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G-20 meeting in Seoul – we call for
real change
Since 2008, a date that
marked the beginning of the most recent global crisis that started
off in the U.S., the G-20 has unilaterally taken over the role as
the key forum charged with global problem solving without either
taking into account the other 172 countries represented in the United
Nations, or listening to diverging opinion and analysis such as
that represented in the Stiglitz report.
In its early days the
G-20 debated themes such as development, employment and the environment
with even some talk of fundamental solutions that would challenge
the underpinnings of the international financial architecture such
as regulating financial markets, combating fiscal paradises and
the illicit flow of capital, and promoting the idea of a financial
transaction tax. But over time we have witnessed that more conservative
proposals have gained the upper hand based on the assumption that
market forces are either resolving the crisis already, or have the
capacity to do so. One can no longer find much mention in G-20 declarations
of financial market regulation and the need to reign in rampant
speculation, and in their references to ‘development’
they try to revive failed policies such as support for easing investment
flows along with greater legal security for transnational capital
and companies. As a result several countries that had adopted policies
aimed at an economic recovery, at improving peoples’ standard
of living, and at reactivating the job market by increasing public
expenditures and stepping up the role of the state as regulator,
have all but been abandoned these efforts in a return to regimen
of structural adjustment where the public purse gets accessed to
save the large financial groups whose speculative activities lie
at the heart of the current crisis.
The crisis is not over,
and the resulting commercial disequilibrium is an indication that
we are into a new phase, one that some are describing as the currency
wars, and in which the US is trying to artificially promote exports
while reducing its commercial deficit by printing money which in
turn leads to a devaluation of the US dollar in the context of an
interest rate that is being held at zero. In response to this, other
industrialized countries have intervened in foreign currency markets
to protect their own currencies from speculative pressures. In the
U.S. and Europe production is not recovering, unemployment rates
remain the same, but the banks and other financial firms have survived
nicely on government subsidies which have allowed them to realize
enormous profits. The countries that make up the G-7 are placing
their hopes on a sustained economic recovery in the emerging economies
that will provide a market for their products and thus help to finance
their own commercial deficits.
Europe’s fiscal
and financial crisis that initially affected Greece and other countries
in eastern Europe and that was front and centre as a topic at the
June G-20 in Toronto, has now extended to other countries on that
continent as can be seen by the reaction to austerity measures in
the form of a wave of strikes in Spain, Portugal, Belgium, and France,
all of which points to worsening levels of unemployment and deteriorating
working conditions. The response has been to cut public spending
on social programs that are all part of a move to the right. This
situation is unleashing racism and xenophobia midst structural adjustment
programs of the type seen in Latin America 20 years ago, and which
at the height of neo-liberalism pushed that region into a period
of stagnation, de-industrialization, and social crisis.
In the face of the current
crisis, faulty decisions have led to solutions being taken by the
G-20 nations that, instead of focusing on the causes such as financial
and monetary speculation and on resolving the unemployment that
this has generated, are simply reproducing the same policies that
brought on this crisis. No measures have been taken against financial
paradises, action against speculation has been timid, no real controls
over financial capital have been implemented, and once again there
are calls to avoid protectionism amidst renewed talk about restarting
the DOHA round of the WTO.
The G-20 decided to
reinforce the powers of one of the institutions that have promoted
commercial and financial liberalization policies – the IMF.
The emerging economies hoped to influence the direction that the
IMF takes in guiding global economic policy on the fact that they
have been given a 6% increase in decision making power in various
bodies of that institution. However, we see the self-same policies
being reproduced in order to maintain the structures of globalization
that have landed humanity in this crisis.
The G-20 is an elitist
and illegitimate construct that is taking decisions over the direction
of the world’s economy, and its responses to the crisis correspond
to the interests of Big Capital. Although the conflicts arising
from the new international geopolitical policies do receive some
eco at the G-20, the emerging economies involved have not been able
to bring about the serious measures required to resolve peoples’
deteriorating living conditions.
In consideration of the
heads of state gathered at the G-20 in Seoul:
We call for real changes
to economic policy. We should not be continuing to deepen a model
that benefits large scale financial capital and transnational corporations;
that serves to erode the role of States in promoting sovereign national
and regional policies; that continues policies leading to ever greater
levels of poverty and inequality. Measures to be taken to deal with
this crisis need to be part of a change in the model of ‘development’.
We demand the suspension
of the DOHA Round and of the free trade and investment treaties
that are one more step in the implementation of this model and which
act to limit the possibility for countries to define their own development
policies.
We reject the intent
at promoting the Copenhagen Accord via the G-20, pushing aside existing
multilateral bodies with the purpose of imposing false solutions
to the climate crisis and allowing for the continuation of the model
that generated climate injustice. We reject the attempt to inject
new life into the IMF so that this body can once again implement
spent policies that serve only to justify its own existence while
remembering that these policies took several of the countries in
the Americas into bankruptcy and generalized poverty in the 90s.
It is necessary to regulate financial speculation by instituting
capital controls, exchange rates controls, and through the elimination
of fiscal paradises.
We call on the peoples
of the world to build a broad common front to oppose the policies
that trying to saddle us with the cost of the crisis, and to speak
out against neo-liberal globalization that is pushing humanity towards
the precipice while simultaneously impoverishing the world’s
people.
Hemispheric Social Alliance
November 5, 2010
Translation done by Rick
Arnold, Common Frontiers - Canada
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