November 23, 2005

• Topic: Happy Thanksgiving

  
  

  Wanted to wish all my readers and friends a happy turkey day!!!

  
  

  highs of the last 24 hours:

  
  

  1) office is empty and quiet today, just the way i like it

  
  

  2) had a good conversation w/ Bob, my new friend who spends his days on the street on 34th btw 6th and Broadway, w/ his dog Abby.  Today he was giving me some geology lessons about coal, natural gas, and oil, since he spent years building the equipment that drilled for those things.  We talked a bit about what it means to be a blue collar worker, and he made a comment about how he would encourage people to develop their minds, because when the physical body goes, as his has due to asbestos, there ain’t nothing you can do.  He’s quite a smart guy, but his illness prevents him from working and he’s in a struggle now to collect social security.

  
  

  3) 4 days of no work coming up.  I was spoiled in college, but now I really get to appreciate having free time.  Time to catch up on movie watching, reading, zoning out to music, watching the Giants on Sunday, tossing a football around.

  
  

  4) Read a great article this weekend in the NYT magazine about Evo Morales, the socialist candidate for the presidency of Bolivia.  If you want to test you political literacy, this is a great article to read.  An excerpt:

  
  

  “Many Bolivians, and certainly almost all MAS (the socialist party) supporters, are more than prepared to blame the Americans for much of what went wrong during what Roberto Fernandez Téran, the economist from the University of San Símon, described to me as “the lost decade of the 1980′s and the disappointments of the 1990′s.” A joke you hear often in Bolivia these days sarcastically describes the country’s political system as a coalition between the government, the international financial institutions, multinational corporations and la embajada – the U.S. Embassy. But while it would be unwise to underestimate the force of knee-jerk anti-Americanism in Latin America, the ubiquitousness of leftist sentiments in Bolivia today has more to do, as Joseph Stiglitz (former chief economist of the World Bank) points out, with the complete failure of neoliberalism to improve people’s lives in any practical sense. It is almost a syllogism: many Bolivians believe (and the economic statistics bear them out) that the demands by international lending institutions that governments cut budgets to the bone and privatize state-owned assets made people’s lives worse, not better; the Bolivians believe, also not wrongly, that the U.S. wields extraordinary influence on international financial institutions; and from these conclusions, the appeal of an anti-American, anti-globalization politics becomes almost irresistible to large numbers of people.”

  
  

  So…what’s this excerpt and the article as a whole about?’

  
  

  One key idea is that many Bolivians live in poverty, despite the fact that the country is rich in natural resources such as natural gas and oil.  While these natural resources are capable of deriving much wealth, the problem is that that wealth is not going to Bolivia.  It is going to the multinational corporations which own the oil.  Not only are Bolivians losing out on the wealth of their own natural resources, but they can hardly even afford their own resources, as the multinational corporations are responsible for setting the prices.

  
  

  In that sense, the oil is privately owned, and Evo Morales is called for this to change.  One thing Morales is calling for is for Bolivia to end relations with these corporations (which could result in int’l lawsuits), and then negotiating new contracts so that Bolivia has more control over their resources.  The article sites this system being used in Brazil and Malaysia, where these wealth producing natural resources are controlled by the state and then deals are made with multinational corporations.

  
  

  A few years ago, Bolivia was in economic crisis, with inflation running wild.  As is the case in much of the world where financial problems exist, countries turn to international lenders, notably the World Bank, and the International Monetary Fund (IMF).  What these organizations do is lend money to countries, but like all banks and lenders, they put certain strings on the money.  A contract is made between the bank and the country receiving the money to ensure that money is not simply being used “wastefully.” 

  
  

  In a corporate setting, a company like Coca-Cola may take out a loan from a large bank like Credit Suisse First Boston.  Part of the agreement in the contract might be that Coca-Cola use the money for R&D, or for marketing, but that money cannot be used to increase CEO pay.

  
  

  In the case of these int’l lending institutions, there are two primary restrictions placed on countries receiving aid.  The first is that they privatize industries such as oil and gas.  The second is that they slim their gov’t spending, lowering their budgets, and in turn lowering taxes.  This philosophy of privatization and small gov’t is a philosophy that is described as pro-globalization, or neo-liberalism.

  
  

  Countries that follow the plan are given good ratings, and will receive aid.  Countries that choose to not follow the economic recommendations of the int’l lending institutions, do not receive funding. 

  
  

  To cut to the chase, here’s where the problem lies, and here’s where even the politically illiterate or semi-literate can follow.  In Bolivia, neo-liberalism has not helped to reduce poverty.  In fact, it’s made the problems worse.  What Bolivians want is to spend more on education.  What Bolivians want are the jobs that would come if they owned their own natural resources.

  
  

  So…Bolivia is tired of these int’l lending institutions (which are made of I think 187 countries, although the US has heavy influence in the neo-liberal side of things, which have been supported by many Democrats and Republicans alike).

  
  

  It’s an interesting article, an interesting look into global politics and economics.  Perhaps the most interesting part, and something glossed over, was how America views this socialist movement in Bolivia.  Certain people w/in the US defense dept. have called Moraels a threat on the level of Osama.  Is this just talk to turn people against Morales’ economic views, or is their a dark side to this socialist movement?

  • 2:48 pm
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