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| Sunday, 7 November 2004 |
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Solemn thoughts by Wendell W. Solomons Your magic carpet ride to destitution with IMF, World Bank On October 25th, 2004, the 'Virakesari', Sri Lanka's major Tamil-language newspaper, carried a key message. It informed readers that a senior civil servant, the Secretary of Sri Lanka's Ministry of Finance, brought up for comment the overbearing attitude of some donors at a time when the country's foreign exchange reserves were in decline. The official, Dr. P. B. Jayasundara, said that the World Bank and the International Monetary Fund dictate drastic conditions for aid to the country. Sri Lanka's citizens had no intention of becoming slaves - yet that is the direction in which they are being pushed by the latter international organisations and the donor nations they influence with dazzle. Sri Lanka's development vis-a-vis-India In 1950, 50 cents of the Sri Lanka rupee bought one Indian rupee. Yet, the worth of Sri Lanka's currency has so declined that you must today add 400 per cent more to buy one Indian Rupee. You see that the steepest slide in the currency arrived when the country's trust was placed in the 'Open Economy' model of the IMF/World Bank (on the Net, you can observe that the dollar was worth Rs. 7 in 1977 - US Federal Reserve data). India's strong currency situation and massive foreign exchange reserves arose through the use of the policy of 'Swadeshi'. This policy focused on developing India's domestic resources. India uses customs barriers to protect domestic industry as it grew. Though seemingly a far-fetched example, India's barriers parallel those pamphleteered by Henry Carey in the US. Though the US economy of the 1860s was one shattered by civil war, from that base Abraham Lincoln and his followers used Henry Carey's foreign trade barriers (yes, similar to India's) to shelter and develop US industry. 'Focus' in USA Henry Carey's model added one more ingredient. As much as a business must focus, Carey suggested that the US focus on developing one key industry. In following that suggestion, President Lincoln chose to focus on the development of the railroad industry in the US. (1) Would force development of mining industry, of metallurgy and of machine building because the need for locomotives, carriages and calibrated steel rails would arise. (2) Would make possible the transcontinental moving of raw material and passengers, something of major logistical significance to the USA. President Lincoln envisaged that focus on railways would create a base for onward development of the USA. Yet, isn't the proof of the pudding is in the eating? The US, a raw material producing (e.g., cotton, tobacco) appendage entered the 20th Century as the world's largest industrial economy. In 50 years the US had surpassed Britain, just previously 'Manufactory to the World'. India and the USA Post-colonial India has emerged as a major outsourcing centre for Wall Street brand names. Computer software and hardware produced in India have long become mainstays for Wall Street brand names as they strive to (a) remain competitive in today's world and (b) stabilise Wall Street's dollar vis-a-vis the Euro. While the European Union also notices India's potential, the US has rushed in defence pacts with India (two sets of live Indian-US joint military exercises took place in 2004). It is in this situation that economist Dr. Jeffery Sachs visited India and then Sri Lanka in January 2003. Best economist in the World The description used by the Governor of Sri Lanka's Central Bank to introduce Sachs' talk is incorporated in the caption above. It is also the title of an article by this researcher in the Sunday Observer. Dr. Sachs suggests utilising in Sri Lanka, a method reminiscent of Henry Carey. The Sunday Observer article is available to a Google search on the Internet. Therefore, 'not to know' what Dr. Sachs proposed condemns Colombo-based representatives of the IMF and the World Bank for criminal negligence or quackery. World Bank and IMF pander to vanity I had mentioned on the Net by 1997 that personnel posted overseas by the IMF and World Bank for a 'neo-Commonwealth' would be faint shadows of the Governor-Generals of Britain's classic Commonwealth. The new technocrats are groomed for one main activity: How to induce debt-slavery. |
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