Zack Gross
Zack Gross

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A New Economic Order?

Brandon Sun “Small World” Column, Sunday,  November 30 / 08

Zack Gross

People working in international charities recently met in Ottawa to discuss how the current economic “downturn” will affect their fundraising from ordinary citizen donors, and the prospects for support from larger funders, such as government.  Most people at the meeting were feeling gloomy, pointing to the fact that donations are already reportedly down throughout the non-profit community, with food banks, as an example, having to deal with empty shelves. 

One person, however, struck a different note.  He’s an old-timer, like me, who has been involved in international development throughout a long career, working in the churches and advocacy groups on issues such as Third World debt and the Make Poverty History campaign.  His opinion was that current global financial troubles would cause the public to re-think the efficacy of our world economic order, and change to become less trusting of “business as usual” and more supportive of economic justice and trade fairness.  He felt that the financial crisis would ultimately be a positive for the marginalized of the world.

At this time, prospects for the world’s poor are not good.  In 2007, overall aid to developing countries actually dropped by 8.4%, making the possibility of our meeting the United Nations Millennium Development Goals by the target 2015 date very uncertain. 

Last summer, the Doha Round at the World Trade Organization (WTO) collapsed for a third time as developing countries refused to allow increased access to their markets by the United States and other major economic powers. 

The recent international food crisis, which saw hunger rise along with prices, has been coupled with the failure of all industrialized countries to meet the 0.7% of GDP aid target, which has been promised by governments for a generation.  One hundred million more people have joined the ranks of the hungry.  A fraction of the money thrown into the bank bailout would have eradicated the debt of the world’s one hundred poorest countries and allowed them to meet their people’s basic needs. 

Aid, fairer trade and other measures do create sustainable wealth, but need to be enacted at the highest and broadest levels. Our idea of aid might be an NGO-sponsored project in Africa, and of fair trade might be purchasing certified coffee at the supermarket.  Beyond this, a paradigm shift must happen at the International Monetary Fund, the World Bank and other global bodies.

Industrialized economies want access to Third World markets without trade barriers, and have been supported by these international financial institutions in this to the detriment of poorer countries.  Europe and North America are “dumping” subsidized, cheap products on Third World markets, destroying their economies, while not allowing them access to our markets.  Prices for cocoa, coffee and cotton, as examples, are way down, adding to the poverty.

The New Economy Information Service is a think tank set up in Washington to study the effects of globalization.  One of its findings is that corporate interests prefer dealing with dictatorships in their business and financial dealings.  While South Africa and Eastern European countries struggle to establish democracies, it is China that has become an economic power, with its goods dominating store shelves, while bringing with it a litany of consumer issues here and environmental and human rights issues there. 

An interesting detail in the NEIS study is that in the decade after the Berlin Wall fell and the Cold War ended, goods imported into the US from democratic countries dropped from over half to just about a third.  During that time, 1989 to 1999, China moved from No. 18 in imports into the US to No. 4 and, of course, is now an undisputed No. 2, behind only Canada.  It would seem that, in the opinion of some, lower wages, more lax environmental laws, bans on unions and tax breaks for the elite make for “good business.”

Unlike his outgoing predecessor George W. Bush, Barack Obama has been speaking out on the need for greater environmental regulation and tougher labour laws.  While it is too early to tell, “free traders” are concerned that this is really an expression of protectionism by the more union-oriented Democratic Party.  Many people in the world, now plugged into everyday life through the Internet whether they be in Africa, Asia or Latin America, are hoping the Mr. Obama brings with him a “New Deal” that will benefit their bottom line - meeting those basic needs of health and education.

The US economy, to which Canadians and most “allies” are tied, has struggled under a number of factors.  The daily cost of war is one.  Even in Canada, opposition parties have found it difficult to access figures on the cost of our Afghanistan mission.  With the holiday season on the horizon, is it possible that we might find, in our economic wilderness, a way forward to peace, justice and prosperity?  It may be too much to expect, but any progress toward a better world will come with us demanding what doesn’t always seem possible – a re-thinking of our economic principles, policies and relationships.

Zack Gross coordinates a provincial fair trade outreach program for the 
Manitoba Council for International Co-operation (MCIC), a coalition of 38 international development organizations.
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