% FROM THE NOAM CHOMSKY ARCHIVE
% http://www.contrib.andrew.cmu.edu:/usr/tp0x/chomsky.html
% ftp://ftp.cs.cmu.edu/user/cap/chomsky/
% Filename:    articles/chomsky.-z.clinton-vision
% Title:       The Clinton Vision
% Author:      Noam Chomsky
% Appeared-in: Z Magazine, December 1993
% Source:      Peacenet conference chomsky.views
% Keywords:    NAFTA, Clinton, economy, free trade
% Synopsis:    Criticizes Clinton's economic and trade policies
% See-also:    articles/chomsky.z.clinton-vision-update

                       THE CLINTON VISION
                          Noam Chomsky
                        October 28, 1993
                    Z Magazine, December 1993


At the end of September, the Clinton Administration finally
addressed ``the vision thing'' in the domain of foreign policy,
with major addresses by the President and Secretary of State, and
of particular significance, by National Security Adviser Anthony
Lake, who laid forth the intellectual foundations of the new
Clinton doctrine at the Johns Hopkins School of Advanced
International Studies. A new National Export Strategy was
announced that set guidelines for international economic policy,
and a White House panel on intervention applied the doctrine in
this particular sphere, all within a few days. The seriousness of
the enterprise was duly recorded with such headlines as ``U.S.
Vision of Foreign Policy Reversed'' (Thomas Friedman, _New York
Times_), implying a dramatic policy change. {note: Address by the
President to the UN General Assembly, Sept. 27; Speech by
Secretary of State Warren Christopher, Columbia U., Sept. 20,
1993. Remarks of Anthony Lake, Assistant to the President for
National Security Affairs, Johns Hopkins U, SAIS, Sept. 21;
Thomas Friedman, ``U.S. Vision of Foreign Policy Reversed,''
_NYT_, Sept. 22; Lake, _NYT_, Sept. 26, 1993. Keith Bradsher,
``Administration Plans New Export Initiative,'' _NYT_ business
section, Sept. 28; Michael Frisby, _WSJ_, Sept. 29, 30, 1993.
Elaine Sciolino, ``U.S. Narrows Terms for Its Peacekeepers: A
White House panel asks, What is in it for us?,'' _NYT_, Sept. 23,
1993.}

The new vision is based on a picture of the contemporary world
that has risen well beyond opinion, to the heights of truism. The
picture is sketched eloquently by the _Times_ chief diplomatic
correspondent, Thomas Friedman: ``America's victory in the cold
war,'' Friedman wrote a year ago, was ``a victory for a set of
political and economic principles: democracy and the free
market.'' At last, the world is coming to understand that ``the
free market is the wave of the future---a future for which
America is both the gatekeeper and the model.'' {note: Friedman,
_NYT_ Week in Review, June 2, 1992.}

The term ``gatekeeper'' has an ominous ring. The whole affair
merits some thoughts about how we keep the gates, who we let in,
and what kind of model we are to offer to the world. We begin
with Anthony Lake's address, recognized to be the centerpiece of
the new vision.


``From Containment to Enlargement''

A long-time liberal dove, Lake explained that ``Throughout the
cold war, we contained a global threat to market democracies: now
we should seek to enlarge their reach.'' Containment having
succeeded, we can now go on to ``enlargement---enlargement of the
world's free community of market democracies.'' The title of his
address is: ``From Containment to Enlargement.'' That is the new
vision that replaces the defensive stance of the past half
century. People everywhere can only hail this new departure,
realizing that ``of course'' the US is unlike any other nation
past or present, Lake observes, in that ``we do not seek to
expand the reach of our institutions by force, subversion or
repression.'' Commentators were duly impressed by this
enlightened stance.

A rational person who wanted to know what Russia (pre-Gorbachev)
was _trying to do_ in world affairs would, naturally, look at
what Russia _did do_ where its influence reached, specifically,
in the East European satellites. Undertaking that exercise, sane
people---assuming that they did not simply collapse in
ridicule---would have known how to evaluate an announcement by
Leonid Brezhnev that the USSR would no longer be content with
containing the Evil Empire, but would now move on to
``enlargement'' of the community of free and democratic
societies. Similarly, sane people who wanted to know what the US
is trying to do in world affairs would look at what it _has done_
where its influence reached, and would evaluate the announcement
of the new vision in these terms---again, assuming that they did
not simply collapse in ridicule. It is interesting that the
questions that would occur to a moderately intelligent ten year
old do not seem to have been raised.

This stance might be justified by the argument often voiced in
sophisticated circles that in the special case of the United
States, facts are irrelevant. Thus in the prestigious journal
_International Security_, the Eaton Professor of the Science of
Government at Harvard instructs us that the United States must
maintain its ``international primacy'' for the benefit of the
world, because its ``national identity is defined by a set of
universal political and economic values,'' namely ``liberty,
democracy, equality, private property, and markets'' (Samuel
Huntington). Since this is a matter of _definition_, so the
Science of Government teaches, it would be an error of logic to
bring up the factual record, and we would simply be illustrating
our silliness by doing so, as if Orwell's Winston Smith had
experimented with objects scattered on a table top to test Big
Brother's denial that $2 + 2 = 4$. {note: _International
Security_, 17:4, 1993.}

Lacking sophistication, let us proceed nonetheless.

We might also tarry briefly on Orwell's core concerns, not given
quite the prominence of his critique of the official enemy. In an
unpublished introduction to _Animal Farm_, Orwell wrote that
``The sinister fact about literary censorship in England is that
it is largely voluntary. Unpopular ideas can be silenced, and
inconvenient facts kept dark, without any need for any official
ban.'' The desired outcome is attained in part by the ``general
tacit agreement that `it wouldn't do' to mention that particular
fact,'' in part as a consequence of media concentration in the
hands of ``wealthy men who have every motive to be dishonest on
certain important topics.'' As a result, ``Anyone who challenges
the prevailing orthodoxy finds himself silenced with surprising
effectiveness.''

Orwell believed that the United States was different, more free
and open. That error was not made by John Dewey, more familiar
with US intellectual culture. Speaking of ``our un-free press,''
he observed that critique of ``specific abuses'' is of limited
value: ``The only really fundamental approach to the problem is
to inquire concerning the necessary effect of the present
economic system upon the whole system of publicity; upon the
judgment of what news is, upon the selection and elimination of
matter that is published, upon the treatment of news in both
editorial and news columns.'' We should ask ``how far genuine
intellectual freedom and social responsibility are possible on
any large scale under the existing economic regime.'' Not very
far, he judged. {note: Orwell, unpublished preface for his
_Animal Farm_; published by Bernard Crick in _Times Literary
Supplement_, Sept. 15, 1972; reprinted in Everyman's Library
edition. Jo Ann Boydston, ed., _John Dewey: The Later Works_,
vol. II, from _Common Sense_, Nov. 1935; see _Necessary
Illusions_, chap. 5.}

The reaction to Clinton's new vision falls well within these
strictures, though to document the (virtually exceptionless)
pattern of which this is a typical instance is something of a
waste of time, as Orwell and Dewey recognized. The more firmly
conclusions are established that challenge system-supportive
doctrine, the more they must be suppressed; if the conclusions
were established by the standards of physics, they would have to
be buried so deep in the memory hole as to be completely beyond
recovery. Those who fail to grasp these simple requirements would
be well advised to seek a trade outside of the respectable
intellectual culture, where the gatekeepers understand what ``it
wouldn't do'' to say or think.

Returning to the questions that would at once occur to a naive
ten year old, to evaluate the announcement of the new vision, we
turn to US behavior in regions where its influence reached. There
are many choices, the US being a global power. But the most
illuminating will surely be the Western Hemisphere, where the US
has long run the show virtually without interference, so its
deepest values and convictions are revealed with great clarity.

According to the doctrine that we are to accept as unquestioned
truth, ``throughout the Cold War we contained a global threat to
market democracies'' in the Western hemisphere, never having
sought to expand our power ``by force, subversion, or
repression,'' from the days when we were ``exterminating . . .
that hapless race of native Americans . . . with such merciless
and perfidious cruelty'' (John Quincy Adams), until the present.
To put the best possible face on the higher truths that it is
unthinkable to question, let us select the peak moments of
American liberalism, the days of JFK and LBJ (who far surpassed
his predecessor in his commitment to liberal ideals). Taking just
the most important case of the many that come to mind, the higher
truth entails, then, that at the peak of modern liberalism, JFK
and LBJ dedicated themselves to the violent overthrow of the
parliamentary government in Brazil in favor of a National
Security State in order to contain a global threat to market
democracy.

So, indeed, the matter was perceived. Kennedy's Ambassador
Lincoln Gordon, who moved on to Washington after helping lay the
groundwork for the coup, lauded the ``democratic rebellion'' of
the neo-Nazi Generals as ``a great victory for the free world,''
``one of the major turning points in world history.'' ``The
principal purpose for the Brazilian revolution was to preserve
and not destroy Brazil's democracy,'' the respected liberal
democratic statesman informed Congress two years later, while the
torturers and murderers were---very visibly---at work. It was
``the single most decisive victory of freedom in the
mid-twentieth century,'' he testified, and should ``create a
greatly improved climate for private investments''---a comment we
may file away for later reference. After leaving the State
Department, Gordon went on to become the President of Johns
Hopkins University, where Lake announced the new revolution in
foreign policy.

As the Generals instituted a regime of fascist terror, Brazil
became ``the Latin American darling of the international business
community,'' the business press reported. It was also hailed by
the leading academic apostles of the free market, much impressed
by the purity of doctrine of the technocrats and the ``miracle''
they had wrought---though in fairness, it should be added that
there were occasional reservations about the sadistic violence by
which the miracle was instituted. The euphoria persisted through
the 1980s, until the fortunes of the rich began to be affected by
the economic disaster, at which point the methods that had been
hailed as a ``real American success story,'' yielding
``impressive economic growth based solidly on capitalism,'' were
suddenly transmuted to a proof of the failure of statist
interference with our market ideals; the self-adulation, not
untypical, is quoted from a highly regarded 1989 scholarly
monograph by Gerald Haines, senior historian of the CIA. {note:
For references, see my _Year 501_ (South End, 1993), chap. 7.}

Brazil is a highly illuminating case, perhaps the reason why ``it
wouldn't do'' to reflect on the obvious lessons. Brazil is far
and away the most important country in Latin America, firmly
under US control since 1945, when it became a ``testing area for
modern scientific methods of industrial development'' applied by
US experts, Haines observes with pride. It is a country with
enormous resources that should be the ``Colossus of the South,''
ranking alongside the ``Colossus of the North,'' as predicted
early in the century. It has had no foreign enemies, and
benefited not only from careful US tutelage but also from
substantial investment. It therefore shows with great clarity
just what the US can achieve in ``enlarging the free community of
market democracies'' under conditions that are near ideal.

The successes are real enough. Brazil has enjoyed a very high
growth rate, which conferred enormous wealth on everyone except
its population---apart from the top few percent, who live at the
standards of the wealthiest Westerners. It is a sharply
two-tiered society. Much of the population live at a level
reminiscent of Central Africa. As Haines was hailing the success
story of American style capitalism, the UN _Report on Human
Development_ ranked this rich and privileged country in 80th
place, alongside of Albania and Paraguay. In the northeast,
Brazilian medical researchers describe a new subspecies:
``pygmies,'' with 40% the brain capacity of humans, thanks to
severe malnutrition in a region with fertile lands, owned by
large plantations that produce export crops in accord with the
doctrines preached by their expert advisers. Hundreds of
thousands of children die of starvation every year in this
success story, which also wins world prizes for child slavery and
murder of street children---in some cases for export of organs
for transplant, according to respected Brazilian sources.

Perhaps Brazil was unusual. We might therefore look elsewhere,
perhaps Guatemala, turned into a ``showcase for capitalism'' in
1954 when Washington overthrew the democratic capitalist
government and soon to celebrate the fortieth year of our
achievements in exterminating another ``hapless race of native
Americans with such merciless and perfidious cruelty,'' along
with others who were in the way. Or El Salvador, the recipient of
some $6 billion in ``aid'' from the US in the 1980s. The results,
always well known outside of Orwell's ``prevailing orthodoxy,''
were recently reviewed by the UN Truth Commission, which
attributed 85% of the horrendous record of atrocities to the
security forces trained, armed, and advised by the US, and
another 10% to the death squads linked to them and to the wealthy
business sector that the US expects to keep firmly in power. The
media meanwhile professed shock at the revelation of what they
had chosen to suppress when it mattered. The Clinton
Administration responded by establishing a Commission to inquire
into this grim history; its mandate was to improve procedures,
nothing more, because ``We don't want to refight the battles of
the 80's. We're not a house-cleaning Administration.'' The
Salvadoran government agreed, issuing an amnesty for the killers
and torturers in gross violation of the peace accords that
established the Truth Commission, which stated that the guilty
must be punished, and rejecting the Truth Commission demand that
the Supreme Court be dismantled in view of its record of
complicity in atrocities.

Immediately after the Truth Commission report appeared, the
political party of the killers (Arena), which the US continues to
support, held its convention to nominate its candidate for the
coming election, Armando Calderon Sol. The party dedicated itself
anew to defending the memory of the founder, Roberto d'Aubuisson,
one of Central America's great murderers, trained at the School
of the Americas, now at Ft. Benning, Georgia. Calderon Sol
declared that the party is united ``more than ever to defend
[d'Aubuisson's] memory,'' while the convention hall echoed with
the Arena theme song, which pledges to make ``El Salvador the
tomb where the Reds will end up''---the term ``Reds'' being
understood quite broadly, as events have shown. {note: For
references, see my _World Orders, Old and New_ (forthcoming). See
this and _Year 501_ for sources not cited here.}

In El Salvador too our defense of market democracy has spared its
beneficiaries no horror. The Salvadoran government procurator for
the defense of children, Victoria de Aviles, recently
acknowledged that the ``big trade in children in El Salvador''
involves not only kidnapping and a gratifying improvement in
exports, but also their use ``for pornographic videos, for organ
transplants, for adoption and for prostitution.'' Hardly a
secret, veteran British Latin America correspondent Hugh
O'Shaughnessy observes, recalling his direct observation of an
operation of the Salvadoran army in June 1982 near the River
Lempa, where the US-trained troops ``had a very successful day's
baby-hunting,'' loading their helicopters with 50 babies whose
``parents have never seen them since.'' O'Shaughnessy's report on
``Takeaway babies farmed to order'' appeared in the London
_Observer_ the same day that the _Times_ featured Anthony Lake's
uplifting and admired remarks on ``enlargement'' of our
traditional mission of mercy and benevolence. {note: _Observer_,
Sept. 26, 1993.}

There is no need to review further how we have ``contained a
global threat to market democracy'' in ``our little region over
here,'' as FDR's Secretary of War, Henry Stimson, described the
Western hemisphere. It is enough to recall a warning issued by
Simon Bolivar in 1822, as he sought to liberate Latin America
from Spanish rule: ``There is at the head of this great continent
a very powerful country, very rich, very warlike, and capable of
anything''---including the evasion of ``inconvenient fact.''

US power has of course reached far beyond the Western hemisphere.
The obvious example that our hypothetical ten year old would look
at to evaluate the presupposed higher truth is the Philippines,
which has benefited from almost a century of US rule, tutelage,
and assistance since its liberation-through-slaughter. The
country is situated in the world's leading growth area, in which
it remains the sole basket case, very much on the Latin American
model. Could that tell us something about our role in advancing
market democracy? One could write a revealing article reviewing
how the question has been addressed in the respectable
literature; a very brief article.

We learn more about our role as ``gatekeeper and model'' from a
World Bank study reported in the London _Financial Times_ just as
the new vision of foreign policy was released here. {note:
Stephen Fidler, ``Latin America `chaos' warning,'' _FT_, Sept.
25/26, 1993.} The World Bank found that Latin America has ``the
most unequal income distribution in the world,'' and predicted
``chaos'' unless governments ``act aggressively against
poverty,'' which is truly appalling in its depth and scale. Why
should Latin America win this glorious record too? Another
obvious question, lying well beyond the horizons of
respectability.

Those interested in an answer might look back to 1945, when the
US was setting out on its crusade to ``contain the global threat
to market democracies''---or as the senior historian of the CIA
puts it, when ``the United States assumed, out of self-interest,
responsibility for the welfare of the world capitalist system.''
In ``our little region over here,'' our foreign enemies---France
and Britain---were to be displaced, so we would have a free hand.
That was simple enough, but another problem arose: Latin
Americans had not taken the right graduate courses and didn't
understand the fundamental principles of economic rationality,
which required that their development be ``complementary'' to the
US economy, in accord with the sacred principle of comparative
advantage. The Latin American countries advocated what a State
Department officer described as ``The philosophy of the New
Nationalism,'' which ``embraces policies designed to bring about
a broader distribution of wealth and to raise the standard of
living of the masses.'' Another State Department expert reported
that ``Economic nationalism is the common denominator of the new
aspirations for industrialization. Latin Americans are convinced
that the first beneficiaries of the development of a country's
resources should be the people of that country.'' These mistaken
priorities ran directly counter to Washington's plans. The issue
came to a head in a February 1945 hemispheric conference, where
the US put forth its ``Economic Charter of the Americas,'' which
called for an end to economic nationalism ``in all its forms.''
The first beneficiaries of a country's resources must be US
investors and their local associates, not ``the people of that
country.'' There can be no ``broader distribution of wealth'' or
improvement in ``the standard of living of the masses,'' unless,
by unlikely accident, that happens to result from policies
designed to serve the interests of those with first priority.

Given US power, economic rationality prevailed, with the
consequences that the World Bank now fears. All happily invisible
to the triumphalists.

Perhaps something changed in more recent years, say the 1980s,
when the yearning for democracy became a leading principle of our
foreign policy, right-thinking people know. Instead of rendering
my judgment, let me cite that of Reagan insider Thomas Carothers,
a State Department official in the Latin American Bureau who
``worked on a variety of assistance projects designed to promote
democracy in Latin America and the Caribbean,'' he reports, and
has written extensively on the consequences; he has no doubts
about the ``sincerity'' of the efforts, though even his own
account suffices to show that they were utterly cynical in
conception.

Carothers finds a correlation between US influence and the rise
of democracy in the hemisphere: a _negative_ correlation. Where
US influence was least, in the southern cone, steps towards
democracy took place, opposed by the Reagan Administration, which
later hastened to take credit for them. Where US influence was
greatest, the effects were worst, in fact far worse than
Carothers recognizes given his crabbed conventional conception of
``democracy,'' though he clearly articulates the main point.
Washington adopted ``prodemocracy policies as a means of
relieving pressure for more radical change,'' he writes, ``but
inevitably sought only limited, top-down forms of democratic
change that did not risk upsetting the traditional structures of
power with which the United States has long been allied.'' Its
``impulse is to promote democratic change, but the underlying
objective is to maintain the basic order of what, historically at
least, are quite undemocratic societies.'' The US keeps to ``very
limited, controlled forms of democratic change'' because of its
``deep fear . . . of populist-based change in Latin America---
with all its implications for upsetting established economic and
political orders and heading off in a leftist direction.'' {note:
Carothers, in Abraham Lowenthal, ed., _Exporting Democracy_
(Johns Hopkins, 1991); _In the Name of Democracy_ (U. of
California, 1991).}

Washington's allies, therefore, are ``the existing power
structures,'' not those who work ``from the bottom up to spread
the ideas and principles of a democratic society among the
citizenries.'' These miscreants, in fact, are the ones left in
ditches, tortured and mutilated, dismissed to their proper place
by the security forces we train, arm, and advise---though
awareness of that decisive truth is too much to expect.

What of the ``global threat'' to the ``market democracies'' we
were defending in Latin America? Take Brazil, where US
intelligence could find no hint of Soviet intrusion, even if that
were imaginable. In fact, in ``our little region'' there have
been no Russians in sight, unless we virtually invited them in.
It is perfectly true that targets of US attack sought help from
somewhere, and since they were not going to get it from the
subordinates of the Enforcer, they ultimately turned to the
Russians, who were sometimes willing to help, for their own
cynical reasons, in which case the US victims became tentacles of
the Evil Empire, whom we must destroy in self-defense.

By similar logic, a Soviet Anthony Lake could have argued that
the USSR was defending freedom and democracy in Afghanistan from
the ``global threat'' of American imperialism and its terrorist
forces---who, since liberation from Soviet rule, have been
destroying and massacring with great zeal and success, another
``inconvenient fact'' that merits little notice. There would, for
example, be little utility in focusing on the exploits of the CIA
favorite Gulbuddin Hekmatyar, one of the world's most extreme
Islamic fundamentalist fanatics, who bears primary responsibility
for 30,000 deaths in the capital city of Kabul alone according to
the London _Economist_, surpassing Pol Pot in Phnom Penh, it
appears.

Perhaps the ``global threat'' refers to indigenous Communists.
Here there is much to say, including some reflections on the
familiar doctrine that democracy requires exclusion of
``Communists'' from the political system, by violence if
necessary. Thus when the US-backed terror regime was doing its
work in Iran after the 1953 CIA-MI6 coup that overthrew the
conservative parliamentary government, the _New York Times_
praised the US clients for their ``long record of success in
defeating subversion without suppressing democracy,'' noting with
pleasure the suppression of the ``pro-Soviet Tudeh party,''
formerly ``a real menace'' but ``considered now to have been
completely liquidated,'' and the ``extreme nationalists'' who had
been almost as subversive as the Communists---all liquidated
without suppressing ``democracy.'' The practice is, again,
standard, and passes with little comment, given the prevailing
concept of ``democracy.''

Still more interesting, perhaps, is the way the concept
``Communist'' is understood. Here the record is voluminous and
consistent: to gain the title ``Communist,'' it is enough to work
``from the bottom up,'' appealing to the ``poor people'' who
``have always wanted to plunder the rich,'' as John Foster Dulles
described the plague. That is precisely why the US terror war in
Central America, motivated by the ``sincere impulse'' to bring
democracy, was in large measure a war against the
Church---``Communists,'' in the technical sense, once the Bishops
had adopted ``the preferential option for the poor.'' Nothing
changes in this regard as new visions replace the old.

The Bush-Clinton approach to Haiti reveals the pattern of
continuity with only tactical modifications. The matter requires
much more careful treatment, but a close look will show that
since the military coup that overthrew President Aristide, the
basic goal has been to impose a settlement that will deny more
than a figurehead role to the elected President, much disliked in
Washington and New York because of his remarkable base of support
in popular organizations that threaten to bring about functioning
democracy. If Aristide can be returned alive, fine; it will offer
opportunities for pieties about our dedication to democracy. But
the bottom line is that effective power must remain with the
``moderate'' and ``progressive'' sectors of the business
classes---meaning those who do not see massacre and torture as
the optimal means to dominate and marginalize the poor majority.
In the interests of ``democracy,'' the ruling sectors will have
to be ``broadened'' to include the torturers and murderers as
well---``conservative critics close to the military,'' as the
_New York Times_ prefers to call them. {note: Howard French,
_NYT_, Oct. 21, 1993.} No problem, because the military will be
professionalized by US trainers, that is, by the same people who
have already civilized the top command in Ft. Benning, including
those now orchestrating the bloodbath---facts quietly omitted
from the standard resumes.

But the government will not be ``broadened'' to include the
overwhelming majority of the population, who are to be reduced to
traditional passivity by the effective use of terror, their
organizations decimated and their leaders either killed or placed
in remote cubicles. We will then be told that this is the best
form of ``democracy'' for backward peoples lacking our
sophistication, democratic culture, civility and respect for
others, and our traditions of freedom and justice.

An important fact about our intellectual culture is that people
can read and write about our long-term policies of defending
market democracy from the Communist threat without laughing. That
takes no little talent. It is real tribute to the educational
institutions and the information system.


Defending Market Economies

Let us drop the drivel about our love of democracy and look at
the market, thus at least approaching the real world. Recall the
one quoted statement of Lincoln Gordon's that does not simply
send shivers up the spine: the neo-Nazi triumph should ``create a
greatly improved climate for private investments,'' as indeed it
did. It is quite true that we seek to impose market discipline on
the Third World, now including the large regions of Eastern
Europe that are to return to their Third World origins. But the
odes to the market are carefully crafted to conceal two important
facts. First, market discipline in the Third World is attractive
because it will leave the societies open to Western plunder.
Second, the wonders of the market are for them, not us, and have
always been: every successful developed society, from Britain to
the East Asian Tigers and dramatically including the US, gained
this status by radical violation of the doctrines we impose on
the poor and keeps that status in the same way.

The second prong of the new vision, Clinton's new international
economic program, reflects the understanding of these truisms.
While Administration rhetoric on the marvels of free trade boomed
on the front pages as part of the PR campaign to ram through an
unpopular (and in fact, highly protectionist) version of a North
American ``free trade'' agreement (NAFTA), the business sections
reported the new National Export Strategy that is to go far
beyond the ``less coordinated efforts'' of Reagan and Bush, with
a planned expansion of Export-Import Bank lending, which as the
Reaganites had conceded in their day, already violated GATT
rules. The Clinton Administration opposes the measures it is
implementing, the press reported, because ``they amount to
government subsidies that distort international markets.'' But
there is no contradiction. As explained by Ex-Im Bank President
Kenneth Brody, ``by creating such a program in the United States,
the Clinton Administration would have more influence in seeking
international limits on such lending.'' The President also
approved an independent program that would release $3 billion in
loan guarantees to domestic and foreign buyers of US-built
ships---again, for the purpose of inducing others to end such
gross interferences in the market, the _Wall Street Journal_
explained.

The logic will be recognized instantly: war brings peace, crime
brings law, arms production and sales bring arms reduction and
nonproliferation, overthrowing democratic governments brings
``showcases for democracy,'' etc. In simple words, anything goes,
as long as there is a good answer to the question: ``What is in
it for us?''

The simple truths were underscored by Clinton's Treasury
Secretary Lloyd Bentsen: ``I'm tired of a level playing field,''
he said: ``We should tilt the playing field for U.S. businesses.
We should have done it twenty years ago.'' In fact, ``we''
(meaning state-corporate power) have been doing it for two
centuries, dramatically so in the past fifty years, even more
under the Reaganites. But that is the wrong image to convey. It
is preferable to speak warmly of Carter-Reagan achievements in
moving ``toward a defense buildup and less government
intervention in the economy''---Harvard economist and _Wall
Street Journal_ contributing editor Robert Barro, pretending (it
has to be a pretense) that he does not know that the Pentagon is,
and has been explicitly designed to be, a massive form of
government interference in the economy to ensure that high-tech
industry feeds at the public trough. {note: Keith Bradsher,
``Administration Plans New Export Initiative,'' _NYT_ business
section, Sept. 28; Michael Frisby, _WSJ_, Sept. 29, 30; Barro,
_WSJ_, Oct. 25, 1993.}

As I discussed here in February, the Reaganites had forged new
paths in violating market orthodoxy for the benefit of US-based
corporations, but they did not go far enough to satisfy the
business community, one reason for the substantial
corporate-financial support for Clinton's program as a New
Democrat. And the new programs, like the old, are described in
the business press, renowned for its devotion to the needs of
working people, as aimed at increasing ``jobs,'' a term that has
taken on the meaning of the unpronounceable word ``profits'' in
conventional Newspeak.

The phrase ``What is in it for us?'' is not mine. I stole it from
the third component of the new Clinton vision, the decisions of
the White House panel on intervention. The Clinton panel
determined to put an end to the era of altruism. No more ``nice
guy,'' as in the days when we turned much of the world into
graveyards and deserts. Henceforth the guiding consideration will
be ``What is in it for us?,'' the words that the _New York Times_
highlighted in its report.

Thomas Friedman's full report on the new ``enlargement'' doctrine
fills in the picture. The National Security Adviser, he observed,
had focused on the fact ``that in a world in which the United
States no longer has to worry daily about a Soviet nuclear
threat, where and how it intervenes abroad is increasingly a
matter of choice.'' That is the ``essence'' of the new doctrine,
Friedman emphasized, a doctrine that clearly and explicitly
reflects the understanding that the ``nuclear threat'' was the
Soviet deterrent to US intervention. Now that the deterrent is
gone, intervention can be freely undertaken, as had been observed
years earlier by others, with the Cold War winding down.

Summarizing, the new vision is that in the international economy,
we will no longer be satisfied by a ``level playing field'' for
US corporations, but will construct a proper tilt by violating
free trade rules even more thoroughly than before. And with the
deterrent gone, we will intervene where and how we choose, though
only when there is something in it for us. The technical term for
this stance is ``the Politics of Meaning,'' to which the Clintons
are said to be sincerely devoted.

Actually, there is nothing new in the new vision, apart from
tactical adjustments reflecting new realities of global power.
The mood of despair in the Third World is easy to understand,
quite apart from the catastrophe of global capitalism that has
ravaged the traditional colonies. It is captured by a leading
Brazilian theologian, Cardinal Paulo Evaristo Arns of Sao Paulo,
Brazil, who observes that throughout the Third World ``there is
hatred and fear: When will they decide to invade us,'' and on
what pretext? And by Egypt's leading newspaper, the
quasi-governmental _Al-Ahram_, which describes the new world
order as ``codified international piracy.''

Another component of the new vision was leaked to the press as
its basic features were being presented in public: a draft report
on government secrecy sent to the National Security Council by
Clinton's Information Security Oversight Office. The report
recommends that classified documents be held for longer than was
the practice during the Cold War, apart from the rule of the
Reaganite reactionaries, whose commitment to state power and
secrecy went far beyond the norm. Their 1982 decision to keep
``virtually all [secret government] documents classifed
indefinitely'' is to be relaxed, AP reported, with restrictions
of only up to 40 years, as compared to Nixon's ``hold period'' of
30 years and Carter's of 20 years. The Clinton task force also
recommended slow and extremely costly document-by-document review
instead of declassification en masse, and called for ``balancing
public interest and national security concerns,'' as determined
by ``agency officials.'' The procedure for automatic
declassification of certain top secret documents, set at 10 years
by Nixon and 6 by Carter, should be extended to 15 years, the
task force proposed. {note: Josef Hebert, AP, Sept. 30, 1993.}

Returning to our attitude towards markets, the doctrinal system
has faced unexpected problems among the population, who were
expected to sit by in silence and ignorance while the state
executives rammed through their secret version of NAFTA, grossly
misdescribed as a ``free trade agreement.'' In the light of
unanticipated popular opposition, it has been necessary to revive
traditional modes of population control.

In earlier years, huge propaganda campaigns had been undertaken
to overcome deviant ideas among the general public, notably after
World War II, when the world was swept by a current of social
reform, bitterly fought by the US government at home and abroad.
Success in reversing these trends was great in most of the world,
including the United States itself, though in Europe and Japan
the attack on labor and democracy did not achieve all of its
goals and countries adopted a kind of ``social contract'' that
included such depraved ideas as health care, workers' rights, and
other departures from the principles for which we serve as a
gatekeeper and a model.

In the US, the wave was beaten back in part through massive
propaganda efforts orchestrated by the Chamber of Commerce and
the Advertising Council, which conducted a $100 million campaign
to use all media to ``sell'' the American economic system---as
they conceived it---to the American people. The program was
officially described as a ``major project of educating the
American people about the economic facts of life.'' Corporations
``started extensive programs to indoctrinate employees,'' the
leading business journal _Fortune_ reported, subjecting their
captive audiences to ``Courses in Economic Education'' and
testing them for commitment to the ``free enterprise''
system---that is, ``Americanism.'' The scale was ``staggering,''
sociologist Daniel Bell (then a _Fortune_ editor) observed, as
the business world sought to reverse the democratizing thrust of
the Depression years and re-establish the ideological hegemony of
the ``free enterprise system.'' A survey conducted by the
American Management Association (AMA) found that many corporate
leaders regarded ``propaganda'' and ``economic education'' as
synonymous, holding that ``We want our people to think right.''
The AMA reported that Communism, socialism, and particular
political parties and unions ``are often common targets of such
campaigns,'' which ``some employers view . . . as a sort of
`battle of loyalties' with the unions''---a rather unequal
battle, given the resources available, including the corporate
media, which offered the services free of charge, then as now.

The results were remarkable, leaving the US off the spectrum of
industrial societies on social issues and basic human rights.
Health care is one case that finally gained attention, as the
highly bureaucratized and inefficient private system began to
become too much of a burden to corporations, though the US will
remain alone, it seems, in ramming through---again, over popular
opposition---a system that is highly regressive (not tax-based)
and that attends carefully to the needs of the few huge insurance
companies that are to take the central management role, at
substantial public cost.

We might note that this is characteristic of the ``welfare
state.'' A _minimally_ realistic picture of the phenomenon will
take into account the fiscal measures designed to benefit the
rich, which amount to hefty government welfare payments.
Reviewing the scale of these devices, political scientist
Christopher Howard points out that ``one crucial fact remains:
the middle- and upper-income classes are the main beneficiaries
of the hidden welfare state.'' Thus ``over 80% of the tax
benefits for home mortgage interest, charitable contributions,
and real estate taxes go to those earning more than $50,000,''
not to speak of ``the large fraction of tax expenditures that
subsidize corporate fringe benefits.'' {note: Howard, ``The
Hidden Welfare State,'' _Political Science Quarterly_, Fall
1993.} Moving on to a _fully_ realistic conception of the
``welfare state,'' we will also take account of the Pentagon
system, export promotion devices, and other measures designed to
provide taxpayer subsidies to the wealthy---to protect ``jobs,''
in standard parlance. The new health reform program is
well-crafted to satisfy the conditions of one-sided class warfare
that guide policy generally.

On health reform, it has so far been possible to keep the options
within a narrow spectrum that excludes the general public, which
continues to favor a standard tax-based (single-payer) system by
considerable margins, as has been the case from the mid-1940s.
{note: For a review of public opinion studies, and the ways in
which the facts have been falsified or suppressed, see Vicente
Navarro, in Navarro, ed., _Why the United States does not have a
National Health Program_ (Baywood, 1992).} But on ``free trade,''
discipline eroded significantly (not necessarily for good
reasons, a different matter). Accordingly, as noted, it was
necessary to undertake ``population control measures,'' to adopt
some terminology of counterinsurgency literature.

Returning to the traditional methods pioneered by the PR
industry, the _New York Times_, in a front-page story, graciously
provided the foolish masses with ``A Primer: Why Economists Favor
Free-Trade Agreement.'' Critics of the executive version of NAFTA
are declared to be ``malicious'' liars, with what they say
entirely ignored apart from the easy and irrelevant targets. The
_Times_ patiently explains the ``fundamental insights'' about
international trade that have not changed for 250 years, citing
the ``legendary textbook'' in which Paul Samuelson quotes John
Stuart Mill as saying that international trade provides ``a more
efficient employment of the productive forces of the world.'' Who
but a lunatic could oppose that? {note: Sylvia Nasar, _NYT_,
Sept. 17, 1993.}

To be concrete, who but a lunatic could have opposed the
development of a textile industry in New England in the early
19th century, when British production was so much more efficient
that half the New England industrial sector would have gone
bankrupt without very high protective tariffs, thus cutting short
industrial development in the United States? Or the high tariffs
that radically undermined economic efficiency to allow the United
States to develop steel and other manufacturing capacities? Or
the gross distortions of the market that created modern
electronics? Who could be so silly as to fail to understand that
we would be far better off if the US were still pursuing its
comparative advantage in exporting furs and crops from stony New
England soils, while India produced textiles and ships and, for
all we can guess, might have led the way to industrial
revolution? Perhaps joined by Egypt, which might not have had to
rely on such radical violation of market principles as
extermination of the natives and slavery to enable King Cotton to
fuel the industrial revolution, as the British and Americans did.
And who could be so ridiculous as to contemplate a NAFTA designed
to reflect the interests and concerns that are actually
articulated by critical voices in all three of the countries to
be linked by treaty arrangements?

No reflections on these matters appear in the primer offered to
the backward peons.

Thanks to extreme departure from market orthodoxy, things did not
pursue the course that economic rationality might have entailed.
Thus India, under British rule, deindustrialized, becoming an
impoverished agricultural society, while Britain prospered.
Egypt's attempt to enter the industrial world was beaten back by
British power. The pattern has extended through much of the
world, the US taking the lead in the campaign against independent
development abroad, and against market discipline at home, as
Britain faltered in the task. Today, India, like most of the
South, is undergoing neoliberal ``structural adjustment''
reforms, while the US, as always, violates market principles as
it pleases along with the rest of the industrial world, most of
it more protectionist than in 1980, the Reaganites often leading
the pack in the attack on economic rationality.

There are notable effects, and beneficiaries are not lacking.
Take diamonds. Seven out of ten diamonds sold in the West are cut
in India, with super-cheap labor, now being driven down to still
greater depths of misery thanks to structural adjustment. But
there is a bright side: ``We pass some of the benefits to our
overseas customers,'' an Indian diamond exporter observes.
Workers and their families may starve to death in the New World
Order of economic rationality, but diamond necklaces are cheaper
in elegant New York shops, thanks to the miracle of the market.

There are also a few highly touted success stories, notably
Ghana, ``regularly cited by [International Monetary] Fund and
[World] Bank economists as the prime example of how structural
adjustment cures failing economies and places them on a path to
sustainable growth,'' Ross Hammond and Lisa McGowan point out in
a review of this ``showcase.'' Thanks to its obedience to market
discipline, Ghana was ``showered with foreign aid,'' including
more soft loans from the World Bank than any country except China
and India (in absolute, not per capita value). Manufacturing has
declined, as have domestic food and livestock, and food
self-sufficiency generally. Malnutrition has increased,
environmental degradation is proceeding apace, the external debt
has tripled, and since 1987, Ghana has paid more to the IMF than
it has received---a standard Third World phenomenon, as the
capital hemorrhage from the poor to the rich countries has been
joined by capital export to the IMF and Work Bank, now ``net
recipients of resources from the developing countries,'' the
South Centre (formerly the South Commission) reports in a 1993
study. But there are reasons for IMF and Bank enthusiasm about
Ghana. Agroexport has grown, ``rich Ghanaians have fared quite
well under adjustment'' as land ownership and income have
concentrated, and Western creditors and investors are doing
nicely. The leading success story deserves its reputation.
 {note: _Multinational Monitor_, Sept. 1993. South Centre,
_Facing the Challenge_ (Zed, 1993), 4.}

The picture only darkens as we move closer to home, where our
benevolence can be exercised more efficiently. Consider
Nicaragua, destroyed by US terror and economic warfare, now
``challenging Haiti for the unwanted distinction of being the
most destitute country in the Western hemisphere,'' Hugh
O'Shaughnessy reports from Managua. Infant mortality has reached
the highest level in the continent after a dramatic decline
before the effects of the US war set in by the mid-1980s. The UN
reports that one-quarter of all children are malnourished.
Diseases that had once been almost eliminated are rampant. Women
set up street corner soup kitchens ``to save tens of thousands of
youngsters from starvation.'' Sandinista health, nutrition,
literacy and agrarian programs ``have been scrapped by a
government pressed by the International Monetary Fund and
Washington to privatise and cut public spending.'' The social
fabric is coming apart under severe duress, with rapidly rising
crime and violence, as usual directed mainly against the most
vulnerable people: rape, for example, is escalating.

``The country's leaders seem to care little,'' O'Shaughnessy
reports, though there is little they can do in the face of the
orders from on high. ``Finance Minister Emilio Pereira boasts
that Nicaragua has the lowest inflation in the western
hemisphere---never mind that its four million people are
starving.'' The far right refuses any compromise, knowing ``that
it has the support of the US government.'' ``The Central American
Foreign Ministers and secretary general of the Organisation of
American States, who came on a mission of mediation, left in
despair [on Sept. 9] after [right wing elements of the US-backed
UNO] refused to join peace talks.''

In the countryside, the situation is even worse than in Managua.
Contra forces are fighting again in the North, boasting of their
Miami suppliers. Others too are mobilized, as desperation is
driving peasants to armed combat. In the main cotton producing
areas, not an acre was sowed this year because of lack of
credits---though the most powerful producers, including the
minister of agriculture and cattle-ranching and the president of
the High Council of Private Enterprise, Ramiro Gurdian, received
over $40 million in loans last year, _Barricada Internacional_
reports. Central America specialist Douglas Porpora writes that
70% of what limited credits there are go to ``a small number of
large export producers,'' in accord with standard US policies of
enriching the wealthy sectors involved in agroexport. Farmers had
been driven out of these regions by Somoza, who had taken over
the land for cotton export, part of the ``economic miracle''
hailed in the US, as the economy grew while the population
starved. After years of intense pesticide use, much of the soil
has lost its fertility. Banana exports and other agricultural
production have also collapsed, and sugar mills, including those
which had become profitable under government control, are being
shut down, apparently in a campaign by the former owners, now
restored, to destroy the unions and reverse the gains in workers'
rights of the past years. {note: O'Shaughnessy, _Observer_, Sept.
12; Guillermo Fernandez A.,_BI_, Sept.; Porpora, _Christian
Science Monitor_, Oct. 20, 1993.}

Despite its victory, the US is not satisfied. Nicaragua's people
must suffer much more to atone for the crimes they have committed
against us. In October 1993, the IMF and World Bank, virtually
US-run, presented new demands of unusual severity. Nicaragua must
reduce its debt to zero; eliminate credits from BANIC, one of the
remaining state banks; privatize enterprises and government
services such as energy and water, to ensure that poor people
really feel the pain---unable to give their children water to
drink, for example, if they cannot pay, thanks to zooming
unemployment. Nicaragua must cut public expenditures by $60
million, virtually eliminating much of what remains of health and
welfare services, while the mounting disaster offers new
opportunities to condemn the ``economic mismanagement'' of the
despised enemy.

The $60 million figure was perhaps selected for its symbolic
value. Last year the already privatized banks shipped $60 million
abroad, following sound economic principles: playing the New York
stock market is a far more efficient use of resources than giving
credits to poor bean farmers, as any competent student of
economics can explain. The bean harvest was lost, a catastrophe
for the population. Banks are now to be fully privatized, to
ensure the ``more efficient employment of the productive forces
of the world,'' with consequences for the population that are
evident but that do not enter into calculations of economic
rationality, as sophisticates understand.

It is only fair to add that the wonders of the free market have
opened up alternatives, not only for rich landowners,
speculators, and corporations, but even for the starving children
who press their faces against car windows at street corners at
night, pleading for a few cents to survive. Describing the
miserable plight of Managua's street children, David Werner, the
author of _Where There is No Doctor_ and other books on health
and society, writes that ``marketing shoe cement to children has
become a lucrative business,'' and imports from multinational
suppliers are rising nicely as ``shopkeepers in depressed
communities do a thriving business with weekly refills of the
children's little bottles'' for glue-sniffing, said to ``take
away hunger.'' The miracle of the market is again at work,
maximizing efficient use of resources. {note: ``Children pay
price in Nicaragua's New Order,'' _Third World Resurgence_
(Malaya) No. 35, 1993.}

On Nicaragua's Atlantic Coast, 100,000 people are now starving to
death, with aid only from Europe and Canada, Church sources
report. Most are Miskito Indians. Nothing was more inspiring than
the laments about the Miskitos after a few dozen were killed and
many forcibly moved by the Sandinistas in the course of the US
terrorist war, a ``campaign of virtual genocide'' (Reagan), the
most ``massive'' human rights violation in Central America (Jeane
Kirkpatrick), far outweighing the slaughter, torture, and
mutilation of tens of thousands of people by the neo-Nazi
gangsters they were directing and arming, and lauding as stellar
democrats, at the very same time---or the ``successful
baby-hunting'' that foreign reporters observed at exactly that
moment. What has happened to the laments, now that 100,000 are
starving to death? {note: CEPAD _Report_, July-August 1993
(Evangelical Churches of Nicaragua); _Barricada_, Oct. 9, 10,
1993; _Envio_ (Jesuit University of Central America, Managua),
Sept. 1993; _Nicaragua News Service_, Nicaragua Network Education
Fund, Washington, Oct. 2-9, 1993.}

The answer is simplicity itself. Human rights have purely
instrumental value in the political culture; they provide a
useful tool for propaganda, nothing more. Ten years ago the
Miskitos were ``worthy victims,'' in Edward Herman's useful
terminology, their suffering attributable to official enemies;
now they have joined the vast category of ``unworthy victims''
whose far worse suffering can be added to our splendid account.
What more need be said?

``The United States has a visceral need to annihilate the
Sandinistas once and for all,'' said a foreign affairs expert
whom O'Shaughnessy quotes. That was evident years ago, when the
refusal of the Sandinistas to genuflect in the expected fashion
aroused sheer frenzy. In 1985, one congressman described ``the
lust that members [of Congress] feel to strike out against
Communism'' in Nicaragua. Opinion divided between those who
called for brutal terror to punish the crime of disobedience, and
those on the far left of the respectable spectrum who recommended
that we should support terror only if it is ``cost-effective''
(Michael Kinsley), and if that test fails, we should seek other
means to ``isolate'' the ``reprehensible'' government in Managua
and ``leave it to fester in its own juices'' (Senate dove Alan
Cranston). Nicaragua must be restored to the ``regional
standards'' of our terror states, Tom Wicker and other media
doves declared with passion. Nor will the US rest until the
military is under Washington's control, with consequences that
are familiar throughout the continent, a crucial element of US
policy towards Latin America for 50 years, emphasized with
particular force by the Kennedy intellectuals.

Nicaragua's efforts to pursue the peaceful means required by
international law aroused particular fury. In 1984, senior US
government officials demanded that an invitation to Daniel Ortega
to visit Los Angeles be withdrawn ``to punish Mr. Ortega and the
Sandinistas for accepting the Contadora peace proposal,'' the
_New York Times_ reported without comment, referring to peace
efforts that the US government was able to undermine. The World
Court condemnation of the US evoked further tantrums.
Washington's threats finally compelled Nicaragua to withdraw the
claims for reparations awarded by the Court, after a US-Nicaragua
agreement ``aimed at enhancing economic, commercial and technical
development to the maximum extent possible,'' Nicaragua's agent
informed the Court. The withdrawal of just claims for billions of
dollars of reparations having been achieved by force, Washington
abrogated the agreement, suspending its trickle of aid with
demands of increasing depravity and gall.

The imperial arrogance is most impressive. Having been condemned
by the World Court for the ``unlawful use of force'' against
Nicaragua in a campaign of wholesale international terrorism that
no other actor in the world scene could hope to approach, we now
demand righteously that Nicaragua prove to _us_ that it is not
engaged in terrorism. Any further aid is conditioned on this
proof, the Senate voted. And having helped to destroy the country
and its people prior to the terrorist war, we now demand that the
beneficiaries of those wonderful years receive properties and
reparations. In September 1993, while the new foreign policy
vision was taking its final form, the Senate voted 94-4 to ban
any aid if Nicaragua fails to return or give adequate
compensation (as determined by Washington) for properties of US
citizens seized when Somoza fell---assets of US participants in
the crushing of the beasts of burden by the tyrant who had long
been a US favorite. Voting against were Paul Wellstone (D-MN),
Jeff Bingaman (D-NM), Paul Simon (D-IL), Russell Feingold (D-WI).
In October, Senator Christopher Dodd, a leading Senate dove,
visited Managua to ensure that these orders are fully understood.

Nothing will satisfy the lust to punish the transgressors, even
their reduction to Haitian standards. Any mafia don would
understand. If someone on your turf fails to pay protection
money, you don't just give him a black eye. Others have to learn
the lesson. The world must come to understand what virtually
limitless power will achieve if offended in any way---the lesson
that Bolivar sought to impart. Accordingly, the treatment is
uniform, extending to Vietnamese, Cubans, Iraqi children, indeed
anyone who doesn't understand the rules of the world for which we
are the gatekeeper and the model. {note: Senate vote, Tim
Johnson, Knight-Ridder Service, _BG_, Sept. 24; _Weekly News
Update_, Nicaragua Solidarity Network, Sept. 26, Oct. 10;
_Barricada_, Oct. 9, 1993.}


Demystification

A major qualification has to be added to everything said so far.
I have been adopting the standard mystification that nations are
actors in world affairs, nonsense of course. In any ``really
existing state,'' power is sharply skewed; those who hold it use
the state to defend their interests, whatever the impact on
others at home or abroad, a truism emphasized by that noted
revolutionary Marxist Adam Smith, among many others.

Demystifying, all looks different. Who lost War II? Certainly not
German and Japanese industrialists who dedicated themselves to
the fascist cause, and were quickly restored to power and wealth
by the conquering armies. Who won? Certainly not the anti-fascist
resistance, which was dispersed or decimated by the military
victors. Who lost the Cold War? Surely not the reigning Communist
_nomenklatura_, now the leaders of _nomenklatura_
capitalism---``a parasitical new robber-baron class of
speculators and mafiosi,'' as Soviet scholar Robert Daniels calls
them, with wealth beyond their wildest dreams. Surely not the
tough Communist Party boss of Sverdlovsk, Boris Yeltsin, now
elevated to the rank of leading democrat as he reverses Russia's
democratic gains from 1989, highly praised by Western governments
and press---and by financial markets---because of his commitment
to the ``market shock'' that is expected to ``create a greatly
improved climate for private investments.'' Or his old
subordinates from the CP apparatus, now staffing his bureaucracy.
Who won the Cold War? Not the huge mass of the populations
controlled by Western power sectors, neither in the former
colonial domains nor at home; nor the common people of the East,
now learning anew the lessons of their history as Third World
subjects. {note: Daniels, ``The Riddle of Russian Reform,''
_Dissent_, Fall 1993. See also Jonathan Steele, Roy Medvedev,
_Guardian Weekly_, Oct. 3, 17; Fred Weir, _In These Times_, Oct.
18, 1993 (including a review of _Times_ falsifications).}

A true history will depart radically from standard formulas.

In Adam Smith's day, the ``principal architects'' of policy, who
saw to it that their interests were ``most peculiarly attended
to,'' were ``merchants and manufacturers.'' The world has changed
since, quite considerably in just the last 20 years, in part as a
result of Richard Nixon's dismantling of the post-World War II
(Bretton Woods) international economic system. One consequence of
these major changes in world order has been a huge increase in
unregulated capital. The World Bank currently estimates the total
resources of international financial institutions at about $14
trillion. Not only can European central banks not defend national
currencies in the face of this unprecedented private power, but
the European Monetary System has ``effectively collapsed'' as EC
governments ``have experienced the power of today's free-wheeling
global capital markets,'' the _Financial Times_ reports in a
review of the world economy and finance. The huge and unregulated
international capital market controls access to capital, but
``global investors impose a price. If a country's economic
policies are not attractive to them'' they will use their power
to induce changes. Such pressures may not be ``fatal'' to the
very rich, but for the South, the international capital market is
``no more than an unacceptable arm of economic imperialism,''
which governments cannot resist in an era when even in the rich
countries, governments ``are on the defensive and global
investors have gained the upper hand.''

A related development is the dramatic shift in use of capital
resources. Cambridge University economist John Eatwell notes the
striking fact that ``In 1971, just before the collapse of the
Bretton Woods fixed exchange rate system, about 90 percent of all
foreign exchange transactions were for the finance of trade and
long-term investment, and only about 10 percent were speculative.

Today those percentages are reversed, with well over 90 percent
of all transactions being speculative. Daily speculative flows
now regularly exceed the combined foreign exchange reserves of
all the G-7 governments,'' the richest seven. One consequence is
that ``economic performance in the 1970s and 1980s has been poor
throughout the industrial nations of the OECD,'' with growth in
each G-7 country about half that of the 1960s, unemployment at
least doubled, and productivity growth in manufacturing industry
sharply down. Furthermore, ``the sheer scale of speculative flows
can easily overwhelm any government's foreign-exchange
reserves,'' as just noted. National economic planning is
increasingly difficult even for the rich, market instability is
increasing, and governments are driven to deflationary policies
to preserve market ``credibility,'' driving economies ``toward a
low-growth, high-unemployment equilibrium,'' with declining real
wages and increasing poverty and inequality.

A third related development has been the sharpening of the
double-edged conception of the market: fetters for the weak, to
be thrown aside at their pleasure by the strong. During the past
20 years, free market rhetoric has soared to glorious heights,
while the rich countries have enhanced their protections against
market discipline. GATT economist Patrick Low draws attention to
``the sustained assault on [free trade] principle from which the
GATT suffered, starting around the early 1970s,'' a ``difficult
period economically'' until today, in which ``the GATT did not
fully succeed in holding the line against growing protectionism
and systematic decline''---to put it mildly. Again, the
Reaganites combined the two tendencies quite brilliantly, orating
in free market voices to the poor while assuring the rich, loud
and clear, that the state will intervene massively to protect
their interests. Secretary of the Treasury James Baker ``proudly
proclaimed that Mr Ronald Reagan had `granted more import relief
to US industry than any of his predecessors in more than half a
century','' international economist Fred Bergsten points out,
adding that the Reaganites specialized in the kind of ``managed
trade'' that most ``restricts trade and closes markets,''
voluntary export restraint agreements---``the most insidious form
of protectionism,'' which ``raises prices, reduces competition
and reinforces cartel behaviour.'' The increase in the Pentagon
budget alone is a major form of state intervention in the economy
for the benefit of the rich, and has been understood just that
way for half a century---one reason why there will be a long wait
for a ``peace dividend.''

A fourth related development has been the rapid acceleration of
the internationalization of the economy. Foreign sales of
Transnational corporations (TNCs) now far exceed all of world
trade---and of what is called ``world trade,'' well over a third
is now estimated to be intrafirm transactions, centrally managed
interchanges within corporations that happen to cross an
international border---one of many reasons why talk about ``free
trade'' and ``markets'' is of limited relevance to the real
world.

An obvious corollary is the sharp decline in meaningful democracy
discussed before in these pages (see, e.g., Edward Herman, ``The
End of Democracy?,'' _Z_ September), as extreme totalitarian
institutions (corporations, banks, investment firms, etc.), with
strict top-down control, internal secrecy, and only the most
limited public accountability gain even further power on a global
scale. Naturally they are constructing organs of governance to
reflect their interests (GATT, the IMF and World Bank, the EC
executive, G-7 closed sessions, etc.), all properly insulated
from popular interference, even awareness, a new and higher stage
in the long struggle to remove any threat to ``top-down'' forms
of democracy that enhance ``the traditional structures of power
with which the United States has long been allied''---eliminating
mystification, ``the traditional structures of power'' with which
the ``principal architects'' of US government policy and the
interests they serve have ``long been allied.''

The consequences are not hard to see or understand: slowdown in
economic growth, decline in economic or other planning in the
interests of the general population, and extension of the Third
World model to the rich countries themselves as the domestic
population becomes superfluous for profit-making, the supreme
human value in the world for which we are ``the gatekeeper and
the model.''

The US and Britain have been leading the way in these
developments, and their accomplishments are welcomed by those who
matter. While the new Clinton vision was receiving its final
touches, a front-page story in the _Wall Street Journal_ reported
``a welcome development of transcendent importance,'' no less:
``the increasingly competitive cost of U.S. labor.'' Thanks to
the harsh attack on labor through a combination of state power
and improved opportunities to shift production abroad, US labor
costs per unit output fell 1.5% in 1992, while costs increased in
Japan and Europe, as well as Taiwan and South Korea. In 1985,
hourly pay in the US was higher than the other G-7 countries. By
1992, it had fallen to below its wealthy competitors, apart from
England, where Thatcher had done even better in punishing working
people. Hourly wages were 60% higher in Germany than in the US,
20% higher in Italy. The US has not yet reached South Korea and
Taiwan, but progress is being made, in the richest country in the
world, with unparalleled advantages---and a highly class
conscious business community, fighting a bitter class war against
an enemy lacking resources, organization, and meaningful modes of
interaction or participation. {note: Alfred Malabre, _WSJ_, Sept.
13, 1993.}

The lessons are spelled out by _Business Week_. Europe must
``hammer away at high wages and corporate taxes, short working
hours, labor immobility, and luxurious social programs.'' It must
learn the lesson of Britain, which finally ``is doing something
well,'' the _Economist_ announces approvingly, with ``trade
unions shackled by law and subdued,'' ``unemployment high,'' and
the Maastricht social chapter rejected so that employers are
protected ``from over-regulation and under-flexibility of
labour'' (job security). American workers are barely a step
behind.

The end of the Cold War offers new weapons for use against
working people in the rich societies. There are ``green shoots in
Communism's ruins,'' exults the world's leading business daily,
the London _Financial Times_; not everything is grim in the
former Communist world. The ``green shoots'' are the new
opportunities for corporations to reduce costs thanks to ``rising
unemployment and pauperisation of large sections of the
industrial working class'' as capitalist reforms are instituted.
GM opened a $690 million assembly plant in East Germany, where
workers are willing to ``work longer hours than their pampered
colleagues in western Germany'' at 40% of the wage and with few
benefits, the journal relates happily. Poland is still better,
with workers available at 10% the wage of the pampered Western
workers, kept that way ``thanks largely to the Polish
government's tougher policy on labour disputes,'' that is,
repression of labor.

Of course, the term ``markets'' has its usual meaning. GM
purchased an auto plant near Warsaw, economist Alice Amsden
comments, ``on the under-the-table condition that the Polish
government provide it with 30 percent tariff protection''---the
usual form that ``free market'' enthusiasms take. Tax holidays
for investors are also offered, among other gifts.

The same is true when our own growing Third World seeks to entice
foreign investors. Alabama recently beat out competitors for a
new Daimler-Benz plant for which its population ``will pay
dearly,'' the _Wall Street Journal_ noted a few days after the
Clinton economic strategy was announced. Germany's leading
conglomerate paid a royal $100 for the plant site, and has been
offered a package of tax breaks valued at over $300 million,
along with other publicly-funded services. Alabama ``has a Third
World economy,'' the head of an economic development group
observes: ``They're losing money to invest in their people, their
roads, their state in general,'' as the market performs its
miracles. The traditional Third World can explain to us how it
works. {note: _WSJ_, Sept. 30, 1993.}

The prospects are inspiring. Canadian social benefits and
workers' rights can be attacked through ``free trade,'' which
forces harmonization downwards to US standards. The same device
can be used to ``lock the United States into a low-wage,
low-productivity future,'' the congressional Office of Technology
Assessment concludes in its review of the executive version of
NAFTA, scrupulously designed to protect rights of investors, not
workers or future generations (the environment). And an increase
in standard of living for Mexican workers is not a serious
threat, given harsh dictatorial rule and the flooding of the
labor market as peasants are driven from the land by US
agribusiness exports. German workers had become ``used to some of
the best working conditions on earth,'' _Business Week_ comments
under the heading ``Time to Leave the Cocoon?'' But no more, as
some ``60% of German industrial jobs are threatened by
competition from Eastern Europe, Asia, and the U.S.,'' the last
now offering its contribution to the ranks of the Third World
thanks to ``the welcome development of transcendent importance.''
With these ``green shoots'' rising in old and new Third Worlds,
Germany's biggest employers' federation, Gesamtmetall, was able
to issue a ``declaration of war,'' cancelling ``union wage and
vacation contracts---for the first time ever.'' Meanwhile profits
should do just fine, as the world moves towards the desired
two-tiered model under its new visions. {note: _BW_, Oct. 18,
1993.}

In brief, the developments of the past years offer new ways to
put the screws on the overwhelming majority of the population
both abroad _and_ at home, options enhanced by the end of the
Cold War---which is why the Cold War victors are celebrating so
triumphantly: investors, executives, and wealthy professionals at
home; the former Communist Party rulers now joining in the global
rip-off; their counterparts in the traditional South; and, of
course, respectable sectors of the educated communities, who are
called upon to trumpet the ``victory for a set of political and
economic principles: democracy and the free market.'' The Clinton
vision merely announces another small step towards the same ends.

How far can this go? Will it really be possible to construct an
international society on something like the Third World model,
with islands of great privilege in a sea of misery---fairly large
islands, in the richer countries---and with controls of a
totalitarian nature within democratic forms that increasingly
become a facade? Or will popular resistance, which must itself
become internationalized to succeed, be able to dismantle these
evolving structures of violence and domination, and carry forth
the centuries-old process of expansion of freedom, justice, and
democracy that is now being aborted, even reversed? These are the
large questions for the future.