World Bank & IMF Polices Behind the Inadequate Health Infrastructure to Quell Ebola

Another interview where it is being reiterated that IMF & World Bank, the international financial institutions, are essentially, tools of the developed countries to keep the developing countries from ever developing. I have blogged about this several times before this post.

IMF & the World Bank are the instruments of the West, to keep the development goal, out of reach, from developing countries in Latin America, Asia, & Africa. These institutions provide billions in loans to countries with known corrupt leaders & then impose harsh restrictions, like austerity measures, to recover those loans. The corruption of the political leaders are well known. Those austerity measures tie the hands of the successive governments, regardless of how much they are well-intentioned, behind their backs, & the developing countries fail to develop.

These countries are instructed to privatize everything, increase prices & taxes for the local citizenry, but decrease their taxes & royalties from natural wealth, & let the international corporations loot the developing countries of their natural wealth. Of course, then, is it any wonder that developed countries keep developing further & amassing huge wealth, whereas, the developing countries stay at the bottom of the pile. If, by any chance, the leaders of the developing countries resist following the demands of the IMF, World Bank, of the political leaders of the developed countries, then political assassinations & interference, & ultimately, war, is imposed on those developing countries.

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https://www.youtube.com/watch?v=nghGovphphw

SHARMINI PERIES, EXEC. PRODUCER, TRNN: … do you think this is an adequate response on the part of the World Bank?

NII AKUETTEH, FMR. DIRECTOR AT AFRICA ACTION: I don't think so … the World Bank and the IMF have contributed to the weak health systems in Africa … . So, therefore, so to speak, they contributed to the problem; therefore they need to own up to their mistakes and they need to do more to help rescue these countries.

PERIES: What do you mean by that? What role has IMF and the World Bank played in West Africa in the past?

AKUETTEH: Oh, well, you know, two phrases. One is structural adjustment programs. Anybody who's been studying Africa since independence knows that especially since the '80s, when Ronald Reagan got into power in the United States and the World Bank and the IMF actually made themselves the economic stewards of economic policy in Africa, structural adjustment, otherwise called austerity measures, they have imposed these policies on the African countries regardless of what the people want, regardless of what the leaders wanted. So structural adjustment is one of those phrases. And the governments were told, were forced, that in order to get a good mark from the World Bank and the IMF, you have to keep government small, you have to slash government officials' pay; after you have slashed the number of government officials, you have to privatize everything and you have to force people to pay, and especially to pay for health care and to pay out of pocket for education.

So I think, though structural adjustment went on for decades and they devastated the African economies, the other phrase that I wanted to throw in is IMF riots. This actually came from Africa, where every time the IMF would impose economic conditions, ordinary people in the street were so hit hard that they would riot. And so it actually created a new phrase in the English language and in economic writing: IMF riots.

PERIES: So, Nii, explain more, in the sense that, yes, of course the IMF would have these horrendous austerity policies and neoliberal economic policies and force governments to shrink their bureaucratic and civil service, all these things in the past were set up in order to service their people. But why are they forced to come to these kinds of agreements with the World Bank and the IMF?

AKUETTEH: I think that's a great question, because on the surface of it, a government, a country can simply say, sorry, your conditions are too harsh, we don't have to deal with you. After all, the United States doesn't take the advice of the World Bank and the IMF. A number of big countries don't. But for African countries, number one, they are economically small and weak. Secondly, having just gotten out of colonialism--I know this is about 50 years ago, but when you are trying to restructure economic systems that was built over more than a century, it is not easy. And so they are tied into the global economy. They are tied into their former colonial masters. That is especially France and the U.K. And they are tied to the United States.

Now, those three countries, the United States, the U.K., and France, play a major role in the World Bank and the IMF. And therefore the World Bank and the IMF actually act as policeman and gatekeepers for the entire global economy if you are an African country, because the rest of the global economy says to you, we will deal with you only if the World Bank and the IMF says you are well behaved. And the World Bank and the IMF will say you are well behaved only if you agree to their conditions. And therefore it's almost impossible for an African country to say, listen, I don't want to do this anymore.

You know, everybody who reads the news, Africa news, and especially U.S.-Africa, will know that the West doesn't much care for Robert Mugabe. Usually you will be told that it's because he is internally repressive and other things. But I happen to think that one major factor also is that for about ten years after Zimbabwe became independent, Robert Mugabe followed the dictates of the World Bank and the IMF very closely. And after about ten years he said, no, this is not working no more. For instance, they made Zimbabwe sell its stock of maize, and say it's uneconomical to hold it; sell it, buy it when you need it. But that was bad economic advice, because when they wanted to buy it, they had to pay more. And so I am saying that countries that defy the IMF and the World Bank get punished by the larger global economy, and therefore it's not been very easy for those countries to reject what the World Bank and the IMF recommend, because they were doing it on behalf of the global economy.

PERIES: But these economies are very resource-rich. I mean, places like Sierra Leone have diamonds and gold, and West Africa is considered one of the natural resource rich regions of the world. The World Bank adopting these policies is really opening the doors and the gates to a flood of corporations coming in to do business in the region and reap the resources out of the region and leave very little behind. Can you sort of describe those complex relationships between the World Bank, the IMF, the local governments, the corporations that have left--the conditions that they have left in the region that is now unable to cope with … a grave epidemic of Ebola in the region?

AKUETTEH: I think that question is fantastic. I mean, because the reason that the World Bank and the IMF do what they do, the reason that they squeeze the African countries and say to them, you do what we tell you, never mind what your own people might want, never mind what your own leaders might want, the IMF and the World Bank, there's a method to their madness. And I believe said the method, the reason they do what they do, is actually to make it safe and hospitable for international corporations to go in and plunder Africa's wealth. It is as simple as that.

Now, it's been going on for years. The IMF and the World Bank are creatures created after the Second World War. They're Bretton Woods institutions. So, after the Second World War, with the U.K. and Western Europe being weakened, they were created to help stand up again in the global economy. So they took over what has been done, which is plundering Africa's wealth, leaving very little for the Africans … . That question goes to why this is done. The World Bank and the IMF would tell the African countries, keep governments small; you can't afford--. I mean, when I was in school, our governments were being told, listen--I'm from Ghana--you are a small country, the United States doesn't invest this much into education, so why should you? You shouldn't invest in education; let parents pay for it, when most parents are poor and when education is an investment. So they want to keep governments small. They want the people of the country to get as little as possible from the wealth--the bottom line is because they want the Western corporations to continue taking the wealth from out of Africa.

This is precisely why they do it. Even as recently as in Liberia, when Ms. Johnson Sirleaf--whom I know well because she was my boss at a certain point-- when she became president, she got a lot of kudos from the West because she is well known in the West and it was great that a woman had been in elected president in Africa. But behind the scenes, she was told that, listen, you will get a lot of corporations investing if you don't insist that they clean up the environment, if you don't push hard for labor protections, if you don't insist on high taxes, so all the things that the World Bank and the IMF says.

I'm saying your question is great because it goes to the heart of it: it's designed to make it easier for Western corporations to plunder Africa. It's as simple as that.

"Income Inequality" by RJ Matson

"Income Inequality" - RJ Matson, Roll Call, Washington, DC, US

"Right to work" by Jen Sorensen

 "Right to work" - Jen Sorensen, US

Tax dodging by big firms ‘robs poor countries of billions of dollars a year’

Loved the article. It's astonishing how large, multinational corporations, like Apple, Starbucks, Wal-Mart etc., move around their money, to take advantage of the lowest taxes possible. It doesn't affect them at all, & actually, their tax managers are rewarded further for helping the corporation & its investors save taxes. But, then these same corporations pay meagre wages to their employees (who then need social services, which are paid by taxes), & take advantage of other social services or infrastructure, paid for by the taxes.

Since, somebody gotta pick up the tab for all those social services & government expenses, & rich individuals dodge the taxes through offshore banking & corporations dodge the taxes through effective use of transfer pricing, the poor of the country gets the bills of the nation.

I'd call this "corruption". These corporations are all tout the horn of "ethics" but then find the first loophole in the law to dodge their fair responsibility. Ironically, when it's done in developing countries, it's called "corruption" & when it's done in developed countries, it's called "effective & efficient use of the law."
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http://www.theguardian.com/global-development/2015/jun/02/tax-dodging-big-companies-costs-poor-countries-billions-dollars

The international corporate tax system is outdated, unfair & will continue to cost developing countries tens of billions of dollars in lost revenues each year unless it is completely overhauled, a coalition of charities & civil society organisations has warned.

In a report ..., the Independent Commission for the Reform of International Corporate Taxation (Icrict), which was initiated by the charities & other organisations, argues that globalisation has rendered the century-old global tax system obsolete as more & more companies trade within related corporate structures.

“Tax abuse by multinational corporations increases the tax burden on other taxpayers, violates the corporations’ civic obligations, robs developed & developing countries of critical resources to fight poverty & fund public services, exacerbates income inequality, & increases developing country reliance on foreign assistance,” says the report.

On a more basic level, it adds, the tax policies of one country can have a dire effect on other countries’ ability to raise taxes that could be spent on education, healthcare & safe roads.

The report calls for the abolition of the separate entity principle, arguing that it allows huge multinational companies to dodge their tax obligations by presenting their operations in different countries as completely independent of one another. The principle permits them to shift their profits to countries with low or zero tax rates – & to move their losses into countries where taxes are higher.

“The primary enabler of international corporate tax abuse is the separate entity principle – a legal fiction that enables the flow of vast amounts of taxable income away from the underlying business operations,” it says.

“We believe the only effective way to stop this abuse is to treat multinational corporations as single & unified firms & divide the taxable profits between the countries where the income generating activities are located. If multinational corporations were taxed as single & unified firms, there would be no transfer pricing because global corporate profits would be consolidated, & thus no profits would be gained or lost through intra-company transactions.”

The report ... also calls for rich countries to agree a minimum corporate tax rate to stop “the global race to the bottom”.

“While each country is responsible for its own tax system, no country is unaffected by the tax system of others,” it says. “In addition to evaluation of the effectiveness of tax preferences, countries should also examine spillovers caused by their tax preferences for multinational corporations.”

Toby Quantrill, principal economic justice adviser at Christian Aid – which is part of the Icrict coalition – said drastic action was required when it came to retooling the international tax system.

“These ideas will be seen by many as radical,” he said. “Such changes will not be easy to implement & will not happen overnight. But as many people know, acknowledging the reality & severity of a problem can be the first step to recovery.”

Quantrill said that although the Organisation for Economic Cooperation & Development (OECD) had launched a plan to tackle multinational tax dodging, it was focusing on the symptoms rather than the causes.

“As a number of reports & analyses are showing, its work so far will be limited in its impact in richer countries & simply will not deal with the fundamental problem for poor countries,” he said.

“As an organisation often described as a ‘rich countries club’, it is hardly surprising that the OECD has not prioritised the problems faced by the poorest countries. And let’s be clear, these problems are significant.”

A recent report by the UN Conference on Trade & Development estimated that profit-shifting by multinational companies costs developing countries $100 billion a year in lost corporate income tax. Another report, by IMF researchers, estimated that developing countries may be losing as much as $213 billion a year to tax avoidance.

Oxfam – which published its own report on tax avoidance ... – says that corporate tax avoidance in the form of trade mispricing by G7-based companies & investors cost Africa $6 billion in 2010 alone. According to the NGO, the sum is more than 3 times the amount needed to improve the healthcare systems in the Ebola-affected countries of Sierra Leone, Liberia, Guinea & at-risk Guinea Bissau.

Oxfam & others are calling for the British government to introduce a tax-dodging bill that would oblige UK companies to pay tax in the countries where they operate – & would also make it harder for big companies to avoid paying tax in the UK.

“Multinational companies, many with headquarters in the UK & other G7 countries, are cheating African countries out of billions of dollars in vital tax revenues that could help vulnerable people get decent healthcare & send their children to school,” said Nick Bryer, Oxfam’s head of UK campaigns.

“To fund the fight against poverty & to tackle worsening extreme inequality, we need action to ensure big companies pay their fair share, here & in the world’s poorest nations.”

Here's how much corporations paid US senators to fast-track the TPP bill

Since, Trans-Pacific Partnership (TPP) is already well on its way to being passed ... & going to destroy North American labour market, I won't say much here. What I liked about this article was the facts & figures of how much each of the Senators in the American Senate received money from corporations which wanted TPP to pass so desperately. (Hint: the money they received is more than an average, middle class, American may make in a year).

On a side note, you should realize that if corporations are so desperate to want to get TPP passed, then it is definitely not going to be something good for the average Joe & Jane on main street.

Getting back to the main topic, as always, I would ask the reader that would you call this a democracy? Does this happen in a transparent & democratic government where Senators (one of them is 81 years old) receive such lucrative "gifts", while signing on a trade partnership, which will only going to kill any & all kinds of labour movements? Is this trade partnership going to help that single mother who is juggling multiple jobs to raise her little family while the rich Senators get more rich by voting for a trade partnership that will destroy her job & not raise her minimum wage? What about that poor student who is trying to brighten up his future by working part-time & getting a degree?

As I always say, political corruption exists everywhere. The primary difference is that it happens all out in the open in so-called "corrupt" countries (i.e. developing countries), whereas, in developed countries, those same "corrupt" practices are first made "legal". Since, the same "corrupt" practices become "legal", government officials are free to indulge in them as much as they want, & the governments of North America & Europe get the blessing of Transparency International (the organization, which is a joke in my view, similar to UN, World Bank, IMF etc.)

As the spokesperson for anti-corruption group, Represent Us, says in the end of the article that “how can we expect politicians who routinely receive campaign money, lucrative job offers, & lavish gifts from special interests to make impartial decisions that directly affect those same special interests? As long as this kind of transparently corrupt behavior remains legal, we won’t have a government that truly represents the people.”
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http://www.theguardian.com/business/2015/may/27/corporations-paid-us-senators-fast-track-tpp

A decade in the making, the controversial Trans-Pacific Partnership (TPP) is reaching its climax & as Congress hotly debates the biggest trade deal in a generation, its backers have turned on the cash spigot in the hopes of getting it passed.
...

Fast-tracking the TPP, meaning its passage through Congress without having its contents available for debate or amendments, was only possible after lots of corporate money exchanged hands with senators. ...

Those impressive majorities follow months of behind-the-scenes wheeling & dealing by the world’s most well-heeled multinational corporations with just a handful of holdouts.

Using data from the Federal Election Commission, this chart shows all donations that corporate members of the US Business Coalition for TPP made to US Senate campaigns between January & March 2015, when fast-tracking the TPP was being debated in the Senate:

- Out of the total $1,148,971 given, an average of $17,676.48 was donated to each of the 65 “yea” votes.

- The average Republican member received $19,673.28 from corporate TPP supporters.

- The average Democrat received $9,689.23 from those same donors.

The amounts given rise dramatically when looking at how much each senator running for re-election received.

Two days before the fast-track vote, Obama was a few votes shy of having the filibuster-proof majority he needed. Ron Wyden & 7 other Senate Democrats announced they were on the fence on 12 May, distinguishing themselves from the Senate’s 54 Republicans & handful of Democrats as the votes to sway.

- In just 24 hours, Wyden & 5 of those Democratic holdouts – Michael Bennet of Colorado, Dianne Feinstein of California, Claire McCaskill of Missouri, Patty Murray of Washington, & Bill Nelson of Florida – caved & voted for fast-track.

- Bennet, Murray, & Wyden – all running for re-election in 2016 – received $105,900 between the 3 of them. Bennet, who comes from ... Colorado, got $53,700 in corporate campaign donations between January & March 2015 ... .

- Almost 100% of the Republicans in the US Senate voted for fast-track – the only two non-votes on TPA were a Republican from Louisiana & a Republican from Alaska.

- Senator Rob Portman of Ohio, who is the former US trade representative, ... received $119,700 from 14 different corporations between January & March, most of which comes from donations from Goldman Sachs ($70,600), Pfizer ($15,700), & Procter & Gamble ($12,900). ...

- 7 Republicans who voted “yea” to fast-track & are also running for re-election next year cleaned up between January & March. Senator Johnny Isakson of Georgia received $102,500 in corporate contributions. Senator Roy Blunt of Missouri, best known for proposing a Monsanto-written bill in 2013 that became known as the Monsanto Protection Act, received $77,900 – $13,500 of which came from Monsanto.

- Arizona senator & former presidential candidate John McCain received $51,700 in the first quarter of 2015. Senator Richard Burr of North Carolina received $60,000 in corporate donations. Eighty-one-year-old senator Chuck Grassley of Iowa, who is running for his 7th Senate term, received $35,000. Senator Tim Scott of South Carolina, who will be running for his first full six-year term in 2016, received $67,500 from pro-TPP corporations.

“It’s a rare thing for members of Congress to go against the money these days,” said Mansur Gidfar, spokesman for the anti-corruption group Represent.Us. “They know exactly which special interests they need to keep happy if they want to fund their reelection campaigns or secure a future job as a lobbyist.

“How can we expect politicians who routinely receive campaign money, lucrative job offers, & lavish gifts from special interests to make impartial decisions that directly affect those same special interests?” Gidfar said. “As long as this kind of transparently corrupt behavior remains legal, we won’t have a government that truly represents the people.”

"Where Apple makes its money" by Martyn Turner

"Where Apple makes its money" - Martyn Turner, The Irish Times, Dublin, Ireland

"Facebook & Privacy" by Arend van Dam

"Facebook & Privacy" - Arend van Dam, Amsterdam, Netherlands