The 10 Misconceptions of the Opponents of Globalisation
by Khaled Ahmed
[Note: This is not a critique of the ‘ten misconceptions’ but a sampling of the
anti-globalisation literature pertaining to the topic of discussion.]
1) Powerful international corporations rule the world; 2) IMF, World Bank and
WTO submit to the will of the powerful in order to suppress the weak; 3) Free
world trade only serves to exploit the developing countries; 4) Globalisation
destroys our jobs; 5) Consumer protection and employee rights fall by the
wayside on the global market; 6) The advances made by multinational corporations
into the Third World only gives rise to poverty, child labour and social
dumping; 7) The great financial crash is unavoidable; 8) The global competition
over locations destroys the environment; 9) Global brands pose a threat to
cultural diversity and values; 10) Globalisation cannot be steered
Chapter headings of the book “Die zehn Irrtümer der Globalisierungsgegner”
by economic journalists Markus Balser and Michael Bauchmüller,
Eichborn Verlag, Frankfurt, September 2003
The above ten criticisms of the anti-globalisation movement are a frequently
encountered critique from the representatives of the established economic order.
Both sides of the debate suffer from some disadvantages. The anti-globalisation
and anti-capitalist side has no basis of practice from where to argue but the
existential evidence of the failure of the present order. The establishment
critics speak from the strength of established theory based on the experiment of
the past centuries including the failure of state-monopoly under socialism. Much
of the anti-globalisation rhetoric is based on the emotional reaction of outrage
felt at the existential level. Much of the established opinion comes out of a
long jurisprudence of capitalist theory which includes reconciliation with
defects of capitalism through marginal fixing which tends to harm the third
world more.
A glance at the recently published anti-globalisation literature should indicate
to us the depth of the objections raised against globalisation and its attendant
phenomena.
1. Powerful international corporations rule the world
In a recent publication on the WTO, the objections expressed by the third world
states about the multinational companies (MNCs) followed the following pattern:
Because of low incomes and low saving rates, industrial units are purchased by
the MNCs from government providers under terms that are disadvantageous to the
third world state. An increase in foreign investment has created a monopolistic
environment. The MNCs are concentrated in Geneva where they tend to influence
the WTO negotiations. To know how an MNC may harm the int4erest of a state see
the following case. In Uganda and Pakistan power projects set up by MNCs were
subject to the condition that the state would buy all electricity produced by
the MNCs at fixed dollar-based prices. After the devaluation of the local
currency the contracts were breached and the two countries came under threat
from the World Bank and had to raise power tariffs domestically till they made
the entire economy unviable.
MNCs have the power to influence the weak regulatory systems of the third world
states. For example in Argentina, a railway privatisation to an MNC was followed
by the said MNC exerting pressure to decreased the tenure of the contract to get
out of difficulties of operation. States deregulating the economy in favour of
access to MNCs run the risk of depriving service to segments of population not
promising high profits. Powerful MNCs have dealt a severe blow to the
negotiation process at the WTO. Their representatives are constantly meeting the
WTO bureaucracy and state officials to further their interests. They are backed
by their powerful governments located in the first world who are in a position
to isolate and punishing third world states not allowing concessions.
2. IMF, World Bank and WTO submit to the will of the powerful in order to
suppress the weak
As for the kind of influence the IMF and the World Bank bring to bear on the
economies and political systems of the developing world, four teachers from the
United Kingdom put down their objections to the Structural Adjustment Programme
(SAP) of the IMF, because they think that applying a uniform rule of the thumb
to economies functioning in disparate environments has not worked . Nor does the
triumphalism of Fukuyama is seen to apply to states that accept SAP: in Africa
it resulted in the growth of authoritarianism while in the Caribbean it paved
the way for democracy. The assertion that free market will go hand in hand with
liberal democracy has not held. The third world finds it hard to implement SAP
and can hardly bear the brunt of its unemployment-creating aspects. Before the
1980s, when the Western economies were on less sure ground, structural
adjustment was international adjustment – a means of buttressing the sagging
textile industry of the developed world. Starting in the 1980s the SAP put
forward in the IMF by its dominant Western shareholders placed the onus of
correcting the flaws of the advanced nations on the poor states of the third
world.
Structural adjustment was invented in the 1980s to intervene in the third world
economies to fix their macro-economic flaws. For ten years SAP went on
insidiously producing negative results in the economies already in trouble.
Their money was squeezed, subsidies cut off, to bring down the deficit, and
their markets opened to international competition to ‘improve’ domestic
production. Criticisms of SAP were ignored because the tragedy of the
consequences of SAP unfolded in distant places among the minnows of the third
world; but in the 1990, the IMF had to sit back and analyse the meltdown in such
big markets as Indonesia, Russia and Brazil. This opened the door to corrective
opinion and the portals of the IMF were opened slightly to let in the fresh air
of the variant point of view. The shareholders realised that SAP was not only
threatening the third world, which they could ignore, pointing to the ‘social’
evils there, but also affect the exports and investment of the advanced
economies. It now became the task of the IMF to stabilise the big economies of
the underdeveloped world. Fukuyama’s observation that free market will conquer
all and bring prosperity had not taken account of the possibility of free
market’s negative effect on the labour movements and the quality of civil
society.
In July 1944, formal negotiations at the Bretton Woods in New Hampshire in the
United States, decided that IMF and the World Bank be created to ‘introduce a
measure of discipline in the world market’ so that a balanced growth of
international trade could take place. The participant countries promised to
submit to certain international rules and the United States offered to base the
new system on the dollar which it pegged in turn to the gold standard. The IMF
looked after the exchange rate problems to smooth the flow of trade till 1971
when the United States went off the gold standard. The Bretton Woods system
caved in and all currencies went on to a float system. The Bretton Woods system
was fashioned by the United States and the United Kingdom, while the third world
was mot even consulted. There was no perception of an identity of interests
between the advanced nations and the third world states. The nations living in
poverty were pegged to a world system that worked only for the advanced
economies. The unequal terms which bedevilled the poor states internalised the
economic flaws that the IMF sought to remove. The facile coinage was
mismanagement and corruption. That is not to say that there was no mismanagement
and corruption in the third world. This was the embedded factor among the newly
independent states, but it was wrong to refuse to examine the real inequalities
of the international system just because the above allegations provided an easy
handle.
The truth lies in the fact that the universalising and reductive assumptions of
the neo-liberal policy package did not take account of the different spatial and
temporal conditions in the subject states. They believe that that the third
world rulers were not equipped to handle the doctrines bequeathed to them by the
early IMF orthodoxy that simply hated he state and wanted it to retreat in front
of free market. Reaganomics and Thatcherite anti-statism were the articles of
faith with it. In the 1990s however thinking became more diversified to include
the reality that solutions had to spatially and temporally specific: what works
in Africa may not work in Asia; and what works in the 1970s may not work beyond
the 1990s. There is increasingly a realisation that there are alternatives to
the received wisdom of the IMF: a broader vision of social transformation, a
socio-economically sensitive underpinning to neo-liberalism,
internationalisation of the struggle of popular movements, emergence of
‘independent’ intellectuals closely linked to the popular majorities and their
struggles. In a nutshell, the aim is not to offer a theoretically alternative
model but a model that is strong enough politically to force the neo-liberal
legacy of the advanced economies to pay heed to the plight of the majority
population of the globe. The days of pitting socialism against capitalism are
gone and there were too many flaws in the enforcement of the socialist model to
revive the old binary economic system. Today what is needed is the strength
within the community of poor states to compel the neo-liberal model to
incorporate some of the humanising aspects of the socialist model.
3. Free world trade only serves to exploit the developing countries
The objection to global free trade has arisen from the observation that it is
one-sided in favour of the developed world. Walden Bello is no stranger to the
world of anti-globalisation movements . His is probably the most comprehensive
and aggressive critique of world capital as politically led by the United
States. His remains the most effective voice from Southeast Asia after the 1997
debacle that shook the Asian Tigers and forced the IMF to take another look at
its global recipes. He gives a blistering account of the neo-liberal roadmap of
the IMF that took the developing world into the exploitative lap of the
multinationals and then switched off their lives. The WTO presides over the
one-sided trade deal that America and its developed friends want to make with
the poor of the world. It protects the agriculture of the rich against the only
expertise of the poor and assists the IMF in dismantling any protective barriers
the poor states may erect to stop the exposure of their masses to foreign
capital.
For political underpinnings to the world neo-liberal system, the US uses the
United Nations but refuses to pay its dues as preemptive punishment. Free market
let loose the US corporations on the poor world till it realised that its
ecology was under threat from this freedom of exploitation. When it came to
agreeing a regime for the protection of global ecology the United States once
again ducked out of its responsibilities as the power behind the new trade
model. After the 1997 crisis no reform in the neo-liberal system has been
brought about and that which was instituted has brought no positive results. The
crisis springs from the same cause: globalisation is devoid of social
responsibility. There is coercion behind the model. America backs the neoliberal
faith with military threat. Bello quoted Thomas Friedman saying that the hidden
hand of the market will never work without a hidden fist and this hidden fist
was the US military. But he believes that military or corporate power was not
the real power of the US; it was the ‘soft power’ of its Lockean democracy.
The US showed the world it believed in a representative system as explained by
Locke and his social contract. Under Clinton it even began to prove that the US
no longer tolerated dictatorships as it did in the past. But the economic
inequality which the US propagated in the form of its land-of-opportunity slogan
sought to recreate poverty in the third world. Liberal democracy has succumbed
to corporate coercion and the people are increasingly questioning the idea.
Denmark refused to sign the Maastricht Treaty and the French voter registered
his anger against liberal democracy by voting for the fascist Le Pen. The G-8
that came into being to stamp out inflation and stagnation has failed to stem
the decade-long descent of Japan into depression. In fact the entire global
economy was in a kind of economic trough without the neo-liberals finding any
credible way out of it. World capitalism was not only in the grip of short-term
business cycles but also long-term Kondratieff business cycles that tend to be
50-60 years long. The last trough was in the 1930-40s; it is now time after
sixty years to go into a 50-year long depression under capitalism once again.
Bello discusses the economy of Argentina which went down obeying the recipes put
forward by the United States. In 2001, Argentina went hat-in-hand to the IMF
asking it to support its $140 billion debt-burden but was told to undertake more
reforms. And the crisis continues. Bello thinks that the Keynesian state came
into being as a result of a compromise between free market and control, but in
the 1980s the Keynesian state was dismantled in favour of a throw-back to the
globalisation of 1914. But a response to the neo-liberal globalisation was
taking place in Porte Alegre in Brazil where in 2002 the World Social Forum was
gathering under its wings those who opposed corporate-driven globalisation. What
is the way out? Bello takes Thomas Kuhn’s opinion according to which there is a
Ptolemaic answer to the crisis of corporate globalisation, and that is
introducing more complex variations on the current defective paradigm till it
becomes completely unworkable. There is also the Copernican solution which
posits changing of the paradigm completely and working within the parameters of
a competing paradigm. Under this principle, Bello would have the IMF
deconstructed and reduced to a research agency; he would finish off the
loan-giving function of the World Bank and reduce it to the giving of grants
only to participatory projects in the third world. This would get rid of the
UNDP.
The disempowering of the Bretton Woods institutions would come about at the
climax of a successful campaign which began in Seattle when protest marred the
ministerial conference under WTO in 1999. WTO is actually not one-country-one
vote organisation but a ‘consensus’ organisation in which the US arm-twists the
poor member states. The fourth WTO ministerial conference in Doha saw the
powerful trading nations bludgeoning the weak states into signing on the dotted
line. Bello is for sabotaging the fifth ministerial at Mexico in 2003. Bello
leans on the phenomenon of mass protest to delink the US from the EU on matters
of trade, assisting the delegates of the poor states to the conference in
understanding the unfairness with which their agreement was extracted to carry
out the WTO agenda including such impoverishing conditionalities as TRIPs. Bello
believes that the capitalist paradigm is finally at an end. He wants corporate
globalisation turned off and asks the poor states to rely on internal resources
and not seek foreign investments, to redistribute income through taxation and
land reforms, to control the private sector through state monitoring, and rely
more on the grassroots cooperatives.
4. Globalisation destroys our jobs
5. Consumer protection and employee rights fall by the wayside on the global
market
A conference in Zurich in 1999 established itself as anti-Davos, the locale in
Switzerland where the capitalist World Economic Forum gathers every year with
2,500 bankers and heads of governments to plan the world economy under
globalisation. The big personalities of the Zurich conference were: Ahmed Ben
Bella, president of Arab Congress, Samir Amin, the great Arab intellectual who
runs the World Forum of Alternatives (WFA), and European intellectuals of
Association for the Taxation of Financial Transaction in the Interest of the
Citizen (ATTAC), the Committee for the Cancellation of the Third World Debt (CADTM),
Coalition against Multilateral Agreement on Investment (MAI) and Structural
Adjustment Participatory Review International Network (SAPRIN). What follows is
a case made against globalisation under the present world economic order .
The statistics in their arsenal is impressive. The UN notes that 358 richest
people in the world possess a fortune equivalent to the combined income of the
poorest 45 percent. Between 1970 and 1985 the world GNP has increased by 40
percent but poverty has increased by 17 percent. In 1960 income of the 20
percent living in the richest countries was 30 times greater than the 20 percent
living in the poorest countries; in 1995 the income of the richest 20 percent
had grown 82 times. In the past 20 years more than a hundred developing
countries suffered disastrous economic failures, more than what was experienced
during the Great Depression of the 1930s. According to the UNDP Report (1996)
growth was a setback for more than a quarter of the world population. Between
1987 and 1993 the number of people with incomes less than a dollar increased by
a 100 million to make the total 1.1 billion. In more than 100 countries today
the per capita income is lower than what it was 15 years ago (including
Pakistan). In the third world malnutrition and lack of education grew in the
past decade while in Europe the unemployed were 37 million in 1996, three times
the number in 1970.
Inequality has increased under the neoliberal international economic order which
deregularises the national economies and gives free access to international
finance and multilateral companies. Privatisation and competition has thrown
people out of jobs and environment has been gravely damaged by a race for
competitive advantage through a cutting of costs. Susan George of the Coalition
against MAI traces the history of neoliberalism with post-war Keynesianism which
once guided the IMF and the World Bank but which was superseded by the
neoliberal economists of the University of Chicago led by Friedrich von Hayek
and his student Milton Friedman because of their ability to get capitalism to
fund a large number of think tanks and foundations to do public relations for
their model. They put together what the Italian Marxist thinker Antonio Gramsci
called “cultural hegemony”. The work of the rightist economist was brilliant,
making people believe that if left to itself capitalism worked like an act of
God, with no alternatives.
Margaret Thatcher in 1979 began the neoliberal revolution with the slogan TINA
(There is no alternative) which was nothing but a Darwinian plunge into natural
selection and competition through privatisation while her monetarism squeezed
the poor. The poor were taxed in the UK while the richest received tax cuts,
something that Reagan took to his heart with supply-side economics, rendering
the US the most unequal society in the world. When the neoliberal model was
spread across the globe through the IMF and the World Bank, inequality was made
universal, and the main instruments in this were: free trade in goods and
services, free circulation of capital and freedom of investment. The IMF grew
from being merely a supporter of balance of payments to a dictator of ‘sound
economic policy’, and WTO was created in 1995 to ram through neoliberal
agreements that the signatory third world parliaments did not even understand.
Had the MAI been signed at WTO the fate of the developing world would have been
sealed.
These are some of the persuasive arguments in favour of doing away the
cumulative third world debt, imposition of a low-interest (Tobin) tax on
financial transactions and subjecting the entire process of globalisation to
democratic accountability. The arguments are strengthened by the observed
phenomena of the 1997-98 free market meltdown in Southeast Asia and Russia.
6. The advances made by multinational corporations into the Third World only
gives rise to poverty, child labour and social dumping
7. The great financial crash is unavoidable
8. The global competition over locations destroys the environment
9. Global brands pose a threat to cultural diversity and values
10. Globalisation cannot be steered
All these accusations and arguments have become further highlighted by the
inability of the developed world to come to some agreement with the developing
world on how free trade under the WTO will affect them. All these are charges
that seek an answer, but so far the WTO has not satisfied the developing states;
instead the WTO summits have a developed a pattern of deadlock. This means that
free trade would be mostly driven by bilateral agreements under the IMF
restructuring programmes. A good look at what the developing states have signed
at the WTO will make it clear.
All developing countries have signed bilateral treaties of free trade under the
World Trade Organisation (WTO) in order to join the new trading order. These
treaties are seen by the critics of the signatories as unequal and too tilted in
favour of the developed economies . As weak traders, mostly of agricultural
produce, the third world countries are in a bind and not a little destabilised
by their domestic critics. The story begins in 1983 with the United States and
Japan calling for fresh negotiations in the General Agreement on Tariff and
Trade (GATT) where the developing world more or less dominated the discussion on
opening up the markets of the advanced economies. The call for fresh
negotiations was no doubt motivated by a desire to reduce the tariffs placed on
products and protecting some products that could be easily copied without
authorisation. The European Union (EU) was not keen in the beginning because it
did not want trade in agricultural goods liberalised, but then it gave in under
pressure. The third world was not keen either because it feared that new issues
of no particular interest to them would be raised in GATT and that the old
issues would be put on the back burner. A new round of talks of Multilateral
Trade Negotiations (MTNs) was launched in 1986 in Punta del Este, a sea resort
in Uruguay, and the talks were called the Uruguay Round.
An earlier discussion of MTNs in Tokyo, called the Tokyo Round, was held in 1979
which had agreed the removal of tariff and non-tariff barriers but these
agreements were binding only on those states that accepted them. Under GATT, the
discussion was restricted to trade in goods, but after the Tokyo Round, the
developed states felt that they had other trade to protect, trade in services
and intellectual property, and better environment for their investors. The
sector of agriculture was under a ‘soft’ regime under GATT and some exporting
nations were keen to bring it under some kind of discipline. The Uruguay Round
went till 1994, with a lot of ups and downs. It was concluded with a ministerial
meeting in Marrakesh which finalised established the World Trade Organisation
(WTO) and brought into effect the agreements reached at Uruguay. The old GATT
agreements were incorporated with certain elaborations and the whole clutch of
accords was called the family of WTO agreements. These agreements cover 12 items
comprising goods: agriculture, sanitary and phytosanitary measures, textiles and
clothing, technical barriers to trade, trade-related investment measures,
anti-dumping, customs valuation, pre-shipment inspection, rules of origin,
import licensing, subsidies and countervailing measures and safeguards. There
are also agreements in the area of services, intellectual property rights, trade
policy review mechanisms and dispute settlement processes. For plurilateral
agreements, on government procurement, civil aircraft, dairy and bovine meat,
are applicable only to those states that accept them.
What is attempted is a quantification of how the developing world has conceded
far more concessions to the developed world than they have received during the
Uruguay Round. It claims that reduction of tariff has hurt he developing world
more because the quantum of reduction is more in their case. In such measures as
anti-dumping the developing world has suffered. In the sector of services too
the resistance put up by the developing states was beaten down by the developed
world without regard to the ill-effects it would have for the former. The
deficiencies and imbalances have not been properly studied by the states before
signing the WTO agreements.
A note on the Tobin Tax
In 1999, an article published in Le Monde Diplomatique recommended that a
special but low percentage tax be levied on the global movement of finance to
prevent the sector from becoming unstable and volatile. It also mentioned that
the Finn government then in power had declared itself in favour of this tax in
its manifesto. The propelling factor behind this reference in the manifesto was
Erkki Tuomioja, who was then the Finnish foreign minister. Tuomioja was greatly
influenced by a fellow-Finn, Heikki Patomaki who had actually researched this
special tax and whose work had been given a point by the flight-of-capital
crisis in Southeast Asia in 1997. What is now called Tobin Tax was first
proposed by James Tobin in the 1970s and has been adopted by such NGOs as ATTAC
which exclusively advocates it as a response to the developed countries’
reluctance to support development in the underdeveloped part of the world .
Tobin Tax is an extremely simple remedy against the floating global money that
ranges through the lowered barriers under free trade and enters and leaves
economies without warning. According to an estimate 1500 billion dollars are
involved in currency transactions in the world. It has been proposed that each
transaction should be taxed at the rate of 0.5 percent. This Currency
Transaction Tax will yield more income than the total amount of official
development aid from the industrialised countries to the less developed
countries. Some countries that wished to avoid the kind of crisis that afflicted
the Asian Tigers and Russia in 1997 have adopted the Tobin Tax (Malaysia and
Chile) and have thus discouraged flight of capital from their economies. But the
idea is not to secure individual countries but to adopt the tax universally
under a global regime so that it can benefit the poor of the world.
The United States has expressed itself totally opposed to Tobin Tax and has no
inclination to even try it out. Given this fact, America’s trading partners, the
European Union and Japan, too are unenthusiastic. Europe should first adopt it
as an experiment under a central Tobin Tax Organisation which should also decide
how to spend it after collection. But unless the Tax finds universal support
such experiments would just end up being curiosities. So far the IMF and the
World Bank, where the free trade philosophy finds its implementation, have shown
no interest in researching the feasibility of Tobin Tax. Needless to say, unless
that is done and a decision is taken to enforce the tax universally, the less
competitive states will adopt it at their own risk. Malaysia and Chile may have
adopted it without damaging their competitive advantage but in other states,
like Pakistan, it may simply be a disincentive added to other already existing
disincentives.
Tobin Tax has been estimated at different levels of taxation. Some give the
figure of 350 billion dollars a year universally at the rate of 0.25 percent
whereas Tobin himself had estimated the total revenue from it at 1.5 trillion at
the rate of 0.5 percent. But many students of the tax think that Tobin’s
calculation was too high because there is bound be evasion. Even at one percent
the total revenue is fixed at between a trillion and half-a-trillion dollars
annually. He recommends that Tobin Tax may be levied experimentally in one
region and be allowed to be studied. There could be punitive taxes for those who
tried to evade it and this too would add to the final collection. He links it to
the principle of democracy in international affairs. Much of the world today
lives under the conditionality of liberal democracy, but there are variations in
the model that may qualify many states as being involved in the process of
democratisation without being democracies. He suggests that a Tobin Tax
Organisation (TTO) be created with two chambers, Council of Ministers and the
House of Democracy. Through the TTO all states would qualify for the
disbursement of the Tobin tax revenues but democracy as a conditionality would
assist the qualifiers preferentially. Just as there would be incentives in it
for the less developed states there would be incentives for the developed world
too, so that arguments of loss could not become a deterrent.
The United Nations at first held a very good prospect of becoming the parent
organisation for Tobin Tax, ultimately giving birth to an Economic Security
Council. But so far, the UN has shied away from mentioning Tobin Tax while
coming pretty close to it in the formulation of its studies and resolutions. In
July 2000 in the 24th Special Session of the UN General Assembly called itself
‘World Summit for Social Development and Beyond’ and adopted a document that
promised to end tax avoidance and proposed measures to tax multinational
corporations (MNCs). That came pretty close to the concept of Tobin Tax. James
Tobin was a teacher at Yale University. He read his presidential address to the
1978 conference the Eastern Economic Association, Washington DC, in which he
announced his special tax. The idea was originally expressed in an article
published the same year in Eastern Economic Journal. He focused on the rapid
movement of funds in the Eastern region in relation to goods and labour under
international price signals.
The anti-capitalist global reaction
The powerful capitalist ruling elite of the world gets together every year at
Davos in Switzerland to refine and promote globalisation. The gathering of the
world oligarchs is called World Economic Forum. In 2002 an anti-Davos took place
at Porto Alegre in Brazil. It was the gathering of the multitudes of grassroots
objectors to globalisation from all over the world and it called itself World
Social Forum. The city government of Porto Alegre is run by the Brazilian
Workers Party since 1998; the city is climatically just the opposite of the
snowbound Davos. The participants were not exactly from all over the world; the
African and Asian critics of globalisation could not all reach the city
resounding to Zapatista slogans. Even then an easy consensus was developed among
such a large rainbow of activists with varying interests and commitments. The
name of the gathering was Social and not Socialist for obvious reasons but one
item in the agenda was the revival of the dying impulse of socialism as an
economic doctrine .
The proliferation of differences at Porto Alegre led to the adoption the
methodology of the French Revolution when 40,000 cahiers de doleances
(statements of grievances) were presented to the grand assembly in 1789. The
cahiers presented by the participants consisted of denunciations of the way the
world was run and contained utopian proposals about how the world should be run.
The forum contained ‘social democrat’ delegates too but it was resolved to
reject them because they had developed the response of acquiescing in everything
that world capitalism was determined to inflict on the world. The task of the
forum this was to revive the Left while leaving out social democrats as a lost
cause. Apart from the Brazilian organisations, one prominent presence at Porto
Alegre was ATTAC, the French organisation that advocates Tobin Tax too as a
brake on casino capitalism which enters the third world states and evaporates
suddenly to bankrupt their economies. The session was the second in a series as
a response to Davos. The first session of the forum took place in Belgium in
1999. The decision to organise the counter-summit was taken in 1996.
There were 55,000 participants in the city of Porto Alegre when the
counter-summit opened in January 2002. India is going to hold the next one in
2004 but one Asian version of it has already taken place in Hyderabad this year.
It is the neo-liberal project called the Washington consensus that is under
attack. The year 2002 was a year of crisis for capitalism in many ways. The
Argentinean economy collapsed despite (or because of) the props provided by the
IMF; the bell-wether multinational Enron collapsed under the weight of its own
folly; the Israeli-Palestinian conflict flared up and the 2001 attack by Osama
bin Laden on New York has lent urgency to the anti-Davos gathering. The
socialist response was gaining strength: The Zapatistas arose in 1994 in Chiapas
in Mexico, protesters made the WTO conference flee from Seattle in 1999, and
demonstrations occurred in the subsequent gatherings of the Bretton Woods
institutions in Washington, Melbourne, Prague, Gothenburg, Quebec City, and
Genoa. The summit took in all the accumulated data of experience from the world
resisting globalisation and sifted from it the alternatives emerging at the
grassroots level. It is from this global experience that finally an answer to
the depredations of capitalist globalisation will finally emerge.
The World Social Forum in its fourth truly mammoth ‘summit’ at Mumbai (100,000
from 160 countries) called on 20 January 2004 for the revision of world economic
order under the IMF, the World Bank and the WTO, and demanded an end to American
unilateralism in world affairs. As a people’s movement it also highlighted
regional issues relating to the negative effects of globalisation, privatisation
and untrammelled movement of international finance. The grand meeting of the
leftwing liberal elements of the world was graced by prize-winning women writers
Nawal Saadawi of Egypt and Arundhati Roy of India. Nobel laureate ex-World Bank
economist Joseph Stiglitz criticised the privatisation of third world
enterprises under duress from the neo-liberal global authority as it caused
suffering to the common man who was still deprived of basic necessities.
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