Crashing the Global Capitalist Party
Press Action
Monday, February 02, 2004
http://www.pressaction.com/news/weblog/full_article/hand02022004/
How George W. Bush Is Spoiling for a Fight with Free Traders
By Mark Hand
“If anti-globalization radicals really want to tear down the world capitalist system they might want to go door-to-door next year on behalf of incumbent U.S. President George W. Bush.” — Jim Lobe, Inter Press Service, Dec. 30, 2003
Conventional wisdom says big-business interests in the United States should stand firmly behind George W. Bush’s reelection efforts in 2004 because his administration’s policies are perfectly aligned with the goals of the corporate community. With the GOP controlling 1600 Pennsylvania Avenue and Congress, Republican Party operatives surely must be reminding top officials of Corporate America not to waste their hard-earned bonuses on campaign contributions to the Democrats as a hedge against the unlikely scenario of Republicans losing control of either branch of government.
On the unconventional side of the fence, there’s a strain of thought that’s made it into the pages of certain business journals and newspapers over the past two years that says multinational companies and other global market players would fare better in a world where the Bush Doctrine is discarded in favor of a more investment-friendly foreign policy.
Some forward-thinking chief executives of multinational companies, in fact, have grown increasingly nervous about the unilateral nature of foreign policy coming out of the Bush White House. Jim Lobe, the Washington correspondent for Inter Press Service, writes that a rising number of economic analysts contend that a continuation of the policies Bush has pursued since Sept. 11, 2001 threatens “the very foundation of the multilateral economic system under which global corporate capitalism has prospered for more than 50 years.”
On the eve of the U.S. invasion of Iraq last March, Business Week editorial page editor Bruce Nussbaum was informing his readers that corporate CEOs are beginning to worry that globalization may not be compatible with a foreign policy of unilateral preemption. “Uncertainty is anathema to investment and growth,” Nussbaum explained in the March 24, 2003 issue of Business Week. “Can capital, trade, and labor flow smoothly when the world’s only superpower maintains such a confusing and threatening stance? U.S. corporations may soon find it more difficult to function in a multilateral economic arena when their overseas business partners and governments perceive America to be acting outside the bounds of international law and institutions.”
The perception of Democrats as anti-business is often highlighted during presidential election seasons when Democratic candidates typically are busy trying to win the vote of their traditional constituents — the working class and old-time liberals — by tapping corporate greed as a campaign issue. In speeches during the New Hampshire primary, Democratic presidential candidate John Kerry spoke of restoring “fairness” and “justice” to the U.S. economy.
“[W]e’re going to repeal the Bush tax cuts for the wealthy so we can invest in health care and education,” Kerry said. “And if I am president, we will scrub the tax code, which has exploded from 14 pages to 17,000 pages of loopholes and special-interest provisions, to remove every single provision that gives a benefit or reward to any Benedict Arnold CEO or corporation for sending jobs or profits overseas — and sticks you with the bill.”
It’s not far-fetched to imagine a Republican operative pointing to such populist campaign rhetoric to convince his or her corporate patron that a Democratic president would try to push through policies that would be unfavorable to Fortune 500 companies and the executives running them.
The reality of the 20th century, however, couldn’t be further from the truth. As with their Republican counterparts, every Democratic administration of the last hundred years has been beholden to the interests of Corporate America and international capital. The Democrats’ coziness with business interests turned more visible with the rise of the Democratic Leadership Council in the 1980s and Bill Clinton’s presidential victory in 1992.
“This is not your grandfather’s Democratic Party,” writes journalist Dick Polman. “The contemporary party is heavily financed by big business, and during the ‘90s, many of its lawmakers worked closely with GOP conservatives to create the conditions that inspired the latest generation of corporate buccaneers.”
The FDR-style language of the leading presidential challengers makes for “good, standard Democratic ‘red meat’ campaign rhetoric, but don’t look for an Edwards or a Kerry White House to do all that much to level the playing field on behalf of the ordinary working people they feel compelled to put at the ‘heart and soul’ of their speechmaking,” Paul Street explains in an article on Znet. “As a skeptical voter told Kerry before the caucus in Vinton, Iowa, ‘we hear about these issues [from Democrats] every four years. How do we know you’ll be any different? Everyone [in the Democratic Party] talks about health care, everyone talks about jobs.’”
Billionaire financier George Soros, the new hero of the Democratic Party who caused a stir in December when he pledged millions to MoveOn.org and other groups seeking to oust Bush, is a fervent believer in economic globalization and government-managed free markets. In his book, On Globalization, Soros provides many ideas about how the operations of the World Bank, International Monetary Fund and the World Trade Organization could benefit the world if only properly managed.
William Early, founder of Global Envision, says the WTO, which draws the greatest ire from anti-globalization activists, is, in Soros’ view, the most advanced of the international institutions. “It has been successful not only in creating international law but also in exercising a judiciary function,” Soros says in his book. Soros believes, according to Early, that the WTO bias in favor of rich countries and multinational corporations has more to do with how the body has been used than how it is organized.
While he may not have wholly supported the New Democrats’ use of these multilateral financial institutions in the 1990s, Soros certainly had to appreciate how the Clinton administration employed various strategies to keep the economic elite in Europe content and exercised discretion in foreign policy by accepting the notion of an international community.
Writing in the New Statesman last June, Neil Clark pondered why Soros is so upset with Bush’s foreign policy. “Soros is angry not with Bush’s aims — of extending Pax Americana and making the world safe for global capitalists like himself — but with the crass and blundering way Bush is going about it,” Clark said. “By making U.S. ambitions so clear, the Bush gang has committed the cardinal sin of giving the game away. For years, Soros and his NGOs have gone about their work extending the boundaries of the ‘free world’ so skillfully that hardly anyone noticed. Now a Texan redneck and a gang of overzealous neo-cons have blown it.”
Soros isn’t an advocate of unfettered free trade and laissez-faire capitalism. He believes the rules of the game under which he, as a notorious currency speculator, has prospered are dangerous for society as a whole. Paul Krugman, the economist and renowned liberal columnist for the New York Times, wrote five years ago about how Soros “believes that financial markets are ‘inherently unstable,’ that left unregulated they inevitably produce recurrent crises. … He seems far more concerned with denouncing laissez-faire ideology than with proposing workable ways to regulate markets without strangling them.”
The members of the world’s economic elite always have appreciated the role of government in enforcing the rules designed to preserve their wealth. Krugman explains that the World Trade Organization, as constituted, is a quasi-judicial entity that works more swiftly and decisively to correct disputes between multinationals and foreign governments than the plodding systems used in the old days. The anti-WTO crowd makes bogus arguments about the scope of the organization’s power to trump a sovereign nation’s laws, Krugman contends. “The WTO has become to leftist mythology what the United Nations is to the militia movement: the center of a global conspiracy against all that is good and decent,” he says.
Krugman is firm in his denunciation of anti-globalization activists who argue against the decades-long trend of exporting low-paying jobs to the developing world. “While fat-cat capitalists might benefit from globalization, the biggest beneficiaries are, yes, Third World workers,” he wrote in a March 1997 article in Slate titled In Defense of Cheap Labor. “You may say that the wretched of the earth should not be forced to serve as hewers of wood, drawers of water, and sewers of sneakers for the affluent. But what is the alternative?”
After Bush landed in the White House in January 2001, Krugman had less time to pontificate on the merits of free trade agreements and the exploitation of workers in the Third World. The unilateralists in Washington and their perceived lack of concern for the U.S. economy distracted Krugman from his previous role as watchdog of the anti-globalization crowd.
In a recent speech at the OneDance summit in Santa Cruz, Calif., John Trumpbour, research director of the Labor and Worklife Program at Harvard Law School and the Harvard Trade Union Program, noted that the unilateralist antics of the Bush administration have frustrated one of global capitalism’s biggest cheerleaders, Krugman, “because he can’t talk about free trade.”
Krugman, who was paid $50,000 by pre-bankrupt Enron to serve on one of its “advisory panels,” described in a September 2003 interview with BuzzFlash how Thomas Friedman recruited him to write a regular column for the New York Times. “It was 1999, and at the time, it seemed like our problem was: ‘How do we deal with prosperity and all the interesting things that were happening in the business world?’ … It seemed like it might be interesting and fun, and of course we figured that the U.S. policy would be sensible and reasonable, and I’d be writing mostly about disasters elsewhere of the new economy. And what do you know? It turned out to be something quite different from anything we imagined.”
Mixed in with his criticism of Bush’s foreign policy has been commentary about the state of the U.S. economy. Writing in the New York Times last March, Krugman said: “I’ve talked in this column about the administration’s eerie passivity in the face of a stalling economy and an exploding budget deficit: reality isn’t allowed to intrude on the obsession with long-run tax cuts. That same ‘don’t bother me, I’m busy’ attitude is driving foreign policy experts, inside and outside the government, to despair.”
This despair about the effect of the Bush Doctrine on U.S. economic policy, according to Inter Press Service’s Lobe, was first voiced in late 2002 as it became clear that the president was determined to go to war against Iraq. Lobe quotes Paul McCulley, a managing director of PIMCO, the world’s largest bond investment fund, who said: “American imperialism is, by definition, a retreat away from global capitalism, a retreat from the invisible hand of markets in favor of a more dominant role for the visible fist of governments.”
Jeffrey Garten, dean of the Yale School of Management and a columnist for Business Week, contends that most CEOs in the United States underestimate the growing risks of anti-American sentiment around the world. The stakes are high, according to Garten, who served as an undersecretary in the Clinton administration’s Commerce Department. U.S. companies have assets of $2.5 trillion abroad, with about 30% of the profits earned by companies on the Standard & Poor’s 500-stock index derived from foreign operations.
American CEOs should “press Washington to change trade policies that reinforce America’s image of arrogance and hypocrisy,” he wrote in the Nov. 10, 2003 issue of Business Week. “Less boasting about the marvels of our brand of capitalism would help, too.”
The Bush Doctrine, says Business Week’s Nussbaum, has three tenets: that unilateral measures are better than international treaties and organizations in dealing with global problems; that no country or combination of countries will ever be allowed to challenge U.S. military dominance; and that the U.S. is free to take preemptive action against terrorists and states that have weapons of large-scale destruction.
“As a foreign policy, it is both arrogant — certain to generate opposition by even the most friendly of countries — and corrosive, certain to undermine multilateral institutions and agreements, including those in the economic sphere,” Nussbaum said.
At the World Social Forum in Bombay earlier this month, it was reported that some attendees were confused by how the forum’s focus had shifted from its previous emphasis on trade and the inequities of global capitalism to the issues of war and discrimination. A teacher from Brazil, the country that had hosted the event in previous years, was quoted as saying, “I came here and went, ‘huh,’” in response to the message of the large antiwar contingent.
Free trade advocates obviously are worried about the threat to their agenda posed by the Bush administration’s unilateralist tendencies. Perhaps their concern is evidence that the aims of anti-globalization activists do, in fact, conflict with the antiwar demonstrators’ desire to harness the U.S. military juggernaut. Giving the Bush administration’s policies another four years to propagate may further disrupt alliances and multilateral agreements around the world, possibly doing irreparable harm to the cause of global capitalism, hence giving anti-globalization activists reason to celebrate a decisive victory.
Mark Hand is editor of Press Action.