New approach to debt called for

Chris Burford cburford at gn.apc.org
Fri Sep 3 00:43:22 PDT 1999


At 21:02 02/09/99 -0500, you wrote:

Christian

I found it hard to understand where you are coming from so I checked previous posts. Possibly this is a continuation of our exchanges over Kosovo, but the difference between us at the moment appears to me that you come from a position of militant cynicism and I come from a position of militant reformism.

Clearly you yourself will not be in the vanguard of any campaign to weaken and defeat the neo-liberal policies of the Bretton Woods agencies. The issue will not be decided by pseudo-logical argument between us, which seems to me to rely on debating maneouvres rather than to get to the bottom of the process of the uneven accumulation of capital in the world and what can be done about it. Calling for periodic charitable annulment of debt, or instantaneous world revolution, is not an answer in my opinion. And you have given no answer at all.

But to the extent that our exchanges illuminate the fundamentals I would reply as follows:


>You can doubt the category of total FDI inflows all you want, but the IMF
>published those numbers, and they, evidently, still believe in the category.

The point is not that I doubt the category of FDI inflows, which deliberately suggests I am silly. I doubt the relevance of you quoting it in this context. You did in fact rapidly concede that a sum of money of the order of $200 billion dollars a year could in fact compensate for the tendency for capital to drain out of Africa much more strongly than it flows in.


>I don't understand what the capitalist state has to do with this.

That is because of your mechanical and superficial approach to the problem. The Bretton Woods agencies are rudimentary agencies of world government in the making. We are in favour of world government of course are we not? Or are you comfortable living with US hegemonism? Even in their rudimentary state the Bretton Woods agencies are being increasingly used in this fashion. The control of IMF loans to Russia for example is consciously used to control its domestic and foreign policy. As you well know the control of capital inflows is being used to accelerate the fall of Milosevic. This morning if the killing of East Timorese, and UN personnel is to be stopped rapidly, it will be through threats to the Indonesian economy as a whole which have the implicit backing of the IMF and the World Bank.


>The IMF is
>not a state, and it's only nominally an official agency.

How unimaginative you are in your concept of the state.


>Its mandate has
>only been renewed in the most ad hoc fashion since the 1980's, when James
>Baker recognized that it might prove useful for the U.S. and G-7 during the
>80's debt crisis.

Here the thrust of your argument seems to be that nothing can be done because we have to accept total control by the US over these institutions. How can neo-liberalism ever be broken then?

The politics of your stance is particularly suspect since you come from the country that has censored the discussion of global taxation. You know that Jessie Helms has led a rule in Congress that any international agency that discusses global taxation will have its US funding cut. That is censorship of clear political motivation. It does you little credit to be supporting it by the cynical argument that nothing can be done to oppose it. On this issue you are presenting yourself as the left face of Jessie Helms.


>If you want to imagine a Tobin Tax having any effect at
>all, you have to pass through it or the World Bank.

So I must try to win the support of Jessie Helms and James Baker?! Please get serious. No, it is not even factually true that it has to pass through the World Bank. If the World Bank is not responsive to the reasonableness of the campaign for progressive centripetal distribution of capital funds, it can be swept aside. There is talk about how the IMF and World Bank have grown closer in function than was planned under Bretton Woods. They could easily be amalgamated, and a new agency set up. That is the way change is managed under capitalism. Reorganisation and renaming. But if one is a militant cynic there is no need to get your hands dirty with such details.


>It doesn't matter what
>the dreams of African states are, on this score, since no one is going to
>hand Tobin Tax revenues over to them.

Speak for yourself.

There are countless examples of states and international structures organising aid on humanitarian lines to many peoples and regions.

What side are you on, for Christ's sake, Christian? Are you mainly trying to prove that despite your name you are not a bleeding heart liberal?


>Or rather, the only people that could
>are working for the IMF, and the IMF made capital account convertibility a
>condition of membership.

So we cannot fight against neo-liberalism? Whose side are you on?


>So there goes your Tobin Tax.

It isn't "my" Tobin tax. This is a cheap condescending debating point. Discussion of a tax on capital transfers has been around for over 20 years and is attached to the name of Tobin. One of the arguments for this tax is to slow the volatility of short term finanical movements. The world financial crisis last year cost hundred of billions. Although the pressure for global financial reform has abated by comparison with last year, world capitalism is not free of troubles. The major world currencies are sliding massively against each other again, but in the opposite direction again, with the dollar sinking in relation to the yen.. Yet the major central banks do not dare intervene in the market because they know they have not got the strength to stem the potential tide of foreign exchange movements totalling over 1 trillion dollars a day. The Japanese central bank did when the yen was at 120 to the dollar. That was the last time they intervened although the yen has risen to 108 to the dollar. Even central banks have to be very careful now when they can take on the surging tide of daily world financial movements.

The costs and disruptions caused by 5% shifts in the relative value of the yen, euro, and dollar are enormous. The major world monopoly capitalist companies (who are the real power holders behind Baker and Helms) have to offset large amounts of money themselves to deal in the international currencies. It is in their imperialist interests, yes imperialist, to have the system more stabilised. Even George Soros has just lost billions.

The resistance to the further extension of global governance in the world economy is far lower than your shallow cynicism suggest. If pressure built up to control this insecurity there would be little resistance from the major imperialist companies. Yes. Because as Lenin argued, imperialism is progressive in comparison to non-monopoly capitalism. It paves the way for socialism. And in global terms the world economy is being run on an old model of laissez faire non-monopoly capitalism when what really matters in capitalist terms are the interests of the giant monopoly multi-national companies who want a smooth playing field for their exploitation throughout the world. They want a single global currency. A Tobin tax would merely be a step on the way.

But probably on principle you do not believe in analysing contradictions among the enemy, since you appear to think the most revolutionary position is that of militant cynicism.

Thank you for annoying me sufficiently by your condescending tone, to be driven to spell this out.

Chris Burford

London



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