People's Democracy

(Weekly Organ of the Communist Party of India (Marxist)


No. 05

February 01, 2004

Globalisation Causes Social Insecurity


From N S Arjun At WSF, Mumbai


ECONOMIC policy making should be taken out of the vicious grip of bureaucrat/technocrats and brought into the centre of political process, said the Nobel laureate economist Joseph Stiglitz. He said globalisation has inflicted rising insecurity for the people of the third world.


Stiglitz was participating in a seminar at the ongoing WSF meetings at Mumbai on Monday. This WSF organised seminar, titled “Globalisation: Economic and Social Security”, had as other speakers eminent Marxist thinkers, Prabhat Patnaik of JNU and Samir Amin of Egypt, Antonio Tujan of Philippines, noted human rights activist from South Africa Trevor Ngwane and others. The seminar was chaired by B L Mungekar, Vice Chancellor of Mumbai University. Jayati Ghosh of JNU moderated the discussion.


Professor Stiglitz, who had resigned from from his post as Chief Advisor to the World Bank after disagreeing over the conditionalities the Bank imposes on other countries, was sharp in his critique of the Bank policies. He castigated the IMF-WB-WTO for prescribing privatisation of social security to nations and felt this would eliminate what little security that is left of for the poor and unemployed people of the world. “During the East Asian crisis, the Bank, due to ideological reasons, overlooked evidence that capital market liberalisation would lead to greater instability. The mindset of the IMF-WB is trapped in models which have failed. There is a need for these institutions to change their rhetoric,” said Stiglitz.


Saying that one of the most important aspects of poverty is the sense of insecurity, Stiglitz warned of the dangers of leaving people’s lives to the vagaries of stock markets. The widespread unemployment in the world was leading to greater social insecurity, he said.


Stiglitz revealed how during his stint as advisor to the Clinton regime, the then US government had bitterly opposed the Republicans demands for privatisation of social security. However, at the same time the IMF-WB were pressurising other countries to privatise their social security systems. “It was very disturbing”, he said.


Stiglitz said that in the so-called development rounds of the WTO, the issue of job-creation should be on the agenda instead of measures to push privatisation and liberalisation of economies or the measures to push capital market liberalisation.


Professor Prabhat Patnaik in his presentation was categorical that unless the capitalist-imperialist system is overthrown the fundamental inequalities would remain. “In a world of unequal distribution of power, there is a need to change the configuration of power relations”, he said. He also disagreed with those who argue that a fairer globalisation process is possible, saying this was linked to class relations. Patnaik stressed the importance of being clear about what is globalisation. He said the process of globalisation was pushed forward due to the emergence of globally mobile finance capital, which was promoting a policy of deflation. He warned about the miconceptions regarding this process. He further remarked it is often propagated that globalisation entails retreat of State from economic arena and substitution by market. In actuality, the State is taken on a different kind of interventionist role, whereby it sells national PSUs to private parties at throwaway prices, guarantees returns to MNCs etc.


Professor Patnaik highlighted how the food security of Indian population has been undermined through significant curtailment in public expenditure by the government ever since India began to integrate with the world economy as part of globalisation. “The irony of the situation was that despite holding large quantities of food stocks in its granaries, the government was not putting purchasing power for the people saying it would increase fiscal deficit”, said Professor Patnaik.

Professor Samir Amin of Egypt said that a better world is possible only by defeating the US project of acquiring total control over the planet. He said the slogan “US Go Home” must be taken up in the entire world beginning from the Indian subcontinent of Diego Garcia, where the US has a large military presence. He said that while people are seeking a better world, the US wants an uglier world. He wanted clear political awareness must be spread through out the world for defeating the US aims.


Professor Amin said one has to question the logic of the capitalist system that is generating so much poverty in the world. He said if capitalism expands further there would be more destruction and more genocides in the world. He warned that unless people are rid of the illusions being spread by ruling classes that market will benefit them, it will not be possible to realise a better world.


Professor Amin termed the assault on agriculture as genocide and said that it is totally unacceptable that agriculture, food and land should be commodified, as being prescribed by the globalisation forces.


A Coca Cola factory worker from Columbia, and a worker from Mexico gave testimonies on how globalisation was effecting them on the ground.