Ñòðàíèöà: 10/12
For a time, local governments tries to stave off default by lending their reserves of foreign currency to indebted firms. South Korea used up some $30 billion in this way. But this money soon ran out. Western banks refused to make new loans or roll over old debts. Asian businesses defaulted, cutting output and laying off workers. As the economies worsened, panic intensified. Asian currencies lost 35 to 85 per cent of their foreign- exchange value, driving up prices on imported goods and pushing down the standard of living. Businesses large and small were driven to bankruptcy by the sudden drying up of credit; within a year, millions of workers had lost jobs while prices of basic foodstuffs soared.
As the crisis unfolded, IMF officials flew to Asia to arrange a bailout, agreeing ultimately to loan $120 billion to Thailand, Indonesia and South Korea. When announcing these loans, the press used terms like “emergency assistance” and “international rescue package,” leading the casual reader to presume that the money will be spent on food for the hungry, or aid to the jobless. In float, the money is used to “help” countries pay bank their debts to international banks and brokerage houses. Which international banks and brokerage house? The same ones who made speculative loans in the first place, then panicked and brought about the collapse of the Asian economies. The IMF rescue packages are intended only to rescue the Western creditors.
The Western financial industry, moreover, has been lobbying heavily for even more secure protection from future losses. One plan, put forward last year by the US and US Treasuries, envisions a $90 billion fund of public money, supposedly to avert currency crises. The idea is that G7 governments will, henceforth, underwrite the finance industry’s speculative ventures into emerging, markets before, rather than after, they turn sour. In this way, when bankers and fund mangers grow bored with a particular market, withdraw their funds and send the currency into a tailspin, they can collect on their losses immediately, without the tedious and time- consuming delays generated by IMF negotiations.
The industry has also been working overtime to squelch defensive government action against their speculative attacks. At a recent conference in New York City, economist Jagdish Bhagwati noted that the IMF and the US Government, despite repeated crises and heavy criticism have intensities pressures on countries to lift exchange controls. The IMF recently proposed changing its Articles of Agreement so as to require countries to permit even more freedom for financial speculations. Echoing this sentiment, US Treasury official Lawrence Summers decried efforts by Malaysia, Hong Kong and other to curb foreign lending, calling capital controls “a catastrophe” and urging countries to “open up to foreign financial service” providers, and all the competition, capital and expertise they bring with them.
Critics of IMF and US policy have, of course, noted that the combination of free flowing capital and bailout funds are a boon to banks other creditors. Such IMF critics as financier George Soros and Harvard’s Jeffrey Sachs complain that the game of international speculation and bailout played by the Western financial establishment- in which hot money rushes into a country, then pulls out, leaving behind a wrecked economy to be cleaned up by local governments and G7 taxpayers- is a menace to world economic stability. For the Western financial establishment, however, the bailouts are not the real prize. Nor are the devastated economies of Asia an unfortunate side-effect of a financial scamp. They are the while point of the game. Asia’s bankrupt businesses, insolvent banks and jobless millions are the spoils of what economist Michel Chossudovsky aptly calls “financial warfare”. The gains to be won from these financial hit-and-runs are immense. There are, first of all, the foreign- exchange reserves of the target countries. Countries accumulate currency reserves by running trade surpluses, often after year upon year of selling more abroad than they purchase. These surpluses are accumulated at great cost to the working populations, who labor hard to produce goods, destined to be consumed by foreigners. In 1997-1998, Asian countries spent nearly $100 billion in accumulated reserves trying- vainly as it turned out- to prevent devaluation. Brazil, the latest country to fall, spent $36 billion defending the real against speculators. Thus, in little over a year, did the Western financial elite confiscate $136 billion of hard-won wealth from the emerging markets.
Ðåôåðàò îïóáëèêîâàí: 11/02/2008