Customer Reviews

The Globalization of Poverty: Impacts of IMF & World Bank Reforms

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I was originally born in Uganda and I can assure you that Africans have always been suspicious of the so-called "aid" they receive since it almost always comes after a crisis that they can't quite explain (like how did a bunch of poor, illiterate preteens get the money to buy those fancy weapons, or why won't aid agencies buy food from the local farmers and distribute THAT).

Suspicions and rumors are insufficient to counter what appears, on the surface, to be international generosity. That is why I am grateful for Chossudosky's contrarian masterwork. It confirms the fears and suspicions regarding a return to colonialism and economic slavery. The fact that Chossudosky was willing to put his career on the line to write this hard-hitting book is worthy of our attention. He shows, without a shadow of a doubt, that there is a deliberate and systematic campaign of "economic genocide" against Africa and all other resource-rich regions. Neoliberalism have mastered the British colonial-era double-speak of "liberty", "democracy", "markets", etc. "Market liberalization" is nothing more than armed robbery. And "investment" is really nothing more than "asset stripping". The Adam Smith phraseology of free-trade and free markets is used, much like their British predecessors, to recolonize the world. Chossudosky shows how the "Washington Consesus" has embarked on a foreign policy strategy of economic sabotage and "strangulation." As Kissinger famously ordered, in the now declassified National Security Memorandum 200, Africans should be kept from becoming consumers of their own raw materials.

Chossudosky does an enormous favors to us neophytes by decoding the neoclassical econo-babble. His brilliant deconstruction of IMF structural adjustment policies is worth the price of this book alone. But he goes beyond that. He shows how nations can be brought to their knees through currency devaluations and speculative attacks. The whole cynical process of creating the crisis then blaming it on the victims, i.e. the "Asian" Crisis which is in fact an American Crisis, or the excuse used to maintain Odious Debt on impoverished nations: "their corrupt leaders are to blame for the Odious Debt". Yes but those "corrupt" leaders were trained at American military bases (much like the 9/11 hijackers), and are killing us with American made weapons (thanks again Kissinger). Besides, everytimes Africans (or Latin Americans) try to put a reformer or socialist democrat in power, he develops a nasty habit of being assisinated.

This book will make you angry at how long and how often you've been lied to. Everything you thought you knew about economics will be tested as the Machiavellian machinations of international creditors, grain companies, and financial "investors" is revealed in page after riveting page. I also recommend Michael Hudson's Super Imperialism and Horowitz' Emerging Viruses. If it's not out of print then get The Merchants of Grain. Some publishing companies are refusing to publish some of these books because of their controvesial nature so get them before they're made "out of print".

With the North American governments and their media flacks noisily championing "economic liberalisation", dissenting voices are muted. The voices of those most directly affected by "globalisation" are fainter yet. Michel Chossudovsky attempts to overcome the raucous proponents of "international free trade" with an examination of just what it does and how it impacts civil societies. The picture he provides isn't pleasant. However, turning away will not cause it to fade from lack of our attention. In fact, reading this book is an eye-opening, if not eyebrow raising experience.

Among the rare critics of globalization Chossudovsky has "on-site" credentials beyond his academic base. He's been on the scene of several nations subjected to International Monetary Fund and World Bank policies. He examines the results of these and other international financial agencies' policies. From Chile through Rwanda to Somlia and Korea, he shows how a new form of warfare is under way. Conquest no longer requires bullets to occupy a nation nor suppress a people. Conquerers now wield position papers, American dollars or Euros and trade impositions. Surrender agreements come in the form of "conditions" accompanying loans and investments. These dicta result in the stripping away of social programmes, alienation of subsistence farm holdings and displacement of vast numbers. These people, deprived of income, traditions and opportunity have become a new breed. They are the hopeless poor for which no amount of "aid" can provide succour.

As he demonstrates repeatedly, the mechanism is simple. The formation of the IMF gave financiers, chiefly North American, a cudgel to change governments, force farmers and pastoralists to convert to cash crop economies, and reduce or eliminate government services. The initial steps were instituted by the Bretton Woods conferences designed to restore nations devastated by World War II. Private financial institutions imposed conditions on loans granted to recovering countries. "Recovering" countries rapidly expanded into "developing" countries as these institutions recognised the value of cheap labour in them. Accepting "foreign investment" led to indebtedness difficult to repay. Defaulting was unacceptable to both borrower and lender, leading to new rounds of loans. These, however, rarely reached the borrowing nation since the new funds were set against the older debt. "Servicing the debt" meant imposition of stringent conditions, ranging from privatisation of services, amalgamation of small land holdings to produce crops to be purchased cheaply, but sold at inflated prices. The consumers of these goods are you and your neighbours.

Each of the nations Chossudovsky examines suffers the same schedule of "structural adjustment programmes" imposed by the IMF. These SAPs outline the changes a nation must endure to receive the "benefits" of globalization. Restrictions on outside investment must be eliminated, with the concomitant privatisation of state-owned facilities and services. Where workers aren't laid off, their wages are frozen or reduced. Local currencies must be adjusted to American dollars, which has the impact of intense inflation spirals almost overnight. The result is a populace under increasing pressure, marginal or famine-stricken and powerless. Civil unrest isn't an option, since disruption brings reprisals - often, of course, the withdrawal of investment, failure to renew loan guarantees or simply real military action.

Although the repetitive nature of the manipulations of the financial institutions on national sovereignty leads Chossudovsky to some redundancy, the reader should understand we are dealing with a global crisis. "Bitter medicine" and "bitter irony" recur, because the circumstances he describes are redundant. An imposing and sometimes intimidating account, he is careful to shift the responsibility to institutions rather than consumers. It is, however, the developed country consumer that provides motivation for many levels of the problem. Chossudovsky's analysis is thorough, well-founded and expressive. He shows why social unrest in "developing" countries is the result of imposed conditions, not unstable populations and environments. That he offers little in the way of solutions for the predicament the world now suffers is only testimony to the immensity of the task ahead. [stephen a. haines - Ottawa, Canada]

M. Chossudovsky attacks head on the New World Order imposed by the World Bank (WB0), the IMF and the WTO, calling their economic 'reforms' enforced on countries in distress not less than genocides.

Their 'free market' system is rigged. The WTO agreements grant entrenched rights to the world's largest financial and industrial conglomerates, derogating the ability of national governments to regulate their economies. The IMF programs enforce governments to privatize big chunks of their national economy, liberalize their markets and downsize social provisions (education, health, social security).
Their 'free' market system is synonym of human poverty, destruction of the natural environment, social apartheid, racism and ethnic strife, undermining of women's rights, economic dislocations, forced displacements, landless farmers, shuttered factories and jobless workers.
More, he accuses the IMF of supporting the appropriation of global wealth by speculators through manipulation of currency and commodity markets. It even manipulates itself its economic statistics in order to show that its policies work. Finally, it cooperates with warmongerers and 'peace keepers'.

He illustrates his verdicts with a host of examples.
Somalia: the entire social fabric of the pastoralist economy was undone through duty-free beef and dairy products from the EU.
Rwanda: the restructuring of the agricultural system precipitated the population into destitution, leading to a genocide.
Ethiopia: the Structural Adjustment Programme caused starvation.
Bangladesh: a devaluation and price liberalization exacerbated famine. Deregulation of the grain market meant dumping of US grain surpluses.
Brazil: enhancement of social polarization by supporting the land-owning class.
Peru: after liberalization, the price of bread increased more than 12 times.
Russia: helping the oligarchs.
India (Andhra Pradesh): repeal of minimum wages and support of caste exploitation
Yugoslavia: serving the strategic interests of Germany and the US by cutting the financial arteries between Belgrade and the republics.
Korea, Thailand, Indonesia: the vaults of the central banks (100 billion $) were pillaged by international speculators. The bail-outs of those countries were underwritten and guaranteed by the same Wall Street banks involved in the speculative assaults.

The author proposes a solution which will be extremely difficult to implement in our actual world, where media and governments are controlled by the powerful: democratization of the economic system and ownership structures, disarming of speculation, redistribution of income and wealth and rebuilding the Welfare State.

Michel Chossudovsky's book constitutes a devastating denunciation of an inhuman system sold by economic strangulating wolves clad in sheepskins.
It confirms the forceful analysis of globalization by Joseph Stiglitz.

A must read.

I also recommend a voice from the South: Walden Bello.

Michel Chossudovsky wrote one of the best books on 9-11 with "The War on Globalization" and has maintained the same high standard with this work, which details through charts and significant documentation the tragedy poisoning the world community with globalization.

The Canadian economist takes aim early on Milton Friedman and his Chicago School, explaining the roots of economic tragedy in Chile through the concept of privatization. He takes his position forward, bolstered by much research, some by himself, while also by colleagues in his Global Research organization,in which economic patterns in affected nations are closely analyzed. One tragic instance is Vietnam, in which disease epidemics are costing numerous lives. The wickedness of privatization is the reason as government programs are cut, wages are deindexed, and the nation has neither the capital nor human resources to meet the burden involved. Another fascinating case study supplied by Chossudovsky is that of Brazil, where a president was constitutionally uprooted so that multinational conglomerates could take over to run roughshod over the economy. Meanwhile the corporate media refuses to tackle this issue while protesters at World Trade Organization conferences are summarily denounced as scruffy radicals.

The word conditionality is used repeatedly. It is tied in with the causal relationship between governments acquiring loans from the World Bank under terms set forth initially by the 1946 Breton Woods Agreement. Conditionality is a fancy word for stripping a nation bare, cutting social services to pay back loan money, at the same time allowing multinationals to arrive in the nations involved and assume control.

The globalization pattern is what is afflicting America in the global job market. With nations such as India and Bangladesh brought to their knees by globalization policies, major American corporations can employ cheap labor, displacing Americans, who are summarily thrown on the employment lines. Thus far this critical issue has not been satisfactorily and openly addressed in the current presidential season, the exception being the candor and courage demonstrated by Congressman Dennis Kucinich of Ohio, who has seen this policy disastrously impact on many constituents in a heavily industrialized state where workers are dangerously losing jobs through foreign displacement.

Although it saddens me to see a strong literature emerging today that was largely anticipated and ignored by people like David Barnett with his Global Reach work in the 1970's, it is a good thing that strong voices like those of this author are now making very comprehensive documented cases for how corporate power and privatized wealth are collapsing nations, bankrupting economies, and impoverishing more and more people unnecessarily.

The table of contents of this book is extraordinarily details and brilliant in its organization. Although the book is mostly case studies that one can read through rapidly if accepting of the author's key points, this may well be one of the finest itemizations of the ills of the 21st century: corporate power run amok, privatization and concentration of wealth (which is, incidentally, one of the precondition for revolution), the collapse of national and local economies (e.g. Wal-Mart), the dismantling of the welfare safety net in most countries, and the outbreak and spread of famine and civil war.

The author is probably the foremost scholar and commentator on how the "free" market is not so free, and how the existing capitalist system is predatory, aided by locked in privileges that the International Monetary Fund and the World Bank impose on nations foolish enough to accept their intervention. In this the author is consistent with Jeffrey Sachs (The End of Poverty) who has put forward the need for a complete make-over of developmental economics, to include an end of the normal business practices of the IMF and the World Bank.

I was tempted to remove one star for lack of sufficient reference to the works of others, but the personal insights and comprehensive review caused me to leave the ranking at five stars. I see a clear pattern emerging in the literature (see my other 700+ reviews) and what I am waiting for is for someone to cut the spines off all these books and "make sense" of the total picture in a manner comprehensible to the indivdual voter.

If we are to restore informed democracy and moral capitalism, this book is one of the foundation stones.

See also:
Confessions of an Economic Hit Man
Crossing the Rubicon: The Decline of the American Empire at the End of the Age of Oil
The Global Class War: How America's Bipartisan Elite Lost Our Future - and What It Will Take to Win It Back
War on the Middle Class: How the Government, Big Business, and Special Interest Groups Are Waging War onthe American Dream and How to Fight Back
Screwed: The Undeclared War Against the Middle Class - And What We Can Do about It (BK Currents)
The Working Poor: Invisible in America
Off the Books: The Underground Economy of the Urban Poor
Nickel and Dimed: On (Not) Getting By in America

Chossudovsky is a brilliant economist and a burning torch for the truth that people are unable to see, hear, or accept due to the propaganda schemas that are embedded in their minds (like a microchip programming) by the global media cartel and the political demagogues.
Chossudovski analyzes the past and the present in relation to debt, globalization, and international financing. He dispels the myth of the good samaritan (like the IMF, the World bank, and the Federal Reserve, etc) that destroys economies of other countries, and impoverish them under the guise of capitalism (actually corporate socialism) and freedom, in order to own them. He clearly elucidates the dollarization process and its role in the New World Order. This book makes a powerful reading that sheds the light on a vanishing truth. I would highly recommend this volume to anyone who is interested in world finance as well as their future, and the future of their children.

Unarguably, Klein's The Shock Doctrine reads like a thriller. Klein is an excellent researcher, so the book is also amply supported with great reference sources. But regardless of the strong emotional impact of her presentation, Klein's photographic close-ups are just that. Chossudovsky, on the other hand, is an economist and concerned with the bigger picture. With clear presentation of facts in a wider context he analyzes the logic and the mechanics of the forces shaping today's economy and politics on the global scale. Chossudovsky's book may not be as well known among general readership as Klein's - it is certainly less publicized, but it should be read alongside Klein. It makes an essential reading for understanding today's world.

As we watch the economic melt down [or is it a take down?] of the US and first world countries at this period in time, it has a familiar M.O. that Michel Chossudovsky describes. Wealth is not local but global. The banks are given more and the real wealth producing industries are being reduced or eliminated. Vulture capitalism offers little for sustaining a middle class or entrepreneurial class in any country. Mostly the economic decisions are insane except if you want a permanent underclass and overclass.

The writing is dense and almost too much to absorb not because of the density but the meanness of it.

Thanks in large part to the corporate controlled media the tendency is to think of poverty and the machinations of the Chicago boys and the neocons as affecting only people overseas in some third world country that we can choose to ignore. It becomes clear with the information presented in a very well researched, well organized, and cogent manner, that the industrialists and bankers have in effect staged a series of world wide coups, starting in 3rd world countries, extended to Asia, and now even in control of the US government. The people running the IMF and the WTO have far more power than the president of the US and Congress, and the average American in blitheful ignorance continues to believe in the myth of democracy, and the valor of our country's professional soldiers who we pretend are heroes and not the well armed agents of state led terrorism killing hundreds of thousands of people around the world.

After reading even just the first 2o pages a light bulb should go on that the globalization of trade is nothing less than the creation of a fascist new world order that dwarfs even Hitler's (and the German industrialists and Swiss bankers behind him) vision for a Third Reich. This Fourth Reich is not limited by borders any more than the Nazi and holocausts are now a global enterprise for profit every bit as heinous as the extraction of gold from the teeth of Jews by the Germans (which ended up in Swiss bank vaults).

When the people of Honduras or Haiti or Columbia or El Salvador or Mexico are exploited by the industrialists and the bankers behind the IMF, World Bank, and of course both political parties in the US, it is also Americans who suffer with the loss of jobs, loss of collective bargaining power, loss of the environment, loss of pensions, loss of medical and health care, loss of public education, and ultimately a shorter life span than 26 other countries. Free enterprise is just a euphemism for piracy and the ability to ignore any social contracts, past, present, or in the future. Human rights disappear first in Guantanamo and then in US courts.

This book does the best job of documenting the activities that have occurred over the past 40 years that are rapidly creating an Orwellian world on a truly global scale that threatens all of humanity. The environmental destruction is going to further exacerbate the famines now happening on an unprecedented scale and the industrialists and bankers and coupon clippers who now think they can hide away in their gated communities while sending their children off to private schools and vacationing in exclusive resorts with armed guards are going to find that the toxic world they have created is going to ultimately result in their demise as well.

As the author demonstrates the world is rapidly becoming a two class society in every country with the super rich and the poor and a dwindling middle class. One only needs to visit a country like Haiti or Honduras to see the stunted economic growth and environmental destruction and the rich in their homes with bars on the windows to see the end result of the neocon's misguided greed. Instead of helping to create a bigger pie where everyone benefits we have the elites using their power to grab bigger pieces from a shrinking pie, ignorant of the folly of this strategy.

Many great civilizations have been obliterated over past millennia and our relatively short lived civilization is likely to pass into history as well with only our concrete highways and buildings and industrial waste dumps left for posterity to judge our accomplishments and our shortcomings. At least after reading this book the chief culprits involved will be easier to identify, though the one omission in the book is the people behind the curtains pulling the strings. It is not Milton Friedman but people like Nixon, Reagan, Bush I, Clinton, Bush II, and even Obama, that have used his misguided macro economic theories to justify the pillaging of the world. The overthrow of the democratically elected governments in Iran, Iraq, Haiti, Guatemala, El Salvador, Bolivia, Argentina, Chile, the Philippines, Indonesia, and any other country where there were resources and people to exploit, required the active involvement of American presidents and their staff and bagmen like Oliver North, Henry Kissinger, and now Hillary Clinton. Cheney.

I think this is a great book, very educational and shines a light on how things really work. Highly recommend!