Reflections of Fidel
THAT is what the G20 meeting that began yesterday in Seoul, capital of the Republic of Korea, has turned into.
“What is the G20?” many readers, inundated with initials, will ask. Yet another monster of the powerful empire and its richest allies, which created the G7: the United States, Japan, Germany, France, the United Kingdom, Italy and Canada. Later on they decided to admit Russia into the club, which was then called the G8.
Subsequently they deigned to admit five important emerging countries: China, India, Brazil, Mexico and South Africa. Then the group increased with the admission of various OECD countries – more initials, the Organization for Economic Cooperation and Development – Australia, the Republic of Korea and Turkey. Saudi Arabia, Argentina and Indonesia were added to the group, taking it to 19. The twentieth member of the G-20 was none other than the European Union. One country, Spain, has boasted the unique denomination of “permanent guest” since 2010.
Another important high-level meeting is taking place almost simultaneously in Japan, that of the APEC. If our patient readers add to the previous group the following countries: Malaysia, Brunei, New Zealand, the Philippines, Singapore, Thailand, Hong Kong, Chinese Taipei, Papua new Guinea, Chile, Peru and Vietnam, all with important trade exchanges and all of them bathed by the waters of the Pacific, they have what is called the APEC: the Asian-Pacific Economic Cooperation forum, the complete jigsaw. They would only need the map; a laptop could perfectly well provide one.
At such international events fundamental aspects of the economy and finances of the world are discussed. The International Monetary Fund and the World Bank, with decisive power in financial affairs, have their master: the United States.
It is important to recall that, at the end of World War II, the industry and agriculture of the United States were intact; those of Western Europe were totally destroyed apart from exceptions like Switzerland and Sweden; the USSR was materially razed and with enormous human losses in excess of 25 million people; Japan was conquered, ruined and occupied. Approximately 80% of the world’s gold reserves had moved to the United States.
From June 1 to July 22, 1944, in an isolated but spacious and comfortable hotel in Bretton Woods, a small location in the state of New Hampshire, northeast United States, the Monetary and Financial Conference of the recently-created United Nations Organization took place.
The United States had the exceptional privilege of converting its paper money into an international currency, convertible into gold at the fixed rate of $35 per Troy ounce. As the overwhelming majority of countries deposit their currency reserves in United States’ banks, something equivalent to a considerable loan to the richest country in the world, its convertibility at least established a ceiling to the unlimited printing of paper money. And it at least signified a guarantee for the value of the countries’ reserves deposited in its banks.
On the basis of that enormous privilege and insofar as the printing of bills had the limit of their convertibility into gold, the powerful country increased its control over the riches of the planet.
The military adventures of the United States in alliance with the former colonial powers, particularly the United Kingdom, France, Spain, Belgium, Holland and the recently-created Western Germany, led them into military wars and adventures that placed the monetary system born in Bretton Woods in crisis.
In the era of the genocidal war on Vietnam, a country in which the United States was at the point of using nuclear weapons, the U.S. president took the shameful unilateral decision of suspending the convertibility of the dollar. From that moment the emission of paper money had had no limits. He abused that privilege in such a way that the Troy ounce gold value passed from $35 to figures already in excess of $1,400; in other words, no less than 40 times the value that it maintained for 27 years, until 1971, when Richard Nixon adopted that disastrous decision.
The worst of the current economic crisis currently hitting U.S. society is that the anti-crisis measures of other moments in the history of the imperialist United States capitalist system have not succeeded in restoring its normal march. Submerged in a state debt that is approaching $14 trillion; in other words, as large as the GDP of the United States, the fiscal deficit remains; the enormous outlay to save the banks and the reduction to almost zero of interest rates have barely been able to reduce the unemployment level to under 10%, nor the number of families whose homes are being repossessed. The gigantic budgets channeled into defense – which exceed those of the rest of the world put together – are growing, and graver still: those directed toward war.
The president of the United States, elected barely two years ago by one of the traditional parties, has suffered the greatest defeat recalled in the last three quarters of a century. Frustration and racism are mixed together in that reaction. The U.S. economist and writer William K. Black coined it with a memorable sentence: “The best way to rob a bank is to own one.” The most reactionary sectors of the United States are sharpening their claws, making their own an idea that would be the antithesis of that of the Bolsheviks in October 1917: “All power to the extreme right of the United States.”
It would seem that the government of the United States, with its traditional anti-crisis measures, has had recourse to another desperate decision: prior to the G20 meeting the Federal Reserve announced that it was to buy $60 billon U.S. dollars.
On Wednesday, November 10, one of the most important U.S. news agencies announced: “President Barack Obama has arrived in South Korea to take part in meetings with the 20 principal economic powers of the world.
“Tensions over monetary policies and commercial interests have been notable prior to the G-20 Summit. The atmosphere remained heated due to a U.S. decision to pump $600 billion in cash into its sluggish economy. The maneuver has infuriated leaders around the world.
“However, Obama has defended the measure taken by the Federal Reserve.”
The same agency communicated to world opinion on November 11:
“A strong sense of pessimism shrouded the start of an economic summit of rich and emerging economies on Thursday, with President Barack Obama and fellow world leaders arriving in Seoul sharply divided over currency and trade policies. “Founded in 1999 and elevated to summit level two years ago, the Group of 20 (G20, a forum that covers developed countries like the United States and Germany, as well as emerging giants like China and Brazil) has become the centerpiece of government efforts to reactivate the global economy and avert another world financial collapse…”
“Failure in Seoul could have severe consequences. The risk is that countries would try to keep their currencies artificially low to give their exporters a competitive edge in global markets. That could lead to a destructive trade war.
“Countries might throw up barriers to imports — a repeat of policies that worsened the Great Depression.”
“But agreement appeared elusive as the summit began, divided between those such as United States that want to get China to allow its currency rise in the face of other currencies, in order to reduce the enormous trade surplus of the Asian giant with Washington by pushing up Chinese exports and cutting U.S. imports.
“Other countries are irate over U.S. Federal Reserve plans to pump $600 billion of new money into the sluggish American economy, effectively devaluing the dollar. They see that move as a reckless and selfish scheme to flood markets with dollars, driving down the value of the U.S. currency and giving American exporters an advantage.”
“The G20 countries [...] are finding no common ground on the most vexing problem: how to address a global economy that’s long been nourished by huge U.S. trade deficits with China, Germany and Japan.”
“Brazil’s president, Luiz Inacio Lula da Silva, warned that such policies would “bankrupt” the world.
“If the rich countries are not consuming and want to grow its economy on exports, the world goes bankrupt because there would be no one to buy,” he told reporters. “Everybody would like to sell…”
“The summit began with a certain pessimism for Obama and the South Korean president, Lee Myung-bak, whose ministers were not able to reach agreement on a free trade treaty, bogged down for some time and for which there were hopes that it could be solved this week.”
“The G20 leaders met on Thursday night in Seoul’s National Museum of Korea for the dinner marking the official start of the summit.”
“Outside, a few thousand protesters rallied against the G-20 and the South Korean government.”
Today, Thursday 12, the summit concluded with a statement of 20 points and 32 paragraphs.
As one would suppose the world is not constituted of the total of 32 countries which make up the G-20 or the APEC on its own. The 187 which voted in favor of eliminating the blockade of Cuba, as opposed to the two that voted to maintain it and the three that abstained, add up to 192. For 160 of them there is no tribunal whatsoever where they can voice one word about the imperial plunder of their resources and their urgent economic necessities. In Seoul, the United Nations Organization does not even exist. That distinguished institution will not even say a single word?
During these same last few days really dramatic news arrived concerning Haiti – where, in a matter of minutes, an earthquake killed approximately 250,000 people in January of this year – via the European news agencies:
“Haitian authorities are warning of the rapidity with which the cholera epidemic is extending through the city of Gonaives, in the north of the island. The mayor of this coastal locality, Pierreleus Saint-Justin, confirms that he personally buried 31 persons on Tuesday, and expected to inter a further 15 corpses.
“‘Others could be dying as we speak,’ he has declared. [...] Since November 5, 70 corpses have been buried in the urban nucleus of Gonaives alone, but ‘there are more people who died in rural areas’ close to the city.”
“…the situation ‘is becoming catastrophic’ in Gonaives [...] flooding caused by Hurricane Tomas could make the situation worse.”
“On Wednesday, the health authorities in Haiti raised the total of victims throughout the country due to the disease to 643 up until November 8. The number infected with cholera in the same period is 9,971. Radio stations are noting that figures to be announced on Friday could talk of more than 700 dead.” “…the government is now confirming that the disease is seriously affecting the population of Port-au-Prince and threatening the suburbs of the capital, where more than one million people are still living in tent cities in the wake of the January 12 earthquake.”
Today, the news agencies were talking of 796 dead and 12,303 people affected.
More than three million inhabitants are threatened, many of them living in tents and in the ruins left by the earthquake, without drinking water.
The principal U.S. news agency informed yesterday:
“The first portion of U.S. reconstruction money for Haiti is on its way more than seven months after it was promised to help the country rebuild from the Jan. 12 earthquake.
“… will transfer $120 million – about one-tenth of the total amount pledged – to the World Bank-run Haiti Reconstruction Fund in the next few days, U.S. State Department spokesman P.J. Crowley said.”
“Having completed the process as outlined in the appropriation, we are now moving aggressively to commit that money to Haiti’s reconstruction,” Crowley said.
“A State Department aide said money destined for the fund would go toward rubble removal, housing, a partial credit guarantee fund, support for an Inter-American Development Bank education reform plan and budget support for the Haitian government.”
On the epidemic of cholera, a disease that has already affected many South American countries over the years, and could extend throughout the Caribbean and other parts of our hemisphere, not one word is being said.
Fidel Castro Ruz
November 12, 2010
8:49 p.m.
Translated by Granma International
