Capital controls – Investigating International Finance
A new video from the New Economics Foundation
Related Think Left Post (1):
Barely 32 years ago, Margaret Thatcher came to power and rejected the post-war consensus by embracing Hayek, Friedman and neoliberalism … but in those three decades, globalization and the deregulated free-market has become a TINA (Thatcher’s slogan “There is no alternative”)… an unquestioned consensus for the overwhelming majority of the media and leading politicians from all three mainstream political parties. This is a false consciousness which has had dire consequences for democracy, sovereignty, and a world effectively run by transanational corporations with governments just facilitating their businesses.
Strangely (or perhaps not), these implications of the major shift in economic strategy have never been much discussed publically. There was also precious little debate in the House of Commons, prior to the Thatcher government promoting and signing up to the 8th round of the GATT (General Agreement on Trade and Tariffs) treaty in Uruguay in 1994. This treaty extended the scope of the previous one beyond manufactured goods to cover services, agriculture and intellectual property, including services such as health, education and other public provision, and environmental ones such as GM foods, nuclear power and agribusiness.
The lack of discussion was particularly extraordinary because effectively this treaty created the World Trade Organisation (WTO) to be a power above Nations … the ideas and regulation of free-trade superceding national governmental decisions and policies. The free-market ideology of Friedman, the economic heretic of the 50s-70s, became enshrined by 117 member governments, representing 90% of world merchandise.
‘With the advent of Globalization with its fundamentalist insistance upon open markets and free access for capital without restraints, there were suddenly no regulations to bind the Financial Class, no taxes they could not avoid and no political process they could not buy. It was a freedom from any notion of obligation, care or concern for anybody but themselves. It was a perversion of the very word freedom. They could vote wherever they chose, buy citizenship wherever they felt like it and pay only those taxes they found convenient and have no loyalty anyone or anywhere. They were ‘free’. (2)
As David Malone writes in the above quote, the Financial Class were set ‘free’ … but the rest of the global community was well and truly ‘stitched up’. It is no coincidence that in the UK and US, there has been a corresponding lack of rise in real wages and huge increases in personal debt. Meanwhile, the 1000 richest list published the other day shows that their wealth has increased 18% since last year and they are now worth 400 bn.