April 14, 2000 -- This week Policy.com sat down with one of the leaders of this week's IMF/World Bank protests.
PC: Welcome to Policy.com's Policy Interview. With us today is Kevin Danaher, co-founder of Global Exchange, and editor of the new book, Globalize This: The Battle Against the World, or Trade Organization and Corporate Rule..
What is the purpose of the protests in Washington, DC?
KD: Well, in a sense, we've already achieved our primary objective, which was to drag these institutions out into the public arena.
Both the World Bank, the IMF, and also the World Trade Organization, have been hiding, they've been making policy for the whole planet for decades, and nobody even knew they existed. You can test it, go out on the street and ask people to give you one intelligent sentence about the International Monetary Fund, and they can't do it.
So the question then comes up, how do you have institutions that are moving billions and billions, tens of billions of dollars around the planet, controlling policy in all these Third World countries, and they're operating in secret? So we want to flush them out, we want to get the snake out from under the rock. And we've already done that, in the sense that we're getting a lot of media coverage, a lot of media focus on these institutions.
And Sunday and Monday, they are having their annual spring meeting, Sunday, the 16th, Monday the 17th. And we are going to non-violently disrupt those meetings. We are going to make it very difficult for them to have business as usual, because we feel, in a global market economy, where there's 30,000 children dying every day from the effects of hunger, not because there's not enough food, or their parents are stupid or something like that . But because the market redistributes wealth toward those who have money, and away from those who don't have money, that's why those children are starving. So our attitude is, no more business as usual, we're going to shut these guys down.
PC: You allude to the violence in Seattle, or at least that these will be non-violent protests, and that that certainly seems to be one of the major points of media coverage. Whose fault was the violence in Seattle, and do you foresee any violence here in Washington?
KD: Well, the violence in Seattle was started by the police, police started shooting us before 10:00 AM, those windows that got broken, got broken about two or three PM, and what the police did was . they fomented a lot of anger in people. And also they created chaos that allowed less than one percent of the demonstrators to do some property destruction. But I think you've got to keep it in perspective.
If you look at what percentage of the police did violence and what percentage of the protestors, and what was the nature of the police's violence. They were doing violence against human beings. Breaking a window is one thing; shooting somebody with . we had a guy in our team get shot right in the face, busted his face open with a rubber bullet.
So, both ourselves and the people who think it's cool to do property destruction, have spent a lot of time dialoguing with each other, and we've managed to patch up a lot of our differences. And this protest here is going to be a lot different, it's going to be a lot calmer. We've gotten good feedback from the police.
In fact, we've done a couple of demonstrations already this week, and we've seen the police behave in a very responsible and peaceful way, so we don't think there's going to be that kind of problem.
PC: Earlier this week, at a press conference at the National Press Club, you mentioned that the protest movement is made up of abolitionists and reformers, and some have alluded that abolitionists were leading the way. I was curious if that is the case, and why?
KD: There's really a transition going on, and I say this as somebody who not only writes about it, and travels around the country speaking about it, but I'm on the steering committees of a lot of these different networks. So I'm actually there when the policy discussions take place within the movement. And I think if you go back 10 years, even five years, the guys like me who were abolitionists were kind of in a minority, and the bulk of the movement in opposition to these institutions could be called reform, or reformist element.
Now I think the center of gravity has really shifted. We've been pressing these organizations for so many years (I wrote my first article on the IMF back in 1975). We've been pressing them for so long, and we haven't gotten any kind of serious response out of them. So now we figure, okay look the time is over, we're going to shut you down, in any way we can that's not violent.
So, any time they have a meeting; for example, the big meetings of the World Bank and the IMF always come in the fall. This year, in September, end of September, they're meeting in Prague, (in the Czech Republic). The planning has already started for the protests in Prague in late September. It's called P-2000. We've got Web sites up, we've got members of our network here going over there pretty soon, in a couple of weeks, to strategize with them.
And we're already starting to plan for the September 2001 World Bank-IMF meetings, which will be held back here in Washington, DC again.
So, they better get ready, because we're coming.
PC: I wanted to ask you, do you support globalization of any sort, and are you a protectionist?
KD: Well there's two kinds of globalization, there's elite globalization, whose institutions are the transnational corporations, (with) their quasi-governmental bodyguards, the IMF, the World Bank, the WTO. which act as sort of creators of the policy environment that force Third World elites to implement policies conducive to the corporations coming in and taking out the wealth, taking out the resources and getting access to labor at very low wages, with no trade unions.
There's a second kind of globalization, that's people's globalization, bottom-up globalization. At Global Exchange, we do reality tours, where we take people out to Third World countries and introduce them to the grassroots groups.
We're involved in the Fair Trade Movement, where we're trying to make sure that the producers in the Third World, like (growers of) "fair trade coffee," are getting a living wage and producing in environmentally sustainable ways.
You can look at Eco-Tours, and Eco-Labeling, the Sister City, Sister Community movement, Solidarity groups supporting the Zapatistas, and all these different efforts to change things around the world. There's a whole network now of grassroots globalization going on, and if you contrast those institutions (to the elite group), the grassroots globalization institutions are very democratic and participatory.
The elite globalization institutions are very secretive, they're a (advocates of) mono-crop (agriculture). It's basically rich, very, very rich people who live in mansions and drive in limousines, whereas we're bio-diverse in the grassroots globalization movement. And the value systems are very different. The value system of top-down globalization consists of maximized profits for big corporations, and turn(ing) nature into money.
A 1,000 year-old redwood tree is not a gift of the Creator, it's $300,000 worth of lumber. On the other side, on the grassroots globalization side, our value system is (to) meet all social needs -- no hungry children, no children without shoes, no children without schools. And save Mother Nature -- don't look at nature as a commodity, but look at it as a gift of the Creator.
PC: Can you explain your relationship with labor, and even right-wingers like Pat Buchanan? Is any of the anti-globalization effort funded by groups like AFL-CIO, or individuals like Richard Milliken?
KD: I wish it were. Actually, I know (to what) you're referring, there was a New Republic article, trying to trash Public Citizen for supposedly getting money from this guy.
It's kind of funny when wealthy elite institutions try to poke at us poor guys (because) we're taking money from someplace. I have a Ph.D. and about eight books out on the market. I'm almost 50 years old, and I get paid $31,000. So if these guys want to switch salaries with us, I'm ready, I'll do it anytime.
It gives hypocrisy a bad name, for them to be focusing on our funding. In fact, our funding basically at Global Exchange is very diverse, it's very broad. We get a lot of small donations from a lot of people. And, we're entrepreneurial. We criticize these big transnational corporations, but we do enterprise. Our tours make money; our stores make money. But the money isn't for me to have a BMW and a cocaine habit. It's for sending the money back to these grassroots groups so they can feed their kids.
PC: Let's go back to 1944, Bretton Woods, New Hampshire. Forty-four nations meet to craft "A new global financial system to hasten economic recovery after World War II, and avoid a second Great Depression." If you were representing the United States, how would you have better shaped the International Bank for Reconstitution and Development, which became the World Bank, and the IMF?
KD: Well, what I would have done was try to get the money into the hands of legitimate grassroots institutions, people at the grassroots level.
What the people who did Bretton Woods wanted to do was, they wanted to make sure that the commercial classes, the business classes, got back into power. You've got to remember that during World War II, the business classes in Europe either backed Hitler -- not too good for your legitimacy after the war -- or, their factories were bombed, and their banks were bombed, or they fled with whatever money they could take. So at the end of the war, the elites in the U.S. have a big problem.
You've got a de-legitimated, weakened business class in Western Europe, but on the other hand, the left -- the socialists, communists, anarchists, Social Democrats, they were the ones who were the resistance to the Nazis. And they were well-armed, so they were both legitimate and armed. So the problem for the U.S. government and U.S. elites, and their junior partner, the British, was, how do you pump a lot of money into the hands f the elite, the business classes, to get them back into power?
And that's what the Marshall Plan was about, too. Once they consolidate that, and in fact, huge amounts of money from the Marshall Plan made the World Bank's money seem insignificant in comparison. The World Bank (later) started switching its focus to countries like Mexico, Brazil, South Africa, Indonesia, the big regional Third World countries with big peasant populations. And they pushed the Green Revolution, a highly capital-intensive form of agriculture, which now has been a bust, throughout the Third World, that succeeded in ruining a lot of land and water, and concentrating wealth in few hands.
So if you look at the historical record of these institutions, they've been controlling economic policy at the global level for over 50 years. Well, is there less inequality, or more now? There's more inequality now. Is the environment better or worse? The environment is far worse.
You know, we're threatened with extinction, it's so bad. Is community better or worse? It's worse. Spirituality better or worse? Every key indicator of human progress is worse now than it was when these guys started making policy for the planet. And the only way you can understand that is, they're making policy in the interests of a minority of the wealthy elite.
And as long as that's the name of your game, things are going to get worse.
PC: One of the points of the protest is the exploitation of the environment. But, history shows that all nations moving towards industrializing and growth have used their resources at their disposal, to reach that level. Why should that change now, and once a nation or a country becomes as economically stable as the United States or as wealthy, there are better ways to then service the environment.
KD: Well, the current economic model is just not sustainable. It's not sustainable. Ask yourself this: You go out and you say to an average American, do you have a right, as an American, to own a car?
People will say sure. Does every Chinese person have a right to own a car? Well if you say no, you're racist. If you say yes, you can kiss the planet's ass goodbye; it's over. The hole in the ozone layer is over twenty-six million square kilometers. It's up into Southern Chile and Argentina already. The oceans are expanding more rapidly than anybody had guessed before, whole island nations out in the Pacific are being inundated. The oceans contain 50 times as much carbon dioxide as the entire atmosphere. If those oceans start giving off carbon dioxide, instead of being a carbon dioxide sink, forget it, we're cooked.
If our agriculture goes, everything goes. Our topsoil is being destroyed, our ground water is being polluted. So, this is not a sustainable model.
What caused the environmental regulations in the United States was not affluence, it was activism. It was people going out in the streets, and demanding of the leaders that they change their policies. Then you get somebody like Reagan and Bush come in for 12 years, and they roll all that stuff back.
So, what we're saying in the movement is, it's time for the end of pipeline politics. And by that I mean, end of pipeline politics, is where you stand outside the factory, and you try and mitigate the negative impact of the pollutants coming out of the factory on people in the environment. What we're saying is, no, forget that; let's go inside the factory, and change the very structure of the production process. Who owns it, who is sitting at the table when the capital investment decision-making takes place, and what are the values that are being put forward.
PC: If you look at something like the Clean Air Act, or even the Kyoto accords, and then realize that market forces have underscored the growth of the U.S. economy, and other leading industrial nations, it's reasonable to say that there would be no way to, to even have a Clean Air Act, or possibly even anything near the Kyoto accords, if there wasn't this growth of the economy.
So these market forces that have helped grow industrial nations, but yet, you want to move away from those in some of these Third World countries.
KD: I just want what you call market forces; that's people with money. It's human beings with money, in the form of limited liability corporations. And that name is very significant -- "limited liability corporation," meaning that they can savage our environment, and kill people, and do all sorts of nasty things, and not suffer the consequences of it.
So if you look at the Third World, the countries like South Korea, Taiwan, Malaysia, they didn't develop through a free market model -- it was heavy state involvement. High tariff barriers to protect young industries, government-directed investment, land reform.
So this free-market mythology, dogma that's being pushed by the World Bank and the IMF, there's not one country they can point to that has actually succeeded in developing via this so-called free market model. What that, what that dogma does is, it puts pressure on Third World elites, and it cools out the public, to say, you open up your country, and allow these big corporations to come in and get access to your labor and your environment?
That's what it's about. It's about prying those countries open. Under colonialism, they controlled them directly; they can't do that anymore, so you got to get control of those elites who are controlling the policy in those countries. And they do it through debt. You get them in debt, and then you say okay, if you want more money, here's the policies you're going to implement. It's colonial.
PC: In your book, Globalize This, you write that "the book is designed to be a tool in the struggle to democratize the global economy." Some would read it as saying that this whole movement is a push to redistribute wealth from the haves to the have-nots.
KD: Well, that will be involved. For example, we just forced Starbucks to sign on to fair trade, to sell fair-trade coffee.
PC: Right, and sounds like that fair trade option is almost a market aspect of how it could benefit.
KD: Exactly. The market has to have humanity injected into it. If it's just let money rule, then we'll get devastated environment, we'll get starving children, we'll get sweatshops. If people inject consciousness into it, and say okay, within these channels, we will let the market operate, but as soon as it starts to slop over the levy, we're coming down hard on it.
And what's happening in the movement, in the social change movement is, we're developing our skills around this. So, for example, with the Starbucks campaign, we didn't even have to launch the campaign. We let Starbucks know, we're going to launch a campaign. And they came to us a week before the launch of the campaign, and said okay, call it off, we surrender, we'll sign up with Transfer USA, to sell fair trade coffee. Well that's beautiful, because now we can take those resources and go after Folgers or, you know, Pete's or Tully's or somebody else who's not selling fair trade coffee.
PC: A new initiative for you is the World Bank bond boycott, and I'd just like you to address how this is different from the past, and if you can explain how the, it was sort of a grassroots emphasis that built this movement.
KD: Yeah. This has been something that we've been discussing within the movement around the world for years, actually; how to get at the World Bank's money.
The World Bank gets over 75 percent of its total funding from selling bonds in the commercial bond markets. They take our taxpayer money, they use it as collateral, they call it "callable capital." They put that aside, and they use that as leverage to issue these bonds. Tens of billions of dollars worth. In fact, the World Bank has been a pioneer in the global bond market, they've been doing this for decades. Then they take that money, they go to Third World elites and they say here, we'll give you this money if you implement policies that we wrote in Washington.
The very notion that people, like at the World Bank where, at the policy level, the pay scale is over $130,000 a year. James Wolfensohn, the head of the World Bank, gets over $300,000 a year, and he was a millionaire from his previous career as an investment banker. To imagine that people who never ride the bus, are going to create policies to eliminate poverty, is just insane! I mean, any, my nine year-old daughter can see through this. So what we said is okay, if you're going to pressure a bank, their jugular is what? It's money. How does the Bank get most of its money? Through these bonds.
Well these bonds are Triple A rated. They carry a good interest rate, and they're Triple A rated because it's sovereign debt, it's based on We the People. So we said well, if We the People are the basis of the Triple A rating, then We the People are going to go out and knock an A off of that Triple A and knock it down to Double A. And maybe we'll knock it down to Single A, or Triple B. And that's exactly like the value of shares on Wall Street. During the Nike campaign, over an 18-month period, their stock price went from $75 a share, to $45 a share, and all of a sudden, Nike executives are willing to bargain, and say okay, we'll raise the wages of the Indonesian workers, etc.
Why? Because they were losing money, not just as a company, but as individuals, because they're getting paid in stock options. So we're trying to take that same strategy and aim it at the Bank, and say okay, you live at that Triple A rating, that's the heart of your existence, because it's the source of your money.
So, by announcing this campaign, we're saying to all these investment managers, who handle large pools of money, we're telling you now, we're going to go out and knock down that Triple A rating. So you're going to be culpable, you're going to be liable for your shareholders, who have entrusted you with their money, coming to you six months down the road, a year down the road. And say, hey, you moron, you bought me into these World Bank bonds, and they slipped from a Triple A to a Double A rating, and now I'm having trouble selling the things because of this World Bank boycott campaign had announced it in April, 2000.
And it was available to the public, it was in all the business press, and you didn't pay attention. So we're giving them a warning; you better be careful about telling your people to invest in these bonds.:
