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by Noam Chomsky
05.15.97
the public pays the costs and the rich get the benefit--markets for the poor and plenty of state protection for the rich.
There's a conventional doctrine about the era we're entering and the promise that it's supposed to afford. In brief, the story is that the good guys won the Cold War and they're firmly in the saddle. There may be some rough terrain ahead, but nothing that they can't handle. They ride off into the sunset, leading the way to a bright future, based on the ideals that they've always cherished: democracy, free markets and human rights.
In the real world, however, human rights, democracy and free markets are all under serious attack in many countries, including the leading industrial societies. Power is increasingly concentrated in unaccountable institutions. The rich and the powerful are no more willing to submit themselves to market discipline or popular pressures than they ever have been in the past.
Let's begin with human rights, because it's the easiest place to start: they're actually codified in the Universal Declaration of Human Rights, passed unanimously by the United Nations General Assembly in December, 1948. In the United States there's a good deal of very impressive rhetoric about how we stand for the principle of the universality of the Universal Declaration, and how we defend the principle against backward, Third World peoples who plead cultural relativism.
All this reached a crescendo about a year ago, at the Vienna Conference. But the rhetoric is rarely besmirched by any reference to what the Universal Declaration actually says. Article 25, for example, states: "Everyone has the right to a standard of living adequate for the health and well-being of himself and his family, including food, clothing, housing and medical care and necessary social services, and the right to security in the event of unemployment, sickness, disability, widowhood, old age or other lack of livelihood."
How are these principles upheld in the richest country in the world, with absolutely unparalleled advantages and no excuses for not completely satisfying them? The US has the worst record on poverty in the industrialized world a poverty level which is twice as high as England's. Tens of millions of people are hungry every night, including millions of children who are suffering from disease and malnutrition. In New York City 40% of children live below the poverty line, deprived of minimal conditions that offer some hope of escape from misery and destitution and violence.
Let's turn to Article 23. It states: "Everyone has a right to work under just and favourable conditions." The ILO has just published a report estimating the level of global unemployment--understood to mean the position of not having enough work for subsistence--in January 1994 at about 30%. That, it says accurately, is a crisis worse than that in the 1930s. It is, moreover, just one part of a general worldwide human rights catastrophe. UNESCO estimates that about 500,000 children die every year from debt repayment alone. Debt repayment means that commercial banks made bad loans to their favourite dictators, and those loans are now being paid by the poor, who have absolutely nothing to do with it, and of course by the taxpayers in the wealthy countries, because the debts are socialized. That's under the system of socialism for the rich that we call free enterprise: nobody expects the banks to have to pay for the bad loans that's your job and my job.
Meanwhile, the World Health Organisation estimates that 11 million children die every year from easily treatable diseases. WHO's head calls it a silent genocide: it could be stopped for pennies a day.
In the US, of course, there is currently a recovery. But it's remarkably sluggish, with less than a third of the job growth of the previous six recoveries. Furthermore, of the jobs that are being created, an enormous proportion more than a quarter in 1992Ůare temporary jobs and most are not in the productive part of the economy. Economists welcome this vast increase in temporary jobs as an "improvement in the flexibility of labour markets". No matter that it means that when you go to sleep at night you don't know if you're going to have work the next morning it's good for profits, not people, which means that it's good for the economy in the technical sense.
Another aspect of the recovery is that people are working longer for less money. The workload is continuing to increase, while wages are continuing to decline which is unprecedented for a recovery. US wages as measured by labour costs per unit output are now the lowest in the industrial world, except for Britain. In 1991 the US even went below England, although England caught up and regained first place in the competition to crush poor and working people. Having been the highest in the world in 1985 (as one might expect in the world's richest country), US labour costs are today 60% lower than Germany's and 20% lower than Italy's. The Wall Street Journal called this turnaround "a welcome development of transcendent importance". It is usually claimed that these welcome developments just result from market forces, like laws of nature, and the usual factors are identified, such as international trade and automation. To put it kindly, that's a bit misleading: neither trade nor automation has much to do with market forces.
Take trade. One well-known fact about trade is that it's highly subsidized with huge market-distorting factors, which I don't think anybody's ever tried to measure. The most obvious is that every form of transport is highly subsidized, whether it's maritime, aeronautical, or roads or rail. Since trade naturally requires transport, the costs of transport enter into the calculation of the efficiency of trade. But there are huge subsidies to reduce the costs of transport, through manipulation of energy costs and all sorts of market-distorting fashion. If anybody wanted to measure this, it would be quite a job.
Take the US Pentagon, a huge affair. A very substantial part of the Pentagon is intervention forces directed at the Middle East, across the whole panoply of intimidation devices to make sure nobody gets in the way if the US tries to intervene. And a large part of the purpose of that is to keep oil prices within a certain range. Not too low, because the US and British oil companies have to make plenty of profit, and these countries also have to earn profits which they can then send back to their masters in London and New York. So, not too low. But also not too high, because you want to keep trade efficient. I'm not even mentioning so-called externalities, like pollution and so on. If the real costs of trade were calculated, the apparent efficiency of trade would certainly drop substantially. Nobody knows how much.
