News and Features
Sparks fly in the debate over the war on terror.
I have met three hijackers in my life, and I hope I do not sound crabby and disillusioned if I add that the standard of hijacking is not what it used to be.
Kurds want Saddam Hussein gone but are wary about joining a US-led attack.
"In the Roman empire, only Romans voted. In modern global capitalism,
only Americans vote," declared George Soros in June. "Brazilians do not
He spoke too soon. With only weeks remaining till the presidential
election on October 6, Workers Party (PT) candidate Luis Inacio Da
Silva--"Lula," as he is popularly known--is still leading in the polls.
His closest competitor, Ciro Gomes, is an ordinary politician whose rise
to second place was fueled by harsh populist rhetoric against the IMF,
neoliberalism and the economic failures of the current administration.
The ruling party's candidate, José Serra, is a distant
third--despite Soros's claim that Brazilians had no choice but to elect
The Wall Street-Treasury Complex, as Columbia economist Jagdish Bhagwati
has named the IMF and its private sector allies, won't be able to pick
the president this time. So they are going for second best: choosing the
policies. On August 19 President Fernando Henrique Cardoso met with the
contenders and tried to rope them into pledging support for continuing
IMF policies over the next three years. "The candidates," he told the
press, "whether they want to or not, will have to commit to these [IMF]
We'll see about that, too. The IMF recently approved a $30 billion loan,
with most of it to be disbursed in installments next year. The idea is
that the IMF can cut off the flow of money if the new government
deviates from its program of fiscal and monetary austerity. That's the
way it usually works, but this time Imperial Rome may not get to choose
the policy any more than the proconsul.
Why not? First, Brazil has an explosive debt burden. The IMF's latest
loan was intended to stabilize Brazil's bond and currency markets, so as
to prevent a default before the election. It will also help US banks,
which have outstanding loans of more than $25 billion in Brazil, to get
some of their money out, on more favorable terms, before the collapse.
(The IMF may as well have written the check to Citigroup, FleetBoston
and J.P. Morgan Chase.) But it will not prevent a default.
The default--or "restructuring," if it takes place in an orderly,
negotiated manner--will make plain to everyone the failure of the
Cardoso/IMF model in Brazil. Since 1994 growth has been rather
slow--about 1.3 percent in per capita income annually. At the same time,
the public debt has soared relative to the economy--from 29 to 60
percent of GDP. And this was on top of $100 billion worth of
privatization, a massive raiding of public assets that should have
helped government finances significantly. The country's foreign debt has
also swelled. This is truly an enormous mortgaging of the country's
future, with very little to show for it. For Cardoso to lecture the
current candidates about fiscal austerity is like Ronald Reagan and
George Bush Senior--who presided over a similar record-breaking debt
run-up in the United States--telling their successors to please keep the
The business press seems to have missed the irony of all this, and
instead has blamed Lula's rise in the polls for the current financial
crisis. That, they say, has spooked investors, causing the currency to
fall (26 percent so far this year), foreign credit to dry up and the
country's risk premium to soar to the level of Nigeria's. But this
picture confuses the event that triggered the crisis with the actual
cause. Just as the accounting and corporate scandals did not cause the
stock market collapse in the United States--stocks were overvalued
relative to any conceivable economic future and had to crash sooner or
later--Brazilian bond prices aren't falling because Lula is ahead in the
polls. The real reason for the financial crisis is that the smarter (or
more risk-averse) bondholders have done the necessary calculations and
concluded that Brazil cannot pay its debt. Although some gamblers will
hang on to collect high returns in hope of jumping ship at the last
minute, default is inevitable.
But that's no reason for Brazil to surrender its democracy to Washington
and Wall Street. The PT has a reasonable reform program: lower domestic
interest rates (now set by the central bank at 18 percent, among the
world's highest), some support for domestic industry and small and
medium-sized agriculture, and a "zero hunger" program, including food
stamps, for the poor.
Brazil used to have one of the fastest-growing economies in the world:
From 1960 to 1980, income per person grew by 141 percent. From 1980 to
2000 it grew by 5 percent, or hardly at all. This is the story of
Brazil's neoliberal experiment. It is similar throughout most of the
region: hence the spreading political unrest. A Workers Party victory
could change the history of Latin America.
Lula might just be the right person for the job. Born into an
impoverished peasant family in one of the poorer areas of Brazil's
Northeast, he confronted hardship and hunger, and by the age of 12 had
to go to work. He rose through the ranks of the metalworkers' union and
was jailed for labor activism during the military dictatorship. He was
elected to Congress in 1986, where he helped win some important
provisions for workers' rights, healthcare and education in the new
(postmilitary) Constitution. Tens of millions of poor and working people
in Brazil identify with both his personal and political struggle against
the injustice of one of the world's most unequal societies. He has been
compared to Nelson Mandela, fighting to bring the poor of Brazil out of
economic apartheid. And the PT also has considerable support among those
in the educated classes, many of whom recognize that the party's program
makes more economic sense than the slow-growth, high-interest-rate,
explosive-debt scenario of the past and present.
But winning the election is only half the battle. One reason the IMF is
so eager to postpone the inevitable until after the election is so it
can threaten the new president with default if he doesn't knuckle under.
If he wins, Lula and the PT will have to explain to the country that
they didn't create this mess and stick to their program as the way
forward. It won't be easy, but it can be done.
In a 1996 Institute for Advanced Strategic and Political Studies paper prepared for Binyamin Netanyahu, the authors---including Richard Perle and Douglas Feith, now, respectively, chair of the De
Doomed by the incoherence of a foreign policy defined largely by biblical notions of the struggle between good and evil, the Bush Administration thrashes about in its hunt for the devil.
In 1998 the World Bank notified the Bolivian government that it would
refuse to guarantee a $25 million loan to refinance water services in
the Bolivian city of Cochabamba unless the local government sold its
public water utility to the private sector and passed on the costs to
consumers. Bolivian authorities gave the contract to a holding company
for US construction giant Bechtel, which immediately doubled the price
of water. For most Bolivians, this meant that water would now cost more
than food. Led by Oscar Olivera, a former machinist turned union
activist, a broad-based movement of workers, peasants, farmers and
others created La Coordinadora de Defensa del Agua y de la Vida (the
Coalition in Defense of Water and Life) to deprivatize the local water
In early 2000 thousands of Bolivians marched to Cochabamba in a showdown
with the government, and a general strike and transportation stoppage
brought the city to a standstill. In spite of mass arrests, violence and
several deaths, the people held firm; in the spring of that year, the
company abandoned Bolivia and the government revoked its hated
privatization legislation. With no one to run the local water company,
leaders of the uprising set up a new public company, whose first act was
to deliver water to the poorest communities in the city. Bechtel,
meanwhile, is suing the government of Bolivia for $25 million at the
World Bank's International Centre for the Settlement of Investment
In South Africa, the only country in the world where people's right to
water is actually written into the Constitution, the townships
surrounding cities like Johannesburg and Durban have become hotbeds of
resistance to water privatization. More than 10 million residents have
had their water cut off since the government implemented a World
Bank-inspired "cost recovery" program (which makes availability
dependent on a company's ability to recover its costs plus a
profit)--something that never happened in the worst days of apartheid.
More than 100,000 people in Kwazulu-Natal province became ill with
cholera recently after water and sanitation services to local
communities were cut off for nonpayment.
Water is at the heart of every fight in this country, where the
population is growing four times faster than the water supply and where
women collectively walk the equivalent of going to the moon and back
sixteen times a day to fetch water for their families. Access to water
is a deeply political issue. Six hundred thousand white farmers consume
60 percent of the country's water supplies for irrigation, while 15
million blacks have no direct access to water. Labor unions like the
South African Municipal Workers Union work with township activists to
organize neighborhood-by-neighborhood resistance, re-hooking up the
water supply and pulling out water meters. Such actions are a growing
sign that citizens are prepared to challenge by action, when they cannot
by law, injustices often originating with foreign-owned firms but
implemented by their own governments.
Several weeks on from the loya jirga national council, the
streets of Kabul have an extra bustle. Whereas in January the place was
deserted by 6 pm, now the curfew has been extended to midnight, and it
costs only $5 to buy the password that can allow your taxi to careen
through checkpoints into the early hours. The chaotic rhythms of Indian
music waft over jingling bicycles and tooting cars, while chai
khanas, ubiquitous teahouses, are full--as are the growing number of
restaurants, frequented by the thousands of foreign aid workers and
other internationals. Increasing numbers of women cross through the
center of town, adorned with a light head scarf rather than the stifling
blue nylon burqa. Fresh life is palpable.
But not far below the surface, the loya jirga has changed little
in the country. The suave President Hamid Karzai ostensibly presides
with new legitimacy over a more representative administration. But
except for juggling one of the ethnic Tajik-run power ministers, the
so-called Panjshiri mafia of the old Northern Alliance mujahedeen
fighters remains firmly in control, not only at the top but among the
practical levers of control such as police chiefs, secret service heads
and army commanders.
Without his own power base, Karzai is seen by some as less a real chief
executive than a liberal opposition figure against his own
Cabinet--offering no apparent strategy for securing and unifying the
fractious country. "The only question," according to Paul Bergne, a
former British special envoy to Afghanistan, "is whether this is because
he has no interest, or simply a reasonable interest, in staying alive."
Especially with the exclusion from power of former King Zahir Shah, the
majority Pashtuns, concentrated in the south, where the Taliban emerged,
feel disfranchised and demoralized. Rubbing salt in the wound, pictures
of the martyred Ahmed Shah Massoud, the rebel leader killed by the
Taliban on September 9, adorn every checkpoint, office and street
corner, and even prayer mats on sale in the city markets.
Soon after the loya jirga, Vice President Haji Qadeer, an ethnic
Pashtun, was gunned down in front of his office by two assailants, who
escaped easily. The United States quickly agreed to provide American
soldiers to serve as bodyguards for a somewhat panicked
Karzai--doubtless a prudent security measure, but one viewed as shameful
by Afghans worried that their leader is Washington's puppet. Meanwhile,
public anger over continuing deaths of Afghan civilians at the hands of
US rocket fire--such as the 175 casualties at a wedding in the tense
southern province of Oruzgan--compelled even Karzai himself to complain.
Separate UN and US investigations into the incident have been launched,
amid speculation that the reports will never be released or that the
most damaging conclusions--including alleged American removal of
evidence--will be redacted. International troops are seen as essential
for keeping the local fighting at bay, but Pashtuns bitterly question
why the bulk of civilian casualties appear to be among Pashtun-majority
areas in the south.
The overwhelming majority of the country's 20 million-odd people are
still poor, ill and unemployed. Basic statistics confirm that the
country remains at the bottom ranking of many development indexes,
whether infant mortality, girls' enrollment in primary education (under
10 percent), annual deaths from diarrhea (85,000) or chronic
unemployment, which cannot even begin to be measured.
Afghan officials--facing growing pressure from their own
constituents--have been raising ever sharper alarms about the pace of
aid payments. According to the US special envoy, only around one-third
of the $1.8 billion in aid pledged for the year at an international
donors' conference in Tokyo has been released. Kabul earns tax revenues
of less than 15 percent of its $600 million annual budget. As a result,
most aid has been spent either on humanitarian needs or simply on the
daily costs of government. There have essentially been no major
reconstruction works that would pump funds into the economy and rebuild
the country's devastated infrastructure.
The first postwar administration in any society is inevitably
problematic. Without any conditions for democracy--too many guns and
recalcitrant warlords, no free press or civic institutions for
independent organizing, no functioning economy--establishing a
legitimate and representative administration is not easy. As the Bush
Administration insists, enormous changes have indeed taken place.
Whatever the problems, conditions are vastly improved from the
circumstances of only a few months ago--when the country was plagued by
severe persecution and increasing food shortages with seemingly no hope.
Indeed, some Afghans respond sharply to any probing questions about the
costs and benefits of the US intervention. "Those are questions for a
Western perspective," remarked a senior local editor. "For us, we are
glad the Taliban are gone."
Yet the risks of an unattended Afghanistan remain high. The transitional
administration faces an enormous challenge, aiming to pave the way for
truly democratic elections in 2004 while striving to balance conflicting
and often violent local interests, and struggling to sustain
international support. The core conflict, however, may be between
America's pursuit of Al Qaeda and Afghan democracy itself: The US
military directly supports many Afghan warlords as allies in its effort
to stamp out Al Qaeda and Taliban holdouts. Continuing that policy will
have a devastating effect on efforts to establish democratic central
government and a meaningful civil society. This is especially true
considering that, despite US training efforts, the establishment of an
effective Afghan national army is years away, and Washington and other
Western governments repeatedly reject Afghan calls--recently joined by
Senators Joseph Biden, Richard Lugar and Barbara Boxer--to extend the
international security assistance force to major cities other than
As a result, the government's authority effectively ends at the
capital's edge. As a result, too, peace could be short-lived. As BBC
regional specialist Behrouz Afagh-Tebrizi notes, "There is a consensus
to avoid a return to war, but there has not been any change in political
culture. Unless the unresolved conflict between the warlords of the
1990s is transformed into a purely political struggle, it is not hard to
see Afghanistan descending back into violence."
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