Re: white-washing, prodding and superceding: a peoples' world bank

On 5 Dec 99, at 14:33, christopher chase-dunn wrote:
> well i dont have all this worked out in detail. 

Chris, the devil is in the detail, unfortunately. So I'll be quick and 
perhaps too curt, given the importance of replying rapidly to your 
argument. Forgive me in advance if it's too bolshi-sounding.

Just for example, why would "we" progressives--in the short-
medium term (with the global balance of forces so extremely 
hostile to "our" interests)--want an international financial agency at 
all, except for, say, the provision of trade finance (which various 
states' trade finance agencies already do, though we spend a wee 
bit more energy greening, gendering and making them more 
accountable)? (Keynes would agree, and argued in the Yale Review 
in 1933 to, "above all, let finance be local" [i.e., domestic]). Why 
would anyone doing grassroots development want a hard-currency 
loan from a People's World Bank? For building a school and hiring 
a teacher that is 100% local-currency sourced? (Even the African 
National Congress adopted this position in its 1994 Reconstruction 
and Development Programme.) True, hard/multiple currency 
facilitation is required for imports/exports, and for that exim banks 
are technically necessary and sufficient. But other current account 
issues can be dealt with once global debt is cleared away, without 
recourse to the IMF/WB, and democratisation of Central Banks 
would logically facilitate development finance.

> but for starts i would
> say that it makes sense to both kick the bank out of south africa and to
> try to reform it. 

What if by trying to reform it you can't kick it out of Pretoria or 
Delhi or similar sites of fairly advanced struggle? What if it puts on 
airs about having reformed already? (A demo at the WB office here 
last month around their involvement in Lesotho dam corruption had 
the Res.Rep. really shaken up, but he very quickly came up with a 
little rap about how under Wolfensohn, governance is the very top 
WB priority--and he trotted out some relations with Transparency 
Int'l as evidence.)

> if reform does not work 

It doesn't. Let's look, for a second, at the history (two decades of 
activism and advocacy) of our allies' BWI reform. Some weak 
green, gender-equity, transparency and community-participatory 
gains. But these have really served to whitewash a more dogmatic 
commitment to WashCon economics. Stiglitz made virtually no 
impact at all (Robert Wade told me that his friends inside 
understood Stiglitz to have a travel-agency relationship with the 
WB, aside from his obvious PR value.) I'll give you plenty of details 
if you like, but emblematically, even Wolfensohn's very very meagre 
debt relief ("HIPC"-style) for extremely impoverished countries like 
Mozambique comes with conditions like quintupling the primary 
healthcare cost recovery and raising tariffs "dramatically" (both in a 
mid-1998 letter from Wolfy to Chissano that I have in my 
possession). "Reform" has conclusively NOT worked, simply said.

> we should found a peoples'
> world bank. facilitating cooperation between these different thrusts
> could be a job for the world party.
 
> as to white-washing the bank, they dont need me. according to one of the
> vice presidents of the bank ( a Dutch economist) we had in a debate here
> a couple of weeks ago there are no neoliberal economists at the bank any
> longer. they are all social democrats now.
> this is the postwashconworld bank that patrick is talking about. . fine.

This is a blatant lie, of course, unveiled not only by every single 
thing that WB staff here in SA have done to promote neoliberalism, 
but by Stiglitz's "resignation." (See the report below by a JHU grad 
student on that meeting, for the requisite cynicism.)

> but what are they going to do to democratize the bank itself, to really
> balance out uneven development and make development sustainable?

We've been there and done that. Get them out of the lending 
business. Get them to stop pretending to be a "knowledge bank." 
Their knowledge is neoliberalism, full-stop (a chapter of a book 
Pluto is publishing in Feb, "Elite Transition: From Apartheid to 
Neoliberalism in SA," provides sickening details about their 
knowledge-banking and policy-advisory influence here.) Chris, can 
you or anyone else come up with anything the Bank is/can feasibly 
do that won't contribute to global uneven development (except 
cancel their loans without conditions, which they won't).

> i dont see any contradiction between movements that want to defend
> themselves from undemocratic global institutions like the bank, and
> those same movements working toward creating the institutions of
> democratic world governance.

Then you haven't sat with Oxfam/Int'l-type reformists when crucial 
negotiating positions are being worked out, and where in 
September this year, the global-reformists took a more 
conservative line than even Jeffrey Sachs (who says get the IMF 
out of Africa). Remember, Chris, when liberals at JHU (e.g. Prez 
Steven Muller) were telling our anti-apartheid movement in the mid-
1980s that the Sullivan Principles would make US corporations in 
SA more responsible, the ANC and the JHU Coalition for a Free 
South Africa replied, bullshit, this just prolongs the agony, get 
them the hell out by divesting (Tutu's line was "we don't want to 
shine the chains of apartheid"). You were clear on the total-
divestment line then. We have a virtually identical strategic opening 
now (which one of your excellent students is involved with), namely 
to defund and shut down the World Bank (using the divestment 
strategy, focusing on a World Bank bond boycott).

Reformism now gets in the way.

As it apparently did when the AFL-CIO leadership in Seattle last 
week diverted their march so that the thousands blockading the 
civic centre were NOT joined by tens of thousands more workers 
coming from the rally (see Alex Cockburn in this week's Nation and 
Counterpunch for details... though see Doug Henwood's various 
rebuttals for balance). 

> some semiperipheral countries have the option of trying to succeed in
> the capitalist world-system vs. supporting fundamental transformation of
> the system. but few can succeed and this is not at all an option for
> peripheral countries.jpzsef borocz has already pointed out that
> socialism in one country does not work. 

Socialism in one country is not the programme. For example, 
Samir Amin's more recent arguments about delinking take the 
hostile conjuncture into account, and promote regionalism as the 
basis for reestablishing a new, more humane int'l division of labour 
but still aimed at non-capitalist, inward-oriented, basic-needs-driven 
development (see the discussion in my JWSR piece on this). This 
is also the direction that movement strategists like Walden Bello 
are taking.

> it is in the interest of the
> majority of the peoples of the world to act to construct the
> institutions of global democratic socialism.

Yes, sometime in the future, agreed. In the meantime, until a 
fundamental rebalancing of global poli-econ can be achieved, it's in 
the interests of the majority of the peoples of the world to sort out 
their own national bourgeoisies first. As someone once said. 

Yours in comradely debate,
Patrick 

Date sent:              Wed, 24 Nov 1999 16:09:11 -0500
From:                   Ben Cashdan <bcashdan@igc.org>
Subject:                No neo-liberals in the World Bank (chuckle)
To:                     debate <debate@sunsite.wits.ac.za>
Send reply to:          Ben Cashdan <bcashdan@igc.org>

Has anyone come across Josef Ritzen, Vice-President for 
Development Policy at the World Bank. We invited him to campus 
yesterday for a debate on the future of the institution. In his efforts 
to show how thoroughly the Bank has thrown off the Washington 
Consensus orthodoxy, he got a little carried away. Here are some 
quotes:  

"You will not find a single neo-liberal economist in the World Bank 
anymore" "You will not find anyone in the World Bank opposed to 
capital controls" "When we go into a country we like to talk straight 
away with key players like trade unions" "Our aid is no longer 
concerned with keeping countries in the one particular 'ideological 
camp'"  

Ritzen obviously inhabits another World Bank in a parallel universe 
(or in his dreams).  

It was a highly entertaining forum, as Hopkins best left academics 
weighed in on the Bank's current contradictions. David Harvey 
asked Ritzen why the Bank would not consider supporting socialist-
oriented development projects if it was so thoroughly cleansed of 
its former role as guardian of market- oriented ideology and US 
interests. Ritzen returned to our universe at that point and pointed 
out that the US is the Bank's largest shareholder.  

Asked what would convince him that the Bank was truly reformed, 
Harvey proposed a 90% reduction in professional salaries and a 
relocation to "somewhere far from Washington, say Kinshasa".  At 
least, said Harvey, that would flush out any remaining neo-liberal 
economists who would find better jobs on the market.  Goivanni 
Arrighi concurred, adding that the Bank might alternatively return to 
its original purpose - that of credit union for Europe.  

Ritzen, a smooth talker, and former Dutch politician, almost 
managed to hide his discomfort as he politely thanked the Hopkins 
academics for their creative advice. The Bank, he added, is likely 
to get more powerful in the near future, as bilateral aid declines, 
and values this kind of "deep debate"!  

***


Patrick Bond
(Wits University Graduate School of Public and Development Management)
home: 51 Somerset Road, Kensington 2094, Johannesburg
office: 22 Gordon Building, Wits University Parktown Campus
mailing address: PO Box 601 WITS 2050
phones:  (h) (2711) 614-8088; (o) 488-5917; fax 484-2729
emails:  (h) pbond@wn.apc.org; (o) bondp@zeus.mgmt.wits.ac.za