by Mark Curtis
The US soon organised the overthrow of the government and replaced it with one that understood the correct priorities. The same fear convulsed US planners with the success of the popular revolutions in Cuba and Nicaragua. Secretary of State George Shultz once noted, for example, that if the Sandinistas in Nicaragua ‘succeed in consolidating their power’, then ‘the countries in Latin America, who all face serious internal economic problems, will see radical forces emboldened to exploit these problems’.10
Currently, and sticking to Latin America, one US enemy is Venezuelan president Hugo Chavez, an independent leader who has criticised US foreign policy and challenged US oil companies. Chavez’s wayward ideas have been met with apparent US involvement in an attempted coup. It would be predictable if a similar fate also awaited Ignacio da Silva, known as Lula, the recently elected president of Brazil and head of the Workers Party.
The fear of independent development goes back much further into history. Two hundred years ago, British elites feared the success and spread of the ideas of the French Revolution in 1789. The call for ‘liberty, equality and fraternity’ had an explosive appeal that carried across borders. Britain became the most determined of the governments engaged in the counter-revolutionary war against France. The radical, republican agitation that arose in England following the French Revolution was met with a pogrom and severe legal repression, with Tory mobs, conniving with the magistrates, often looting and burning the houses of radicals and dissenters.
This period saw increasing threats to the position of the British aristocracy through the establishment of what historian A. L. Morton described as the first definitely working class political organisation, the Corresponding Society. This Society drew on the ideas of Thomas Paine’s Declaration of the Rights of Man, which put forward the novel idea that politics was the business of all the people rather than simply a ruling elite, with the test of government being whether it pursued ‘life, liberty and the pursuit of happiness’. Paine’s expression of the principles of the French Revolution drew great support among the British working class.
The government’s response was to enact draconian laws to suppress dissent, banning public meetings and making the Corresponding Society illegal. The Rights of Man was banned and Paine himself escaped trial by fleeing to France. Over the next few years, the government continued to suppress dissent and frequent strikes and bread riots broke out. Morton comments that ‘the whole country was covered with a network of barracks’ while ‘the industrial areas were treated almost as a conquered country in the hands of an army of occupation’.11
The key way in which the threat of independent development is currently being countered is through multilateral organisations, especially the trade agreements of the WTO. According to the United Nations Development Programme, ‘the new [trade] rules are highly binding on national governments and constrain domestic policy choices, including those critical for human development’. The UN’s main trade body, UNCTAD, states that ‘many WTO members will not be able to emulate the development strategies pursued successfully by many countries in the past’.12
Policies banned under the WTO rules include many pursued by East Asian countries in successfully eradicating poverty. Cambridge economist Ajit Singh states that openness, international competition and close integration into the world economy – all urged by New Labour’s liberalisation theologists – ‘were not in fact practised by either Japan or the Republic of Korea, the two most successful East Asian countries’. From the 1950s to the 1970s Japan imposed ‘draconian import controls’ and was ‘far from being open or closely integrated into the world economy’. Other heretical policies pursued were a highly protected internal market, discouragement of foreign direct investment and heavy government intervention in all spheres of the economy.13 Many of these policies could not now be legally pursued.
Indeed, while half the world lives in poverty, the WTO rules championed by Britain and the US are in effect preventing developing countries from promoting their own development. As noted in the previous chapter, these rules restrict countries’ ability to raise tariff barriers to protect themselves against the cheap imports that are undermining local producers. They also heavily restrict countries’ ability to regulate foreign investors to contribute to national development. Some types of government subsidies to agriculture – the lifeline of most poor people – have been banned altogether. And many industrial subsidies – successfully used by some countries to nurture local business through ‘infant industry protection’ – are now also banned.
The WTO’s agreement on intellectual property and patents, TRIPS, is a case of massive corporate protectionism – giving private companies the ability to take out monopoly patenting rights over natural resources such as plant varieties and seeds. The evidence suggests that these patents are likely to reduce poor farmers’ access to affordable seed, make local agriculture dependent on imported inputs and enable biotech companies to control local species. TRIPS has been described by UNDP as ‘a silent theft of centuries of knowledge from developing to developed countries’.
Before TRIPS, most industrial countries, including Britain, developed their own industries by copying innovations from elsewhere. But now, according to UNDP, ‘tighter control [of intellectual property] under the TRIPS agreement has closed off old opportunities and increased the costs of access to new technologies’. UNDP also says that:
The privatisation and concentration of technology are going too far … Poor people and poor countries risk being pushed to the margins of this proprietary regime controlling the world’s knowledge … From new drugs to better seeds, the best of the new technologies are priced for those who can pay. For poor people, they remain far out of reach. Tighter property rights raise the price of technology transfer, blocking developing countries from the dynamic knowledge sectors. The TRIPS agreement will enable multinationals to dominate the global market even more easily.14
Northern governments use various other levers to counter independent development and promote global ‘liberalisation’. The receipt of loans from the World Bank and IMF, debt relief and bilateral aid are all conditional on southern governments pursuing the correct policies. The ‘agreements’ the EU is making with developing countries on ‘regional free trade areas’ are likely to be even more extreme than the WTO rules in pressing developing countries to ‘liberalise’ their economies. These levers are pushing in the same direction to achieve a global economy that works for the primary benefit of transnational business. And they are all being justified by reference to ‘poverty eradication’. Much current ‘development policy’ is effectively geared to preventing development.
In summary, in the earlier postwar period, the major threat of nationalism was countered by a mix of economic policies, covert action to remove wayward governments and outright military intervention. The constant pretext was the Soviet threat. The chief proponents of the nationalist threat were ‘radical’ governments (that is, those independent of the West) and liberation movements.
In the era of globalisation, independent forces are being countered primarily by economic instruments like the WTO and by military/political strategies like the ‘war on terrorism’. The latter is aimed at bolstering friendly regimes (under the guise of anti-terrorism) and provides a cover for a new phase of global intervention to remove unwanted governments. There are a variety of proponents today of alternative strategies: the global pro-democracy movement, labelled the ‘anti-globalisation’ movement; governments promoting alternative types of capitalism (such as China, Malaysia and other parts of Southeast Asia); and (often extremely brutal) Islamic regimes and groups in the Middle East. The first offers the brightest prospects, to which I return briefly in the final chapter.
The democratic threat
Popular, democratic forces are more of a threat than a promise to British governments. It is a myth that British governments generally promote democracy abroad. The reality is quite the opposite. Britain tends to support any g
overnment that promotes its fundamental interests, which are to maximise its political influence in the world and to make the global economy enrich British, and Western, commercial interests. Given that many popular, nationalist and/or democratic forces oppose these aims, Britain systematically sides with elites, often repressive ones who will keep such democratic forces in check.
If, as the myth goes, Britain generally supports popular, democratic forces struggling against elites, why did Britain not support the African National Congress and instead choose to back successive apartheid regimes in South Africa?; why did it not support a succession of progressive movements in Latin America struggling against US-backed elites, but chose to side with the US in undermining them?; why didn’t it support the various popular African movements like the MPLA in Angola or Frelimo in Mozambique?; why doesn’t it support popular movements like the Zapatistas in Mexico?; why have New Labour ministers been so critical of – and often tried to ridicule – the ‘anti-globalisation’ movement? Why have they supported the repressive regime in Bahrain rather than its more democratic, popular opposition?
Britain gave its total support for Indonesian ruler, General Suharto, until the mid-1990s when he began opposing economic policies imposed by the IMF. At this point, the West began to seek his removal and suddenly discovered he had been murdering Indonesians and East Timorese for three decades. Zimbabwe’s Robert Mugabe was supported during atrocities committed by the army in the 1980s and afterwards, until the point when the started threatening white-owned farms. Now, the British government has suddenly discovered his regime is repressive and abusive of human rights.
Similarly, the Saddam Hussein regime was given British backing while he gassed and otherwise murdered tens of thousands of the Kurds throughout the late 1980s. This backing suddenly ceased when he disobediently invaded Kuwait in 1990, at which point he was transformed overnight into a new Hitler. Various Turkish regimes kill Kurds and depopulate their villages by the thousands while Britain barely bats an eyelid and extends diplomatic support for Turkey’s entry into the EU.
The list goes on. British support for repressive elites is so generalised that promoting repression is an ordinary element of British foreign policy. Neither is British foreign policy about promoting ‘national interests’. What national interests are being promoted when Britain supports sanctions that kill children in Iraq or adopts a pro-Israel line in the Middle East, or as in the past, overthrows governments in British Guiana and Iran, or, arms Indonesian generals and sides with economic elites in Russia and South Africa? The interests being promoted here – outlined further in the following chapters – are those of British elites.
Put crudely, British ‘foreign policy’ is in reality a fancy term for supporting elites overseas. Britain ensured the continuation of its empire by creating new (or sustaining old) elites in the conquered territories who would manage colonialism in British interests. British rule in colonial India was based on support from the army of sepoys, native princes and landowners who thus owed their privileges to British authority. Britain destroyed the village community, the social base of the life of the mass of the population, and created instead a new oppression by those princes and nobles.15
Towards the end of formal colonialism, Britain set about creating elites that would do Britain’s bidding after independence; some attempts were successful – as in Kenya, described in chapter 15 – while some failed. Britain remains a ‘great power’ (second order, these days), partly because it is an important ally to some key ruling elites. This is especially true where Britain’s commercial interests are great, such as in the Gulf, where favoured ruling families manage oil under overall Western control. The Gulf includes some of the world’s worst authoritarian regimes, which are partly propped up by British policy. Here, British elites barely even pretend to support more liberal political forces, so total is their support for the existing rulers.
Under globalisation, however, something new in human history has emerged – a transnational elite. It consists mainly of business and political leaders, together with senior technocrats from North and South, mainly the US, and is organised around the major actors in the global economy – the 200 largest corporations which control a quarter of the world’s wealth. This elite is the champion of the global ‘liberalisation’ project that seeks a fundamental reshaping of the world’s economy. It is a new, often personally stupendously wealthy and powerful global ‘overclass’.
The new transnational elite acts on behalf of itself, not the nation state from which its individuals and companies come. This applies even, in fact especially, to US business elites, who are the clear leaders of the global liberalisation project. The elite has an annual meeting at the World Economic Forum in Davos, Switzerland, every January, attended by a few thousand specially invited business leaders and a handful of academics, journalists and international NGOs.
Most southern elites are no longer challenging US power. Instead, they see themselves as junior partners in the transnational elite, concerned with creating the best local conditions for transnational capital. This often means pitting country against country in increasing competition between them, resulting in a ‘race to the bottom’ in standards, lower wages, less regulated capital and reduced workers’ rights.
The role of national governments is no longer seen by the transnational elite as formulating national policies; it is simply to prepare citizens to take advantage of ‘opportunities’ presented by globalisation and to administer policies favoured by the transnational elite. These policies – or rules – usually emanate from the multinational institutions (such as the WTO and the World Bank) that the elite controls. As noted in chapter 9, this, of course, is a massive, conscious undermining of democratic decision-making.
The new transnational elite ultimately wields political power but the underlying power lies with the demands of the global market economy. Political leaders are deploying their influence to deepen the economic power of the transnational elite, and in so doing are in effect disenfranchising themselves politically. There is little that is ‘inevitable’ about globalisation, just like there is little ‘natural’ about ‘free trade’. ‘Free trade’ rules and globalisation itself have been brought about by massive government intervention. Elected governments, working together, can choose to regulate globalisation, to a very large extent, if they want. But political leaders like Tony Blair are choosing to abandon the ultimate political control they have.
The transnational elite has both an economic and a political project. The economic project is global ‘liberalisation’, which seeks total mobility of capital and completely ‘liberalised’ markets everywhere for trade, investment, services and much else. It eliminates most state intervention in the economy and most means to regulate businesses to promote national development goals and ethical standards. Its political project is to promote governance systems that will deepen such global liberalisation. In this, governments can be straightforwardly repressive, but they are tending to be elitist forms of democracy, that have been called ‘polyarchy’.
Polyarchy is generally what British leaders mean when they speak of promoting ‘democracy’ abroad. This is a system in which a small group actually rules and mass participation is confined to choosing leaders in elections managed by competing elites. Those who win in elections then become largely insulated from the public so that they can ‘effectively govern’. Between elections, groups who control the state are largely free from serious accountability to the public. Polyarchy has been described as a form of ‘consensual domination’ where (competing) elites control the state while popular forces and civil society groups are subject to the hegemony of the elite.16
In contrast to polyarchy stands ‘popular democracy’, where public participation is much greater and civil society groups are able to use the state to promote their interests. Here, mobilisation within civil society would be the principal way in which political power is exercised.
The elitist understanding
of ‘participation’ in policy-making is instructive here. The World Bank responded to massive criticism of its economic policies in the 1980s and 1990s by launching a new initiative to promote the ‘participation’ of civil society in formulating government policies in developing countries. Governments are now required to hold formal consultations with civil society groups in order to draw up a national development strategy, which will then receive World Bank funding. These processes are now taking place in most countries where the World Bank is ‘aiding’ governments. But real participation is generally non-existent, as numerous recent studies show. It is not people’s involvement in policy-making that is being promoted. Rather, civil society groups are being consulted to ratify decisions on policies being made by elites. In most countries there are few opportunities to shape policy, still fewer to implement alternatives.
Much of the blame for this should go to Southern elites who often have no intention of allowing the public to deflect them from their policies. But much is also to do with the conception of democracy emanating from the World Bank and the transnational elite.
Western governments support and work through civil society groups and non-governmental organisations to promote the polyarchic and neo-liberal economic agenda, using aid programmes to support local and Northern NGOs. Some of this aid can help the emergence of a more vibrant and influential civil society. But most aid in fact goes to more elitist organisations with reformist rather than radical agendas. Much aid to NGOs is intended to substitute for the state’s role in providing public services. The involvement of transnational business, especially in public services, is increasingly being encouraged. Many NGOs have been co-opted while popular, radical alternatives have been closed off.