Whose world order? Conflicting visions

By Noam Chomsky, speech at the Opera House, Willington, New Zealand, 10 November 1998

There are occasional moments in human affairs when power relations make possible the establishment of socio-political arrangements that are far-reaching enough to merit the term ‘world order’. That's not necessarily a term with positive connotations, as history amply reveals.

One of the most dramatic and easily timed of those moments was well over 50 years ago in the aftermath of the most devastating single catastrophe in human history, which was right in the heartland of Western civilisation. At the end of the war the United States had an overwhelming share of power and wealth, and quite naturally dominant forces within the state-corporate nexus planned to use that power to organise the world in accordance with their own perceived interests. Nothing new about that.

There were, of course, conflicting visions, both at home and abroad, and they had to be contained and that was done with varying degrees of success. Nevertheless the basic conflicts persist and the reason they persist is simple enough. They are about fundamental values, about freedom, justice, human rights, and in a world of great inequality and enormous concentrations of power, the real world in other words, those values quite commonly constitute a major arena of conflict between centers of power and most of the rest. A good deal of history revolves around these conflicts, and the latter part of the 20th century is no exception.

At the onset of the current era, a bit over a half century ago, the framers of the new world order faced these challenges everywhere. At home in the United States, what had to be contained, or if possible rolled back, were the very strong commitments of a large majority of the population to more or less social democratic ideals, that the business world quite rightly perceived as a grave threat to its traditional dominance of society. The ‘hazard facing industrialists in the rising political power of the masses', as the National Association of Manufacturers phrased the danger. And similar problems arose throughout the industrial world. They were enhanced elsewhere by the prestige of the anti-fascist resistance which often had a radical democratic thrust and by the discrediting of the traditional conservative order which had been linked to the fascist systems. Reinstating that traditional order and its essentials was a primary task of the early post-war years. It was achieved to a considerable extent, often in pretty ugly ways.

As in the United States that project has taken new forms in the last quarter century or so under the guise of Neo-Liberalism or economic rationalism or free market doctrines, a notion that's permeated with a large element of fraud and hypocrisy. In what has been called the Third World, there were similar problems. They were compounded by pressures to overturn the imperial systems and the legacy that they have left of dependency and subordination.

We know a lot about the United States, by comparative standards a very open society. There's a very rich documentary record of declassified documents that reveal quite clearly the internal planning. Although the basic issues are essentially the same everywhere, you see them in starkest clarity in Latin America. The reason for that is quite simple. In Latin America the United States faced virtually no challenge apart from the domestic population, which did pose a serious threat, and it was recognised.

If you go back to State Department and other high level documents in the mid 1940s there is great concern over what was called the “philosophy of the new nationalism that is spreading all over Latin America, which embraces policies designed to bring about a broader distribution of wealth and to raise the standard of living of the masses on the principle that “the first beneficiaries of the development of a country's resources should be the people of that country”. That's what's called “radical nationalism” or “economic nationalism” in official state papers.

Well of course that's unacceptable. It's taken for granted that the first beneficiaries of a country's resources should be US investors, their counterparts elsewhere and the local associates who do the management of these affairs in particular regions. As one of the leading planners, George Kennan, said, we have to “protect our resources”, which by accident happened to be in somebody else's territory but they’re ours and they can’t be the first beneficiaries, that's clear. There was a hemispheric conference called by the United States in Mexico in February 1945 where these issues were thrashed out, and power won as it usually does.

The United States imposed what was called a Charter for the Americas, an economic charter for the Americas, which called for an end to economic nationalism in all its forms. There followed a cruel and bloody history for half a century, still going on, and throughout it these were central themes. They are very much alive today, now often in the framework of globalisation of a very specific form that's no historical necessity but a specific form that's crafted primarily in the interests of transnational corporations and financial institutions and the powerful states that support and back them and implement their interests.

The most critical part of the Third World a half a century was, and still remains in fact, the Middle East. The reasons are straightforward, that's the locus of the world's major energy supplies and will be for the perceivable future. Here it's of particular importance that the first beneficiaries are not the people of the region because of the enormous significance of controlling the world's energy. The resources have to be under effective US control and accessible on terms that the US leadership considers appropriate. And crucially the huge profits that are generated have to flow primarily to the United States, secondarily to Britain, to the British ‘junior partner’, to take the terminology that was used rather ruefully by the British Foreign Office in the mid-1940s, recognising the new realities of the world. So the US and the junior partner have to control those resources and benefit from them primarily. These are recycled in a variety of ways by local managers who have to be dependent on the global rulers. Back in the days of British dominance they were called the ‘Arab facade’ in secret British documents. Britainwould exercise actual rule and the Arab facade which is still there has to be weak and dependent and subordinate to the real rulers rather as in the days of British domination. It's rather striking how profound are the similarities that remain with all the changes. In this case the major change is the shift of who pulls the strings.

Back before the Second World War the United States was a very marginal player in world affairs despite the scale of its economy. After the Second World War it became the dominant force, Britain was reduced to junior partner, others were marginalised more.

Well, it's natural that these arrangements have engendered continual conflict. The internal documents warn of the threat of radical nationalism or some equivalent that threatens US dominance. For the public it's put in different terms. It's called international terrorism or a ‘clash of civilisations' or some other fancy phrase. That is just the old fashioned radical nationalism. The effort by beleaguered people to overcome the principle that they never seem to understand that the first beneficiaries of a country's resources are not them but somebody else. Hard to get through the heads of backward peoples.

These conflicts are very likely to become more virulent and ominous in the coming years at least if the rather general consensus of geologists is anywhere near correct. The broad consensus is captured rather well in the headline of a major article a few weeks ago in the journal Science of the main scientific professional society. The title is “The Next World Crisis Looms Large—and Perhaps Close” and it points out, as knowledgeable specialists in the field have been doing, that the current phase of an oil glut and unusual low prices is temporary. The rate of discovery of oil has been declining since the mid 1960s, despite highly improved technology in the drilling and so on.

The Gulf region has regained the share of energy production that it had back in the early 70s and they expect it to increase. That's where the major known reserves are by a large margin and world consumption is approaching the 50% level of total exploitable known capacity. That's expected to happen within maybe a decade or two, or even less, and it's accelerating very fast. So almost half of the oil that's been used in human history has ben used since the early 1970s and that rate of use is going up.

All of that spells crisis so unless there's some technological fix that nobody can dream of at the moment, the concern over who runs the Middle East is going to be even more crucial than it has been in the past. And it has been regarded as crucial. If you go back to the mid 1940s the State Department and the political leadership described the Middle East as “a stupendous source of strategic power” and “the greatest material prize in all history”, and that continues to be the case more than ever. So we can rather confidently look forward to (that's not exactly the right phrase) some very ugly events in that region.

Let's turn to something different—the institutional framework that was designed for world order 50 years ago, a few comments about how it's fared and where it stands today, what we can expect in the foreseeable future.

The institutional framework has three prongs: there was an international political order, a human rights order and an international economic order. Those are the three basic elements. The international political order is the United Nations, it's articulated in the UN charter. The human rights order was expressed in the Universal Declaration of Human Rights, December 1948, 50th anniversary's coming up in a couple of weeks. The international economic order is called the Bretton Woods system.It was designed by the United States and the junior partner in 1944. Those are the three fundamental elements. I want to talk mostly about the third but a few words first about the first two.

The UN Charter, the international political order, has one essential principle, everything else is kind of a footnote. The essential principle is that the threat or use of force is barred in international affairs. That's illegal and ruled by the World Court as illegal. There are very narrow exceptions. In fact, two exceptions. One exception is if force or the threat of force is specifically authorised by the Security Council after it determines that peaceful means have failed.

Case two is the famous Article 51 of the Charter which permits self defence against ‘armed attack’ until the Security Council acts. So that means, for example, if Cuban armies invade the United States, the United States is supposed to notify the Security Council and it's allowed to defend itself until the Security Council takes appropriate steps. That is the only exception.

Actually that example may be, I’m not sure, hypothetical. The Cuban military threat was downgraded by the Pentagon a couple of months ago. That elicited great anger in Congress and the White House flat out rejected it. The White House stated that Cuba still poses a national security threat to the United States. It invoked that threat when the US rejected World Trade Organisation jurisdiction when the European Union brought to the World Trade Organisation a complaint about gross US violations of trade agreements and international law in the case of the Cuban trade embargo. That had already been condemned by just about every relevant international body, even the quite compliant Organisation of American States. But the US claims the national security exception because of the threat to US national security posed by Cuba, so whether it's a hypothetical threat or not, I don't know.

These are the sole exceptions to the barrier against the threat or use of force. Well there's obviously no enforcement mechanism apart from the great powers, decisively the United States, but the great powers reject the principle completely. The United States in particular is a little unusual in that it rejects the principles not only in practise but also in doctrine. That's an innovation of the past 15 or 20 years.

With regard to the practice in the last half century, there's no need to review it. The bombing of the pharmaceutical plant in Sudan a few months ago is a recent illustration that's trivial in the historical context, although I think it's fair to guess that if some terrorists destroyed half of US medical supplies and fertiliser production it might be taken a little bit more seriously than this one was. The official doctrine by now reveals straightout utter contempt for the principles of world order that are, of course, loudly proclaimed when they serve some power interest, to beat up some enemy.

Since the Reagan years the United States has officially justified its acts of violence on the grounds that Article 51 authorises ‘self defence against future attack’. That was the official justification for the bombing of Libya in 1986, a straight terrorist attack. In the case of the invasion of Panama, with hundreds if not thousands of fatalities, the United States claimed that Article 51 permits the United States to ‘defend its interests'.

Under the Clinton administration, the pretexts are even more outlandish. UN Ambassador Albright, now Secretary of State, put the matter pretty frankly when she was admonishing the Security Council when it was refusing to go along with US policies towards Iraq. She said the United States will act Rmultilaterally when we can, and unilaterally when we mustS, unconstrained by solemn treaty obligations. The World Court, the foundations of world order or anything else are irrelevant.

That's been the case all along, not just for the United States. It's been demonstrated in action in shocking ways, no need to review. It's now a principle. What that means is that the international political order is officially dead, not just dead in practise. The United Nations is fine as long as it serves United States interests. Otherwise, get lost.

In fact the US war with the United Nations for the last 30 years has been highly disruptive. It's way in the lead in vetoing Security Council resolutions, followed by the junior partner, with everybody else far behind, since the 1960s. That's not even worth reporting in the United States and the facts are basically unknown and constantly denied easily since they’re not reported. It's hard to find them even in scholarly literature. Anyhow, that's the international political order.

What about the Universal Declaration of Human Rights? We’re coming up to the 50th anniversary and it's pretty safe to guess that in the coming weeks we’ll be regaled with condemnations of human rights violations that are sometimes horrendous. Everyone writes of violations of somebody else, particularly official enemies. Those charges sometimes will be reasonably accurate but they’ll be very partial because we can also be confident that a vastly more important topic will be ignored, namely the human rights violations, often horrendous atrocities, that are chargeable to our own account. These are vastly more important for quite elementary moral reasons, namely we can act to mitigate them or to terminate them, so by the most elementary moral standards they would be more important even if they were less than the atrocities of others.

The comparative treatment of enemy atrocities and our own atrocities- that's a very instructive story which again I’ll have to put aside somewhat glibly. There's a lot of material in print about it if you're interested. Edward Herman, Professor of Finance at the University of Pennsylvania, he and I have published a lot of extensive documentation including several books jointly. Unfortunately there's no similar analysis of Stalinist propaganda, I wish there were. I assume it was pretty much a mirror image of ours, that is, atrocities committed by official enemies are horrible, terrible things. You're permitted to lie about them and be very eloquent in denouncing them, but your own you have to deny. At least I assume that Stalinist propaganda, if investigated, would turn out to be a mirror image of ours which has been investigated. Although it would be interesting to discover if they actually sank to the level of moral cowardice that is easily demonstrated in Western doctrine. That's actually a good research topic for some aspiring graduate student looking for a thesis, but incidentally not aspiring to get a job in a respectable university. Anyway, that comparison has not been undertaken.

We gain a certain insight into these matters, though more obliquely, by looking at a doctrine that's well known to international lawyers, it's called the Hull formula. It's credited to Cordell Hull, Secretary of State of the Roosevelt administration. This formula defines what's called the ’international minimum standard of civilisation’. Now that standard doesn’t involve genocide or torture or other marginal issues, rather it's concerned with ‘the right to adequate, effective, and prompt compensation’ for expropriated property where full compensation is to be at ‘fair market’ value as determined by the former owners. That's the international minimum standard of civilisation. Human rights, genocide and so on are somewhere else.

That formula is an interesting one. It applies in quite intricate ways, you have to be well educated to understand it all. It's the basis of the US economic embargo and terrorist wars against Cuba for the last 40 years. These are carried out because of Cuba's failure to meet the minimum standard of civilisation, that is it's failure to offer what Washington unilaterally decided was fair compensation for nationalised property. So there the whole formula applies.

On the other hand it does not apply to US investors and the US government who stole the Cuban properties at the turn of the century when, you will remember, Cuba was under US military occupation and was forced to consent to the robbery at gunpoint essentially. Nor does it hold for the US government and private powers who stole Spanish and British possessions in Cuba and the Philippines, for example. One case was the Spanish-owned railway company. After the bloody conquest of the Philippines, which killed hundreds of thousands of Filipinos, the United States threw out the Spanish concession because it Rhad been inspired by Spanish imperialistic motivesS, unlike the US possessions which Cuba nationalised.

The formula also doesn't apply to the founding of the United States which was based on expropriation of British possessions and also the possessions of British supporters who are about as numerous as the rebels in the Civil War, the great world war of the time, now known as the American Revolution. New York State alone made close to $4 million by taking the property of loyalists. That was a huge sum in those days, of course.

You must have a rather a subtle mind to comprehend all of this and to understand what really counts as ‘the international minimum standard of civilisation’. It's against that kind of background, of which this is an illustration, that you can assess accurately the significance of the Universal Declaration in the real world. Again, there's lots more to say about that, but let me turn to the third pillar of world order, the Bretton Woods system.

Actually that's all over the front pages right now and the reason is quite simple. There's a serious fear of global economic meltdown which might affect the privileged sectors of the world, not just the usual victims. As long as it's just them, it's not on the front pages. But now it's getting serious.

The Bretton Woods system has two essential principles. First one was an attempt to liberalise trade, to try, if possible, to bring international economic interactions up to the level where they were, say, before WWI. In fact what's today called globalisation is by gross measures like trade relative to gross national product, financial flows relative to growth in the world economy, it's actually less in many respects than it was before WWI, so it's not a radically new phenomenon.

It had declined a lot in the inter-war period and the first principle of Bretton Woods was to try to liberalise trade, to bring it up to what it had been, although circumstances were now quite different. The second principle of Bretton Woods, closely related to the first, was that capital flow was to be regulated and exchange rates were to be fixed; so liberalised trade and regulated flow of capital. Those are the two principles of Bretton Woods. If you bother to look, they're still written in the IMF rules. There's now an effort to change them but they’re still in the rules so the IMF, for example, is permitted to withhold credits to cover capital flight, which is about all it does in the last 25 years, but that's contrary to its charter. As I say, there's now an effort to try and change the charter. That's the Bretton Woods system.

There is a good reason for the second principle, the regulation of capital flow and the fixing of the exchange rates. The reasons were in part theoretical. There was a fairly broad consensus among economists that freeing up capital flow allowing for capital flight and short term speculative flows and exchange rate fluctuations, that those processes would tend to undermine trade and investment. So they were incompatible with the first principle. That's a theory. Like most economic theory it is not very solid, but it was plausible and widely assumed, and recent experience of the past 25 years is quite consistent with that assumption. It's approximately what's happened.

The second reason for the regulation of capital flow and fixing of exchange rates was not a theory, it was a truism. It was clearly understood that the free flow of capital undermines democracy and undermines the welfare states which were far too popular in the 1940s to be simply abandoned or ignored, and the reasons for that are completely straightforward and uncontroversial.

I’ll just paraphrase the framers of Bretton Woods. The paraphrase: capital controls (that is, prevention of free movement of capital) allowed governments to carry out monetary and tax policies in an effort to sustain employment, to maintain incomes, to institute and expand social programs without fear of capital flight that would terminate those efforts. If there is free flow of capital, that is no control, that leads to what some international economists have called a ‘virtual Senate’ of financial capital which can impose social policies on governments and their populations simply by the threat of capital flight.

Capital flight leads to higher interest rates, economic slowdown, budget cuts for health and education and so on, recession, maybe collapse, in fact exactly what the IMF prescriptions are for the poorer countries today, that's a clear and immediate consequence of the threat of capital flight. So that popular decisions or governmental decisions, which are popular to the extent that the government's democratic, those can simply be barred by the virtual senate simply by saying that if governments carry out irrational policies which are aimed to help people rather than profits, capital will travel elsewhere, and that's the end of the policies. So that undermines democracy, undermines the welfare state, for completely straightforward reasons.

All of this was articulated quite explicitly at the time by the US and British negotiators Harry Dexter White for the United States and John Maynard Keynes for Britain. That's very important to keep in mind when you look at the current period, as the elementary principles are still operating.

The Bretton Woods system was in place up until the early 1970s. That's the period which is often called the golden age of postwar state capitalism. That was a period of high rates of growth of the economy, of productivity and expansion of the social contract of the welfare state. This was dismantled from the early 1970s at first by unilateral acts of the United States, then followed by Britain, Switzerland, and other financial centers. By the 1980s capital controls were mostly gone in the rich countries. The smaller economies came along, almost invariably by force. In the case of South Korea, a striking case, it was compelled to drop capital controls in the early 1990s. That led to a huge explosion of speculative inflow of capital and then a rapid outflow of capital which wiped out a pretty solid economy. Certainly harmed it badly. Much the same is true in other parts of Asia that had suwccumbed to this pressure.

It's widely accepted now that liberalisation of capital flow and market failures are major factors, the dominant factors, in the recent crisis, which is very serious. Here we have to distinguish East Asia from Southeast Asia. The East Asian economies, South Korea and Taiwan (Taiwan has been somewhat immune from this, partly because it did not liberalise to the same extent) were much more solid economies, Southeast Asian ones were much more fragile.

The East Asian economic miracle is still regarded by serious analysts as very real. For example the chief economist at the World Bank, Joseph Stiglitz, recently in World Bank publications has emphasised that what he called the East Asian “economic miracle”, what he calls an “amazing achievement”, is historically without any precedent and based on significant departures from the official doctrine, what is called the Washington consensus, actually much greater departures than he indicates. And he also thinks it should last unless it's destroyed by irrational financial markets, he's speaking mostly of South Korea and Taiwan. He points out that in order to achieve this economic miracle governments took major responsibilities for the promotion of economic growth, abandoning the “religion” that markets know best and intervening to enhance technology transfer, equality, education and health along with, we may add, industrial policy coordination and strict capital controls, until they were forced to drop them a few years ago.

Stiglitz also mentions that the rich societies had followed quite similar paths, in fact far more so than the World Bank has acknowledged. What has happened since the early 1970s, coincident with the liberalisation of capital flow, there were some very striking developments. It's reasonable to think that they were partially caused by it, that could be debated, but the facts are not debatable. I’m talking now about primarily rich western societies, in fact primarily the United States and Britain, but others are dragged along.

The first associated phenomenon, maybe consequence, is that the growth of the economies and productivity slowed very sharply. The second is that incomes stagnated or declined for the great majority of the population Dramatically true in the United States, partially Britain and to some extent others. The effects in the United States have been associated with a worsening of working conditions, and extension of the working week. The American worker works two or three weeks more than in the early 1970s to at best maintain an income that has declined.

Another fact, also social services have deteriorated, infrastructures have deteriorated, the welfare state is falling apart, I don’t have to tell you about that here. Thirdly, inequality increased quite rapidly. It had been declining both in the United States and Britain and elsewhere from around the 1930s through the golden age up to about 1970. Since then it's increased, in the United States it's now back to the level of the 1920s.

There has also been a dramatic increase in incarceration, which is surely related to that. Go back to say 1980, the United States was similar to other industrial societies, kind of at the high end within the spectrum both in crime rates and in level of incarceration. Crime rates have not risen, they in fact have declined, but incarceration has gone through the roof. The United States is now five to ten times as high, relative to population, as other industrial societies and well in the lead among any societies which have meaningful statistics. China may be higher, but certainly among Western industrial societies it's far, far ahead. It's overwhelmingly black males and it's a consequence of a completely fraudulent drug war which is known to be fraudulent. It was designed essentially, as Senator Moynihan put it (he's one of the few Senators who pays attention to social statistics) as he put it when the last phase of the drug war was announced, “we were determining to create a crime wave among minorities”, that's what the policy was for and that's exactly what was done.

The details are interesting. The scale is so great that if you consider the number of the population in jail it actually adds about 2% to the official unemployment rate. Associated to what criminologists now call the crime control industry, private prisons, prison labour, public funds for prisons for high tech industry, financial institutions like Merrill-Lynch and so on and so forth. It's a major industry, it's not the Pentagon but it's coming close. It's serving, along with the function of getting rid of the superfluous population, it's serving as another way for public funds to enrich private power, very much like the military system. Well that's another consequence or associated phenomenon.

Another associated phenomenon is that profits have soared, particularly in the 1990s. They’ve been unprecedented—double-digit profit growth year after year. The business press has been ecstatic, though.

We have to admit that there are some problems. If you follow the business press, maybe you read articles in Business Week a couple of years ago which talked about the problems facing the business world under the headline “The problem now: what to do with all this cash” as “the coffers of corporate America were overflowing”. About a year later it got even worse. There was an article reporting that something like two-thirds of a trillion dollars of corporate wealth is sitting there, causing “vexing problems” for Intel, IBM, General Electric and others who don’t know what to do with it. Fortunately there's a solution. A solution, and there's a bipartisan consensus on that. The solution is to cut corporate taxes. The point is that that is supposed to free up investment funds. The wealth that is causing such “vexing problems” is not enough. That's what's been going on until this year. This year things have changed which is part of the reason for the concern on the front pages.

Another phenomenon that's been taking place in this period is that the markets have become much more irrational and uncertain. The reason for that is the enormous, astronomical increase in capital flows, most of it very short term speculative flows. The scale is astronomical, it's been estimated well over a trillion dollars a day, but 80 percent of it comes home within a week, often within hours. None of that contributes to the real economy, it harms the real economy. The proportion of foreign exchange transactions that is connected to the real economy, trade and investment, is now estimated roughly at 5%. That's 95% speculative. If you go back to the 1970s before the breakdown of the Bretton Woods system, the figures were essentially reversed, 90% related to the real economy, 10% speculative and all together a far smaller amount.

Well that's led to very volatile markets. The IMF recently did a study of the roughly 180 countries that are its members, essentially everybody with a functioning economy. Of those about 80% had one or more banking crises, about 20% had serious banking crises from about 1980 to 1995 and it's getting worse.

Another phenomenon of the same period has been an attack on freedom of trade and free markets, again as predicted. It's what's called a “sustained assault’ on free markets by the head of economic research of the World Trade Organisation in a technical monograph. The attack on free markets has been led by the rich countries, primarily the United States. The same author, Patrick Low, attributes to Reaganite protectionist measures about three times the effect of other industrial countries and that's very plausible. During the Reagan years protection approximately doubled, subsidies increased very sharply, along with outright bailouts of domestic banks and international banks.

There was a reason for all of this. The United States had to do something to overcome very serious management failures that had led to a decline of US industry. If you go back to around 1980 there was great concern over what was called a need for reindustrialisation of America—to somehow save the central components of the industrial system from foreign competition, mainly Japanese competition, and that was a management failure. US management has not moved forward to take up modern production techniques, lean production, flexible production, automation and so on and so forth.

The government turned to the usual source to overcome all of this, namely the Pentagon. That's something that's gone on in postwar history, back to early US history. The Pentagon undertook a management technology program, the purpose of which quite explicitly was to create, to assist US management to overcome some of its inadequacies, to create what was called “the factory of the future”, based on automation and other modern devices which American management hadn’t picked up. This increased quite radically under the Reagan years. They also tried to subsidise US industries sufficiently so they dominated emerging technology and markets like information technology and others. The internet is one example. All of that continues under Clinton including radical interference with free trade when it's convenient. It's had an effect, it's restored American industry to its dominant position from when it was collapsing. If it hadn’t been for this it's quite likely that the US would now not have functioning automotive, electronic, information technology, bio-technology and other major industries. Well that continues under Clinton as does the market interference, that's a fixed element of US policy and has been throughout US history. It goes right across the spectrum.

About three years ago the Clinton administration imposed, essentially blocked, export of Mexican tomatoes which cost Mexico close to a billiondollars a year. The very frank and honest reason was simply that they were undercutting private growers. American consumers preferred them to Florida agribusiness-grown tomatoes, therefore the US blocked them. Technically it wasn’t a tariff, just a power play where Mexico was forced to agree.

Just recently at the other end of the spectrum, the Clinton administration barred Japanese super-computers. And the purpose was frankly stated—to protect American manufacturers who were unable to compete,private enterprises. Private enterprises is an odd word its profits are private, the markets are government, a lot of the technology and funding is government—sometimes from universities, other parts of the public sector in terms of funding. But it's true that the profits are private, so in that sense it's private industry. This again was frankly acknowledged, wasn’t even hidden.

The next one will probably be steel. Steel manufacturers are now calling for barring imports from Japan, Korea and Russia which are undercutting US sales. And the US can do that whenever it feels like it. There's a law called Super—301 which the US can invoke whenever it likes effectively to block exports. It just threatens other countries with loss of the US market unless they accept cutbacks in exports. That's part of US trade law and used repeatedly. For example it's been used to forceAsian countries to accept US lethal drugs including one of the most addictive and one of the most lethal drugs around, namely tobacco.

These countries were compelled to accept US exports as well as advertising primarily to vulnerable markets, and if they didn’t accept them US markets would close. Under the threat of Super-301 they accepted them with predictable effects. In China alone, one Oxford University epidemiologist has predicted that about 50 million people will die of tobacco-related diseases.

If you really want to see the way it works in all its ugliness an interesting and horrifying case to look at is the two extremes in the Western hemisphere. The United States of course is by far the richest country. The poorest country is Haiti. It's been under US domination for most of this century including US Marine occupation, and it's now a total basket case. It's had one democratic election, December 1990, which lasted about seven months. The US strongly opposed the democratic government and tried to undercut it. Then came a military coup which was tacitly supported by the United States. The US finally did move to eliminate the coup regime, but on a condition. The condition was that Haiti accept an extremely neo-liberal program. It was forced to liberalise to an extreme level, maybe New Zealand has a similar level, but for the rest of the world that's the kind of thing imposed by force. That was the condition for elimination of the coup, the terror and the torture. And the consequences in the last couple of years have been as bad as you can guess.

Haiti is a potentially successful and in fact large rice producer. Rice production has been destroyed by “free competition” with US agribusiness. US agribusiness was helped out a little bit by the fact that about 40% of its profits comes from government subsidies, which increased rapidly under Reagan, while Haiti has had a free market. One of the few successful enterprises since the coup has been the production of chicken parts. Well that's been undercut because chicken parts have been dumped by US producers. American customers prefer white meat to dark meat and that's been dumped on the Haitian market way below cost, destroying one of the few hopeful enterprises.

Canada can block this. Canada is independent enough so that it can impose tariffs which are 50 times as high as what Haiti is permitted to impose under its neo-liberal program, and they block US dumping. Technically Haiti could also use the equivalent of Super-301. That is, they could threaten the United States to close off the Haitian market to American exporters unless the US stops this so it's really a free and equal world. A level playing field, I think is the technical name for it.

I could go on and review in brutal starkness what these things amount to. To the Third World generally, the post-Bretton Woods era has been pretty much a disaster. Some have escaped but mainly by also abandoning the “religion’, that is, not following the rules that are imposed by the rich but virtually never followed by them. In the US there's supposed to be, if you read the headlines, a tremendous economic boom. On the airplane I was reading the London Financial Times which was ecstatic about what they call the “radiant new economy” in the United States and if you read the headlines that might be what you think. There is supposed to be a “fairytale economy” in which Americans are supposed to prosper, during “the healthiest boom in American history” and on and on.

The facts of the matter are a little different. The economic boom is indeed unprecedented. It's the worst one in postwar American history, the slowest recovery from the low point of the business cycle in 1989. The growth in the 70s and 80s was far below the 50s and 60s and the current recovery is totally unprecedented in that it has left out the large majority of the population. So roughly 80% of households are working more hours just to try to stay where they were, they haven’t yet recovered the level of 1989, the low point of the business cycle, let alone the early 1970s when the new economy was introduced. But it is a fairytale for some, the top 1% of the population are doing magnificently. The top 10% are doing reasonably well. If you look at the next 10%, it turns out that during the fairytale economy their net worth has actually declined. Their debts have increased faster than their assets. If you go below that it, gets worse and worse the farther you go down.

So the fairytale is for some people, which happens to include the people who are writing fairytales about it and deluded foreignors who sometimes believe them. But the facts again are not controversial. Take a look at the economics journals and so on, you find that. The reasons for this fairytale are also quite frankly explained. The economic tsar in the United States is Alan Greenspan, Chair of the Federal Reserve, the Financial Times calls him “the saintly Mr Greenspan”, a highly admired figure. He testified before Congress at the Senate Banking Committee about the economic miracle of which he is very proud He attributed it to what he called “greater worker insecurity” which has led to significant wage restraint.

The Clinton sdministration in its economic reports to Congress agreed. It talked about salutary “changes in labour market institutions” which is an intricate way of saying the same thing. What it means is that workers are too intimidated to ask for raises, in part because of literally criminal attacks on unions. Criminal is not an exaggeration. It means in violation of laws authorised since the Reagan administration which have severely harmed unions. And in fact about 90% of American workers are insecure. And that's good for the health of the economy, any economist can explain that to you, just as a “flexible labour force” is good for the health of the economy. A flexible labour force means when you go to sleep at night you don’t know if you have a job tomorrow. That's healthy for the economy, it keeps profits up, it keeps inflation down, and in general yields the kind of fairytale that we’ve had. Threats of job transfer under the seriously mislabeled Free Trade Agreements are another device that contributes to the health of the economy. They’ve been studied, it's not reported, but they’ve been studied and they’re serious.

It's clear enough who's benefited from all of this, and clear enough who's suffered, namely the majority of the population in the richest country of the world and for peasants and slum dwellers in the poorest countries in the hemisphere it's indescribable. It's much less clear what to do to tame the destructive forces which have been unleashed and that's the problem that's causing lots of concern in high places. There are now calls for re-regulation of financial markets from pretty surprising places. The Bank for International Settlements in Basle which is the super-conservative institution, the central bank of central bankers, the World Bank which has now split from the IMF on this issue, a good part of the business press including the Financial Times, major investors and very prominent free trade economists are now condemning what they call “the Wall Street-Treasury complex” which is destroying the international economy by imposing policies that free financial markets, and that's a problem.

There are proposals that have been on the table for 20 years on how to tame this beast. They’ve never made it to the agenda because more powerful forces in world affairs liked the way things were going, not very surprisingly. Now they’re worried and they may work or they may not work.

It's helpful and I think enlightening to take a longer view of all this. We are living in the latest phase of a struggle that's been going on for centuries. It reached its first modern climax in the first modern democratic revolution in 17th century England. These were complicated events but one element in them was the conflict over the meaning of liberty. There was one strand of thought which happened to win out, which defined liberty as “the freedom to possess and acquire” property and understood the English common law to be a law of property protecting the landed gentry. Much of the population disagreed. They took the law of the gentry to be the enemy of liberty. Remember that this was right in the middle of the era of enclosures of common land, a period of harsh and often quite violent transformations of English society which over several centuries turned the rural population into a subdued working class lacking their traditional communal rights to land, forests, village solidarity, craft traditions. They were also without political rights until early in this century.

In 17th century England a large part of the population was strongly against this and in fact against both sides in the Civil War between King and Parliament. As is the case in most civil wars including the American revolution, much of the population were opposed to both sides. And we know what they thought because the printing press was available and there were popular pamphlets being circulated and so on. And they carried a strong message that the common people wanted to be represented by “countrymen like ourselves” who “know the people's sores”, not by lords and gentlemen who only oppress us.

Well, they lost but the struggle continued and it went on as the industrial system was imposed. People had to be taught discipline and obedience, their working lives were supposed to be worthless. The founders of modern economics gave a supposedly scientific grounding to all of this, not incidentally Adam Smith who was pre-capitalist and, in my opinion at least, anti-capitalist both in spirit and content, but Ricardo and Malthus and other early 18th century figures who said straight out that people had to be taught that they have no rights apart from what they could gain in the labour market. They have no right to live, essentially. If they can’t survive they could go to the workhouse prison or they could go to the new colonies that were being cleared of the native population A history that's well known here.

The classic study of this period is Karl Polanyi's book “The Great Transformation” which remains unsurpassed 50 years later, justly respected across the serious spectrum. He writes there that “mankind was forced into the paths of a utopian experiment”, namely subordination to market principles. “Never perhaps in all modern history has a more ruthless act of social reform been perpetrated”,” crushing multitudes of lives”. He says “almost immediately the self protection of modern society set in, factory laws and social legislation, and a political and industrial working class movement sprang into being to stave off the entirely new dangers of the market mechanism.” There was widespread despair and suffering that led to disorder and protest. In fact in the early 19th century the British army spent much of its time putting down riots. And after riots came something even more dangerous, namely organised social movements that began to challenge the principle that had raised accumulation of capital to the supreme, in fact only, human value, and quite ominously for their masters it also challenged their right to rule. That led to changes.

This was never even tried anywhere else but in England it was, thanks to Britain's overwhelmingly predominant position in the international economic system, a result of 150 years of protectionism, violence and extreme state intervention and so on. After 150 years the laissez faire experiment became possible, but the business classes quickly recognised it was going to destroy their own interests. As Polanyi puts it accurately, they recognised that the free market “could not exist for any length of time without annihilating the human and natural substance of society. It would have physically destroyed man and transformed his surroundings into a wilderness.” Well, laissez faire doctrine fell into further disrepute as the business classes recognised that they were going to need to rely on a powerful state and that markets would have to be administered somehow to prevent the disaster, preferably administered by themselves of course. So free market capitalism was essentially abandoned by the beginning of this century in favour of the system of administered markets of the corporate era.

Meanwhile popular struggle took new forms. Early in this century voting rights had to be granted to the general population and the elite reaction was similar in both of the leading parliamentary democracies. In England the Conservative Party warned that if they were going to maintain traditional rule the party would have to “ apply the lessons” of the highly successful propaganda campaigns of World War One. They had to apply those lessons to the “organisation of political warfare”, and that was done with considerable success. Wilsonian liberals in the United States drew the same conclusion in the same years, that includes intellectuals, prominent figures in the developing profession of political science and most significantly in the public relations industry. If you look at their literature it's very revealing. Business leaders understood very well that the industrial system was forcing people into meaningless lives and that they might revolt, seek to take control of their own lives and work and that had to be prevented somehow. And the way to prevent it was to extend the concept of liberty to the mass of the population in some limited form. The best way to do so, it was quickly understood, was to identify liberty with the liberty to consume, so people were supposed to perceive their needs in terms of consumption of goods rather than quality of life and work. So leaders in the advertising industry explained.

The idea that they might control their own lives and work, that had to go. It was necessary as business leaders put it, to “nullify the customs of the ages”, just as the enclosure movement had nullified the customs of the ages in earlier years, then the radical experiment of industrialisation and the even more radical experiment of laissez faire which was quickly terminated. Well, if you think about it, the neo-liberal programs of the last generation are just another phase in the same process and it will presumably have the same consequences. It's been going on for hundreds of years and it's not over.

It's quite understandable that concentrations of power should pursue those ends. It makes good sense. Uunderstanding can liberate people to design and follow very different paths, to overcome the injustice and the needless suffering that can deface contemporary civilisation, to defend “the substance of society”, to enrich it for themselves and for others and to show that human beings are something better than the ridiculous creatures that are crafted by contemporary ideology and the power that it serves.

QUESTIONS:

Questioner 1:

Do you think it was appropriate for Jean Lacouture to apologise in 1978 for having once disbelieved the reports indicating genocide by the Khmer Rouge. The same reports you once disbelieved, and for having once believed, like you, that the Khmer Rouge could in your words, play a constructive role in Cambodia/

NC:

Not my words.

Questioner 1:

I’m from the Noam Go Home committee by the way.

Noam Chomsky:

Yup. First of all those are not my words. You’re quoting from a review that Edward Herman and I wrote of several books on Cambodia and one of them, which was written in 1976 after a few months in which the Khmer Rouge had been in power, described them as playing a constructive role and we referred to that, just as we referred to what was reported in the other books.

As to Jean Lacouture, it's not true that he apologised for not believing the claims of Khmer Rouge genocide. In fact he's the one who initiated them. In a very widely publicised review in February 1977 in the New York Review of Books he reviewed a good serious French book by Francois Ponchaud, a priest who’d been in Cambodia. He reveiwed that, or he allegedly reviewed it, and in the review he claimed, now this is early 1977, after well over a year of Khmer Rouge being in power, he claimed that they had boasted about murdering 2 million people. That was the claim that was then widely circulated. A couple weeks later he wrote in the same journal that all of this was fabrication and he withdrew all those claims. In fact they were not only fabrication but outlandish fabrication.

So his claim of the Khmer Rouge boasting of killing 2 million people—it turned out was based on the following intriguing calculation. He claimed that Ponchaud had claimed that 800,000 people were killed in the American war, the first phase of the atrocities in Cambodia, and that the American Embassy had said that 1.2 million people had died, not been killed, but died since the Khmer Rouge take over. If you add the numbers allegedly killed by the US bombing and the numbers that the US Embassy had claimed had died since, you get 2 million killed and then you add the boast. He conceded that that was all fabrication, as was every single reference to Ponchaud's book that he made in the review. It gets worse if you look more closely. The figure of 800,000 killed in the American war was a vast exaggeration which we pointed out in that review incidentally. We pointed out, referring to the one book that had documentation: Hildebrand and Porter, that the charges—

Questioner 1: ( interrups)

Noam Chomsky:

I said that Jean Lacouture said that killings were perhaps in the thousands, after first claiming—totally falsely_ I referred to a series of sources that claimed that. And we, Herman and I, ended up by saying we can not pretend to know where the truth lies between these radically different assessments. You don’t have to refer to that review, we then published two volumes a year later with extensive documentation. I urge you to look closely at this to compare the reaction to the atrocities of others with atrocities of ours. We compared them in close detail in that case. Have a look.

Questioner 2:

A hypothetical question. If you were the American President, what are the three most important things you would try to do.

Noam Chomsky:

I have a standard answer to that. If I were the American President the first thing I would do is convene a war crimes tribunal to try me for the very likely war crimes that I’m going to commit because that's inherent in the office. It's not that every person is by nature a war criminal, it's kind of an institutional fact that if you run the biggest power system in the world in the interests of the distribution of domestic power, you’re going to commit crimes. It's hard to avoid that.

Assuming that the President of the United States was in a position to modify policy (which is senseless because policy flows from real power centers, the President's a figurehead who implements them). If the President was in a position to implement the kind of policies I’d like to see, that would be the result of a social revolution which had completely changed the distribution of power inside the country and had opened the path to new policy directions. So it doesn’t really make sense to ask what the President would do as if the President were an independent agent. The President is not an independent agent, neither in the United States nor any other place, nor is a king nor anyone else.

There is some distribution of power in the country, you’ve got to figure out what it is and policy flows from it. This is as old as history. If you want you can read it in Adam Smith who pointed out accurately that the, in his words (he's talking about England in the late 18th century), that the principal architects of policy are the merchants and manufacturers of England and they use state power to ensure that their own interests are properly attended to, however grievous the impact on others including the people of England. That was accurate. It's not a very deep comment, a truism about history and it remains a truism about history.

So what we should ask is who's pulling the levers? To the extent that a population can change the way things are working, you can get a President who follows certain policies but not in isolation from big social change.

Questioner 3:

Do you see that the changes that have been going on in New Zealand with asset sales and the movement towards right wing doctrines, the freeing up of the investment markets and so forth as being just a typical example of American elites exercising their power?

Noam Chomsky:

Well what's happened in New Zealand is quite unusual. In fact it's one of the very rare cases in history that I know of where what are called neo-liberal policies have been voluntarily adopted, not rammed down people's throats. In Haiti they were rammed down the throats of the population by three years of vicious and brutal terror and then removal of the terror on condition that the population accept the policies of the defeated candidate in the 1990 election, the US candidate. They were forced to accept those policies at the end of a whip. New Zealand has taken them up themselves.

There is a couple of centuries of history indicating where those policies typically lead. I should make it clear, it's not obvious, that nobody ever understands very much about these things. The international economy is not well understood, in fact big molecules aren’t all that well understood. When you get to really complicated things like human affairs there's a lot of guesswork. But there is also a lot of history that you can look at. So for example you can look at what's called neo-liberal, (that's an extremely bad term—it's not new for one thing, it's centuries old and it's certainly not liberal), the neoliberal policies, the rich never accepted them except for a very brief moment in England The wealthy and the privileged have always insisted on sheltering under the wings of the nanny state. I mentioned the Reaganites who happened to be extreme in this case, but it's standard.

What are called neo-liberal policies are the policies that have been forced down the throats of the Third World. If you go back to the 18th century, the difference between what's now called the First World and the Third World were not very extreme. In fact to some extent they were back in the other direction. So the major commercial industrial and commercial center in the world in the 18th century was actually India, or perhaps China—I don’t have detailed figures, but the center of commerce, interchange and so on was Asia, it was India and China.

England could not compete with Indian exports and it got over that problem by instituting extremely high tariffs to protect British manufacturers from competition and forcing free market principles on India by violence. That was already described by Adam Smith very accurately. He discussed the savage injustice of the Europeans' who were destroying Bengal, which was then one of hte richest places in the world, by imposing on them what amount to market principles while protecting themselves, and that continued. It's the same with Haiti. Some of the richest parts of the world in say the 18th century were Bengal and Haiti and Bengal is now Bangladesh. Have a look at them and you see a dramatic indication of what these policies lead to.

There's a controversial recent doctoral dissertation at Havard in economic history by an Indian scholar who has argued rather convincingly that Indian wages and working conditions were better than England's in the 18th century. It wasn’t a matter of cheap labour (this is by no means certain, but looks plausible). There is no question that India was a major economy, producing more iron than all of Europe, for example, in the 18th century. And as late as around 1820 English technicians were going to India to learn how to make sophisticated steel products. When the railway boom took off later in the century Bombay was producing locomotives competitively with England but England wouldn’t have any of that. They had the force and they stopped them. India become a de-industrialised agricultural economy while England flourished. Well that's one example. The same with France and Haiti. A good part of France's wealth comes from Haiti, the same with Holland and the East Indies. A very substantial part of Holland's wealth came from what is now Indonesia.

One major factor, you can argue how important it was, it looks like a major factor, was the radical violations of market principles by the rich and the imposition of market principles on what are now the poor. Well maybe the New Zealand experiment will radically break with history but I wouldn’t bet money on it.

Questioner 4:

I’m interested in what you were saying about capital flight because I think that's often used by right wing governments, well at least New Zealand, to justify lowering taxes particularly among the richest people in society. They’re at the top of companies like Telecom and often it seems that the justification for lowering taxes and therefore what's going into the welfare state or health system is because if we don’t make it easy on these rich organisations, they’ll pull out of New Zealand, they’ll deinvest and therefore New Zealand will suffer. What do you think?

Noam Chomsky:

That's exactly what I was describing. That's what is called in international economics a virtual senate.If there are no capital controls, if capital flows free, in other words if you violate the fundamental principles of Bretton Woods as has been done since the 1970s, you get just what you’re been describing, a virtual senate of financial capital that can determine government policy and undercut steps to sustain employment, or stimulate the economy or develop a welfare state simply by the threat of capital flight. Yes, that's exactly why Keynes and White, the British and Americans, established the Bretton Woods system on the basis of regulation of capital flow, precisely for that reason. And it lasted through the period of rapid growth from round 1970. Since then it's been dismantled with the, I think consequences, uncontroversially associated phenomena that I described and it's just what you say.

Now you know one small country can’t reinstitute capital controls. Malaysia is trying but it's not going to work. These have to be cooperative. It's well understood that capital controls only work if they’re imposed at both ends. If some major power decides to break out of the system, it erodes, which is what happened in the early 70s. But only if it's cooperative it can work just the way it did from 1950 to the 1970s.

Incidentally, there are perfectly well-known proposals by major economists, Nobel Prize-winning economists right in the manstream as to how to temper this monstrosity. Maybe the most famous is what's called the Tobin tax, proposed by James Tobin, a Nobel Prize winner back in the mid-70s.

It was pretty clear what was going to happen as a result of the deregulation of capital as he predicted in a well known article in the mid-70s. This was going to lead to a low wage, low growth, international economy. And he suggested a simple, market-style proposal, namely a small tax on short-term capital flow. So in other words if you’re going to have investment for three hours or a week, something which is destructive to the economy, then pay a tax on it. It's called the Tobin tax. The idea was to, as he put it, throw some sand in the gears of speculative capital. Of course it can work if it's cooperative.

There's controversy and discussion about this. As I said, nobody really understands the international economy or for that matter the domestic economy and honest economists admit it, in fact make big statements about it. It's plausible. If you’re interested in it there's a book called The Tobin Tax with contributions by major international economists that was published about two years ago. It was going to be distributed by the UN Development Program but the Clinton administration intervened to prevent them from distributing it. But if you look at the list of authors it's the most prestigious and well known international economists. There is some debate about whether it's going to work but it's generally supported.

And there are other suggestions too. Some of them in fact are in existence. Chile for example, which is called a free market economy but that's just nonsense. They had a free market experiment like New Zealand in the 1970s and it ended in total collapse. The worst economic disaster in Chile's history. In about 1982 there had to be a complete bailout of the private economy by the government (which owned more of the economy than it had under Allende) and since then they moved on to a kind of a mixed economy. But one element of it which probably prevented them from being totally wiped out by the recent crises is that they do impose a tax on short term investment. So if you want to invest in Chile you don’t pull out any profits for, I think, a year or something like that, which is a way of penalising short term investment which is harmful.

And there are other proposals around. Maybe they’d work, maybe they wouldn’t but they haven’t been tried because the rich and the powerful are delighted with they way things have been working. They want to see the welfare state disappear, they want to see themselves enriched, they’d love to see tax rates go down so the poor people pay most of the taxes, and of course they want to shelter under the wings of the nanny state like I said. They are the greatest believers in state power and protection. During all this period, the last 15 or 20 years when, for example, in New Zealand, people talk about minimising the state, it's exactly the opposite of what's been happening in the rich countries. If you want to find out the details, take a look at the World Bank Development report in 1997 which is basically calling for an end to the Washington consensus, and they give figures on the growth of the state relative to GNP during this period. And in the rich countries and the OECD countries it's gone up. Thacherite England stayed flat, the United States went up, but on average it went up in the OECD countries and way down in places like Latin America and sub-Saharan Africa.

Questioner 4:

Why was that, why despite being anti-bureaucracy, why did governments involve themselves in this?

Noam Chomsky:

Just ask yourself who's gaining from it. There are people are being very much enriched so the US economy is indeed a fairytale for a few percent of the population who are delighted to have it continue.

Questioner 5:

I just want to know, in this, as you describe it, this terminal phase when the global garbage can is just about full—if our ancestors ie the English Civil War couldn’t beat the top echelon and now the new corporate elites have got such advanced mechanisms for isolation and it's underlined by the profits. Now, what can we do?

Noam Chomsky:

First of all it's not true that our ancestors, well it's true that they didn’t win, but they didn’t lose either. If you look over the course of the last couple of centuries, they won more and more victories. So the world is a much freer, more democratic, more egalitarian place than it was a couple of centuries ago. In fact 50 years ago in many ways. So there is sort of slow steady progress over time, a lot of regression (it's cyclic), but certainly generally upwards.

Just look at the number of hours it took to keep yourself alive a hundred years ago as compared to today. Or take say voting rights. Until early in this century there were no voting rights for most of the population. Half the population in the United States was disenfranchised until 1924 - women. And blacks had no effective voting rights until the 1960s. Things like a health service and a pension system, they didn’t exist until very recently. Now people are struggling to defend them. You didn’t have to defend them half a century ago because they didn’t exist in most countries, certainly not in the United States, and over time there are slow victories and there's no reason why that can’t continue and why it can’t accelerate.

There is also regression. Go back to the mid-19th century in the United States for example. Factory workers in Eastern Massachusetts, who never heard of any radical intellectual—they regarded wage labour as virtually the same as slavery. Wage slavery, which is what they called it, was not very different from chattel slavery and that was not an exotic opinion. That was actually the slogan of the Republican party. That was Abraham Lincoln's position. In fact you can even read it in editorials of the New York Times, believe it or not. It was taken for granted that in a decent society people don’t have to rent themselves to others. It took a lot of work to drive that out of people's heads and it's not going to take much work to get it right back in where it belongs and that has lots of consequences. There's no limit to the changes that can be introduced. Those are questions of human will, we don’t know how far it can go. But the general tendency is surely more progressive in just about every respect.

Questioner 6:

Could you comment really briefly on the situation in Yugoslavia at the moment. That seemed like the next hot spot and now it's all off. I’m wondering how that fits into the world order. I thought all wars improved an economy and that sort of thing.

Noam Chomsky:

The Balkans have long been a horror chamber, if you think about more generally. Under the Tito years ethnic conflicts were dampened in a dicatorship, but they were still simmering and when the dictatorship collapsed the ethnic conflicts came forth in quite ugly ways. The West had plenty to do with this like the premature recognition of Croatia was a major contributor to the destruction, so were the neo-liberal programs of the 1980s which devastated the Yugoslavian economy.

There are a lot of things that happened but speaking quite generally - there's a kind of a myth going around that since the end of the Cold War, intercommunal and ethnic violence and conflicts had increased, as if we’re in some kind of a strange new era. This is not true. What happened is that an empire collapsed, the Soviet empire, it happened that Yugoslavia was a dissident part of it but was basically part of a similar system. When those imperial systems collapsed ethnic and communal conflicts developed but that's standard.

Have a look at what happened when the British Empire collapsed. In India alone probably 10 million people were killed in the next couple of years. That alone makes the end of the Soviet empire look pretty tame. In the former Palestine the conflicts are still going on and the same is true of the rest of the former British empire.

When the French empire collapsed, exactly the same thing, still going on, take a look at Algeria. The most recent empire to collapse was a small one, the Portuguese empire. That led to huge disasters, much worse than anything in the former Soviet empire. And it was simultaneous in Southeast Asia and Africa. What happened in East Timor, if anything deserves the term genocide. That's on the Western account so we don’t talk about it much. There the agent of the atrocities happened to be Indonesia.

The same thing happened in Africa at the same time. In Mozambique and Angola, there the agent was South Africa backed by the United States and Britain and in both cases it was devastating. In the areas around South Africa the result of South African aggression and atrocities backed by the United States and England, during the 1980s alone is estimated by the UN at about a million and a half people killed and over $60 billion in damage. Quite comparable to the Southeast Asian part of the Portuguese empire and in fact very similar.

People tend to look at these things in isolation but you should really look at the pattern. Same thing happened in both Africa and Asia and it's the standard phenomenon after the breakdown of empire, so it's happening after the breakdown of the Soviet empire, on a smaller scale incidentally. It's ugly, very ugly but it's not unusual. During the period of the worst atrocities in Bosnia there were worse atrocities going on in Angola so the bombing of Sarajevo was a horror story but the bombing of Cuito was no less of a horror story, was probably worse. That wasn’t discussed. For one thing it was kind of uncomfortable. The one who was carrying out the atrocities was not a bad guy, not Milosevic or a communist, it was our man, the man who’d been hailed as a freedom fighter, Jonas Savimbi, and he was getting huge American aid. He was the one primarily responsible for the atrocities so that wasn’t a story. But there are lots of ugly things going on around the world.

Let's take for example Rwanda and Burundi. That's a really horrible story but it's not new. There were huge massacres right there in the early 1970s. Herman and I discussed them in our book in 1979. They weren’t being reported becasue they weren’t of any interest to anyone. This is the former Belgian and French empires collapsing. Monstrous atrocities and they’re still going on with again plenty of Western input. Each of these cases has to really be investigated on its own but these are standard concomitants of the collapse of imperial systems.

Questioner 7:

Professor Chomsky, my name is Ian Prior. I am a public health physician and have been involved with IPPNW, or the International Physicians for the Prevention of Nuclear War since 1972 both here in New Zealand and internationally. Three years ago here we established Abolition 2000 and that's becoming an important move towards nuclear disarmament. I’m going to direct my quite short questions to you on that area.

Firstly I would like to congratulate you not only on your extraordinary, eloquence and easy understanding of what you’ve been telling us but also that you’ve established a record here in New Zealand that Helen Caldecott did in 1982 when the Wellington Town Hall was overfull inside, the concert chamber next door was full. So tonight you’ve got this theatre full, you’ve got the Paramount theatre full and we believe 300 couldn’t come in.

My questions are simple, more or less. We’ve been following all sorts of interesting things in the US for some time, some related to Clinton and that lady he got involved with, but also we’ve been very concerned about Newt Gingrich, the Republican House leader who's just resigned. Do you think the new man, Livingston, do you think he has sufficient leadership or could be encouraged to bring together younger leaders and ask themselves why America has not yet paid its UN dues of $2.5 billion, why Senator Jesse Helms, the 80-plus year old chairman of that committee is still there, and the man who's chairman of the Defence Committee is over 90 and he's also still there. When they’re asked about it they’ve said “ but you can’t move them”. I think New Zealanders could manage to move blockheads like that.

Noam Chomsky:

Well there's a technical reason about why you can’t remove them. There are bureaucratic rules about who chairs a committee. It's the person with the longest tenure with whatever political party happens to have a majority. So if it's Strom Thormond who I think is 94 or something…

Questioner 7:

Surely that can be changed?

Noam Chomsky:

Well it can be changed. But it can be changed only by—well the same way Gingrich got changed. He was essentially forced out, he didn’t resign because he felt like resigning, he was forced out by powerful interests. Gingrich, you have to remember, has been one of the most unpopular figures in American politics for years. There is a lot of fraud about this. The 1994 election is widely described, I don’t read the New Zealand press but probably here too, as a landslide victory for Gingrich conservatism and so on. That is totally false.

The Republicans won in 1994 with 20% of the electorate. For contested seats that was about a 2% change from 1992 when the Democrats won. Exit polls made it very clear that it was a vote against the incumbents because of the continuing recession, which incidentally still continues for most of the population. So there's a very powerful vote against, there is virtually no vote for and that changes in very limited ways from election to election.

The current election, I saw the figures just before I left, it's the lowest participation rate in American history actually and it keeps going down because most people think the whole thing is a ridiculous joke. In fact about 80% of the population, (there's regular polls in the US on everything and you know pretty well what public opinion is) when asked on an open question “what's the government for?” over 80% say it works for the few and the special interests, not the people. What people mean by special interests, who knows, but for the few and special interests, not the people, that's over 80%. It used to run at a steady 50%. It started going up in the Reagan years. And it's just one indication of many that the American public does not regard the political system as reflecting any of its own interests. That's why people don’t vote.

Gingrich was kicked out because he didn’t serve private power. He's been extremely unpopular among the really powerful corporate executives because he scares them, he's a kind of a loose cannon, he doesn’t only support their interests. On the other hand he very definitely generally supports their interests. So Gingrich has always been in favour of big government. He wasn’t doing his job properly—he was replaced. But replacing one name by another name doesn’t really mean a lot uUnless these changes substantially reflect changes in the whole social system and involvement of the population and so on they’re just ways of…

Questioner 7:

But aren’t you trying to do that in your way?

Noam Chomsky: Well I think that's just the fluff at the edge of the system. It doesn’t matter what the name is. For example if there was pressure for the US to pay its UN dues, it wouldn’t matter to Jesse Helms as the Head of the Foreign Relations Committee.

Questioner 7:

What about political will in the US for the elimination of nuclear weapons? Why is it not moving when 80% of the population on polls say they would be quite happy to do without nuclear weapons?

Noam Chomsky:

Well for the same reason that public opinion and policy are sharply divorced on issue after issue all the way down the line. The Nuclear Non-Proliferation Treaty obligates the nuclear powers to make serious moves towards eliminating nuclear weapons. Of course they refused and they’ll continue to refuse unless the population forces them.

Questioner 7:

I would like to close by offering you and your wife, a small koha, which is a gift, one of which includes some documentation produced by IPPNW

Noam Chomsky:

It's an organisation I know very well, including a close friend who is also my cardiologist.

Questioner 7:

Here's a document here called the “Abolition of Nuclear Weapons—a New Zealand perspective”.

Noam Chomsky: It's a good movement. I’m all in favour of it.

Questioner 7:

Finally, you may not be aware that sunflowers have become an icon of the anti-nuclear movement. On behalf of all the peace movement in New Zealand, I would like to present these to you and your wife. And also this poster which has been produced by one of our best printmakers for Abolition 2000 because the mountains represented here are Hikurangi on the East Coast where the sun will, almost first, come up on the year 2000.

Noam Chomsky:

I should just add approbation. The role that New Zealand has played in the anti-nuclear movement is really something you ought to be proud of. It's been really significant. Thanks.