Stiglitz' loose talk again

hoov hoov at
Fri Jul 3 19:17:36 PDT 1998

Brad De Long:
> A while ago you told a story about the Manley government in Jamaica
> negotiating with the IMF for a structural adjustment loan. If that loan
> didn't "help", why did they negotiate for it? Why not simply spurn all
> connections with the IMF if all it does is help foreign creditors and
> industrialists?

in the years between 1973-76, Michael Manley and the People's National Party (PNP) sought new diplomatic relations, moved towards international non-alignment, called for a new international economic order, implemented redistribution policies, and began to assert national control over the economy...

foreign investment declined $200 million, bauxite production declined 36% with a reduction of $54 million in revenue, and a US sponsored boycott of the tourism industry resulted in a 50% loss of the nation's leading source of foreign exchange...

the PNP left, which advocated greater self-reliance through reduction of imports and increased collective/cooperative Third World activity, supported seizures of property, wildcat strikes, and other direct action methods...the center (of which Manley was a part) and the right- wing of the party held the left responsible for worsening economic conditions and began to isolate and ostracize it...

the PNP's opposition to the IMF weakened alongside the purging of the party's left-wing while the center and right increasingly favored negotiations with the IMF to address the deteriorating balance-of- payments situation...36 reform programs were introduced during Manley's first term, only three were allowed during his second term under the terms of 2 IMF agreements...the PNP was forced to oversee a reduction in the standard of living of its strongest supporters - the poor - in exchange for internationa loans...this weakened the government's ability to govern and crippled efforts to organize support for itself around a mass line...

I spoke with Michael Manley in the early 1980s and he was forthright in stating that he was a class collaborationist and a constitutionalist. ..Michael Hoover

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