The real score

By Renato Constantino, Manila Bulletin 3 May 1998

It is now fairly easy to recognise globalisation for what it really is. It is the rule of the Bretton Woods Twins and the WTO which regulate and intervene in the affairs of the South. It is the means by which the South will not be allowed to threaten the gains of the North under colonialism and neocolonialism.

In the romantic view of neo-classical economists who swear by the virtues of the ‘free market’, globalisation is perhaps the best thing that ever happened on this planet. According to their abstract models which are conveniently devoid of real people, the end result of globalisation - efficiently produced goods made widely available at the cheapest price—is worth more than its momentary pain. Eventually, globalisation will even out the playing field with the most efficient ‘world-class' producers winning the game, to the ultimate benefit of consumers.

Anyone who has experienced real life knows that this romantic notion exists only in the heads of economists in love with their own flawless projections. The shaky peso, high interest rates, increasing inflation, massive layoffs, and near starvation in some areas of the country have constituted a rude awakening even for those who wanted to give the prophets of boom the benefit of the doubt.

It is back to reality, and it is obvious that there are huge holes in the sails of the ship Philippines 2000 as it navigates the treacherous seas of ‘global competitiveness'. The fact is that the odds are stacked against countries like ours in a highly uneven playing field designed to make winners win even more.

And because of the mounting losses suffered by the losers which happen to be the usual ones—the former colonies located in Asia, Africa, Latin America, Caribbean and the Pacific—it is now fairly easy to recognise globalisation for what it really is.

It is the rule of the Bretton Woods Twins and the WTO which regulate and intervene in the affairs of the South. It is the means by which the South will not be allowed to threaten the gains of the North under colonialism and neocolonialism. Rules and regulations for countries of the South need not apply to countries of the North which flout the rules that they want others to follow.

For example, protectionism is a no-no practised by Southern governments. But when the United States arbitrarily imposes restrictions on the entry of specific goods from particular countries, or when European states continue to heavily subsidise their agricultural products in order to dump them in Southern markets, these are perfectly all right.

Transnational corporations based in the North, notorious for their unfair trading practices and other misdemeanors, cannot be reined in by a code of conduct. Efforts to come up with such a code have recently been aborted.

Far from ensuring free trade, globalisation in reality provides a framework for intervention by the strong in the affairs of the weak. The United States as the lone superpower has become the guarantor of ‘order’. It has mandated itself to interpret events and policies in the light of its own interests. It has assumed the task of policing the world by projecting its military power. This is the privilege of the hegemony.

As leader and protector of international capital, the United States tries to be a supranational state that can define the relations between the South and the advanced countries of the North. The chief concern is that there be no threat to the dominance of international capital. What is important is the institutionalisation of formal and informal structures that predetermine decision-making of the developing country so that they are consistently favourable to the collective interests of the superpower and its allies.

This is quite obvious in the ways that the East Asian financial crisis is playing itself out. The IMF is playing God, virtually dictating the way the most seriously affected countries will be run. And the chief of state of the lone superpower through a phone call makes it plain to those affected that they have no other choice but to obey.