How the Globalist "Free Trade" mantra is a lie

[Go2Peace]

Globalist "free trade", despite the propaganda, is reducing the living standards of the majority of people in second world countries. If you haven't been to one of these countries, let me give you some eye witness exprience of what is is like:

A Lot of money is flowing through these countries, but imagine our latest "version" of "capitalism", and then multiply the unequal division of wealth by several factors, and you have the global version of the market system. The vast majority of wealth goes into very few hands. While the rest of the population is left to deal with heavy inflation. While they could survive before on very little. The local goods, which used to be reasonable and priced in local terms, are now all affected by the global market. In a global market, they pay similar prices for goods to you and I.

So, while the average wage has increased from $60/mo. to $150/mo, the price of bread has gone from 50 cents to $2.00, and the price of eggs has gone from 40 cents to $1.50. Cheese has gone from $1 a lb to $3 a lb. Transportation (buses), which used to be free for anyone over 50, are now only showing up twice an hour and are packed to the gills, and the price for those under 50 is now 4x what it was.

Homes, which used to cost about $5000, are now $35,000-$100,000, depending on location, thanks to all of the foreign interests and neuvo rich who buy up "the cheap property" as investments. So places like the former USSR, where, for all the inneficiencies, at least the population were all housed, now have a huge and growing homelessness problem. I mean, can you imagine trying to pay for a $40,000 house on $200 a month?

Since the "Capitalism" our elite class propogate is an ideological version that is close to the Republican nirvana of a semi-libertarian state, they are taught to have an extremely low tax rate, which leaves them without the money to properly fund a very weak and underfunded justice system and law enforcement infrastructure. It turns out that libertarianism is not all it is promised, so the rich and powerful have their way with government officials. If you have money, you may get "justice", but if you don't, well, I know someone who was almost beat to death, a completely peaceful friend, without provocation, but the assailant had lots of money and bought off the justice.

In the new "Globalist dream" developing world sure, some are made rich, some others prosper, but the gross effect to the majority is hunger, stress, trafficing and debasement of women, triumph of money and power over justice, and more severe poverty.

Please, if you are still laboring under the myth that "free market Globalism" is good for humanity, please get out and live in one of these countries and learn the truth first hand. it is not at all as it is being presented.

[fasttense]

1. "Free" market, globalism, supply side, trickle down and voodoo economics is a scam.

RepubliCONS will fall for anything and they fell for this con, hard and fast.

[Go2Peace]

2. True, but even many Democrats have bought into it. They just haven't really seen what the truth is

and what it really does.

[Hello_Kitty]

3. There are people on DU who have bought into it. eom

[Fire1]

4. These are people who have nothing against capitalism. n/t

[Hello_Kitty]

7. Yeah, like these people.

http://thinkprogress.org/2009/11/12/business-worried-child-labor/

[Fire1]

8. There are some democrats who have fared very well under

capitalism.

[Hello_Kitty]

9. Yes indeed. eom

[anigbrowl]

5. Sources please. What country are you using for your examples?

Or are you just making stuff up?

[Go2Peace]

38. Obviously you have not been to a developing country, because

many of them are struggling with the same effects of globalism.

My personal example is Ukraine. I have relatives there and lived there for some time. Sorry I did not respond right away as I was away from my computer for a while.

[anigbrowl]

52. I have been to developing countries, but don't necessarily agree with you.

I would still like to see the sources for your numeric assertions. Anecdotal reports are generally not very good evidence.

Off the cuff, statistics seem to suggest that economic growth in Ukraine has outpaced inflation over the last decade: http://www.wolframalpha.com/input/?i=ukraine+average+income/ukraine+inflation

[MisterP]

6. this was identified as "techno-yuppieness" in the early 90s:

espoused by George Gilder and Fukuyama: a Commie-free wet dream of tech jobs, genetic modification, transcendent fiber-optics, liquid capital freely invested, no labor laws (since the magical market would just expand forever and automagically raise everyone's standard of living), cyberspace, Project Daedalus, tilling the Moon, etc., etc. ad nauseam

the IMF basically promised, back in the 80s, that Honduras or the Dominican Republic would be the "next Japan" (and, since Nakasone did collapse the Japanese economy, that much has come true)

[MellowDem]

10. Your blame is misplaced

Free market economics is not the reason for all those problems you listed. An economic system is only as good or fair as the government allows it to be. Bad economic policies and poor governance are the big factors when it comes to what you referance. The sooner people stop blaming all the ills of society on free market capitalism the sooner they will be able to work on the true source of the problem.

[Hello_Kitty]

11. Bad economic policies and poor governance have become a feature, not a bug of the system.

[MellowDem]

14. How so?

Lots of different countries have this economic system, yet there is quite a lot of variation between them. Europe has a free market capitalist system and many of its countries have very fair and just societies. Then you have places like Russia and then China even. One has nothing to do with the other.

[Go2Peace]

46. Most European countries are not nearly "Free Markets". Only in the Euro Zone

They still have many policies and taxes in place. They have much more regulation in imports.

But I will give you that it is not really the "free market" component but the libertarian (small on regulation, no real tax base, mass sell of of state industries) that is the killer component of what was done and what is still hurting those societies. But global competition for national resources is a severe impediment to the developing world the way it has been implimented.

[girl gone mad]

12. meh.

Credit Default Swaps were an illustrious example of the free market at work. In fact, I'd say the derivatives market between 2000 and 2008 was the closest society has ever come to a pure Friedman economic model. Look how well that turned out. Poor governance and bad economic policies had absolutely nothing whatsoever to do with the clusterfuck and subsequent meltdown. Free markets are highly inefficient and volatile.

[Hello_Kitty]

13. Commondities Futures Modernization Act helped that along.

I'd call that bad governance.

[MellowDem]

15. All economic systems have to be regulated...

and the credit default swaps is a classic example of poor governance. There wasn't enough government oversight. There is no such thing as a "pure economic model" of any kind that exists in the real world. Which is why government regulation is as much a part of a country's economy as anything else. Anyone who argues that any "pure" form of economics is the best is delusional I would agree, but the OP was referancing the free market system in general, not some extreme, pure form of it.

[Go2Peace]

43. Why do you assume that I am saying only socialism or market barriers works?

I find it odd that you just said that regulation is integral, and yet you are countering my post, which is essentially saying something similar. I think you are reading this through "media glasses". Many of these countries were naive, and in particular with the former USSR, they accepted what the IMF (and Republicans, who are now a worldwide organization, another poorly known fact) told them was "good capitalistic practice".

These countries have been an ideological experiment. It is a seriously libertarian view. It is quite different than a western society that has a %25 Federal tax base that can pay for things like the backbone of a decent judicial system, water treatment, regulatory agency staff.

Sure they have had internal problems, but we gave them an ideology that led them right into it. Why do you think the oligopolists came into power? Because the country was told it had to divest all state property immediately and they bought into it. Why do you think they had such a terrible crime rate with Mafia? Because their society naturally bent that way? Fuck, if you knew the society you would know that they were used to incredibly low crime. Sure they had "blat (bribery), but it mostly was at a completely different level (give your Dr. candies when you saw them, give the train ticket person a gift to get a better seat). How did that develop into the mafia and organized crime stealing people's money, raping and killing in the streets? They were told that they needed to have an overly small tax base and they could not pay their police departments and investigations units. Then when their police needed to take care of their families they accepted bribes to feed and house them.

There is so damn much propaganda out there everyone thinks that this was some kind of "natural progression" or thinks that it is the "Russian" way. Bullshit on that xenopathic stereotype. It just isn't really the truth. Even our leaders will admit they "don't quite" understand how it all happened. Well, duh, that is because they aren't looking in the right places. And unfortunately the Russians, who have no background in modern capitalism, just thought "this is the way it is supposed" to happen.

I would highly encourage you, if you are really pressed to hold onto your understanding, to go over to one of these countries or many others that we sent in the IMF and "restructured" their economy. But stay long enough to get to know average people, and don't stay in Moscow or Warsaw or the other capitals, but go to other cities a little out of the way. And don't accept the stereotype that "they were always" this way, learn the truth about life before the IMF. It wasn't grand but it was nothing like what they have now.

[MellowDem]

48. I never said these countries....

were "always this way". The IMF is just one organization, and their philosophy is no more "Russian" than the philosophy of communism was, but that didn't stop the Russians from adopting it in their own way. You can blame the IMF or Marx or whoever for Russia's plight, but it's the Russian leadership's own fault for adopting and implementing economic policies. And I really don't have much sympathy for the Russian government, whose policies are just as much aimed at keeping themselves in power as they are trying to follow some sort of libertarian experiment.

[Go2Peace]

49. They are following the path but we are the leaders. I still don't think you really understand what

is happening out there. Did you know that this is all setup by a worldwide branch of the Republican party? Did you know that the President of Ukraine is married to an American who works for the Heritage Foundation? You haven't a clue friend. You have bought into a great lie.

[MellowDem]

51. That sounds really out there...

Russia is anything but our "followers". They have their own interests and they are pursuing them without regard for some conservative economic policy. Ukraine has been trying to distance itself from Russia for a while now and is ultimately going to be trying to get into the EU, which requires them to reach certain economic goals.

[pampango]

16. The USSR mishandled socialism to the point of collapse. Russia today, if that is the reference in

the OP, may indeed be mishandling capitalism today.

Europe has a progressive approach to capitalism that makes it work well for its people. The US capitalist system does not work nearly as well for its people as Europe's does. Some countries make socialism work better that the USSR ever did.

No matter what economic system a country adopts, how well it is run makes a big difference in how well that system meets the needs of its people.

[ljm2002]

26. I seem to remember the IMF imposing "austerity measures"...

...that contributed to the severe effects of a new capitalist economy in the former SSRs.

[pampango]

29. I think you're right. They may have had "help" screwing up capitalism while they did it to socialism

all by themselves.

It will be interesting to see how the former SSR's progress, or not, in the future. I'll particularly interested to see how those that joined the EU fare compared to Russia and the SSR's that don't join.

[Go2Peace]

40. Europe and the rest of the west had a century to develop and even they are struggling with globalism

But developing countries are at a particular disadvantage.

But my comments are regarding our "current" model, which is tied to libertarian ideals of free markets. It strips countries of the tax base needed to create internal infrastructure and social programs. Many of these countries can't even begin to try and create an FDA or EPA.

This somewhat describes Russia, but they are not only "mishandling", they are "believing" the lies and following a script. They have been trying to pull together their justice system, police system, and other systems for years but they just don't have the money that it takes. The only thing that has been keeping their heads above water has been oil.

But I was mentioning in particular the disconnect between global marketplace inflation and wages. We don't notice it because here our prices are going down. But in these countries global competition puts intense inflationary pressure on food and necessities. A few benefit, but the distribution of wealth is way out of wack. And most of these populations are *not* better off. But that is not whate we hear in the media.

Of course things can get better, as they wake up and institute their *own* form of economy, like has happened in some places in South America, but international "globalism" is a HUGE failure because it is subjecting so many to mass suffering as it is currently implimented.

[Go2Peace]

45. And some countries, like the Czech republic, listened more to Europe than the IMF

because they were closer in proximity and were naturally closer to their European neighbors.

Read my other post to get a better idea what happened to countries that didn't take that path.

http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=389&topic_id=7018591&mesg_id=7030874

[Toucano]

19. Your distinction is academic.

Globalization would not exist without government intervention. It is predicated on poor governance.

That's actually why it's such a disaster. The market forces are being manipulated by so-called "free trade" agreements.

[Overseas]

20. People pushing "free market" economics revoked Glass Steagall.

And look where that got us-- the Bush Depression. And the looming derivatives crash or propping up.

People who believed in free market economics and didn't want us to enforce antitrust regulations gave us all those companies Too Big To Fail that we have bailed out.

People promoting "free market economics" privatized more and more of our military services, and ushered in lots of war profiteering and reckless illegal conduct by private contractors. Privatization of so many of our military services has made our country far less secure than it once was-- we have paid much more for poorer quality and reckless practices that created more enemies for our country.

People pushing "free market economics" defeated our last attempt at national health insurance in the 90's, telling us the wisdom of the free market could do better. And look where that got us-- soaring private profits, millions more uninsured, millions more bankrupt.

People pushing "free market economics" got us NAFTA. That got them what they wanted, a depressing effect on US wages and union strength. "Free market economics" is promoted with the idea that "a rising tide lifts all boats" and yet it has led to a steady decline in real wages for US workers while "productivity" and private profits soared. But hey, if we average things out, we all got really rich-- Bill Gates and I have an average income in the billions.

[Romulox]

31. It's the "No true Scotsman" fallacy. nt

[Go2Peace]

39. Again, you don't sound like you have lived in one of these countries

The theory sounds nice, but the reality is quite different.

[MellowDem]

41. I have lived in a free market country and visited others...

and really, it's relatively good living. It's not the free market capitalism that causes those problems, it's indemic corruption, authoritarian regimes, etc. etc. that keep the "second world" countries from developing in a wonderfully calm fashion.

[Go2Peace]

42. In other words you have not seen what I describe and have not spent time in a 2cd world country?

Sure "Globalistic free trade" looks good if you are in the right population and country. Honestly, how can you really understand my observations if your experience is not in a second world country that has had this foisted on them?

Do you think that it is OK to impoverish millions through inflation because a minority will be able to consume more goods. Do you think I am a purist who is against all "free market" ideology? Reread my post. I am against foisting a poorly thought out libertarian globalist IMF ideology that harms as many, if not more than it helps.

Let me try to explain it another way. You don't go throwing a child into a pool unless you are prepared to help them float until they can swim. If they die while trying to learn did you achieve what you hoped? And even so, by attaching "libertarian" aspects to it is like making the pool so large the child can't possibly swim out before they are exhausted. You cannot "create" a modern society without a tax base.

Do you really think our environmental laws would have come into place if the majority of the population was just fighting to have a roof and eat? Do you think that you can have an EPA to keep your food sources from being contaminated with human meat (like happened last week in Russia), bacteria, or your water with harmful chemicals? I don't quite understand your position here.

And does the "end" justify the "means", if scores die early and sick while struggling to "get there"?

I am not a fan of communism, but what they have now is a worse standard of living for most, exploitation of women, children in the streets, and pollution without restraint. If that is the "globalist model" we are all in a lot of trouble.

[MellowDem]

47. I never said the "ends justify the means"...

I'm just pointing out that it is the Russian's or whoever's own choice to develop at their own pace and "capitalism" is not to blame as to why their leaders choose to ignore such things as the environment, labor rights, etc. And under communism, Russia was no better off in any of those areas either. It's not too often that authoritarian regimes of any sort put much thought into those things unless they directly challenge their rule.

When America was a "second world" industrializing nation, it took the development of the middle class to push for issues such as the environment or labor rights. And the US was a democracy of sorts at least, whereas Russia has no real history of democracy or any sort of institutions to uphold the power of the citizenry, so any of the problems the general populace faces won't be addressed since they don't really have representation.

Nothing you said has anything to do with how capitalism is to blame for the plight of developing nations. Under any economic system, developing countries face a lot of change and rough challenges. The increase in global trade has made us more aware of their plights, but it doesn't contribute to the source of their problems. A country that treats its people like shit and has a ton of cheap labor that is able to produce goods at very low cost might benefit us in terms of allowing us to buy cheap goods at the cost of humanity, but that is our choice in general and it doesn't keep such harmful policies in place, domestic issues in those developing countries do.

If you want to see what a communist, isolationist authoritarian regime looks like, just look at North Korea. I have no idea if your claim that more Russians are worse off is actually true, but it sounds like a made up "fact".

[Selatius]

17. Most markets in the world are not free. They are typically dominated by oligopolies or one monopoly.

The sooner people realize this, the better off they are when they realize that at least with the government, they can kick out the politicians and hopefully find better ones who are not afraid of dealing with corporate oligarchs.

Comparative advantage works fine on paper, but in the real world, all corporations are doing is moving manufacturing to the cheapest places possible to take advantage of cost differentials between different laborers in different countries. Then, they take the profit for themselves and let everybody else deal with the social upheaval and the environmental damage inflicted.

Comparative advantage is only desirable if society as a whole benefits from it, not just a few. If only a relatively small few benefit from it, there is no point at all in trade, except for the richest. They make out ahead anyway, and they will impose it, even if it means putting their thugs on the street to crush labor protests or topple democratically elected governments that refuse to bow to their wealth and influence.

People need to realize that free markets are just a myth, as mythical as the idea of a workers' paradise. Having said that, I am not opposed to mixing a little more socialism in with the capitalism.

[Toucano]

18. It is a disaster all the way around.

Especially agricultural products.

Under "free trade" agreements, locally produced products in poorer nations have more value as an exported product than when sold domestically.

This drives the prices of basic food items UP in the poorer countries. Why should I sell my neighbor a banana for 10 cents when a foreigner is perfectly willing to pay 30 cents for the same banana?

But wait! It will be okay because the poor nation has all these new jobs, right? No. The wages are low in those new jobs. Thst was the point of exporting the jobs in the first place.

It is just another form of slavery.

[blindpig]

21. At the end of the day it's just capitalism

It's what capitalism does, must do, expand.

It will eat the world if we allow it.

[Romulox]

22. The whole thing is propped up with taxpayer dollars. It's much more like fascism.

It's manipulated on the front end (subsidies), the back end (bailouts) and everywhere in between (US Military protection for shipping lanes, e.g.)

[blindpig]

24. Rather....

Fascism is a variation or stage of capitalism. Consider the Nazis, they could never have come to power without the consent of German capitalists and never fucked with the capitalists at all. The nazis were good for business and were the mortal enemies of those who the capitalists feared most, the commies.

[Romulox]

25. Yep. The monied interests leaning on the levers of power are now pan-national, however. nt

[blindpig]

28. That's capitalism for ya

Grow or die.

[Romulox]

30. LOL. No, it's some sort of new pan-national fascism.

Manipulate the power of governments to your profit or die.

[blindpig]

32. They have no choice

They could not keep up the game on their own, the accelerating rounds of inevitable crisis required something, so they appropriate the governments, just as they appropriate our labor, nature, water, air......

[leftstreet]

34. That's a good way of putting it

so they appropriate the governments, just as they appropriate our labor, nature, water, air......

Indeed

[The2ndWheel]

35. It's just economics

Which economic system doesn't have a need to expand?

[blindpig]

36. Socialism

An economic system which has as it's only purpose the meeting of people's needs, rationally organized. It is the only thing that can work on a finite planet.

Because capitalism must find new places to invest accumulated capital else investors will balk or flee the market if their investment stalls or goes south it is a treadmill of ever increasing crisis, such as we are now experiencing. Even now they are turning water into a commodity, how far behind can be breathable air? And then what?

[anonymous171]

44. State Socialism is a joke.

[blindpig]

50. Another substantive post....

n/t

[Greyhound]

23. Similar to our WTO/IMF scam that enslaves poor nations and ensures they are

ruled by the most foul criminals. We "lend" them large sums with the requirement that these funds are paid to specific (foreign) companies to build expensive projects. Of course this country can never hope to repay that much money especially with the interest charged so they default on the loan. Now the IMF comes in and imposes their "austerity" programs, slashing/eliminating any and all social programs, and forcing the sale of that nation's natural resources for so little that the debt just continues to grow.

So in the end, the government becomes another kleptocratic "failed state" (in the cases where it wasn't already), the select corporations make a killing, the bank makes a killing, and the "leaders" make a killing, and the citizens are relegated to generations of servitude to the corporations that move in for the plunder.

Why do they hate us?

ETA; and they have this big shiny new, and utterly useless, project with no infrastructure and nobody capable of running it and without the means to even maintain it.

[Lydia Leftcoast]

27. The "shock therapy" that Milton Friedman's disciples imposed on Eastern Europe

was a crime.

They couldn't get free rein to impose their ideas in the U.S. (our lawmakers have just enough smarts to prevent it), but they went whole hog on Eastern Europe and the former Soviet Union.

We all saw the news reports of Russians selling their furniture to buy basic food, even as the same news reports were full of the opening of the first McDonald's in Moscow.

In 2001, I attended a translators' convention at which I talked to a representative of a translation agency who had been born in Russia and left as a teenager in the 1970s, under the policy that allowed Jewish emigration. I asked her if she had ever gone back. Yes, she said. She had gone back once in 1995 as an interpreter for a group of American businessmen. During her off hours, she looked up some old school friends and was shocked to find that almost all of them had a lower standard of living than in the 1970s. She told me that she had no desire to visit again; it was too depressing.

I have a friend here in Minneapolis who goes to Russia frequently to do consulting on case management for the country's exploding population of AIDS patients. As such, she gets to see the backwater cities, the ones that were neglected during the Soviet period and are absolutely in shambles now. The social safety net is completely gone. In the old days, most people were poor in Western terms, but there was a level below which you couldn't fall, since jobs were guaranteed. Now, even that assurance is gone.

Or I think of a Russian film I saw at last year's international film festival, Wild Field. It's about a rural doctor who is reduced to operating under 19th century conditions (operating outdoors--because he has no adequate indoor lights-- with vodka as disinfectant and anesthetic). When his district supervisor comes around, he asks for basic supplies, but there are none. The supervisor mentions that years ago, they used to have a fully-equipped clinic, but no more.

I'm no fan of the Soviet system, but it was cruel to impose economic libertarian "shock therapy" on a country where no one had run a business for 70 years. For the first several years, only the criminals prospered. (The Baltic countries and Eastern Europe suffered, too, but did somewhat better because it had only been 45 years since anyone had run a business.)

[DU GrovelBot]

33. ## PLEASE DONATE TO DEMOCRATIC UNDERGROUND! ##

This week is our fourth quarter 2009 fund drive. Democratic Underground is
a completely independent website. We depend on donations from our members
to cover our costs. Please take a moment to donate! Thank you!

[Toucano]

37. kick. n /t

[taught_me_patience]

53. Do you have any sources?

Or is the "gut feel"? Standard of living has increased all around the world.

[unlegendary]

54. Do your part for "free marketing"

Well in the name of free markets the next time you see a well heeled puke (republiCONartist) involved in a bad car wreck or his or her house is on fire be a free marketer and demand payment before dialing 911 for them. When they complain just tell them you're doing your part for free markets.
What? You have no cash on hand, but you have multiple broken bones and your car is about to explode from leaking gasoline? What? You're stuck on the 3rd floor and there's no escape from all the flames? Sorry pal.. I don't take credit cards, but will take that $50000 Rolex if it still works.. Don't worry.. I'll just cut your hand off if you can't slip it off your wrist in time. This ain't no damned welfare state ya know.