February 18th 2006

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Articles from this issue:

COVER STORY: AWB biggest scandal to hit the Howard Government

EDITORIAL: Tide turns on global capitalism

SCHOOLS: Why our children don't know history

ECONOMICS: Sky's the limit with CEO pay increases

EDUCATION AND TRAINING: Engineer shortage hurting economy

RURAL CRISIS: Black Friday for Canadian farmers

MEDICAL: Abortion pill a bonanza for lawyers

STRAWS IN THE WIND: The humbug revolution / Iran / Bush, oil addiction and the environment

AUSTRALIAN SOCIETY: Is pornography just harmless fun?

ENTERTAINMENT: American awards honour traditional values

EAST TIMOR: Will Indonesian military be let off the hook?

WAR ON TERROR: Tackling a home-grown security threat

OPINION: 'Human rights' charter a backward step

OBITUARY: Colin Pike, champion of the underdog

Religious persecution during the Spanish Civil War (letter)

B.A. Santamaria on Toynbee's 'creative minorities' (letter)

BOOKS: MANHOOD: An action plan for changing men's lives, by Steve Biddulph

BOOKS: HEAD OF STATE: The Governor-General, the Monarchy, the Republic and the Dismissal, by Sir David Smith

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Tide turns on global capitalism

by Peter Westmore

News Weekly, February 18, 2006
In many countries around the world, people are voting out of office governments committed to deregulated capitalism.

Fifteen years ago, as the empire of Soviet communism unravelled and finally collapsed, it seemed that Western democracy had emerged as the dominant political form throughout the world.

Accompanying this was a concerted push for the adoption of American-style free-market capitalism (as opposed to the West European Christian Democratic social-market model). This was to be a world of globalised economies, of privatised national economies, and free-trade agreements in which all barriers to the movement of goods and services were removed.

For a time, the project seemed to work, particularly in Latin America and Eastern Europe where former communist states embraced not only democracy, but deregulated free-market capitalism in the belief that it was a shortcut to American levels of prosperity and innovation.

Over recent years, however, the experiment has soured, as people in many countries have experienced the downside of the uncontrolled free market. In countries as diverse as Russia and Poland, Chile and Brazil, the advocates of American-style capitalism have been replaced either by leftists, ex-communists or anti-American politicians.


While there are always local issues at play, the common ground is that these politicians are riding a wave of resentment against the imposition of policies which are perceived as widening the gap between rich and poor, and favouring transnational corporations over local businesses.

In Latin America, the shift to the left first appeared in Venezuela, where a left-wing populist, Hugo Chavez, was elected President in 1999, and re-elected in 2004 after surviving a presidential recall vote. He will face the voters again later this year.

In 2002, Lula da Silva, a left-wing union official, was elected President of Brazil, on an explicitly nationalist platform; then in 2003 Nestor Kirshner, a centre-left Peronist, defeated the free marketeer, Carlos Menen, as President of Argentina, the second largest country in Latin America.

Uruguay and Bolivia later followed a similar course. In Bolivia, the leader of the Movement for Socialism, Evo Morales, was elected late last year on an explicitly anti-American platform.

Morales has said, "The worst enemy of humanity is capitalism. That is what provokes uprisings like our own, a rebellion against a system, against a neo-liberal model which is the representation of a savage capitalism. If the entire world doesn't acknowledge this reality, that national states are not providing even minimally for health, education and nourishment, then each day the most fundamental human rights are being violated."

He described American plans for a Free Trade Area of the Americas as "an agreement to legalise the colonization of the Americas".

Last January, the people of Chile elected Michelle Bachelet, the left-wing daughter of a former Air Force General imprisoned and tortured to death after the 1973 military coup which put General Pinochet in power.

Bachelet defeated a billionaire businessman and former senator Sebastián Piñera, obtaining 53.5 per cent of the vote, in what was widely seen as a change of direction in Chile. The significance of Bachelet's election is that Chile was the first country in Latin America to embrace the free market in the 1970s.

One consequence of the swing to the left in Latin America is that Cuba, the communist dictatorship led by Fidel Castro, has been able to emerge from the total diplomatic isolation it has suffered since the demise of the Soviet Union in the early 1990s.

Similar developments have taken place in the Middle East, where the United States brought pressure to bear on Egypt, Iraq and the Palestinian territories to hold free and fair democratic elections.

The result in all three places has been the emergence of powerful Islamist political forces. In Iraq, the US-backed secular group won only 25 seats out of a total of 275 in last December's parliamentary elections, while the Shi'ite religious alliance won 128 seats and will be a leading force in the next government.

In Egypt, where the Muslim Brotherhood is technically illegal, candidates affiliated with it won 88 of 444 parliamentary seats, a six-fold increase.

Last month, the terrorist organisation Hamas won the Palestinian elections with an absolute majority, routing the secular Fatah Party which had previously governed the Palestinian territory.

Apart from orchestrating the current wave of suicide-bombings in Israel, Hamas is aligned with, and has been armed by, the Islamic republic of Iran, and receives large amounts of money from Saudi Arabia and the oil-rich Gulf States.

There can be no doubt that when the US embarked on a campaign to build democratic institutions in Latin America and the Middle East, it expected that the outcome would be to replace authoritarian régimes with pro-American democracies. This has not happened.

The election of anti-American governments is not a repudiation of democracy, but rather a rejection of US foreign policy, aspects of secular Western culture and unbridled capitalism.

  • Peter Westmore is national president of the National Civic Council.

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