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For InterPress Service
© Hazel Henderson, August 2002
www.hazelhenderson.com
(1,021 words)

“BUSH’S AGENDA IN JOHANNESBURG”

US Secretary of State Colin Powell will have a tough job at the UN World Summit on Sustainable Development (WSSD) in Johannesburg. Powell must provide public relations and “spin” on US President Bush’s continued “go-it-alone” disdain for multilateral cooperation. Bush’s stance is rooted in the laissez faire ideology of his corporate supporters, the fundamentalist, right wing of his party and the “rugged individualism” philosophy of the US “wild west”.

This 19th century ideological brew threatens the Johannesburg agenda, which seeks to address the increasingly urgent 21st century real world issues underlying the much-misunderstood term: sustainable development. To the Bushies, the term is subversive, heralding a new disguised form of socialism threatening Adam Smith’s 1776 “invisible hand” of the marketplace in which they put their faith. This faith is translated into the economic policies espoused by the International Monetary Fund, the World Bank, the US Treasury and Federal Reserve Board as “The Washington Consensus”: free trade, free markets, privatization, open capital markets, floating currencies and all the rest.

Yet, this Washington Consensus ideology is facing growing skepticism: in Latin America following Argentina’s economic collapse and even amongst former adherents. Investors and economic policy makers around the world are now shocked at the moral rot at the heart of US-style capitalism. They see on global TV how rugged individualism turned into greed, self-interest over the public interest and almost morbid concern with accumulating material wealth – all measured in money. The parade of corporate chieftains caught defrauding their employees and shareholders are not just a few bad apples – as President Bush and his former corporate CEO cabinet members claim.

Instead, we see clearly that unfettered capitalism is driven by Wall Street’s speculative expectations of corporate growth and ever-rising stock prices. These are features of the same financial system that leads pharmaceutical companies to manipulate patent laws, keep drug prices high and even bring lawsuits to try and prevent countries from manufacturing low-cost generics, as in the use of drugs for AIDS.

It is these obsolete economic ideologies that drive the Bush Administration’s geo-economic policies – from pulling out of the Kyoto Protocol on climate change to its trashing of so many UN treaties, cutting funds for family-planning and weakening the UN Monterrey Consensus on Financing for Development.

The US delegation to WSSD in Johannesburg will be guided by these same 19th century economic theories, still taught in obsolete textbooks: rational economic behavior is still seen as individual maximizing of self-interest in competition with all others. By this same ideology, cooperation, sharing resources, and volunteering are considered “irrational,” along with the “uneconomic” work of women in nurturing the young, the aged and sick and maintaining their households and communities. Even amid today’s corporate crime wave, many economists and business schools still teach all this – undermining business ethics – as even Bush has noted. Economic models still omit the value of air, water and environment as “free goods” and assume that the best way to manage these common resources necessary for all life is to privatize them!

The collapse of Enron and its worldwide energy and water acquisitions proves the case against such privatizations. The world has seen the disastrous consequences of water privatization in Latin America and Britain. Prices rose and water was cut off to those who could not afford it – leading to opposition by public health officials and widespread public protests. Even more absurd are economists’ calculations of monetary value of other priceless ecological life-support systems, such as rainforests and biodiversity by using public opinion surveys of willingness to pay (WTP). This pits ordinary citizens who wish to protect common environmental resources and amenities against developers with profit motives to exploit them. The only way to value such life-support systems is at replacement costs – and most are irreplaceable.

Many other absurdities pass for economic “science” and hoodwink the public in the same way that economists justified giving emission credits to polluting corporations, rather than allocating such rights to use common resources like air and water equally to every man, woman and child on the planet. Only with such fair, per capita allocation of “pollution licenses” can markets for emissions trading be fair to all countries and peoples. Governments should not follow US models, but instead auction such pollution licenses publicly. Giving them to corporate polluters also distorts incentives and markets for many new, clean energy and resource companies. Similarly, while Bush preaches the virtues of self-reliance, free trade and markets, he enacted huge new subsidies to large farms and steel companies for political gain and continues the huge subsidies and tax relief to oil, coal, nuclear and other corporations.

All this bodes ill for WSSD, as Bush, the self-proclaimed free trader now has “fast track” authority to push new trade deals – at the expense of workers and the environment. When the WTO’s economic models of “efficiency” are corrected with full-cost prices and account for taxpayer subsidies to transport infrastructure, it turns out that physicists and thermodynamicists have been correct all along: local efficiencies of scale in production and distribution are superior to world trade in most goods. Much of today’s world trade wastes energy and resources while putting local businesses and communities in jeopardy. Worse, today’s global casino of financial and currency trading transmits crises and contagion at warp speed and is the flywheel of much ecological destruction, poverty and social disruption.

The epitome of 19th century economics is the obsolete belief that economic growth as measured by GNP/GDP indicators is the way to measure national wealth and progress. At last, in the 1990s this belief was challenged by a host of broader indicators: the UN Human Development Index, the World Bank’s Genuine Savings Indicator (which accounts for environmental depletion), Ecological Footprint analyses and others which allow a more scientific assessment beyond the abstract weighting of social and environmental losses and gains in money terms.

Only by challenging the Bush Administration’s unrealistic, outdated assumptions – good for his corporate constituency but bad for everyone else – can the debate in Johannesburg be clarified. The real needs of people and our planetary life-support systems can best be advanced by ignoring and exposing the “spinmasters” in the US delegation.

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