IMF screws poor over high GNP

Ben Godar

Last week our televisions were again filled with images of people protesting globalization, this time at the World Bank and International Monetary Fund meetings in Washington.

The slant the news media seemed to put on the event was “shame on these unruly young people.” This is more than a little strange in a country supposedly founded on preserving the people’s right to demonstrate against oppression.

The concerns of the protesters in Seattle and Washington should be all of our concerns. Globalization is the most important issue facing people worldwide, but unfortunately I have a feeling most ISU students think IMF was the band that did “Unbelievable.”

The goal of IMF was to provide loans to struggling third-world countries to rescue their economies from the brink. Countries who took this money then had to find ways to invest it in order to be able to pay back their huge loans.

The only way to make this money back is through large corporate industries. To attract these industries, a country must severely deregulate environmental and labor laws (if any existed in the first place). As a result, the country is stripped of both its natural resources and the human capital of its people.

Compounding the problem is the fact that often times these countries are under the rule of a dictator, who simply takes the money for himself. When this happens, it is the impoverished people of that country who end up shouldering the burden of paying back the loan.

In some of these instances, the loans have been forgiven. Protesters are lobbying for even more to be waived. It may not seem fair for these loans to simply be forgiven, but it is much more unfair for the people of the country to be held accountable for the actions of a dictator they had no part in electing. The hardship a country must endure to pay off a loan is much more severe than the hardship they were under in the first place.

Beneath the rumblings of corporate conspiracy by the World Trade Organization (made up of CEOs from many of the same corporations who routinely move into underprivileged countries) protesters simply want a new model for globalization.

Rather than focusing on increasing the production in a country in trouble, protesters want to focus on improving human and environmental rights around the world. They believe that people are better off with a livable minimum wage and environmental protection than they are with a stronger export economy.

Proponents of the World Bank and IMF point to countries such as Mexico and South Korea as success stories. They frequently point to figures like gross national product as indicators that these countries have gotten out. In fact, these countries may be bringing in more money, but the wedge between the rich and poor has grown far deeper.

Mexico, like many struggling countries, has established “free trade zones” along its northern border. These are areas where a country essentially secedes land to a corporation. Mexico does not place any restrictions on the practices of the corporations located in these areas.

It is incorrect to think of those opposed to the WTO, IMF and World Bank as luddites. Only fringe elements would suggest that creating a global economy in itself is bad. Instead, protesters are critical of how we are currently creating that economy.

We in the West are in a position to help the people of the third world economically. Even more valuable to these countries than loan money, however, would be the level of human and environmental rights we enjoy.

Why not, as a condition of any loan money, insist these countries comply to minimum standards for wages and environmental protection? There is no value in making these countries look stronger on paper if we are doing nothing to enhance the life of the common man in that country.

Proponents of current systems need to realize that they are doing nothing for the common people. Trickle-down economics never works. If you put money into the hands of those on top, whether they be dictators or CEOs of corporations, they will make sure that the money does not find its way down to the people at the bottom.

Allowing our international business partners to operate below the minimum wage standards we have here in the United States is ultimately detrimental to U.S. workers. As long as cheaper wages and fewer environmental constraints are found elsewhere, the American worker will be the victim of the expanding world economy.

Therefore, it is in the interest of American workers, as well as international workers, for agents of globalization — currently the WTO, IMF and World Bank — to put human and environmental rights at the forefront.

I hope in the future more Americans will take advantage of our right to demonstrate against these agencies on behalf of the people of the world.


Ben Godar is a senior in sociology from Ames. He is an assistant arts & entertainment editor for the Daily. The things you say … you’re unbelievable, OOOHHHH!!!