What would it take to make poverty history?

November 10, 2006

On November 18-19, the G20 meeting in Melbourne will bring together the finance ministers of the powerful G8 group of nations with those of Australia, the European Union and 10 of the largest Third World economies, along with the heads of the World Bank and the International Monetary Fund.

During those two days, more than 50,000 children will die from preventable diseases, 2800 women will die in pregnancy or childbirth, and more than 16,000 people will die as a result of HIV and AIDS. The G20 promotes policies that cause this genocide by poverty.

Spelled out in the 2004 "Accord for Sustained Growth", these policies include: the elimination of restrictions on the international movement of capital; "flexible" labour market conditions; privatisation; enforcement of intellectual and other private property rights; creating a business climate conducive to foreign direct investment; and global trade liberalisation (through the World Trade Organisation and bilateral "free-trade" agreements).

As if to illustrate the saying that behind the hidden hand of the market is the iron fist of imperialist militarism, the World Bank will be represented by Paul Wolfowitz, one of the architects of the war on Iraq, which has killed upwards of 650,000 people so far.


The spin doctors' claim that free-market policies represent a strategy for ending world poverty is an extraordinary inversion of reality. The biggest killer of children is preventable diseases caused by lack of clean water. The G20's solution — the privatisation of water supplies for the benefit of Western multinationals — will decrease access to clean water.

The term "free market" is deceptive. Freedom for multinationals to exploit human and natural resources takes away freedom from people. The Democratic Republic of the Congo is one of the richest countries in the world in terms of natural resources, yet one of the poorest in terms of its population. This is because 32 Western corporations own the country's mineral wealth.

The lengths to which these corporations will go to protect this freedom of ownership was demonstrated by Australian company Anvil Mining in the village of Kilwa in October 2004. To protect a silver and copper mine from impoverished locals, the company employed Congolese soldiers, transported in company vehicles, to kill and rape locals, leaving more than 100 dead.

"Intellectual property rights" is another benign sounding phrase for a malignant reality. It describes the monopolisation of technological know-how by multinational corporations, which more often than not simply buy patents that are the fruits of publicly funded research. By giving ownership of ideas to the multinationals, the "international community" represented by forums such as the G20 seeks to criminalise poor countries' attempts to develop and control their own resources.


Another way in which Western corporations plunder the Third World is through debt. Debts are generally incurred by undemocratic Western-supported Third World governments to pay for infrastructure that benefits multinationals and military expenditure to protect their investments.

High interest rates make these debts unsustainable. For example, Nigeria has to date repaid US$16 billion on an initial US$5 billion loan yet still owes US$32 billion! Between 1982 and 1996, Latin America repaid US$740 billion in debt — more than double the $300 billion it borrowed in 1982 — but still owed $607 billion.

For every $1 of US aid to Africa, $3 is taken back in debt repayments. The human cost of this is illustrated by Zambia, which spends twice as much on debt repayment as on education. In Malawi, where one in five people are HIV-positive, the government spends more on debt repayment than on health.

Forums like the G20 meeting usually involve many self-congratulatory pronouncements about debt relief, but the amounts involved are no more than a drop in the ocean and are conditional on the implementation of poverty-increasing privatisation and austerity.


While the agenda of the G20 includes cutting trade barriers, this applies only to Third World, not rich, countries. For example, subsidies to farmers in the rich countries are around $3 billion per annum: more than the combined income of the world's poorest 1.2 billion people. This causes overproduction by rich country farmers, who then sell their produce below cost, impoverishing Third World farmers. Thus, 2% of the world's farmers own two-thirds of trade in agriculture.

The US and European Union governments spend $1 billion per day on agricultural subsidies, six times more than they spend on aid. This leads to the obscenity whereby every European cow receives $2 per day from governments while 1.2 billion people live on less than $1 per day!

In industry, there is a similarly uneven playing field. For example, a shirt imported into the US from Bangladesh will be taxed at 20 times the rate of one coming from Britain.

The climate change crisis is likely to compete with world poverty in the G20s pronouncements. Politicians are finding it increasingly difficult to deny the reality of global warming.

However, as with poverty, the free-market policies that create the problem will be touted as the solution. Politicians' favourite solution at present is carbon emissions trading. Yet in the European Union, a profitable market in trading pollution rights has not stopped emissions from rising.


None of this is necessary. For example, on the question of global warming, fossil fuels could be phased out and replaced by wind-turbine and solar energy. Energy use could be dramatically reduced overnight by replacing car use with public transport as the main means of travel in Western countries.

What stops such common-sense solutions to the impending environmental catastrophe is the same as what stops solutions to global poverty: production for profit, not human need.

Cuba is a small island country without significant natural resources. For centuries it was plundered by Spanish colonialism then US imperialism.

Since Cuba won its independence from US corporate domination in the 1959 revolution, the US has imposed an economic blockade on the country. Following the collapse of the Soviet Union in 1991, Cuba lost 80% of its imports of oil, food and agricultural chemicals. Despite all this, not only does Cuba manage to feed its population, it has lower infant mortality than the US, and free education and health care, things we don't have in Australia despite our country's wealth.

In contrast to the austerity promoted by forums such as the G20, Cuba has dealt with its economic difficulties through a program of organic agriculture and alternative energy. Its highly educated population was understood to be the greatest resource for dealing with the crisis.

Furthermore, Cuba has not achieved this at the expense of other countries. On the contrary, Cuba has more doctors working overseas than the World Health Organisation.

Likewise, in Venezuela, that country's oil resources are now being used to raise living standards and provide education and health care to the previously disempowered poor majority, and in Bolivia the government is working to wrest control of the country's hydrocarbons from foreign corporations.

The secret to these countries' achievements is people power. In Cuba, it took a popular revolution to overcome a US-backed military dictatorship. Since then, the Cuban people have developed a form of democracy that involves popular control of the economy.

In Venezuela, since the election of President Hugo Chavez in 1998, there has been an emphasis on popular participation, reflected in people power defeating a US-backed coup in 2002. Workers' and community control of production, while at an early stage, is developing rapidly.

Only people power can stop the profit-driven insanity of poverty, war and environmental destruction globally. Opinion polls show that on questions from war to global poverty, civil liberties to environmental destruction, the majority of people support the values of human solidarity and sustainability over the values of greed and fear. However, for the values of the majority to shape reality they need to be expressed actively.

The demonstrations against the G20 meeting in Melbourne are part of this global movement of people power.

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