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InvisibleXlea321
Stranger
Registered: 02/26/01
Posts: 9,134
Free market harms the poor
    #1559108 - 05/19/03 01:47 AM (13 years, 6 months ago)

I was wrong. Free market trade policies hurt the poor

The IMF and World Bank orthodoxy is increasing global poverty

Stephen Byers
Monday May 19, 2003
The Guardian

In November 1999, during the World Trade Organisation ministerial conference in Seattle, I watched from my hotel room as thousands demonstrated against the evils of globalisation.
Anarchists clad in black marched alongside grandmothers dressed as turtles and steelworkers from Philadelphia. They saw international trade as a threat - to their jobs, the environment or simply as part of a capitalist conspiracy.

As leader of the delegation from the United Kingdom, I was convinced that the expansion of world trade had the potential to bring major benefits to developing countries and would be one of the key means by which world poverty would be tackled.

In order to achieve this, I believed that developing countries would need to embrace trade liberalisation. This would mean opening up their own domestic markets to international competition. The thinking behind this approach being that the discipline of the market would resolve problems of underperformance, a strong economy would emerge and that, as a result, the poor would benefit. This still remains the position of major international bodies like the IMF and World Bank and is reflected in the system of incentives and penalties which they incorporate in their loan agreements with developing countries. But my mind has changed.

I now believe that this approach is wrong and misguided. Since leaving the cabinet a year ago, I've had the opportunity to see at first hand the consequences of trade policy. No longer sitting in the air-conditioned offices of fellow government ministers I have, instead, been meeting farmers and communities at the sharp end.

It is this experience that has led me to the conclusion that full trade liberalisation is not the way forward. A different approach is needed: one which recognises the importance of managing trade with the objective of achieving development goals.

No one should doubt the hugely significant role that international trade could play in tackling poverty. In terms of income, trade has the potential to be far more important than aid or debt relief for developing countries. For example, an increase in Africa's share of world exports by just 1% could generate around ?43m - five times the total amount of aid received by African countries.

This has led President Museveni of Uganda to say: "Africa does need development assistance, just as it needs debt relief from its crushing international debt burden. But aid and debt relief can only go so far. We are asking for the opportunity to compete, to sell our goods in western markets. In short, we want to trade our way out of poverty."

The World Bank estimates that reform of the international trade rules could take 300 million people out of poverty. Reform is essential because, to put it bluntly, the rules of international trade are rigged against the poorest countries.

Rich nations may be pre pared to open up their own markets, but still keep in place massive subsidies. The quid pro quo for doing this is that developing countries open up their domestic markets. These are then vulnerable to heavily subsidised exports from the developed world.

The course of international trade since 1945 shows that an unfettered global market can fail the poor and that full trade liberalisation brings huge risks and rarely provides the desired outcome. It is more often the case that developing countries which have successfully expanded their economies are those that have been prepared to put in place measures to protect industries while they gain strength and give communities the time to diversify into new areas.

This is not intervention for the sake of it or to prop up failing enterprises, but part of a transitional phase to create strong businesses that can compete on equal terms in the global marketplace without the need for continued protection.

Just look at some examples. Taiwan and South Korea are often held out as being good illustrations of the benefits of trade liberalisation. In fact, they built their international trading strength on the foun dations of government subsidies and heavy investment in infrastructure and skills development while being protected from competition by overseas firms.

In more recent years, those countries which have been able to reduce levels of poverty by increasing economic growth - like China, Vietnam, India and Mozambique - have all had high levels of intervention as part of an overall policy of strengthening domestic sectors.

On the other hand, there are an increasing number of countries in which full-scale trade liberalisation has been applied and then failed to deliver economic growth while allowing domestic markets to be dominated by imports. This often has devastating effects.

Zambia and Ghana are both examples of countries in which the opening up of markets has led to sudden falls in rates of growth with sectors being unable to compete with foreign goods. Even in those countries that have experienced overall economic growth as a result of trade liberalisation, poverty has not necessarily been reduced.

In Mexico during the first half of the 1990s there was economic growth, yet the number of people living below the poverty line increased by 14 million in the 10 years from the mid-1980s. This was due to the fact that the benefits of a more open market all went to the large commercial operators, with the small concerns being squeezed out.

The evidence shows that the benefits that would flow from increased international trade will not materialise if markets are simply left alone. When this happens, liberalisation is used by the rich and powerful international players to make quick gains from short-term investments.

The role of the IMF and World Bank is also of concern. The conditions placed on their loans often force countries into rapid liberalisation, with scant regard to the impact on the poor.

The way forward is through a regime of managed trade in which markets are slowly opened up and trade policy levers like subsidies and tariffs are used to help achieve development goals.

The IMF and World Bank should recognise that questions of trade liberalisation are the responsibility of the WTO where they can be considered in the overall context of achieving poverty reduction and that it is therefore inappropriate to include trade liberalisation as part of a loan agreement.

This represents a departure from the current orthodoxy. It will be opposed by multinational companies who see rich and easy pickings in the markets of the developing world. But such a change would benefit the world's poorest people and that's why it should happen.

? Stephen Byers is Labour MP for North Tyneside. He is a former trade and industry secretary and was a cabinet member from 1998 to 2002.



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Don't worry, B. Caapi


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Invisiblesilversoul7
Chill the FuckOut!
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Re: Free market harms the poor [Re: Xlea321]
    #1559111 - 05/19/03 01:49 AM (13 years, 6 months ago)

This shouldn't be a surprise to anyone.


--------------------


"It is dangerous to be right when the government is wrong."--Voltaire


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OfflineSkikid16
fungus fan

Registered: 06/27/02
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Re: Free market harms the poor [Re: Xlea321]
    #1559313 - 05/19/03 04:14 AM (13 years, 6 months ago)

This is just the unnatural way of doing nature's work.  The population is too high, instead of some natural disaster doing the reduction, its just the dollar mowing down the poor. 

But my sneakers from walmart sure were cheap.  :wink:


--------------------
Re-Defeat Bush in '04


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InvisibleinfidelGOD
illusion

Registered: 04/18/02
Posts: 3,040
Loc: there
Re: Free market harms the poor [Re: Skikid16]
    #1559631 - 05/19/03 11:20 AM (13 years, 6 months ago)

Free market makes stupid people poor.
we, as a nation decided long ago that this was acceptable


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OfflineGazzBut
Refraction

Registered: 10/15/02
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Re: Free market harms the poor [Re: infidelGOD]
    #1559667 - 05/19/03 11:43 AM (13 years, 6 months ago)

More to do with luck than stupidity and perhaps ability to perform mind numbing tasks for 40 years which in itself seems to me fairly stupid!


--------------------
Always Smi2le


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InvisibleinfidelGOD
illusion

Registered: 04/18/02
Posts: 3,040
Loc: there
Re: Free market harms the poor [Re: GazzBut]
    #1559675 - 05/19/03 11:49 AM (13 years, 6 months ago)

I would define stupidity as the inabliilty to adapt to the system. you don't have to agree with the system, but it is what it is and you have to be able to work it. if you can't do that then you're stupid.



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InvisibleXlea321
Stranger
Registered: 02/26/01
Posts: 9,134
Re: Free market harms the poor [Re: infidelGOD]
    #1559697 - 05/19/03 12:05 PM (13 years, 6 months ago)

Nah, if you were born anywhere but america you'd find it just as hard as the "stupid" people do.


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Don't worry, B. Caapi


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OfflineMadtowntripper
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Re: Free market harms the poor [Re: Xlea321]
    #1559834 - 05/19/03 01:16 PM (13 years, 6 months ago)

I wont argue that the free market hurts the poor. But I still say that not much else is better. I mean, whats the alternative?


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After one comes, through contact with it's administrators, no longer to cherish greatly the law as a remedy in abuses, then the bottle becomes a sovereign means of direct action.  If you cannot throw it at least you can always drink out of it.  - Ernest Hemingway

If it is life that you feel you are missing I can tell you where to find it.  In the law courts, in business, in government.  There is nothing occurring in the streets. Nothing but a dumbshow composed of the helpless and the impotent.    -Cormac MacCarthy

He who learns must suffer. And even in our sleep pain that cannot forget falls drop by drop upon the heart, and in our own despair, against our will, comes wisdom to us by the awful grace of God.  - Aeschylus


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Invisibleluvdemshrooms
Two inch dick..but it spins!?


Registered: 11/29/01
Posts: 33,724
Loc: Lost In Space
Re: Free market harms the poor [Re: infidelGOD]
    #1560423 - 05/19/03 04:56 PM (13 years, 6 months ago)

Quote:

Free market makes stupid people poor.
we, as a nation decided long ago that this was acceptable




And it is acceptable.


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You cannot legislate the poor into prosperity by legislating the wealthy out of prosperity. What one person receives without working for another person must work for without receiving. The government cannot give to anybody anything that the government does not first take from somebody else. When half of the people get the idea that they do not have to work because the other half is going to take care of them and when the other half gets the idea that it does no good to work because somebody else is going to get what they work for that my dear friend is the beginning of the end of any nation. You cannot multiply wealth by dividing it. ~ Adrian Rogers


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Offlineatomikfunksoldier
T'was born oftrue in the yearof the cock!

Registered: 04/07/03
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Re: Free market harms the poor [Re: luvdemshrooms]
    #1560455 - 05/19/03 05:07 PM (13 years, 6 months ago)

infidelgod:

"Free market makes stupid people poor.
we, as a nation decided long ago that this was acceptable"

wow, could you get a little bit more ignorant?

lemme guess, you dont know shit about poor people or poverty do you?

please prove me wrong, for humanities sake.


--------------------
enjoy the entertaining indentity i have constructed for you while you can.


Edited by atomikfunksoldier (05/19/03 05:07 PM)


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InvisibleinfidelGOD
illusion

Registered: 04/18/02
Posts: 3,040
Loc: there
Re: Free market harms the poor [Re: atomikfunksoldier]
    #1560504 - 05/19/03 05:22 PM (13 years, 6 months ago)

I qualified that statement with a definition of "stupid".
I don't like it either but that's the way it is...


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InvisibleXlea321
Stranger
Registered: 02/26/01
Posts: 9,134
Re: Free market harms the poor [Re: infidelGOD]
    #1560606 - 05/19/03 05:52 PM (13 years, 6 months ago)

I would define stupidity as the inabliilty to adapt to the system. you don't have to agree with the system, but it is what it is and you have to be able to work it. if you can't do that then you're stupid.

So what do you think of guys who stood up against the holocaust and risked their lives to help people? Would they be stupid for not working with the system?


--------------------
Don't worry, B. Caapi


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InvisibleinfidelGOD
illusion

Registered: 04/18/02
Posts: 3,040
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Re: Free market harms the poor [Re: Xlea321]
    #1560635 - 05/19/03 06:00 PM (13 years, 6 months ago)

no. you're trying to apply a narrow definition to something out of context. I was talking about people having the ability adapt to an economic system (free market) that for the most part, rewards intelligence and hard work. it's not perfect and I hate to see people left behind.. but it's the way our society works. deal with it.



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InvisibleXlea321
Stranger
Registered: 02/26/01
Posts: 9,134
Re: Free market harms the poor [Re: infidelGOD]
    #1560651 - 05/19/03 06:05 PM (13 years, 6 months ago)

Well you were talking about failing to adapt to a system means you're stupid. In a lot of cases it means exactly the opposite.

Are you sure hard work is rewarded? How long do you think Bill Gates would last in an average south east asian slave labour factory? My hunch is that the average 12 year old girl eating a bowlful of rice a day would work him into a state of complete physical and mental collapse within a couple of weeks.

And the 12 year old girls would only get a few cents as their "reward".


--------------------
Don't worry, B. Caapi


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Offlineatomikfunksoldier
T'was born oftrue in the yearof the cock!

Registered: 04/07/03
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Re: Free market harms the poor [Re: Xlea321]
    #1560667 - 05/19/03 06:10 PM (13 years, 6 months ago)

"economic system (free market) that for the most part, rewards intelligence and hard work."

this is incorrect, many intelligent work hard and make very little money, that is a fact.

on the other hand, many stupid people work very little and make lots of money.

please elaborate, i think you are confusing intelligence with greed.


--------------------
enjoy the entertaining indentity i have constructed for you while you can.


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InvisibleinfidelGOD
illusion

Registered: 04/18/02
Posts: 3,040
Loc: there
Re: Free market harms the poor [Re: atomikfunksoldier]
    #1560720 - 05/19/03 06:32 PM (13 years, 6 months ago)

"for the most part rewards intelligence and hard work."


yeah some morons are born into wealth and never have to work a day in their lives. and some intelligent hard working people catch some bad breaks and are never really able to take advantage of the opportunities that a free market gives them. these are exceptions. opportunity is key. hard work or intelligence doesn't guarantee success. but a free market gives opportunities to those who are able to seize them. like I said, it's not perfect...

and no I'm not confusing intelligence with greed. stupid, greedy people usually don't last long. intelligent and greedy people are the ones who make it. the way I see it, there is nothing wrong with rewarding greed... greed is ambition and the opposite of greed is laziness. should we be rewarding that?

yeah a free market can create competitve pressures where some greedy people are tempted to use slave labor or child labor, but you can't blame the system for that. there will always be these people taking advantage of others regardless of the system they're in. that's why we have laws to prevent this kind of thing but of course, once again, it's not perfect... what is? what's the alternative?


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InvisibleXlea321
Stranger
Registered: 02/26/01
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Re: Free market harms the poor [Re: infidelGOD]
    #1562021 - 05/20/03 01:45 AM (13 years, 6 months ago)

What's the alternative? Would it really harm Nike's profits to pay the slaves they abuse and exploit a living wage? To build them a few decent houses? To give the kids one day off a week and give them an education? Give them decent healthcare? Clean up the environment? Reduce pollution levels? Improve working conditions so the kids arn't being poisoned by handling dangerous chemicals at work?

There are a thousand ways you can help people instead of brutalising and enslaving them. It's not hard to think up a few. Instead of making 50 million profit you just make 49.5 million tho - that's the decision you've got to take. The trouble is in the free market the only thing that matters is profit for the few guys at the top - everyone else, the environment etc are secondary.


--------------------
Don't worry, B. Caapi


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OfflineGazzBut
Refraction

Registered: 10/15/02
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Re: Free market harms the poor [Re: infidelGOD]
    #1562312 - 05/20/03 05:02 AM (13 years, 6 months ago)

What you fail to understand is the way the system works there has to be people who supposedly "fail". It cant work for everybody because the greed of those in power makes it top heavy. Then people like you perpetuate it by bolstering your little ego with talk of how you can adapt to the system and are therefore better than these stupid people who are supposedly failing through their own faults.

Obviously some people are stupid and have no one but themselves to blame for their life situation but for many people they are not stupid they are just unlucky and exploited.

cunning eh?


--------------------
Always Smi2le


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InvisibleinfidelGOD
illusion

Registered: 04/18/02
Posts: 3,040
Loc: there
Re: Free market harms the poor [Re: Xlea321]
    #1562361 - 05/20/03 06:48 AM (13 years, 6 months ago)

What's the alternative? Would it really harm Nike's profits to pay the slaves they abuse and exploit a living wage? To build them a few decent houses? To give the kids one day off a week and give them an education? Give them decent healthcare? Clean up the environment? Reduce pollution levels? Improve working conditions so the kids arn't being poisoned by handling dangerous chemicals at work?

I completely agree with you there. I'll just say that it's possible to have a free market AND to have these things...



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InvisibleinfidelGOD
illusion

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Re: Free market harms the poor [Re: GazzBut]
    #1562372 - 05/20/03 06:58 AM (13 years, 6 months ago)

What you fail to understand is the way the system works there has to be people who supposedly "fail".

well sure... isn't that the way it works? I understand it just fine...
isn't that the way EVERY system works? wealth is relative so there will always be people who "fail". what system is there where people don't fail?

It cant work for everybody because the greed of those in power makes it top heavy

who says it should work for EVERYBODY? should the system work for those who refuse to work?

I think some of you are blaming capitalism for the failings of human nature... there will always be people being exploited, no matter what the economic system happens to be. I don't like it either, but I'm not going to blame the system for it, I blame the individuals who are responsible.



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