(c) Copyright 1999: Graham L. Strachan
1st April 1999
So that politicians can globalise their countries economically without openly committing treason, two phony versions of well-known economic theories have been concocted: ‘economic rationalism’ and ‘free trade’. These economic theories and policies based on them are transferring economic ownership and control out of national hands and into global hands. This is indisputable fact, the only question is whether or not it is intentional. Why do I say they are phony?
ECONOMIC RATIONALISM is supposed to be ‘free market economics’. Is it?
To have free market economics you first need a market. A market is an economic system in which many competitors compete for customers by trying to provide the best quality products or services at the cheapest possible price.
So is a monopoly a competitive market (say Telstra before Optus)? No? What about a duopoly (say Telstra after Optus, or the 2 airlines under two airline policy)? A ‘market’? No? What about an oligopoly, a market controlled by (say) 3 big operators (the Australian grocery ‘market’, 80% controlled by 3 big operators). Is that a market? Oligopoly is a market only if you stretch the meaning of ‘market’. And THAT is the form of most markets in Australia today.
Suppose oligopoly is a ‘market’ (which is not conceded). A FREE market is one free (‘deregulated’) of government controls, including no preferential treatment for any of the ‘players’. A ‘level playing field’. So what if the government lets the big foreign players, but not the small national players, avoid tax (which it does), gives them R&D concessions (which it does), and in many cases direct subsidies (cash payments) to set up or keep operating (which it does). What then? Is that a level playing field’? Is that a ‘free market’? By what stretch of the imagination? Under a ‘free market’ like that, the big foreign players will buy up or wipe out smaller nationally-owned players, transferrring national ownership of assets and control of national economies to global interests: exactly the programme of globalisation. Is that what’s happening? Absolutely! Is it supposed to do that? Only a child (or a ‘free market’ economic mystic) would even doubt it!
Genuine free market economics allowed that some corporations and all public utilities could be owned by the public sector. Economic rationalism insists that they be sold. Who ends up owning them? Well, transnationals and foreign investors. Ownership of assets is transferred out of national into international hands. It's that li'l ol' programme of globalisation again. Amazing. What about the 'mums and dads shareholders'? What about the tooth fairy?
Let’s consider FREE TRADE. Free trade means no barriers to imports or exports between nations.
Unless all the participating nations have similar costs of production, free trade will wipe out industries and farms in the higher cost countries unless they can reduce their costs (labour and materials) to match their lower cost competitors.
If their labour costs are inflexible, either due to minimum wage policies, or to the social expectations and living standards in their countries, all their cost savings must come from the other inputs of production (raw materials, fertilisers, etc).
If the cost of those inputs is relatively inflexible too, (for example, because the chief suppliers are transnational oligopolists and they keep their prices high), the industries and farmers in the high cost countries will go bankrupt. They can then be bought up by foreign transnationals or investors at bargain basement prices, transferring assets and economic control out of nations and into internationalist hands: precisely the programme of globalism. Is that happening? Absolutely! Is it deliberate? Only a child or a free trade economic mystic would doubt it for a moment.
What about 'comparative advantage', countries concentrating on producing and exporting those things they can produce cheapest? Sounds good? Through debt for equity swaps, many countries no longer own or control the assets that might give them their comparative advantage. Global capital does. Few countries have an absolute comparative advantage (monopoly) which would enable them to maximise that advantage anyway. They struggle to compete in a climate of deteriorating terms of trade, getting further into debt and selling progressively more of their 'comparative advantage' to global capital. Is that happening? Absolutely. Is it deliberate? Oh, come on!
After levelling out the cost structures of the players, free trade will only continue to work if all players play by the rules. If the major players, particularly those who protest loudest for ‘free trade’ won’t, then there is no free trade and the system is a lie.
America which claims to want free trade, wants it when it benefits America, but not otherwise. Thus when America wants to force bananas or hormone treated beef on Europe, that’s ‘free trade’. When Japan wants to export cheap steel to America, that’s ‘dumping’, and America raises trade barriers. Similarly with Australian lamb. Free trade in that case is not free trade at all, but a device to advance American neo-colonialism.
Let’s consider BOTH free markets and free trade. They are supposed to be ‘good for the world’. Are they? So far, no. Why not?
Because they can only be good for the general population if that is the ultimate purpose of economc policy. If the ultimate purpose of economic policy is profits, not people, then it will further enrich the already rich, and drive the rest of the world down into neo-feudal poverty.
The meaning of ‘rational’ in economic rationalism means ‘reason, not emotions’. ‘Emotions’ includes concern for the plight of people. Economic rationalism and free trade are (at present) amoral, and as such can only benefit global capitalists and their hangers on. Is that happening? Absolutely! Is it deliberate? Only ‘free market’ and ‘free trade’ economic mystics would doubt it for a moment!
In the meantime both these so-called economic policies and their underlying ‘theories’ (ideologies) are implementing globalism: destroying national ownership and control of economies, and transferring the assets and control to central TNCs and the international bankers that own them. And that, in my submission, is precisely what they are intended to do.
EVEN IF economic rationalism and free trade were the genuine articles (neo-classical economics, which is not conceded), the government has NO MANDATE to adopt economic policies which have the effect of transferring Australian economic sovereignty to foreign interests, destroying the farms and businesses of hundreds of thousands of Australian producers in the process, without the EXPRESS INFORMED CONSENT of the voters at referendum. No such consent has been obtained or sought. Unless and until it is, it is my submission that this government is fraudulently misrepresenting its allegiance to the Australian people, and is in fact implementing globalism on behalf of the 'international community', whatever that is. There's a word for that sort of behaviour.