the Problems of Globalization

How to Solve the Problems of Globalization
Joseph Stiglitz and Evo Morales offer differing views

Ronda Hauben

As part of its 2006 World Leader's Forum, Columbia University hosted two programs which demonstrate that there are two significant but opposing models for economic development. One was with Columbia Professor Joseph Stiglitz, and the other with the President of Bolivia, Evo Morales.

The first program, held on Tuesday, Sept. 19, was a talk by Stiglitz about his new book, Making Globalization Work. Stiglitz is an economics and business professor at Columbia, who shared the 2001 Nobel Prize in Economics. In his talk about his new book, he describes how globalization is what he calls "market fundamentalism." This is a way of referring to the belief of the proponents of globalization that if left unimpeded, the market will solve all economic problems.

Stiglitz acknowledges that globalization is currently not working. That countries and regions of the world are becoming poorer, rather than benefiting from the removal of regulations and the lowering of corporate taxation that make up key elements of the program of globalization. Stiglitz does not see the problem, however, as a flaw in the globalization itself, but only in how it is being implemented. He proposes that the winners have not yet found a way that is "fair" to carry out their program.

Stiglitz blames the problems he outlines on the fact that the political program has lagged behind the economic. In his talk he briefly proposed some changes in policy. He warned that unless there are changes, those benefiting from globalization will see increased opposition.

Three other panelists supplemented the program, praising Stiglitz's book and giving their views on globalization. One of the panelists was George Soros.

Soros, a financier, pointed out that Stiglitz had failed to consider the impact of globalization on workers. While capital moves to where there is little or no taxation or regulation, workers have no comparable opportunity to move to, for example, a nation or region where there is strict regulation enforcing good labor conditions. Soros blamed the political leaders for allowing the abuse of workers in their countries. He failed to mention, however, that international agreements which promote the economic policies of globalization strip national entities of their ability to provide local protection.

What Stiglitz and the others who spoke at the forum promoting his book failed to acknowledge, is that the economic policies being carried out in the name of globalization empower large corporations which already have much wealth and power. These are entities which do not recognize any social obligation. The very restrictions and political obligations that the corporations seek to have removed are often the institutional processes that were created to contain their unbridled political and economic power.

Little time was available for questions from the audience. Instead extended responses from several of the panelists to a few questions used up the time that was supposed to be available for a substantial question and answer period.

No critic of globalization had been invited to be part of the program. Only those who agreed with Stiglitz's contention that minor reforms would solve the problems he outlined were invited to be part of the program discussing his book.

Oh Thursday, Sept. 21, Evo Morales gave a talk at Columbia. When Morales entered the auditorium, many people who were in the audience stood and applauded. He began his talk by thanking the audience for their warm reception. He explained how in his career as a union official in Bolivia, he had been the target of criticism from U.S. government officials. The U.S. embassy even tried to persuade Bolivians not to vote for Morales. He had not expected to find support from the American people. He explained that the warm greeting he was accorded filled him with great emotion. "I thank you very much for this reception," he told his audience.

In his talk, he described a model which provides a striking contrast to the one proposed by Stiglitz. Morales outlined how prior to his winning the presidency of Bolivia, a small minority of the population controlled the wealth and resources in his country. Bolivia is a small country, still it was listed as one of the most corrupt countries in an international survey. This corruption, he pointed out, was at the top of the power structure. Convened after Morales' election, a constituent assembly is drafting a new constitution. The vast majority of people, he explained, were excluded from having any say in the earlier constitution created for Bolivia.

Morales outlined the social program being carried out to improve the lives of the Bolivian people. An example he gave was that students have been given support to go voluntarily to poorer areas in Bolivia to provide education in literacy for the population. He explained how one third of the people didn't have legal papers and so couldn't vote or participate in other ways within Bolivian society. He was working to remedy this situation. Also 33,000 people had been able to have eye operations which would have previously cost $1000 each. Though there had been a question about whether to limit access to these free medical procedures to the poor, a decision was made to make the operations available to anyone who needed one. Morales stressed that the indigenous culture is not one that excludes anyone but is one which is inclusive, welcoming all to participate in an equal way.

A serious problem Morales discussed was the problem of cutting back the coca production in Bolivia. Another South American country, Columbia, spent billions of dollars trying to force restrictions on how much coca was produced without success. Morales argued that any successful program would have to be voluntary. Also, he defended the legal use of the coca plant, as a food and for chewing. The illegal use of the plant, to produce cocaine, however, is actively opposed.

The model of society that Morales outlined is a social model, with active programs by the government to improve the economic and political conditions of the Bolivian people. Attention is paid to remedy the harm suffered by large segments of the population in the past because of their exclusion from the benefits of the society.

Morales has also carried out some land reform, handing out state-owned land to agricultural workers. Some 2,300 new land titles were distributed, making a total of 9,600 square miles of land distributed as part of the land reform. Also, 50 tractors have been distributed to impoverished peasants. Morales' plan to redistribute privately held land which is not being used, which was acquired by illegal means, or which is used for speculation, has not yet been approved by the Bolivian Senate.

After he was elected President, Morales nationalized the Bolivian oil and gas reserves, explaining to the companies developing them that they would be guaranteed a profit, but not a windfall. Morales welcomed them as partners but not as bosses of his country. The money earned from these activities, he explained, has been put toward increasing social programs for the Bolivian people.

Morales is the first indigenous president in Bolivia. He estimates that the composition of the Bolivian population is 80 percent, whether they acknowledge it or not, indigenous people. In Bolivia, Morales argues, the neoliberal model does not work. An economic and political program with a social purpose is needed to address the hundreds of years of harm most people in Bolivia have suffered all the time that the wealth and resources of the countries has been in the hands of a small sector of the population who were only interested in their own self-enrichment.

Stiglitz would do well to recognize that the globalization model has a deep internal contradiction. This neoliberal model is one where powerful and wealthy interests are able to extend their wealth and power. Stiglitz's solution to the flaws of globalization is that these very interests voluntarily agree to put in place new restrictions on their increasingly unbridled power. This is fundamentally in opposition to the very program of globalization, which has been to remove all restriction on their wealth and power. The Bolivian model is an alternative model. It recognizes the need for an economic and political program to not only stop the current abuse, but also to address the impoverishment and corruption of hundreds of years.

OHMYNEWS
KOREA