The leaders of the world’s industrialized nations met in Calgary, Canada to formulate a common strategy for the future of the world, its “security,” and its sustainability. Similar to most international meetings in recent years, Africa and poverty eradication in poor countries of the Third World were discussed as important human and security issues. A new initiative was dislodged for Africa: grants in return for market liberalization–free trade, cuts in subsidies, and the rest of the good old neolibearl package.
For two decades the Africans were blackmailed by the IMF and the World Bank, and “advised” to liberalize their markets as a condition for new loans. And for two decades, the Africans did exactly as they were advised. They opened their borders in hope of increased foreign investment and rising manufacturing production and exports. But, despite all these reforms, the conditions of the continent deteriorated. African nations fell deeper into the abyss of indebtedness. Sub-Saharan Africa experienced a decline in foreign investment. The continent remained an exporter of primary goods. Industrialization did not materialize. Unemployment and absolute poverty increased. Average income dropped in most of the continent. Having lost the ability to earn a sustainable living through cash crop production, millions became internally displaced. Some wandered in the continent in search of a better life, and other became voyagers in far away lands hoping to find a new home and economic security.
The Africans never reached their promised land. The old IMF/World Bank lending scheme became socially and economically unsustainable. Africa was increasingly unable to pay back its debt. This was understood by all. A new scheme was required. Led by the Bush Administration, the G-8 meeting in Calgary proposed “grants” as a replacement for loans. But, like the old loan policy, the new “grants” were conditional. A forceful move towards free market capitalism was to be undertaken prior to receiving the “grants.”
The G-8 meeting in Calgary ended. The rich returned to their castles. The poor Africans flew back to their countries waiting for the $10 billion continent-wide “grant” to arrive by 2006. They had a task to perform: further open their borders to the free flow of goods and capital, and remove the remaining obstacles to free markets in the continent.
But, to many analysts and observers, the new initiative in Africa can only intensify the old problems of the continent. Ravaged by AIDS, Malaria and other diseases, environmental catastrophe, and widespread poverty, Africa is on the verge of extinction. Saving Africa requires a global effort, but one different from the G-8 initiative.
In what follows I will suggest a possible alternative to the G-8 initiative for Africa and other Third World countries.
AIDS, Free Markets, and the African Drama
Despite the dispute about the exact number of infected Africans, HIV/AIDS remains the biggest treat to the sustainability of life in the continent. AIDS is devastating Africa. The continent is unable to deal with this human drama with its own resources. There is no African solution to the HIV/AIDS crisis. A concerted global effort and approach is needed.
Free markets have failed the Africans. The experience of the past two decades demonstrate clearly that the ability of the continent to deal with the epidemic has progressively declined. Africans will die in rising numbers while we debate the merits of free market capitalism, and wait for the kind-heartedness of pharmaceutical firms to lower their prices for distribution in Africa. Private charities, even if they are guided by good intentions, cannot make a dent into this problem.
There is no private solution to the AIDS crisis in Africa and other poor nations of the world. A new outlook and policy paradigm is needed. Given the scope of the problem, the only viable solution to the crisis seems to be found in approaching AIDS/HIV as a global public good problem. This requires the formation of a global and public fund for research and development, production, and distribution of drugs.
The project can be financed by the imposition of a universal tax on financial transactions–a Tobin Tax of some sort; a small income and tax; and a marginal tax on profits in industrialized nations and wealthy emerging markets. The taxes need to be specifically designated for the Global AIDS Fund. The fund must be managed by the United Nations and its affiliates.
The fund will not replace private efforts towards the development of a cure for AIDS. It will supplement them. The global and public fund will reduce the cost of production by putting together medical and technical resources from around the world. I t will dramatically lower prices by eliminating profits.
Healthcare is a right recognized by the International Declaration of Human Rights. The Global AIDS Fund will be an important step towards the realization of the declaration.
Sweatshops, Child labor, and the Global Campaign for a Living Wage
Though not reported by the mainstream media in the U.S., the G-8 meeting was protested by the anti-globalization forces. Fleeing to a protected resort did not stop the protesters from voicing their discontent and rage. The protests in Calgary were the most recent manifestation of the rising consciousness in the West about the plight of those negatively affected by globalization and its dominant policy, neoliberalism.
Boycotting or calling for a ban on the import of goods made by child labor or under sweatshop conditions have become a cornerstone of the anti-globalization protests. The demand is meant to protect the children and laborers of impoverished Third World countries, including Africa. But, although noble in its intention, the ban on imports will not change the problem of poverty in Africa and elsewhere. It will not replace child labor with high-paid jobs for adults.
Africa and other poor nations of the world need more globalization and not less. But, they need a different type of globalization, different policies and relations, and a different approach by the progressive civil society in the West. They need more investment, technology, production and exports, and jobs with a living wage.
The boycott and import ban are not welcomed by those in Africa and other Third World countries who see a chance to labor, even under the most inhumane conditions, preferable to not working at all. This is an unfortunate fact of life in much of the Third World. Many in poor countries view the boycott and import ban as disguised protectionism in the West. To be effective, the movement for global justice needs a new outlook and new demands.
The demand for the boycott goods made in sweatshops and with child labor should be supplemented with a universal demand for the payment of a living wage by Transnational Corporations (TNCs). A living wage can be calculated and approximated for all countries. The United Nations Development Programme (UNDP) and other similar UN agencies, along with NGOs from Third World countries and the West are perfect institutions for this task. The living wage campaign will be operationlized by passing into law a surcharge and tax levied on TNCs in cases of payments of wages below the living wage. That is, that TNCs and their affiliates and subsidiaries, and the local producers they subcontract with will be held accountable by the global civil society and a new international law. The tax charged to the TNCs should exceed the difference between the living and the actually paid wages. It should be collected by the countries where the TNCs parent companies are registered, and contributed to a UN fund for development in the Third World.
The benefits of the new policy are clear. The payment of wages lower than the living wage will lose economic rationality. The TNCs will lose the ability to threaten and blackmail the capital-poor nations of the Third World with capital flight, forcing them into a destructive wage competition and race to the bottom. There will be no escape for the TNCs and their subcontractors. The mandatory payment of a living wage will end the existing downward spiral of wages. It will narrow the global wage disparity by bringing up wages in poor countries. This will not dissuade the TNCs from investing or sub-contracting production in Third World Countries. The living wage in the Third World will still be below those in the West. Investment in the Third World will remain advantageous for certain products and activities.
The campaign global campaign for a living wage is not a retreat from globalization. It is a specific call for a different globalization, one that is less exploitative. The campaign will help the attempts towards building international labor solidarity and remedy the existing south-north rift between workers.
The campaign could only succeed if it is articulated, advocated, and fought for by the global civil society and the movement for global justice. Opposition to neoliberalism is growing around the world. The emerging movement needs an open discussion of its policies and demands. To become a truly transnational movement, it needs to address the needs and aspirations of its diverse constituencies. The campaign for a living wage will be an important step towards this end.
Behzad Yaghmaian is the author of Social Change in Iran: an eyewitness account of Dissent, Defiance and a New Movement for Human Rights.
He can be reached at: behzad_yaghmaian@hotmail.com
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