Note: Please also read my other post on this subject: IMF Just Bought A New India President. Click on this link at https://onefinalblog.wordpress.com/2012/06/18/imf-just-bought-new-india-president/. Thank you for your feedback and share.
India’s one billion people are now going through a massive and catastrophic terrorist attack. On the surface, this attack is bloodless. On the surface, this attack is not even violent. This new terror is silent.
This is a well-organized, pre-planned economic terror attack. And it is going to kill countless people.
You can consider this article as an urgent terror alert: a red alert. I would be happy to answer any questions you may have, and willing to be a part of any debate mainstream media is bypassing. My hope is that you would not overlook this grave scenario unfolding right now.
The newest economic terror unleashed in India and on the Indian people — one billion of them — brings with it terrifying weapons of mass destruction. The new weapons are massive devaluation of the Indian rupee, historic price hike, and forcing harsh, neoliberal economic “reforms.” India now has the world’s steepest and fastest price rises for essential commodities — such as cooking oil and gas, rice, wheat, vegetables and pulses. I’m not even talking about the huge price rise in health care, education, housing and transportation.
Corporate India, Wall Street, IMF and their mouthpiece big media tout these new, harsh reforms as “necessary for growth.” They have their friends in the Indian government. In fact, India’s queen mother Sonia Gandhi, prime minister Manmohan Singh, and longtime finance minister Pranab Mukherjee who now assumed the position of India’s ceremonial president are all involved in and aware of this neoliberal economic terror, unleashed full-scale by IMF, World Bank, WTO (previously GATT), and their corporate forces.
These forces have now re-colonized India.
Update (September 22): It’s extremely disturbing that India’s media has completely bypassed this extremely important discussion. The only discussion that they were forced to take on was because of West Bengal’s loose-cannon chief minister Mamata Banerjee, who pulled out her support for the Manmohan Singh government on the issue of Foreign Direct Investment (FDI): where the government gave away carte blanche rights to Wal-Mart, Mansanto, GE, Coca Cola and such sinister corporations to invade India’s huge retail market, replacing and destroying local economies. NO substantive discussion of the role of IMF has taken place, even during the month-long election campaign.
I have lots at stake in India. My father, sisters, cousins, in-laws, uncles and aunts, nephews and nieces, teachers and students and a large number of friends live there. All my childhood neighbors live there. All of those people who helped me to survive, grow up and prosper live there. My twenty five years of living memory lives there.
This new massive and catastrophic terrorist attack could kill them all. And a direct consequence would be: here in the U.S. where I live now with my little nuclear family could be killed too.
This is a real scenario. This is very real. This is very scary.
I blame the current Indian government. They have failed again to prevent a huge terror attack — just the same way they failed to prevent the 2008 bloody Mumbai terrorism. And many others that happened before and after.
I also blame the International Monetary Fund. I believe IMF-WTO with World Bank is responsible behind this new terror.
How does IMF unleash the economic catastrophe? Here’s a quote from Malaysia’s former prime minister Dr. Mahathir Bin Mohamad, who showed us a way to break away from IMF.
“In the old days you needed to conquer a country with military force, and then you could control that country. Today it’s not necessary at all. You can destabilize a country, make it poor, and then make it request [IMF] help. And [in exchange] for the help that is given, you gain control over the policies of the country, and when you gain control over the policies of a country, effectively you have colonized that country.”
The Mahathir Mohamad quote can be easily applied to India. In the 80’s, Rajiv Gandhi became (or was put in as) the prime minister of India after his mother Indira Gandhi was assassinated — allegedly by a CIA plot. Rajiv Gandhi who had no prior experience in politics, naively and ironically, opened up the floodgates of India’s socialist (and “stagnant”) economy to foreign corporations, and India has ushered in the new era of “reform.” The present prime minister Manmohan Singh was one of the chief architects of that so-called liberalization. This new reform has pulled India out of a so-called stagnation that the country’s elite did not like, made them extremely rich, and created the largest-ever inequality and rich-poor divide in India’s history. India’s corruption and black market have stooped down to an historic abyss.
Through this two-decade-long “reform,” India has succumbed to Western multinationals and directives of IMF and World Bank. India now has one of the highest price rises especially for oil and gas; its currency has devalued from 11 Indian rupees per U.S. dollar to 55 Indian rupees — in just twenty years. Unexplained by media. Accepted by the status quo. There is a cultural shift.
This is the same policy IMF imposed on countries such as Argentina. What is happening in India right now is a stark reminder of what happened in Argentina just a decade or two ago.
In the 1990s Argentina was the poster child for globalization. They followed the IMF and World Bank program. Soon after, their economy and infrastructure were destroyed. Western media did not care. India media did not tell that story either. Now, Greece is going through the same IMF horror. Ireland, Spain and Italy have begun suffering greatly, thanks to the global economic terror and anti-poor austerity measures in the European Union. (Gosh! Why don’t they ever ask the super-rich to do some austerity too?)
The first step was capital market liberalization. Its liberalized markets freed capital to flow in and out across borders. But once Argentina’s economy began to wobble, money simply flowed out.
In India, money now leaves the country like crazy. Or, in a more India-like fashion, it simply goes underground: either into Swiss Banks or the country’s biggest-in-human-history black market. Nobody in the government ever discloses the amount of black (unaccounted-for and/or untaxed) money: there is no legal mandate to do that. Corporate media, strangely, never get to the bottom of it. The infamous Bollywood movie industry or India’s rising-star cricket industry with game-gambling — two biggest profit makers — are known to be run by smuggled or mafia money. Then you have India’s largest-in-the-world gold industry: particularly in crisis, black money changes to gold.
The second step in the IMF-World Bank regimen in Argentina was privatization. Both at the urging of lenders and out of financial necessity, Argentina throughout the nineties sold off the state’s oil, gas, water, and electric companies and the state banks.
Since the fall of the Soviet Empire, India has rapidly succumbed to the hands of globalization pushers; particularly its banking industry has been taken over by foreign banks. Nationalized banks such as State Bank of India have practically dwindled on the verge of collapse; Citibank, HSBC and such others have taken over the entire country’s middle class and their savings. Investing U.S.-style into the globalized stock market — particularly its financial sector with an aspiration to be quickly rich — has backfired on the middle class.
In 1994, at the World Bank’s urging, Argentina partially privatized its social security system, diverting much of it into private accounts. The US-based Center for Economic and Policy Research (CEPR) calculated the revenue loss from this decision alone to be almost equal to the nation’s budget deficit during the period.
For that matter, India never had a social security system. But its nationalized insurance industry has collapsed too at the hands of Metlife, New York Life, now-fallen-from-grace AIG, etc. This is a direct result of never-well-disclosed IMF’s Structural Adjustment Program. I wrote about it in my Outlook India oped a couple of years ago. Click on the link here if you’re interested to read it.
The third prong of the push was “market-based pricing.” In Argentina, the main target of this initiative has been labor, that most inflexible of commodities.
“A major advance was made to eliminate outdated labor contracts,” states the CEPR report, noting approvingly that “labor costs” (i.e., wages) had fallen due to “labor market flexibility induced by the de facto liberalization of the market via increased informality.” Translation: workers who lost unionized jobs were forced into ad hoc arrangements, with far less protection. Here, the report asks the government to decentralize collective bargaining, a move that would reduce union power.
A very similar development in the labor sector has happened in India. Labor unions have seen harsh repression, governments and corporations have taken away their precious collective bargaining, and the once-mighty leftist or other pro-worker trade unions have practically died. Indian construction and manufacturing industries have used child labor that international human rights organizations have reported to be the worst-case scenario in the world. Women workers are often the victims of sexual violence and grossly underpaid, even by Indian standards. Worse, work, workers and poverty are now looked-down-upon — just the new trickle-down American way.
Step four of the IMF program was free trade. The loan terms of the two institutions had required Argentina to accept “an open trade policy.” As recession set in, Argentina’s exporters — whose products were effectively priced, via the peg, in US dollars — were forced into a spectacularly unequal competition against Brazilian goods priced in that nation’s devalued currency. Argentina grows a special kind of long-grain rice favored by Brazilians, and yet even as Brazil faced a hunger crisis tons of rice went unsold.
India has seen more or less the same. “Free trade” has seen a one-way free trading where multinational corporations such as Monsanto have devastated Indian farmers: they have forced, with collusion from their operatives in the Indian government, permanent seed replacement with their own genetically modified seeds. Indian farmers, forced to take vast loans to keep their farms and produce, have become destitute and the country has recently seen the largest-in-human-history suicides of farmers. Indian farmers have also been forced to sell their traditional trademark products like Basmati rice to multinational corporations. In fact, the age-old name Basmati has been owned by a Texas rice company!
Before 1980, when the World Bank and IMF set out to rearrange the economies of developing nations, nearly all of them adhered to Keynesian or pro-worker, bubble-up, demand-side economy. Following the “import-substitution model”, they built locally owned industry through government investment, behind a protective wall of tariffs and capital controls. In those supposed economic dark ages, spanning roughly from 1960 to 1980, per-capita income grew by 73 percent in Latin America and by 34 percent in Africa.
India also saw an equitable economic system and price control for the essential commodities kept the poor and lower middle class happy and content.
I came from a poor or lower middle class family in Calcutta and I know for the fact that in spite of the low income of my father who worked in a factory was enough for us. Now, in 2012, with this new economic terror unleashed by IMF and World Bank and their operatives in the Indian government (such as the finance minister who is also, as I said before, the country’s official head of IMF), my poor cousins simply cannot survive with the money they make.
Health care costs are now so high that one of my cousins cannot send her mother to a good-quality private hospital; the poor woman is dying practically untreated at home (update: just this past weekend, she died). A friend whose son was a bright student in school could not go to an expensive private college; his dreams are shattered. Public sector health care and education, along with employment — once strong pillars of India’s somewhat egalitarian economic structure — have been purposefully destroyed. Public transportation is going to see the same fate in the coming days — again, the U.S. neoliberal way.
Sky-high rents and other essential living costs are driving the middle class into major debt; they’re driving the lower middle class into poverty, and the poor into destitution and death. One of my childhood friends in Calcutta killed himself because his parents were both ill and he was overwhelmed with debt because of their medical expenses. He and I played alley cricket and football together.
The newest round of oil price hike and sharp devaluation — under directives from IMF — will bring even more desperation for those people I left back there. A brother in-law recently died when he was only forty; he could not take anymore his lifelong unemployment, hopelessness and embarrassment. The sister he married nearly died too. IMF’s official India director who is also India’s national finance minister (nobody knows!) might want to face these families — on camera. (I want to be present there as the interview moderator.)
All of the above have had direct impact on my home here in the U.S. A failed globalized economy is running amuck worldwide. My family and I keep paying for its impossible price.
I want to live happy here in the U.S. But I can’t.
This new terrorism is ruining my people’s lives. And my life.
Brooklyn, New York