form that can be reshaped. The direction of the change should be the opposite one of that indicated by neoliberalism. We need more democracy. That does not mean - and this has to be clear - a supposed simplification of the electoral system, by abolishing the proportional system in favour of majority mechanisms. Similarly, more democracy does not mean to preserve or strengthen presidentialism.

A deepened democracy demands a certain elaboration in the different areas of the direct and semi-direct democracy. It demands a democratisation of the communication means whose concentration in hands of very powerful capitalist groups is incompatible with any electoral justice or real democratic sovereignty. In other words, these three themes can be translated in a classic vocabulary. These are the three modern necessary forms of liberty, equality - we will not say fraternity because the term has a sexist connotation - and solidarity. To implement these options, we need a sure and aggressive attitude, we could say not less cheerfully fierce than neoliberalism was in its origins. One day perhaps one will call it neosocialism.

Different social forces have long-since been engaged not only in a critique of the current model of society, but also in a re-definition of different models of society to the one which is imposed on us and whose sole vision is of a merchant society which is individualist and socially unjust and, above all, cynical. François Houtart (sociologist, director of the Tricontinental Centre and Executive Secretary of the World Forum for Alternatives) suggests that one should study these alternatives carefully. In order to do this he started out from the contributions of the Revue Alternatives Sud during its first three years of existence.

As a beginning, we should quote a pupil of Adam Smith, the Swiss Count Sigmond Sismondi, after he had visited England three times between 1818 and 1826. In 1826 he wrote on the subject of liberal economic theories: “These theories as they are practised have contributed to the growth of material wealth, but have diminished overall satisfaction for the individual; ... they tend to render the rich richer and the poor, poorer, more dependent and more miserable.”

If more than 170 years later we are still talking in the same way, both in the Third World and in our society, this is no doubt, to a certain extent because similar situations still exist, but more especially it can be put down to the fact that the same economic logic dominates the society. This is why the search for alternatives is certainly specific to the time in which we live, but retains a sense of continuity with the experiences of the past. In short, we must seek a new language and new techniques with the same objective.

1. Alternatives to capitalism

If neo-liberalism is only one phase of capitalist development, what we are talking about is alternatives to capitalism rather than simply making minor changes; it is alternatives to real capitalism not simply alternatives to liberal, neo-liberal or even neo-classical economic theories, nor it is alternatives to savage or civilised, American or Rhenan capitalism.

In any discussion of alternatives, the obvious first step is the notion of real socialism, which, after 1917, became the antithesis of capitalism. The defeat of real socialism must clearly be analysed from all angles. And in fact, we can learn a lesson from its defeat in terms of the strength of capitalism as a global system, which used all political and military means at its disposal to bring about the downfall of socialism. But there is also a lesson to be learnt about the character of an alternative construct which, quite clearly, defined valid social objectives and gained appreciable results, but which also succumbed to its own internal inflexibility and fell a victim to its own mistakes.

One of the reflections we can make on this subject concerns the transition to another form of production, i.e. another approach to the organisation of the production of goods and services. This is a long-term process. Capitalism has taken over four centuries to construct the material basis of its reproduction, in terms of creating a new way to organise labour, which goes hand in hand with technological development. Socialism had to walk with the legs of capitalism, without having its own material basis and this had many consequences among which is the need for a surfeit of ideology and symbols, the establishment of a crushing bureaucracy and leaving an easy way back to capitalist mentality.

Another point to be made concerns democracy, and was well expressed by Lula, the Brazilian head of the Labour Party (PT) at a meeting of the Forum de Sao Paulo in San Salvador in 1996: any alternative to capitalism should not only be a goal but must also be the means. A party, which is ahead of its time and espouses the truth, including philosophical truths, in theological language, as Marx would have said, can only end up by suffocating democracy. This is clearly not talking about a form of democracy reserved for those who can pay for it but one, which allows people and social groups to express their needs, their aspirations on various levels of real life.

Finally, we should be aware that the need to establish a power relationship to construct alternatives is also a lesson in contemporary history. We should not forget that it is the very existence of the eastern block, with all its ambiguities, which at least indirectly, incited Western societies to establish the post-war social pacts. These pacts were a defence strategy against the danger posed by the threat of a more aggressive socialism created by the working classes. And the defence strategy had positive results. The agreements were also the fruit of internal social struggles. Keynsianism was not born out of nothing. It came out of national liberation movements in the former colonial countries and of revolutionary movements in countries like those of Central America, which forced the West to seek compromise solutions between a national bourgeoisie and the popular classes.

The fall of the Berlin wall shook this power relationship and the restructuring of the means of accumulating capital, which was at the root of the crisis after the 1970s, bringing with it the subsequent neo-liberal solutions only served to profoundly change the relationship yet further. A new power relationship must therefore be established, to allow for a response to the dismantling of the systems of social protection and the weakening of social movements.

       A. How to approach the question of alternatives?

When the word alternatives is used in the plural it is not in an attempt to give an impression of a diluted mass of small initiatives. There is one system which must be replaced, but there are also various different levels of change and varying times at which changes need to be implemented, not to mention the very many different places in which the changes will take place and the individuals in each of those places who will be working together to achieve that goal. This is why we must provide a detailed analysis of the subject.

            Alternatives based on an analysis of social relations

What characterises neo-liberalism is the absence of consideration given to social relations. The market is presented as self-regulating for all social processes. The invisible hand produces a general balance on condition that the laws of the marketplace can continue to function freely (natural law of the economy). The policies of structural adjustment are aimed at freeing the economy and cover privatisation, the opening of the market, deregulation of labour, etc. All this is conceived in a social vacuum, with no consideration given to the relative weight of social groups. Under these circumstances we should not be surprised when the rich become richer and the poor become poorer, regarding this situation as if it happened by accident and can be rectified by taking various measures en route, when we should see that in reality it is the very logic of the system which is causing the situation.

In any search for alternatives it is imperative to analyse not only the existing social relations, that is the class structure, which is the direct result of the capitalist organisation of the economy, but also the pre-capitalist relationships between castes, different ethnic backgrounds, men and women. Without this analysis we can not understand why, for example, in many countries in the South, neo-liberal policies end up in caste conflicts (Africa, Chiapas) or in the feminisation of poverty in the informal sector. This type of analysis is a vital precursor to any attempt to measure the social and cultural effects of the extension of the capitalist system, especially in its contemporary neo-liberal phase, but it also permits us to draw up strategies and alliances for resistance.

There is an important phase of de-legitimisation in the neo-liberal system, which must arise simultaneously with the search for alternatives. This phase must be based on the no-functioning of the economy. In fact, in its current organisation, the economy is not fulfilling its essential function of ensuring the availability of goods and services necessary to all human beings for their existence. The economy does not identify with either science and the practice of accumulation or with competitive performance and less still with the exploitation of human beings. If, every five years, the United Nations announces that the number of poor in the world is rising, including in industrialised societies, this is not the result of bad luck but of the deficiencies of a system. Having noted this fact, which is essentially an economic one, one must move on to an analysis of the ethical aspect.

It is ethically unacceptable to allow the majority of human beings to continue living in materially, socially and culturally undignified conditions, while humanity has never known so many possibilities for resolving its problems. However, a critique, which is only based on ethical objections can become an obstacle to true alternatives. Firstly it runs the risk of resulting in the criticism of individuals rather than of the system. And this ends up in social inefficiency of the radical ethical critique. But there is one other point to consider. The critique can be useful for the capitalist system, because it affects visible abuses rather than an invisible logic, and thus contributes to the reproduction of the latter, since no system can indefinitely resist its own corruption. This was perfectly demonstrated in the case of real socialism. Every system needs instances of control, including moral control. And it was in this sense that Marx said that purely ethical criticism was bourgeois.

However, this type of critique is essential in order to achieve delegitimation but it only goes half way to a solution if it does not integrate an analysis of social relations and a critique of the economic function.

So we need to create a different logic, which was well expressed by K. Polanyi, the American economist of Hungarian origins, who wrote about the need to re-embed the economy in society. In fact, capitalism has rendered society an entity in and of itself, which has ended up by imposing its norms and its objectives on all of society, where everything has a commercial value and we are heading for a state of total market. We have privatised everything right up to social security, not to mention development co-operation and public services.

B. World capitalism

What needs to be replaced by these alternatives is a massive construct, which is increasingly concentrated and interconnected, and increasingly little controlled by the adjusted states. But the construct is vulnerable due to its own contradictions: the disproportionate size of financial capital faced with the activities of production and services; pressure on labour income and the resultant crisis of under-consumption; the class divide, the bases of which cross borders. This is the context in which the alternatives must be conceived.

2. Different levels of alternatives

There are many types of alternatives and we have to try to clear the terrain and make out the various different levels.

A. Utopia

We can dream of a perfectly balanced society, where the difference between individual initiative and solidarity are reduced to a simple state of tension, where human beings are judged because of what they are rather than the added-value they produce, where cultures are considered to be equally valid expressions of being and where scientific and technical progress is oriented towards the well-being of all rather than the enrichment of a few.

We must dream of this type of society be it called the Kingdom of God or a socialist society (or why not even both at the same time?), because even if it is not attainable in our topos (place), it does have the force of attraction, which mobilises the spirit and the heart and a dream of the necessary utopia. But unless this utopia starts out from a firm conviction that it is possible to construct another social logic and thus to approach the ideal, it remains a dream.

B. Some broad outlines

The search for alternatives passes through more general and realistic perspectives, while nevertheless being inspired by utopian ideals.

New poles of thought and action

After the deconstruction of socialism in the East and the triumph of neo-liberalism came profound disarray in alternative thinking. Some were seduced by the flight of liberalism, hoping that economic gains might result, such as by creating riches to be later re-distributed, or by the idea of the indivisibility of freedoms, market freedom being the forerunner of other freedoms to come.

A further result of this deconstruction was a development of post-modernism, in philosophy, human sciences and in particular in sociology. Starting out from a pertinent critique of modernism, scientism, totalitarianism in all its forms, this trend came to the point of refusing to analyse situations in terms of globablity or the system. Instead it moved towards an over-evaluation of the individual as the unique subject of current history at a time when capitalism had provided for itself the material and technical basis of a real world system. It should be added that there was a simultaneous weakening of the anti-systemic forces: unions, popular organisations, and revolutionary movements.

Little by little, new poles of thought and action saw the light. Many examples of this new trend can be seen, particularly in the field of thought, in many places in the five continents. There is a growth in the critical analysis of Marxist thought and practices. There is also a re-thinking of the political left. The Forum de Sao Paulo in Latin America is one example of this, passing from a critique of neo-liberalism and auto-criticism by the Latin American left to a progressive formulation of alternatives. This was the central theme of the meeting in Porto Alegre in 1997. In Asia, we saw the PP XXI (People’s Power for the 21st Century), which brought together social action groups and popular movements from all over Asia and went through a similar evolution.

All over the world we are witnessing social pressure being brought to bear demanding democracy, which is increasingly seen as a methodological requirement which goes far beyond the simple electoral process. This is one of the main thrusts of the teachings of the Zapatists in Mexico. We are also witnessing attempts to globalise resistance on the level of political thought. One example of this is the World Forum for Alternatives, which was created with its headquarters in Dakar. But there have also been new initiatives in action, such as the Europe-wide strikes seen at Renault, m solidarity with the closure of one if the headquarters in Vilvorde in Belgium.

Redefinition of globalisation

Rather than seeking globalisation directed by the needs of capitalist accumulation, we should be aiming for a synthesis of regional groupings working to the service of the people. This implicates groups such as the European Union, Mercosur in Latin America or ASEAN, all of which represent firstly an extension of the dimension of the market, but they can also give real, even shared, power to States to govern their own economy. This would provide States with an increased means of protection against transnational businesses and would place them in an improved negotiating position vis-à-vis other groups. It would also allow the poorer States in particular to develop negotiating power on an international scale. Finally, these types of groups would form the basis of the organisation of collective security.

Regulatory mechanisms and institutions would accompany this type of reorganisation on a world level, so as to ensure a balance in economic transactions, political co­operation and international security. Thus, The Bretton Woods organisations could exercise new functions whereby they would cease to be instruments of neo-liberalism. This new philosophy would bring about a polycentric world, whose philosophy would be opposed to current globalisation, dominated by transnational businesses and capitalism. This does not in any way imply autocracy and isolation but rather a disconnection from globalisation in its current form, so as to allow for the construction of a new form of globalisation on a different basis.

Regional response to the real needs of the people

On the basis of the regional groups referred to above, the next step would be to work on the basis of auto-centred development, that is development centred around the satisfaction of interdependent local needs rather than based on the current philosophy of everything for export. So these groupings would not just be stops on the path to capitalist globalisation, as is the case of ALENA, the free exchange zone between the United States, Canada and Mexico, but they would act as poles of development responding to the real needs of the local populations. In Africa, for example, this would allow for the promotion of sustainable agriculture supported by industrialisation.

All this presupposes, of course, the development of regional policies, inside each of the groupings, capable of taking the necessary economic and social measures to ensure stabilisation. In particular mechanisms would need to be set up to strengthen the position of the weakest countries or social groups.

Alternative Eco-development

The word ‘sustainable’ is used today as a quasi-magic term but in official literature, it is used outside the context of social relations. This was the price paid to ensure the continued existence of the concept in a world dominated by neo-liberalism. This is why we prefer to use the expression alternative Eco-development. This term implies the creation of new relationships of social production, responding simultaneously to the impasse created by the destruction of non-renewable natural resources, pollution and ecological deregulation.

New social, popular and democratic alliances

In order to create the power relationships capable of achieving these political goals, we need to establish new social alliances, alternatives to those that have existed until now. In industrialised countries, the time has come to work towards common strategies between the working class, the declining middle class, the intellectuals, immigrants and movements representing specific interests: ecologists, women, children’s rights, etc. In countries in the South, faced with the alliance between international capital, the comprador bourgeoisie and part of the middle class, the alternative consisted in using joint programmes and actions to bring together the different grass-roots groups such as workers, peasants, the informal sector, movements of the urban poor, co-operatives, minority ethnic groups, and also the vulnerable middle classes, students, etc. Some initiatives and experiences have already been undertaken in this field, and they prove that it is possible to achieve this goal even if nothing is ever permanent in this area.

Reorientation of international political powers

The move for the creation of regional entities clearly requires political redefinition. European experience shows that the lack of political definition within the regional powers is one of the major obstacles to their efficiency. There is no doubt that this will require a redefinition of the sovereignty of existing States. But at the same time it will give back to these States a much more real power vis-à-vis the transnational economic powers, which are destroying their sovereignty even more effectively than any regional grouping ever could.

In addition, the political reorganisation of the United Nations and its specialised organisations is essential. Some of these organisations have already been the object of retaliation by the more neo-liberal States. Take for example, the case of UNESCO, from which The United States, the UK and Singapore have withdrawn with accusations of undue favouritism towards the South. Similarly, the role of the ILO has been questioned by the United States Senate on the pretext that the fall of the socialist bloc renders it obsolete. It is true that the neo-liberal dogma of total deregulation of labour is hardly compatible with an organisation, which supports social pacts. The real goal we should be aiming for is the progressive creation of a world state, passing via a real confederation of states.

This is why the demand for a democratisation of the international organisations is an integral part of the alternatives. In particular, this implies the Security Council, which is so dominated by Western interests. As far as the Bretton Woods organisations, the World Bank, the IMF and the WTO, are concerned, they require total transformation, following a philosophy that meets the integral goals of the economy, i.e. the satisfaction of human needs rather than alignment with the satisfaction of capital accumulation.

Forms of democratic organisation on all levels

The very concept of democracy is being rethought and extended today. Democracy is all too often limited to the con­cepts of multi-party political leadership and the electoral pro­cess and is imposed in these terms within the neo-liberal dis­course (but not in its practices). However, it takes on another meaning in the context of new social movements and contemporary political reactions. On a political level, it is a question of deepening and widening the way in which public powers function democratically. This is particularly true on a super or inter-State level. Furthermore, State decentralisation, the importance given to municipal authorities and linked organisations (e.g. the panchayat in India or CACES in Haiti) are all steps forward provided that they are not conceived simply as forms of dismantling the State.

On an economic level, the various formulae for self-managing democracy are all valuable, particularly on the level of local initiatives or small and medium businesses. When it concerns large-scale production we need to seek other formulae, new forms of social links between the workers going beyond what has been a sort of joint management aimed above all at integrating them into the logic of capitalist accumulation.

On the question of democracy, it is worth adding two thoughts on the subject of terms often used these days and whose meaning or interpretation is profoundly altered through discourse and neo-liberal practices. Firstly there is the notion of civil society. This term is used by democratic institutions as well but often in the sense given to it by the dominant discourse. In reality, civil society is the place of social struggle and the notion is not solely identifiable to democratic organisations and social movements. Lobbies of transnational businesses to national or regional parliaments are also a part of civil society.

So terms must always be used judiciously. As a matter of fact, from a neo-liberal perspective, strengthening civil society can also mean destroying the State, on the pretext of privatisation to strengthen. If it is true that the concept is distinct from everything which relates to the public sector, it cannot be distinct from the reality of concrete social relations existing in a society and, thus, social struggle. So, the promotion of civil society is not a panacea to avoid conflict. On the contrary, it highlights the efforts of the weakest to organise a more just society and to overturn the existing power relations.

The second concept is that of NGOs (one issue of Alternatives Sud was dedicated to this topic in 1997). Within the framework of neo-liberalism, NGOs are considered to be organisations that are capable of finding solutions to social problems. But this positive definition is situated within the context of aid to support the struggle against poverty or as a response to needs not covered by society. As soon as NGOs move out of this perspective and support social or economic movements they are regarded with mistrust and the political and economic powers try to control them or to use them to their own ends.

There are two dangers for NGOs in this context. The first is that they might become, or be made into, palliatives to structural situations caused by the economic system, rather like the St.Vincent de Paul Conferences in the XVIII and XIXth Centuries: fine people but ineffective in the struggle to change social relations. The second danger is that often under the influence of established powers they might become weighed down in bureaucracy and end up becoming centres of power themselves, which are forced little by little to subscribe to the dominant logic in order to reproduce socially.

The role of culture in social emancipation

All large-scale social movements have produced their own cultural expressions, diffusing their movement and their values through poetry. Thus they become entrenched in local culture. This, in turn is renewed by social interaction. Social movements are expressed through poetry, music, painting, songs, theology and liturgy. A striking example of this can be seen in the Sandinista revolution in Nicaragua. But expressions of culture are only real if they grow in a democratic context. They cannot be imposed. This is the sign of popular authenticity.

     C. How to achieve the goal

Talking of utopia is necessary and even good. But it is even better to draw up some broad outlines of an alternative project, even if this always remains provisional. However, the big question mark remains — the method in which to get there and how to define the means.

The start of new perspectives

We should recognise that the debate in this area has only just begun and it is still distinctly secondary to the institutionalised practices of the past: the logic of reproduction of the institutions (political parties, unions, State forms); co-option of individuals or organisations from the popular sector into the dominant system (some unions, NGOs, agricultural co-operatives); corporatism of social groups which risk leading individual struggles without placing them in the context of the overall social objectives; pragmatism of the left which has come into positions of power and which is losing sight of the utopia or is too focussed solely on the interests of its own society. In short, history weighs us down with considerable force, but the importance of what is at stake forces us to take a different approach and, all over the world, we can see the emergence of new reflections, proposals and experiences.

Today, we are seeing the proposal of a series of concrete measures that generally cover the area of regulations and we will look at these later. However, none of these could succeed without a social movement pushing on the democratic and popular forces. Some see this as the only way of saving a regime rendered fragile by the destruction of its agents (notably financial), discredited by its own mistakes and endangered by social divides (internal and North-South). Others, on the other hand, find in it the means of constructing the steps towards fundamental transformation of the economic system and its political expressions. In other words, for some, it is a question of neo-Keynesianism and for others it is the point of departure for a non-capitalist alternative to neo-liberalism.

Concrete areas of regulation

The areas in which regulations are proposed are varied. They cover, naturally, the broad area we have covered above. We will specify these without going into any detail, each of them being the object for detailed analysis and debate, because, they can not only be interpreted totally differently, as we have already said, but also because experts disagree on the concrete mechanisms of their implementation. So in this document we will simply list the various regulations.

A.       Economic regulations

Obviously most of the major proposals fall under this category:

 -- regulation and taxation of international financial operations

 -- regional and international fiscality elimination of tax havens

 -- reduction of external debt for economically disadvantaged countries

 -- setting up of the regional base as a place of economic resistance

 -- transformation of the Bretton Woods institutions into regulatory bodies

 -- world sharing of technology

 -- creation of new paradigms of political economy and socialism of the market

B.       Ecological regulations

 -- efficient protection of non-renewable resources

           -- protection rules for biological resources

           -- strengthening of the programme of United Nations

              Agenda 21

C.       Social regulations

           -- labour legislation on a regional and an international level

 -- participatory power for social and popular organisations in economic, political and cultural, regional and international institutions

D.       Political regulations

 -- reconstruction of the power of the State to ensure the entirety of the regulations

 -- constitution of regional powers with regulatory powers reorganisation of international organisations: democratisation of the UN, creation of regulatory organs on this level

 -- world management of natural resources

 -- institution of a world parliament

E.        Cultural regulations

 -- creation of new cultural consumer models, respectful of the environment and of the equal sharing of world resources

 -- creation of new models of agricultural production which are non-destructive to the earth and phreatic layers

 -- conception of new models of industrial production placing technology at the service of labour rather than simply accumulation

 -- establishment of social code of ethics based on the analysis of local, regional and world social relations.

3. Global or partial social alliances

Nobody will believe that this type of objective on short or medium term can be achieved or even pursued without extreme social struggle. While certain sectors of the dominant economic world realise that the regulations are necessary to avoid the collapse of the system, most of them nevertheless try to support it and defend its integrity, identifying their interests with pure reproduction. This is why alliances must be created between social forces, whether they have long- or short-term perspectives depending on the concrete objectives in question. And it comes down to creating power relations to obtain precise objectives. One current example is the zapatist movement on Chiapas, which makes no claims for power but which demands an alliance of all social forces to democratise society.

This type of alliance should never lose sight of its ultimate objective or utopia at the risk of becoming a part of the by-products of revolution or being content with reformism. What appears to be happening is that multiple strategies are emerging out of the current trend and contemporary practices, taking into account the urgent need to find solutions given the dramatic situation in which hundreds of millions of people in the world find themselves and which risks ending up in collective suicide.

Conclusions

History is a dialectic process rather than a linear one. On an economic and social level it is the fruit of two contradictions affecting modes of production. The first contradiction is that of the physical limits set by the natural environment and the second is that of the limits of human exploitation. It is out of the synergy of these two points that social struggles emerge to construct another system of production and collective organisation of humanity. The current transition can already be seen in the questioning of social forms of an economy which every day has to struggle harder to reproduce itself or in the emergence of social struggles with repercussions which go beyond their place or origin and also in new forms of organisation. It is a long transition period, but it has begun.

The inheritance left by the past in the area of social analysis, the definition of collective objectives and the power of struggle should definitely not be abandoned. A critical study of this inheritance provides a constant source of new lessons, lessons which, today, place the emphasis on long term transition, on the multiplicity of strategies and on democracy as a means and not only as an objective. This could well mean a second breath for socialism.

We wish to extend the reflections of the different analysts and associated networks examined in the first section. In part we will continue this reflection. Each contribution has re-examined or re-examining the recent development of the capitalist regime from a particular angle. How do these same analysts propose a solution to bring back more equity? What are the salient traits of a globally organised resistance which should motivate and activate this planetary commitment?

The first article is by Christophe Aguiton ,from ATTAC. He helps us understand why the current epoch is favourable for a ‘counter-offensive’.

The idea of an alternative Davos has an intrinsic interest: it shows that there is opposition, it shows that other voices exist, of which many represent effective resistance, than those talking in the temple of liberalism. However, if it is not integrated into a more global programme this objective would have evident limits. The ideological climate is beginning to change and it is possible to make oneself heard through other means and to claim the first victories as in the case of the MAT, a victory which is yet to be confirmed. Let us now discuss the different aspects of a more global programme of international action.

1. Our departure point is the structural, economic and financial crisis, with all the practical and ideological consequences which we can draw from it for our action programme. We must first address the ideological changes. Over nearly 20 years, neo-liberalism has continued to score points, but now the wind is changing, and it is our responsibility to make this change as visible as possible and to make it the focal point of a counter-offensive. The counter-offensive must be developed on practical and concrete issues (MAT etc.), and also on the larger field of social alternatives to the disaster of neo-conservative counter-reforms.

2. This medium- and long-term project is twofold. First, to support and facilitate the development of concrete campaigns with limited objectives. Starting from simple, focused and accessible starting points is a guarantee for campaigns to have mass appeal, as was demonstrated both by the campaign against the MAT and the launch of ATTAC. After MAT (a campaign that will continue with the shift to the WTO where there is a project to coöpt, in the framework of the American lobbying system, a part of the opponents) concentration could be focussed on the tax on capital (Tobin tax etc.), the struggle against the plans of the IMF, the struggle against Third World debt.

Next we must promote social alternatives to neo-liberalism. This objective is much more difficult to realise; the debates between the militants opposed to liberalism have only just begun. During the first meetings of ATTAC, we saw the succession of clearly anti-capitalist positions and those, whose priority is the regulation of financial markets and of the world economic system. Agreement was eventually met (but that will not settle everything!) on the necessity for ‘empowering the citizen faced with the dictatorship of the market’.

3. A vast international convergence seems possible on such objectives because social forces with a radical critique of liberalism have developed (MST in Brazil, KCTU in Korea, European marches, etc.) and because international and regional demonstrations (above all in Europe, America and Asia) are growing in strength.

To achieve such convergence, we have to take into account the plurality of the preoccupations in the different countries, the verification that the initiatives do not compete with each other and the need for very large alliances, for numerous networks and movements developing around related themes. All that calls for patient, methodical unitary work so that the different initiatives being proposed in various countries work towards the common goal and within the joint perspective.

As we will see below, the all-powerful multilateral institutions are not concerned about the satisfaction of human and social needs. Keeping poor countries in extreme poverty and using the debt of the poor countries as a means of exerting blackmail is an out-an-out contravention of human rights. The text of CADTM permits us to see the situation in indebted countries more clearly. It was edited by Eric Toussaint.

CADTM

The Committee for the Cancellation of Third World Debt, created in 1990, is an international network based in Brussels working for radical alternatives to the different forms of oppression wherever they take place in the world. CADTMs main focus is Third World debt and the structural adjustment which it is resulting in today. The system of debt constitutes one of the fundamental mechanisms through which the dictates of G7, the multinationals, of the World Bank/IMF/WTO trio are implemented. CADTM calls for the cancellation of Third World debt and the abandonment of the structural adjustment policies imposed on peripheral countries. The realisation of these demands constitutes an insufficient but necessary condition for breaking the chain of oppression on these countries. Other priority demands supported by CADTM are: the expropriation of the wealth kept in the North by the rich of the South in order that it be given back to the people of the Third World; wealth tax; tax on financial transactions; rejection of the MAI and its clones; the right of peripheral countries to protectionism.

In addition to these concrete demands are general demands, of which the most important are: emancipation of women; radical agricultural reform; general reduction in working hours; disarmament; the rejection of all forms or racism; the creation of a planned transfer of wealth from the countries of the North to the countries of the South to compensate for the pillage which these peoples have been and still are subjected to.

CADTM is active in Europe, Africa and Latin America. Recently, collaborative relationships have been established with new popular movements in Asia. CADTM is a network for planning, sensitising and mobilisation. Its members are individuals and movements. For CADTM, lobbying action is incidental. CADTM actively participates in the development of ATTAC.

Address:

Rue Plantm 29, B-1070 Brussels Tel:       32/2/527.59.90 - Fax: 32/2/522.62.27 E-mail: cadtm@skynet.be  Website: http:// users.skynet.be/cadtm

Since 1997/1998, Third World countries, which account for 80% of the world’s population, have, outside of a few exceptions, been confronted with a new debt crisis. The immediate causes of this are as follows:

1. an increase in interest rates (whilst interest rates are falling in the North, they have increased for peripheral countries);

2. a reduction in the flow of fresh capital;

3. a sharp fall in their export income (caused by the fall in price of most of the products exported by the countries of the South).

The incidence of debt in the South

The growth in the debt burden has been very rapid in Asia and in Latin America. The amounts to be reimbursed over the short term have increased whilst new loans have been rare and export revenues are falling. Africa is, relatively speaking, less harshly affected by this changing situation: loans and investment by private financial institutions from the North have been almost insignificant since 1980. They can hardly decrease further (except for the Republic of South Africa and Nigeria who receive almost 70% of investment). Africa continues to go through a crisis whose dramatic aspects on a human level are even more accentuated than in Asia and in Latin America.

New loans accorded to Third World countries by private financiers have been rare since the crisis which began in South-East Asia in 1997 rebounded on Eastern Europe and Latin America in 1998. The Third World countries which still had access to international financial markets and which could issue public bonds in London or New York, had to increase the yield payments they guaranteed to purchasers of their bonds. The loan raised by Argentina in October 1998 in the financial centres of the North, guaranteed an interest rate of 15%, or two and a half times that offered at the time by public bodies in the North for their new loans. Nevertheless private lenders in the North and South prefer to buy public bonds of Northern states rather than those of the South (or East).

To sum up, as at the beginning of the 1980s, during the preceding debt crisis, credit became scarce and more expensive for the Third World. Direct foreign investment, aimed at South-East Asia (including China) and towards the principal economies of Latin America (at the cost of a significant privatisation program) rose between 1993 and 1997. After 1998, they experienced a tailing off which risked continuing into 1999 (direct foreign investment in South-East Asia fell by over 30% in 1998 compared to 1997 and loans fell by 14% in the first semester of 1998).

IMF Action

The measures imposed by the IMF on the economies and populations of the peripheral countries have resulted in recession, a loss of the fundamental elements of national sovereignty, and a dramatic fall in the standard of living. In certain countries, they have aggravated a situation which was already unbearable for a large section of the population. The contrast between the growth of returns to the national owners of capital and the drastic fall in the income of popular households has reached historic proportions for the 20th century. In September-October 1998, the holders of Brazilian domestic debt were rewarded with an almost 50% interest rate whilst the rate of inflation did not exceed 3%. Brazilian capitalists and multinational firms, particularly those based in Brazil could borrow dollars at 6% on Wall Street and lend them within Brazil at rates varying between 20% and 49.75%. At the same time, they hedged a large proportion of their capital from changes in Brazil’s economic situation by taking it out of the country en masse.

Some figures

Total Third World debt (excluding the countries of the East) stood at around 1950 billion dollars in 1997. The Third World reimburses each year more than 200 billion dollars. Total public development aid (including loans repayable at below market rates) has not exceeded 45 billion dollars in recent years. Sub-Saharan Africa spends four times more in reimbursing this debt than it does on its total expenditure on health and education. Other figures from 1998 show that the debt of households in the United States stood at 5,500 billion dollars (UNDP 1998). The public debt of the Unites States exceeded 5,500 billion dollars. The public debt of the 15 members of the European Union exceeded 5,500 billion U.S. dollars. Every year, military expenditure in the world amounts to 780 billion dollars (UNDP 1998, 41) that of advertising stood at 1,000 billion dollars (UNDP, 1998, 70). Each day, more than 2,000 billion dollars are traded on the currency exchange markets and more than 90% of this amount is traded in speculative operations.

Whilst the preceding text highlights the sovereignty deficit resulting from globalisation, the contribution from the ATTAC, looks at new financial forms of global capitalism. It is written by Dominique Pilhon and François Chesnais, economists and members Of ATTAC’s Scientific Council.

ATTAC

Association for taxation of financial transactions for the benefit of the citizen

ATTAC was founded in France on June 3, 1998 on the initiative of the Le Monde Diplomatique monthly. In the early stages, to guarantee its long-term existence, it was constituted around a group of founders bringing together publications, associations, trade unions, as well as various well-known personalities. It was then reorganised to accommodate individual members as well as new trade unions, associations, publications, enterprises and local collectives. In May, 1999, ATTAC had some 9,000 members and more than 100 local committees.

The central objective of ATTAC is to produce information - from books to tracts - to counter all aspects of domination by the financial world on political, economic, social and cultural life. The association organises meetings on a local, national and international level, takes part in public debates and lobbies decision-makers at all levels.

ATTACs principal focus areas at the moment are: the different forms of taxation of financial transactions, in particular the Tobin tax on currency speculation; the creation of new instruments for the regulation and control of finance at the national, European and international levels; the battle against tax havens and financial crime; and the demystification of pension funds.

ATTAC extends these actions at the international level through the contacts it maintains with multiple groups and networks working towards the same goals. ATTAC associations have been created in Italy, Belgium, Switzerland, Brazil and Quebec.

Address: 9 bis, rue de Valence, 75005 Paris Tel: 33/1/43.36.30.54 - Fax: 22/1/43.36.26.26 E-mail: attac@attac.org - Internet: http://Attac.org

Since financial globalisation established itself in the world economy, crises have followed at an accelerated rhythm: the 1987 stock market crash, European currency crises in 1992-93, the Mexican crisis of 1994, the crisis in the emerging countries of Asia in 1997 and in Russia in 1998.

The current crisis is doubtless the most serious on account of its gravity and the number of countries affected. Indeed, it started in South-East Asia in 1997, then destabilised Japan, then affected in a more generalised form other emerging countries in Europe (Russia) and soon in Latin America (Brazil). There is no longer any doubt that it will profoundly affect the world economy starting with the United States and the countries of the European Union. It is therefore a global systemic crisis since it cannot be reduced to just a financial accident but affects the underlying springs of world economic growth.

Point of departure: the financial crisis of the Asian ‘Dragons’

These countries which had seen exceptional growth rates, were presented by the defenders of the liberal order as development models which demonstrated the benefits of the globalisation of the world economy. By opening up to the outside world, they benefited from the arrival of capital from the industrialised countries. Their growth was accelerated by a rapid increase in exports to industrialised countries with whom they successfully competed thanks to low labour costs.

This ‘virtuous model imploded for three main reasons. First of all there was the exhaustion of the specialised sectors of the emerging countries which manifested itself in the overproduction of low value-added goods by these countries (textiles and electronics in particular). Secondly their exchange rate, which was anchored to the dollar, became overvalued following the rise of the U.S. currency in 1996-97. As a result of this these countries lost their competitivity, which affected their exports, and they became the targets of speculative attacks since their exchange rates no longer appeared credible. Thirdly were the shortcomings of the emerging banking and financial system. The banks were the beneficiaries of the massive influx of international capital and lent money indiscriminately, creating a speculative bubble, particularly in the real-estate sector and on the stock markets. Such poor risk management was aggravated by the deficiencies of the supervisory authorities which were in most cases incompetent and corrupt.

Why is this crisis more serious than the preceding ones?

The current crisis is a direct consequence of the globalisation process. This last, which has become widespread over the past ten years, has led to two principal changes in the world economy. The first is that the markets have become the dominant mode of regulation, which means that the political bodies have lost their importance in the face of private operators (international investors and multinational enterprises). Secondly, countries involved in this new order are largely open to the world economy, which has reinforced the interdependence of national economies.

The crises preceding globalisation were contained since public authorities still played an important role. Thus the debt crisis at the beginning of the 1980s was a crisis involving the sovereign debt of developing countries. For this reason, they were limited to a small number of borrowers. In this context, it was possible to control it by concerted action between states.

Today, the situation is totally different as the financial crisis involves essentially private players (banks, investors, enterprises). These result from complex interactions between a multitude of players obeying a micro-economic logic. This new complexity of economic crises explains why they can no longer be easily controlled.

The seriousness of the current crisis is exacerbated by the strong interdependence of national economies, the second characteristic of globalisation. This explains why the crisis has spread since 1997, beginning in the emerging countries of Asia which were hit one after the other through a domino effect, and their ailment then being transmitted to the rest of the world, starting with Japan, then the United States, then more recently Europe, Russia and the European Union.

Another factor which has helped amplify the crisis is the role played by speculators. International investors play the markets to realise added value, and in this way take part in the creation of financial bubbles. But when they lose confidence, they withdraw brutally from local financial centres, thus contributing to local crises. These movements are even more brutal since speculators tend to act like sheep, all react together, at the same time, and heading in the same direction.

To sum up, the current crisis, that has not finished in making its effects felt, illustrates the inability of the globalised market economy to self-regulate. This is a rude blow to the dangerous optimism promoted by liberal ideology, according to which the famous ‘invisible hand’ is there to ensure that markets lead to a harmonious economic order, from which everyone would benefit.

Our analysis shows that it is necessary to propose right now another way of regulating the world economy. We must try to reduce the two negative dimensions of financial globalisation. We need to limit the exorbitant power of the markets by giving importance back to public regulation. We must, in particular, re-regulate and impose a tax on financial operations in order to discourage pure speculation. We also have to reduce the negative effects of the interdependence of economies. It is neither possible nor desirable to question the development of international exchange, but it is necessary, by contrast, to bring about international co-operation to control the international operators and sanction practices which are contrary to national interests, particularly those of developing countries. Clearly, the international bodies today, and the IMF in particular, are incapable of correctly playing this role.

However, these measures would be insufficient to attack the basis of the current crisis which is the manifestation of the deep-rooted malfunctioning of world capitalism, as is explained below.

Crisis of overproduction, crisis in the regime of financial accumulation

This crisis is not simply restricted to the financial sphere, which could be dealt with at this level alone. We need to look at the roots of the financial convulsions. They herald the re-emergence of the classical crisis of generalised overproduction, the basis of which, as Marx showed better than anyone, is to be found at the level of production relationships which are at the same time the relationships of the distribution of wealth.

What is new, however, is that the return of this increasingly intractable economic crisis, is happening in explosive circumstances. There is firstly a globalisation of capital based on liberalisation and deregulation, i.e. the widespread disassembling of the governmental mechanisms which were previously in a position to manage anti-cyclical policies. Moreover, there is a certain blindness and unpreparedness among the dominant capitalist classes, intoxicated by the ‘victory over communism’ and committed to a neo-liberal utopia about the self-regulating and omniscient nature of the market mechanism.

The crisis is thus one of overproduction in the framework of a new regime of globalised accumulation of the financial capital. This expresses in the impossibility of ensuring to a sufficient quantity of capital, the completion of the cycle of production and commercialisation, of creation and realisation of value and of added value, due to the endemic insufficiency of effective world demand.

Marx did good work on the paradox of overproduction where he underlined its relative nature and said that, far from displaying a surplus of wealth, it is the sign of a system where the fundamentals set limits on accumulation due to the endemic distribution mechanisms. Keynes tried to provide a response without leaving the framework of the private ownership of the means of production. He was devoted to hegemonies. Over the last twenty years the countries of the Third World have seen the re-emergence of the worst scourges of malnutrition, even famine, sickness, often pan-epidemics and, in OECD countries, a rise in the number of unemployed, weak homeless and those without rights. These scourges are not “natural”. They affect populations which are marginalised and excluded from satisfying their need for the basic necessities of life, and thus from the basis of civilisation given their incapacity to transform these pressing needs into effective demands, monetary demands.

This exclusion is thus of an economic nature. In certain cases, it is recent and, in all countries, it has worsened seriously compared to the situation in the 1970s. It is the direct product of the system of accumulation born from deregulation, liberalisation and the destruction, not only of jobs, but of entire systems of social production. These were enabled by the submission of technical progress to the most narrow indicators of profit, through the total freedom of movement of capital and to the competitive battle of the forms of social production whose final objective is contradictory: maximising profit on the one hand and, on the other, ensuring the conditions of social reproduction of communities of farmers, fishermen and craftsmen.

It was well thought-of to celebrate the “victory of the consumer over the producer” as well as “revenge on the lenders”. They forgot that the “producers’ i.e. the wage earners, are also consumers and that by sacking workers in the advanced capitalist countries and taking away, through liberalisation, the livelihood of peasants in Third World countries, the consumer loop closes up.

Consumption by the shareholder groups, those who live completely or partially from financial revenues - interest from bonds or dividends from shares - can support demand and economic activity in the United States or in some other “shareholder countries”, the source-countries for massive capital investments. This has been the subject of several theoreticians of imperialism, many of whose analyses became a total reality again. But at the macro-economic level of the world system, no stockholder-consumer can ever compensate for the markets which are being destroyed by massive unemployment or absolute impoverishment imposed on communities which previously could ensure their reproduction and exercise a certain level of effective demand.

The world economy is facing the brutal return of the reality principle: before being able to appropriate value and added value, these have to be created on a sufficient scale. This supposes that the cycle of capital has been achieved and production commercialised. The managers of the large investment funds - mutual funds or private Anglo-Saxon pension funds - as well as the other major operators in the financial markets, have developed yield norms for their investments. They have imposed these on companies as well as on those financial markets which are reliant on the system and which are the links in the global process of the centralisation of wealth towards the shareholder countries.

In their eyes, these standards, these constant pressures, are the conditions for the flow of revenue transfer towards the financial markets at a pace, and on a scale necessary to satisfy this international shareholder economy. It is beautiful, it appears to function. In fact, it only works provided the returns on the capital which is creating value and added value, the bases of distribution and transfer of wealth towards the creditors of production, has been achieved on a grand enough scale and without shocks or interruptions in the flow of wealth.

The financial markets which have resulted from liberalisation, deregulation and financial globalisation, have their own time-frame which is not that of the value-creation process and less still creation itself, with the slow-downs, or, worse, the interruptions in the returns process. It seems that the operators have no memory of past crises and do not even know, even through vague bookish memories, what happened in 1929 and in the 1930s and thus find themselves totally defenceless. Their behaviour cannot be anything else but “helpless”, or even panic, which serves to accelerate the crisis at key moments, by strengthening the subjective dimensions of the propagation mechanisms and propelling them even more rapidly forward.

Let us look now at a text, produced by the collaboration of Riccardo Petrella (economist at the Catholic University of Louvain), Charles-André Udry [Swiss economist] and Christophe Aguiton (militant trade unionist, secretary of ATTAC). We will only consider the first part of this text, more analytic, leaving the second part for Part II.

The International Economic Forum met every year for almost twenty years at Davos, Switzerland, to rethink and re-orient the world economy according to the interests of capital. It brings together world powers and represents an important, albeit informal, environment to discuss world economic strategy.

Davos is no longer acceptable, it lives in the past

The priorities of the “Men of Davos” are not the ones of the inhabitants of the earth. Their priorities do not take account of the living conditions, needs, aspirations and capabilities of some 5 billion human beings, but are exclusively concerned with the interests of the social groups which, throughout the world, own the property and above all control decision-making regarding the allocation of the planet’s material and immaterial resources.

The choices which they have made at the political, economic and social level over the past thirty years, have in fact increased disorder, inequality within and between countries, and violence.

The “system” which they have produced - and which they reproduce with tenacity - is leaking from everywhere. Even among the “Men of Davos”, voices have multiplied demanding urgent reforms - right at the heart of the system, that is to say in current world financial architecture’. The fragility of this -- due, among other things, to exchange rate instability, market volatility, the development of derivatives, and to the structural deficiencies of the institutions (IMF and the World Bank) upon which the financial system rests -- is now admitted by all. The 1994 Mexican crisis and the Asian crisis since 1997, have been just major confirmations of this, and for which the price has been paid by local populations (more than 200 million people).

It is evident therefore that one cannot construct the future of the world based on the priorities of the “Men of Davos”. They represent a past which is unacceptable and intolerable.

The crisis has not just come out of the blue

The crisis is indeed the end-result of their choices. It has not just emerged out of the blue. A decade after having proclaimed the “end of history” and the arrival of a new world order of prosperity based on ‘democracy and the market’, globalised financial capital has subjected the majority of the planet’s working populations to the burden of international recession, which has spread out in leaps and bounds, from Asia: recession and deflation in the world’s second economy, Japan; recession and even depression m various east Asian countries, since the first quarter of 1997; the collapse of the Russian economy six years ago and financial bankruptcy in July 1998; brutal recession in the leading economy of Latin America, Brazil; the beginning of the downturn in the economies of the OECD countries.

The mechanisms of this international capitalist recession, the latest of which, to date, some would like to see as the first crisis of world capitalism, are well known: contraction in production and trade; deflationary trends; massive growth in the volume of loans accumulated by international banks on countries or on the major industrial and banking groups, loans which become transformed into irrecoverable debts; brutal capital withdrawals from countries by the major financial operators, which live from the revenue from parasitical investments in bonds, shares and other derivatives. All these reveal a crisis in the system which has become prolonged and exacerbated since the start of the 1970s.

The constructors of disorder, inequality and violence

Ronald Reagan’s “Star Wars’ and the technological advance of the OECD countries, along with the resultant productivity differential, accelerated the crisis in the Soviet economy, which was blatantly unhealthy ever since the end of the 1960s, as was confirmed by the first debate launched by the nomenclature on the urgent need for reform. The reformist efforts made by Mikhail Gorbachev, which emanated from what was called the ‘universe of bureaucracy’, rested on a fragile base. With the help of pressure from the West, it resulted in the implosion and collapse of the USSR.

The end of the so-called ‘cold war’ is certainly not to be regretted. The transition from a superpower duopoly, in terms of military power, to a world monopoly, however, has had, among other effects during the 1990s, that of destabilising the fragile balance upon which the international multilateralism of the United Nations had been able to function, well or badly, during the 1960s and 1970s (following the “defrosting” and decolonisation, both the results of social, cultural, democratic and national struggle).

The weakening of the U.N.

In ten years, the United Nations system has been delivered a knock-out blow - ironically the moment when, in 1995, it celebrated the 50th anniversary of its creation and, in 1998, the fifty years anniversary of the Universal Declaration of Human Rights. The “U.N. is dead” exclaimed the Belgian Foreign Affairs Minister on December 26, 1998, following the latest bombardment of Iraq by United States and British aircraft. Apart from UNICEF (the humanitarian agency whose finances depend on donations), the other “world’ institutions from U.N. such as UNESCO, the FAO, WHO, ILO, UNCED have all been considerably weakened. They are battling for their financial survival.

The spirit of international co-operation and solidarity (in the world of linked aid) is at its lowest point (the developed countries contribute less than 0.2% of their GNP whilst in 1980 they committed themselves to allocate at least 0.7 %). “Help yourselves, heaven will help you” or “Forget aid, compete”, this is the new doctrine as preached and imposed by the leaders of the most powerful nations. Thus, the only international organisations which have any real influence on world affairs are those economic and financial organisations (the World Bank, the International Monetary Fund, the World Trade Organisation..) where, often, decisions are influenced and even prepared by private organisations such as the International Chamber of Commerce, the Club of London (private lending banks), the multiple committees dealing with norms and standards. These organisations (WB, IMF, WTO) are financially dependent on the developed countries and are placed under their political control.

The reign of finance

The neo-monetarist credo imposed by the United States since 1971, the complete adhesion to “market forces” (which George Soros defined as ‘market integration’) and the consequent ripples, throughout the world, of liberalisation, deregulation and privatisation measures - have devastated politics, weakened the representative democratic institutions and colonised the state. Through the choices they have made, the “Men of Davos” have dismantled the welfare state and left to wither the mixed economy, the co-operatives, the mutual societies, the social concertation, which were certainly linked up with the strong trade-union presence in the United States and in Europe.

These decision-makers have overturned the enterprise structures through bursts of mergers, acquisitions and strategic alliances. The industrial and financial landscape is increasingly dominated by networks of giant enterprises which are outside all democratic political control (take, for example, mutual funds, pension funds, hedge funds etc.). They have changed the economic ethos (oikos nomos = rules of the house and oikonomos = the art of well managing the house) by sacrificing the objective of social well-being and full employment to the demands of the rate of profit and thus to increasing shareholder value.

They have overtly transferred power over to finance, and sovereignty over to monetary policy. They have imposed the independence of the central banks vis-à-vis politics but not vis-à-vis the financial markets and the feeble minorities who organise and exploit them in their own interests. They have reduced everything to the status of merchandise, including sport, art, culture, and even human beings (whose emblem is the liberty accorded to a patented human gene). Everything has become a resource to be exploited and made profitable. For the masters of this world, human beings have also become “human resources”.

The imposition of a world culture

They claim to have been promoting the emergence of a world culture, since they succeeded in imposing the globalisation of consumer markets for their products and services. In a world where priority is given to monetary accumulation and to the commercial value of ‘things’, they have helped amplify and globalise the phenomenon of corruption. The liberalisation of the movement of capital since 1974 has greatly facilitated the recycling of ‘dirty money’ -from the sale of drugs and arms through to that generated by white collar criminality - in legalised tax havens and, thanks to banking secrecy, through the financial and industrial organisations otherwise respected in countries ‘of excellence’ reputed for their professionalism and democratic institutions. In a time of predatory trade globalisation, they have even succeeded in corrupting the Olympic Games and their supreme organisation the IOC, which perhaps does not surprise connoisseurs of the history of this institution.

Thus when they purport to be promoting cultural diversity and the joy of living together, their globalisation has in fact -thanks to world television (such as CNN) the internet and global cyberspace, world tourist operators, credit card companies (Visa, American Express..) - succeeded in stirring up fear and rejection of others, intolerance and hatred through conflicts between civilisations which they cynically allow to be presented as a form of conflict which will dominate the future of the world.

The pillage of the ecosystem and the inequality of income

Added to all of this the ecosystem, Earth, is being continually pillaged. One paradox amongst others is that, when they talk of the integrated and desirable management of the planet, they do not mean how to avoid producing increasing amounts of waste and pollution, but how can these same wastes be managed in a profitable and privatised way? From whence come solutions based on the “market of the right to pollute”! These “Men of Davos” adore the objective of “zero inflation” but they mistrust that of “zero pollution”. The negative external effects (diseconomies, social costs) do not preoccupy them excessively. It is the cost of progress, they say: “humanity must pay if it is to advance”. Social injustice, social inequalities, discrimination towards women, all of which increasingly going hand in hand to the disadvantage of those concerned, together with the degradation of their close environment, have always existed, they say, and we will never succeed in reducing or eliminating them.

In reality, up until the middle of the 1970s, inequalities of income between the inhabitants of the same country tended to decline - excluding those who have a personal fortune or an inheritance - thanks to the redistributive effects of the State and of Welfare. Equally, the rate of growth of the inequalities between countries also declined. From around 1980, the inequalities between people have increased to new heights. According to the 1998 UNDP report on human development, income inequality between the populations of the richest countries and those of the poorest countries has increased since the beginning of the 1990s by a factor of 32 to 70.

World capitalist archipelago: globalisation is not everywhere

In short, speaking of globalisation, as do the ‘Men of Davos’, is simply a sham. The reality is that there is no real globalisation of society, economy, or human condition. There is no globalisation of political regulation, state or democratic institutions which provide guarantees and exert control over decisions affecting the various regions and populations of the world, in the general interest of the world at large.

What they have constructed, these past thirty years, is not a globalised economy, but the world archipelago of capitalist islands -large or small - where they have concentrated world scientific and technological capacity (more than 92% of world R&D expenditure, more than 90% of patents and of the installed computer capacity...),financial power, symbolic power and media power of the present time. The globalisation is taking place in the form of a growing polarisation of the international economy.

Some 30 cities represent the infrastructure, the brain and the heart of this archipelago: New York, Los Angeles, Chicago, San Francisco, Detroit, Miami, Toronto, Montreal, Houston, London, Paris, Frankfurt, Munich, Stuttgart, the Ruhr, the Dutch Ranstad, Copenhagen, Milan, Rome, Madrid, Barcelona, Stockholm, Tokyo, Osaka, Nagoya, Shanghai, Sao Paolo, Hong Kong, Singapore... In these cities lie the major business centres of the world, the hearts of the communication and information networks and the headquarters of the largest industrial, financial and commercial multinationals. Liberalisation, deregulation, privatisation and competition have tightened yet more the links between them than the links between them and the rest of the world. The famous “world village” is just an archipelago.

The “Men of Davos” say that the innovation which counts, is generated in and produced by these islands, certain of which have been elevated to the level of paradigms to be universalised (such as Silicon Valley). According to them, these islands are at the origin of the “new information society” and are in the process of engendering the “knowledge society”, the universe of dematerialised wealth and new knowledge. In this context, the only realistic option for other regions of the world will be to try to attach themselves, at any cost, to one of the islands of the archipelago in the hope of becoming an integral part of it. Those that do not succeed will, according to the ‘Men of Davos”, be inevitably cast adrift, they will not even be peripheral any more but “without a future”.

“Internet” teaching of literacy becomes a necessary step for the establishment of channels and bridges with the archipelago. For this reason, the construction of cyberspace pipelines and networks is becoming one of the major priorities everywhere, even more important than the installation of taps with drinking water, which are vitally needed by two billion people even today.

Clearly, current “globalisation” has expropriated life, and the right to basic living.

Expropriation of the future of the world

Expropriation phenomena have multiplied and been amplified everywhere such as, for example:

The human being, has been expropriated of his basic rights:



as a “human resource”, he/she only has the right to exist as a function of profitability and of what is now known as ‘employability’, a concept which has replaced that of the ‘right to work’.

Society has been expropriated of its raison d‘tre as a system for organising and promoting inter-personal and inter-institutional links with the corresponding interactions and transactions. It has been replaced by the market, elevated to the rank of ‘system’ and ensuring the optimal nature and organisation for transactions between individuals.

Work has been expropriated in its role as a creator of value and history: “Good” competing with other goods on the global market, his cost must fall continuously, using the leverage of globalised unemployment to achieve this.

Social life has been expropriated of its functions of identity and solidarity: value is only given to individualism, the logic of survival and the application of force in a context of warlike competition;

Politics has been expropriated of its fundamental power role of regulating, representing, controlling and being a democratic legitimising force: this role has been handed over to finance and to technocracy.

Culture has been expropriated of its variety, drama and its divinity: in its place has been put technology, numbing standardisation, violence of instincts and the barbarism of force.

The town has been expropriated of its function as a community area: it has been turned into a place of non-belonging, flux, speed, a place where one fits or one is lost in a permanent nomadic state without memory;

Democracy has been expropriated of its values of liberty, equality and solidarity: effective power has been given to a new world oligarchical class whose characteristic traits, values and methods of operation we are now starting to get a glimpse of.

A second retrospective analysis has been offered by Mr. Samir Amin in the name of the World Forum for Alternatives. This text is entitled Globalisation of social struggles. As in Prof. Perry Anderson’s text, we will simply take the passages concerning the interpretation of current mutations and reserve the more projective part for the second part of the book.

The World Forum for Alternatives

The idea for the Constitution of a forum bringing together social struggles and intellectuals working on the analysis of situations and the search for alternatives was born in 1996, at the 20th anniversary of the Tricontinental Centre in Louvain-La-Neuve. The idea took form in Cairo in March 1997 where a provisional Executive Board was constituted and a manifesto drawn up. The manifesto was signed by more than one thousand people across the world. In May 1998 it was decided to organise, at the beginning 1999, a meeting and a press conference at the annual meeting of the World Economic Forum in Davos. Several organisations and individuals worked together to bring this project to fruition. The Forum plans to establish links with a series of networks of social movements and also to set up working groups on social Movements and on Alternatives to the capitalist organisation of the economy.

Provisional committee:

President:

   Samir Amin, BP 3501, Dakar, Senegal

   Tel/Fax: 221/821/821 11 44. E-mail: ftm@syfed.refer.sn

Executive Secretary:

   François Houtart, Ave. St Gertrude 5,

   B-1348 Louvain-La-Neuve, Belgium

   Tel: 32/10-45 08 22. Fax: 32/10-45 31 52

   E-mail: houtart@espo.ucl.ac.be

Bulletin:

   Pierre Beaudet, Rue Jeanne Mance 3680-440,HTX 2K5, Montreal, Quebec

   Email: pbeaudet@alternatives-action.org

1. False deregulations

At the outset of the Davos initiative, there was significant involvement by the Mont Pèlerin sect”, following the “guru” Von Hayek. The sect advocated total economic liberalism with no reserves or borders, in other words a reactionary utopia of complete submission of societies to the exclusive unilateral logic of capital, their ‘adjustment’ -- in all its dimensions, political and social -- to the sole rationale of the project. The electoral victories of Margaret Thatcher and Ronald Reagan in 1980 inaugurated the start of that programme. But after 1989-90, with the foreseeable implosion of the Soviet system, the ruling classes of the capitalist world were seized by a formidable revisionist orgy. History has finally achieved its goal, we dared to write. The socialist dream has ended, as has the dream of the independence of nations. We return, but this time on a world scale, to capitalism tried and true. The world media claimed that there were no alternatives to this, capitalism was our inevitable path. Exhausted, the national populist blocs of the Third world that were proposing to deepen their victory against previous colonialism with a modernisation-industrialisation presented in the perspective of “catching up”. Third world countries had to submit to plans called structural adjustment, and thus to the exclusive ambitions of capital expansion dominated by transnationals. Everything that the people had achieved through their struggles over the centuries was to be abrogated. This included the Welfare State in developed countries -- a regulation of a much too ‘social’ market. The French Revolution itself had to be brought into question. Davos was set up in this climate to be the high mass of the revisionists.

The real content of the programme of these gentlemen (and some ladies) is undeniable because at its base it guarantees maximum profit for capital, at the price of stagnation and growing inequality between the small minorities benefiting from the system and all the working classes, and between the nations of the triad and all the rest. It is a system that fatally engenders poverty, unemployment, and exclusion, often on a continental scale.

The programme therefore had to be dressed up with the strong affirmation of great words: speeches on ‘open society, the sign of equality automatically placed between Market and Democracy, the elegy of the so-called deregulation which had come to be the synonym of liberty (without clarifying whose), the anti-state speeches, the state which was considered to be the obvious synonym of bureaucrats, autocrats and idiots, no longer the possible instrument of the management of historic social compromises, founded on democracy. All these found their place in this campaign of orchestrated propaganda. We refuse to be trapped by misleading speeches. They have no scientific basis and are proven ungrounded every day.

There are no deregulated markets except those in the fantastic imaginations of ‘pure’ economists. The detractors of such markets will not be self-regulated but exploited. In reality markets function because they are regulated. Thus the question is to know by whom, and to the benefit of whom. Deregulation is the fig leaf that covers clandestine regulation (in contradiction therefore to the fundamental rule of democracy that demands transparency) by the dominant capital of oligopolies. The MAI takes this quasi-mafiosi form of regulation by the transnationals to the extreme, as the project in question gives them the freedom to judge themselves -- to be simultaneously the judges and the judged, again, in contradiction to the fundamental rules of democratic law. The WTO is a black room, charged with rubber-stamping accords secretly concluded in the corridors of the Organisation (in the name of secrecy of private business) by the oligopolies. The precarious state of the salaried is not due to deregulation, but to the regulation of the work market by a single partner -- the bosses, we rarely see accepted rules so similar to those practised by the Mafia.

The implementation of a neo-liberal programme equally coincides - not coincidentally -- with the development of a structural crisis of capitalism of gigantic proportions. This programme therefore becomes the way of handling this crisis. The imbalance between production capacities on the one hand and those of consumption on the other, endlessly deepened by growing inequalities themselves the result of neo-liberal policies, engenders a surplus that cannot be invested in the expansion of productive systems. To avoid the devaluation of capital - what most billionaires fear most -- they need to create alternative means to fund the system. Monetarism, floating exchanges, foreign debt of third world countries and former eastern countries, the American deficit all these together make up the means for the management of this crisis. This explains the apparent paradox that is not one: that the levels of profit (especially those of investments) are increasing, stock market values rise every time ‘good news’ is announced - an economic stagnation, a dismantling of industry, or the growth of unemployment.

Of course the sole success of this policy has been to deepen the social catastrophe.

Simultaneously the most fanatic supporters of ‘deregulation’ remain entrenched in the ‘regulationist’, but there is no question of them allowing the migration of workers. Whereas if such migration were to be regulated while the trade in goods and the transfer of capital are given free reign, this results in the inevitable aggravation of development inequalities among nations.

2. The degradation of Democracy

Economic globalisation as laid out by neo-liberalism necessarily accompanies the degradation of democracy, which, if it does not permit social progress, loses its sense and credibility.

In rich and powerful countries with an established parliamentary tradition neo-liberalism feeds a dangerous trend towards what can be called ‘low-intensity democracy’, the alternative without being one so that, whether you vote white, green, blue or red, your fate no longer depends on the government you have chosen but on the whims of the market, on (secret) strategies of the oligopolies, on decisions of an ‘independent’ central bank (of citizens, but not financial markets). In other, more fragile, countries people’s hopes placed in the virtues of multipartism are systematically destroyed. Victories delivered to these people, at the price of wrong-headed and costly struggles, often too costly m human lives, are precarious. A multipartism, which is manipulable and manipulated risks becoming the only image that ‘market democracy’, gives to its people.

Under these circumstances it is not surprising that the world system produced through neo-liberal politics should be founded on hegemony, arrogance, military intervention and the cynical manipulation of double standards. Neo-liberalism systematically produces social crises and faces permanent revolt and inevitable explosions. This results in the need for a large police force and, among other things, a world police force; it must maintain the individualist strategy espoused by Washington and this is why despite market conflicts which could oppose them and despite declared reservations expressed in the area of defence of culture for example, the triad countries remain in the wake of the United States. They are incapable of liberating themselves from the logic of neo-liberal globalisation and it remains for the governments of the countries in question to simply encourage the arrogance of the United States. The bombing of Iraq, a decision taken unilaterally by Washington, despite reservations expressed by the UN is the most striking proof of this so far. We are sadly forced to note that never since the presence of Hitler have we seen a government so blatantly compose so false a report to give credence to its premeditated military aggression. Will the UN really suffer the fate of the League of Nations? Will it be considered to be an encumbrance and useless as has been said in the press on the other side of the Atlantic, and expressed in terms that hold a terrible reminder of the terms the power that be wielded against the League of Nations.

Neo-liberalism has not produced a “New World order” strengthening the security of people and peace. On the contrary, it has produced chaos and the increase in conflict.

3. The meaning of crisis

This globalisation of neo-liberalism has entered the stage of dissolution. In the short space of a few years the absurd myth of freedom of the market which was to resolve social problems and lay the foundations for democracy has crumbled away. Social struggle in the workplace has begun again here and there, in France, Italy, Germany, Korea. The arrogant discourse of neo-liberalism has already got lead in its wings. At the same time, the extension of financial globalisation, in which Russia and the south-east Asian countries played a part in the second half of the 90s will lead to the financial bankruptcy of these same countries within a few years, contributing to the dissolution of one whole part of the system, that of a global market. These “economic crises” have been accompanied by political crises, be it Russia or ex-Yugoslavia, central Africa or the Middle East and all have appeared to be endless and without solution in the framework of political management of the said globalisation.

The crisis of the countries in South-east Asia and Korea was predictable and was foreseen by political analysts form the county in question. In the 80s, these countries, and also China, were able to take advantage of the world crisis by playing a part in globalisation of exchange of goods (through their relative advantage of cheap labour), and calling for foreign investment and by signing up their development projects within a nationally governed strategy (in the case of Korea and Korea, but not the South-east Asian countries). In the 90s Korea and South-east Asia became increasingly open to economic globalisation, while China and India underwent a certain isolation in this sense. Moving foreign capital surpluses were attracted by the high economic growth in these regions and by investing did not contribute to increased growth but rather to inflation in real-estate value and investment. As had been predicted, the financial bubble exploded only a few years later.

Political reactions to this crisis are interesting and new (in the sense that they are fundamentally different to those created by the crisis on Mexico for example). The United States and their supporter, Japan, tried to take advantage of the Korean crisis by dismantling their manufacturing system (on the false pretext that it was controlled by oligarchies!) and to subsume it to the control of.... American and Japanese oligarchies! The powers in the region tried to resist this take-over by questioning their role in economic globalisation (re-establishment of the control of exchange in Malaysia), or in the case of China and India, by completely suppressing their participation in this. It was this financial dissolution which led the G7 to evolve a new strategy, thus opening the door to a crisis in liberal thinking.

The Russian crisis in August 1998 was not the product of a “transposal” of the South-east Asian crisis as has often been claimed. It could have been foreseen and predicted, as it was the result of the policies, which had been implemented since 1990. These policies allowed the dominant world capital to directly and indirectly through its Russian commercial and financial intermediaries develop a strategy of pillaging the countries’ industry (through the massive transfer of surpluses generated by the industry to the intermediaries and to foreign capital). The destruction of the entire productive capacity of the country, and the prospect of being reduced to being an exporter of petrol and mined products played into the world geostrategic aims. Quite apart from the social upheaval this caused, it prepared a favourable base for the potential political dissolution of the country, following on from that of the ex-USSR. For the United States, Russia, like China and India are “too big” (only the US has the right to be a big country) and a threat to their world dominance.

The advance of this system towards crisis was accelerated when Russia entered the world market in 1994-1996. But it is interesting to note here that political reaction to this crisis (the relative neutralisation of the Elsine powers and the choice of Premakov as Prime Minister) possibly softened the return to the strategy of transition to capitalism and the reestablishment of a minimum of national control over this.

The political crises in the Middle East, ex-Yugoslavia and central Africa demonstrate that political management of globalisation associated with the dominance of the United States is increasingly confronted with difficulties.

In the Middle East the American-Israeli project to create a zone which is economically and financially integrated Washington and Tel Aviv has met with problems despite the unconditional support of the autocratic regimes and the US Gulf protectorates (which are themselves under the military occupation of the US). Faced with this defeat Washington opted for resolute support for Israel’s expansionist plan, rather than openly contravene the Oslo accord. Simultaneously the US is using the situation created by the Gulf War in 1990 to legitimise their military control over the biggest oil region in the world. But this means they have to maintain their aggression against Iraq such as witness operation “Desert Fox” (called operation Monika by the Arabs). This operation arrogantly violated all international laws.

In ex-Yugoslavia and central Africa, the chaos created by neo-liberal options are unceasingly encouraging ethnic cleansing and will find no solution, even military solutions, within the framework of global neo-liberalism.

4. Arguments for managing the world system

The themes advanced ad nauseam by the massive propaganda machines orchestrated by the dominant media to legitimise this unacceptable world system have lost their credibility whether they are talking about “democracy”, “terrorism” or “nuclear danger”.

The quality of democracy is either confederated or refused according to the whim of the day of the powers that be who are so devoted to neo-liberal globalisation. Thus, those of the Russian leadership who subscribed to the injunctions of the G7 and the IMF are the “democrats” despite their conquest of Parliament through the use of canons, the Tsarist Constitution drawn up in 1993 and their declaration that they will ignore the election results.

The theme of terrorism, as one knows, gives rise to an unstoppable flow of media commentaries. But never to our knowledge has the role of the government of the United States and its agencies (particularly the CIA) been questioned in this respect as it continues to fund, train, equip and give permanent and continued support to the Taliban terrorists in Afghanistan. It is with a certain wry amusement that we note how many of the staunchest supporters of “women’s rights” in the American establishment do not question the US support of the Taliban even though the latter’s behaviour in this area is well known! There are, no doubt, other interests at stake, such as those linked to the oil fiefdoms of central Asia! A certain third world country accused, wrongly or rightly, of having sheltered a group of terrorists suffers severe condemnation and subjected to a blockade which starves its people. Under this harsh light of international law which we claim to have set up to judge the crimes of the highest leaders of state would we ever judge the US whose victims mount up in multiples of those of all the other terrorists.

When Israeli soldiers killed a woman and her six children on Lebanese territory, which they have occupied in violation of all UN resolutions, this is not called terrorism. When the Lebanese citizens take their revenge and kill Israeli soldier this is quite clearly an act of terrorism!

These examples of the cynical use of the double standard could be recounted without end. It would be seen that the only criterion of condemnation or praise is the degree to which the perpetrators refuse or submit to the injunctions of the instruments of neo-liberal globalisation.

The fears of the people faced with the exponential growth of the production of arms of mass destruction, both nuclear and other are quite legitimate. But the dominant system tries to neutralise these fears using a “non-proliferation treaty” of nuclear weapons which imposes what some call nuclear apartheid, that is to say, giving certain countries the right (the five of the Security Council, but also Israel) to hold such arms. As though the main danger is not precisely from these quarters which we know will not hesitate to use these weapons in cases where its “long-distance bombings” (which therefore don’t put our boys in danger) are shown to be ineffective.

The rise of social struggle and the disintegration of entire areas of financial globalisation, the loss of credibility of the dominant discourse have already given rise to the crisis in the neo-liberal system and its ideology. It is in the light of this crisis that we must examine the defence plan proposed by the G7 after the crisis in South-east Asia.

This is why the G7 and its institutions, from one day to the next, change discourse. The term regulation, which has been until now completely forbidden, is non resurrected and it finds its place in the discourse of these leaders: we must “regulate the international financial stakes!” The economist in chief at the World Bank, Mr. Steglitz, proposed opening a debate to define a new “Washington Post consensus”. The speculator George Soros, published a study under the eloquent title “The crisis of Global Capitalism.” We should be clear that this is a strategy, which is working to the same objectives: to allow the dominant capital of transnationals to remain masters. None of the people concerned are credible. They have all been responsible for the disaster. It affords a somewhat cynical pleasure to watch these people trying to place the responsibility for the failure of their system on others.

But we should not underestimate the danger that this reaction could mean. Many well-intentioned people are in danger of being duped. The World Bank has already been trying over the past few years to engage NGOs in its discourse of the “struggle against poverty”.

Faced with these plans to pursue the plan for liberal globalisation, which does not concern the people at all, we must independently develop our own proposals for alternatives, based on social struggle and which only the victims of the system can lead.