Economics and Society 101: Economic crisis as crisis of imperialism
By ARTURO BOQUIREN
In earlier issues of the Nordis, I described the current food crisis as a crisis of imperialism. The current food crisis can be traced to the several recurring crises that imperialism, or more precisely, the imperialist world system, undergoes. In particular, the current food crisis resulted from imperialism’s continuous attempts to make developing nations dependent on markets.
Imperialism wants developing nations to be dependent on markets because by doing so, imperialism would be assured of access to labor, materials, investment areas, military staging points, and war personnel. In contrast, imperialism and developed nations are not entirely dependent on markets.
Europe, for instance, has its economic union to shield itself from the uncertainty of the world market. The United States conveniently employs “voluntary export restraints” or VER, which are practically political and economic pressures against countries to reduce their exports to the U.S. Thus, it is through VER that the U.S. protects itself from the uncertainties of the market. Of course, Japan is a known practitioner of economic or trade protectionism. All developed countries subsidize industries and agriculture in one form or another. Developed countries promote trade liberalization in the developing world even as they practice protectionism in their home fronts.
Imperialism reproduces various types of crises. The current food crisis is just one of them. The Asian currency crisis, for instance, resulted from imperialism’s success in putting all countries in Asia compete to assume Hong Kong’s role as an economic center after the completion of its handover to the People’s Republic of China (PRoC). However, the PRoC decided to make Hong Kong a special economic zone and Hong Kong’s role in the region, contrary to expectations of international business, continued even with the handover.
Earlier, in its desire to become the new Hong Kong, several Asian countries invested in hotels, offices spaces, and infrastructure. They thought they could be new Asian economic center after Hong Kong’s handover to China.
With China’s institution of Hong Kong as a special economic zone, however, Hong Kong’s role continued in the region and this translated into a the meltdown of Asia’s property sector. In turn, the meltdown of Asia’s property sector translated into a financial crisis (the financial crisis is usually associated with a crisis in the banking sector although the banking sector is only a part of the financial sector).
The crises in Asia’s property and banking/financial sectors underlie the Asian currency crisis of mid-1997 to the early years of the 21st century. Imperialism worsened the crisis in each of countries directly affected by allowing financial analysts to speculate. The speculations are unfortunately accepted as projections thereby worsening the crisis.
The International Monetary Fund (IMF), apart from being one of the reasons for the emergence of the crisis, worsened the crisis by encouraging further speculations and by engaging in speculations itself. The IMF had issued irresponsible statements that cause currencies values to sink. The Philippines has been one of the IMF’s victims in its speculative activities. At various points during the crisis, the IMF gave extremely negative projections on the Philippines. It turned out however that the Philippines was one of the most resilient countries during the crisis. Rapid sinking of currency values actually benefits imperialism because they are able to buy off local firms or even government firms under the guise of privatizations.
As mentioned in the earlier discussions of this column, imperialism is the one to blame for the current food crisis because of its continuing attempts to put economies dependent on markets. A wiser decision would be to construct economies that utilize both market and non-market mechanism to ensure food security and economic stability. Markets are not always up and while non-market measures, although they help ensure that social goals are met, can lead to inefficiencies and shortages.
Of course, the governments are also to be blamed because of their complicity to the wishes of imperialism. As to why there is complicity can be rooted to the similarity of interests between local economic and political rulers and imperialism. And, thus, the solution to the problem cannot be found in democratic policy alone but in the empowerment of the marginalized in all countries of the world. Only through the genuine empowerment of the people can imperialism be addressed. #
(The writer maintains a blog at www.geocities.com/arturoboquiren. Comments can be coursed through www.nordis.net, firstname.lastname@example.org, and +63927-536-8431)