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ISSN 1655-5295

Vol. 10 No. 2 MARCH-APRIL 2011

Cover and Layout DesignRon Villegas

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Antonio Tujan, Jr.International Director

Editor-in-Chief

International Department

Paul QuintosMaria Theresa Nera-Lauron

Editorial Board

Education for Development

COVER STORY

1 Time for a New Paradigm

Sharan Burrow

4 What does wage-led growth mean in developing

countries with large informal employment?

Jayati Ghosh

7 A new era of social justice based on decent work

Juan Somavia

NEWS

9 Nine months to deliver:

tipping point to make development aid effective

BetterAid, OpenForum

10 Libya Intervention threatens the Arab spring

Phyllis Bennis

12 Japan: vulnerability and uncertainty prevail in wake of

nuclear disaster

Suvendrini Kakuchi

14 Uniting to Lose Our Chains: The International Festival

for Peoples Rights and Struggles

IFPRS Secretariat

SPECIAL FEATURE

16 Wisconsin Awakens a Sleeping Giant

Sarah van Gelder and Brooke Jarvis

19 Mondragn worker co-ops ride out global slump

John Ballantyne

23 EDSA and the Philippine Economy:

25 years after

Sonny Africa

25 Europes Austerity:

Like Something Out of the Brothers Grimm

Conn Hallinan

MOVIE REVIEW

28 GASLAND

Jeff Leins

FACTS & F IGURES

29 Global employment trends

Education for Development Magazine

is published by

IBON InternationalIBON Foundation, Inc.

IBON Center

114 Timog Avenue, Quezon City

1103 Philippines

Website: www.iboninternational.org

E-mail Address: [email protected]

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Fax +632 927 6981


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1E D U C A T I O N F O R D E V E L O P M E N T

COVER STORY

ese are truly times for anger.

e world is barely re-emerging from the deepest economic crisis in a century, yet the very policies and mindsetthat caused the problem in the rst place are back with a vengeance. Indeed, the world economy risks sliding backinto crisis as dangerously short-sighted policies are put into place. e brave words of reform from world leadersin the G20 meetings of 2009 are now largely forgoen and have been replaced with the old scriptures of scalconsolidation and calls to address the fundamentals.

And thus the world is fast slipping into a self-defeating round of competitive austerity where everyone seeks

salvation from austerity at home through export-led growth. is is a strategy that might have worked for some fora time, but those days are gone: credit-driven consumption in a few key countries can no longer make up for the lackof wage-driven consumption worldwide.

Weakness in wage growth has been shown to be a prime cause of the crisis. is should come as no surprise: withglobalization there has been a growing disconnection between wage growth and productivity. Whereas workercompensation rose in parallel with the improvement of productivity until the early 1980s, overly restrictivemonetary policies, trade liberalization, labour market deregulation and employers strategies have combined sincethen to weaken this link. e consequences are now well documented: the share of labour income has dropped in

Time for a New ParadigmBy Sharan Burrow

guardian.co.u

k


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2 E D U C A T I O N F O R D E V E L O P M E N T

COVER STORY

most countries, inequalities have increased almosteverywhere, and consumption has been maintainedin large part through credit.

What is worse is that since the 1990s the declinein labours share of income has been highlypronounced in countries with trade surpluses (seeFigure 1). In other words, the winners of the newglobal trading system have not shared those gainswith their workforce is is protable for someindividual companies, but it is bad for overall growth

and prosperity. Ultimately it is unsustainable.

With unemployment and household debt stillhigh in some of the key jurisdictions in the world(including both the U.S. and Europe) and withgovernments engaging in counter-productiveausterity, it is more urgent than ever to ensure thatworkers get their fair share. More than a moral issue,it is also the only way to extricate ourselves from thecurrent macroeconomic mess.

We need a fundamental change in paradigm.First, jobs and decent work can no longer besome collateral by-product of economic policiesgeared to rolling out the red carpet to investors.Full employment has to become anew the centralobjective of economic policy, and it should beexpected that governments use all their levers scal, monetary, regulatory and industrial toachieve it. In parallel, we need active policies toimprove workers capacity to engage in collective bargaining to link wages to productivity growth

once again.

All of this will require new rules of the gameinternationally. As it stands, the currentinternational economic and nancial systemhas given the upper hand to speculators and taxevaders, fostered instability and put the burdenof economic adjustment on the parties that werealready experiencing di cult times. As a result, the

Figure 1: Change in wage share, 1995-2005

TRADE DEFICIT COUNTRIES TRADE SURPLUS COUNTRIES

Source: World of Work Report 2010, ILO.


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COVER STORY

fate of entire societies has not improved much over

the past thirty years. is needs to change.

First, we need to reform the currency system to

ensure that adjustment is not achieved mostly by

deating decit countries, but through reatingsurplus nations. In this way, the system wouldensure that the adjustment led to more growth forall, not further wage and price depression. is ideais not new; it was rst proposed by J.M. Keynes backin 1944 and has elicited renewed interest recently.Such a system would perhaps entail capital controlsof some kind, but that would remain a lesser evilthan the costs of disorder.

Second, we need new regulations on tax havens aswell as on taxes on income and wealth. Controllingtax evasion and tax competition has to become apolicy priority. At a time when the average workingperson is being asked to shoulder the bailout costsof the nancial system, the least that can be askedis that all pay their fair share. Eliminating theseloopholes is not nearly as complicated as somemake it sound and would bring much neededresources into the scal purse. In the same spirit,the establishment of an international nancial

transactions tax to raise new resources would go along way to make it possible for nancially strappedgovernments to fund the necessary increase inO cial Development Assistance to achieve theMillennium Development Goals (MDG) as well as the mitigation costs of climate change.It has been estimated that, for the United Statesalone, such a tax would conservatively raise in theneighbourhood of $US170 billion, the equivalentof the entire funding of the MDG programme

Last but not least, we need a renewed focus aroundthe enhancement and respect of labour standards by all. When it comes to labour rights, the worldfaces a classic free rider problem. Now more thanever, it is essential to ensure a basic internationalsocial oor, that all countries endeavour to respect

basic standards and that competitive advantagedoes not come at the expense of the over-exploitation of workers. If it is true that labour isnot a commodity, the manner in which we achieveeconomic prosperity is as important as the goal

itself.

None of these ideas is particularly radical. What setsthem apart from the current orthodoxy is that theygive prominence to workers needs and aspirations,and pragmatically dene a high road to economicdevelopment.

e experience of the last three years shows thatdepartures from economic orthodoxy are feasibleat times when the establishment is going throughnear-death experiences, but that this does not havea lasting eect. In hindsight, the brief irt withKeynesianism when the nancial system was onthe brink of collapse only lasted as long as it wasneeded to save the banks.

If during the crisis workers organisations couldhave anticipated that a new era of dialogue hadbegun, the moment has clearly passed. Our socialpartners have le the restaurant and presented

us with the bill: austerity, tax increases, wageconcessions, increased precariousness, publicsector retrenchment, cuts in public pensions, andso on.

If much of the solution to our problem isinternational, trade unionists will have to nd waysto exert their power and inuence internationally aswe confront the consequences of the crisis.

Both opinion polls and the wave of strikes and

protests in many countries show the growingdiscontent with one-sided and short-sighted policysolutions.

In times of anger, the moment is certainly not forbusiness as usual

Sharan Burrow is General Secretary of the International Trade Union Confederation ( ITUC). This article was published by global-labour-

university.org on 21 February 2011.


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COVER STORY

What does wage-led growth meanin developing countries with large

informal employment?By Jayati Ghosh

The past decade has been one in which export-led economic strategies have come to be seen as the mostsuccessful, driven by the apparent success of two countries in particular - China and Germany. In fact, theexport-driven model of growth has much wider prevalence as it was adopted by almost all developingcountries.

is was associated with suppressing wage costsand domestic consumption in order to remaininternationally competitive and to achieve growing

shares of world markets as far as possible. Managingexchange rates to remain competitive, despite eithercurrent account surpluses or capital inows, becameone of the major elements of this strategy. is wasassociated with the peculiar situation of rising savingsrates and falling investment rates in many developingcountries, and to the holding of international reservesthat were then sought to be placed in safe assets abroad.

is is related to a classic dilemma of mercantiliststrategy, which is evident in exaggerated form for theaggressively export-oriented economies of today: they

are forced to nance the decits of those countries that would buy their products, through capital ows thatsustain the demand for their own exports, even whenthese countries have signicantly higher per capitaincome than their own. e ows of capital from Chinaand other countries of developing Asia is an egregiousexample of this.

ips.org


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COVER STORY

e strategy also generated fewer jobs than amore labour-intensive paern based on expandingdomestic demand would have done, which meantthat employment increased relatively lile, despiteoen dramatic rises in aggregate output. is is

why, globally, the previous boom was associated with the South subsidizing the North: throughcheaper exports of goods and services, through netcapital ows from developing countries to the USin particular, through ows of cheap labour in theform of short-term migration.

e recent collapse in export markets halted thatprocess for a while. Although there has been arecovery, it is very evident that such a strategy isunsustainable beyond a point. is is particularlytrue when a number of relatively large economiesseek to use it at the same time. So, not only was thisa strategy that bred and increased global inequality,it also sowed the seeds of its own destruction bygenerating downward pressures on price becauseof increasing competition as well as protectionistresponses in the North.

So there are both external and internal reasons whyit is hard to sustain such a strategy beyond a point.

Externally, decit countries will either choose orbe forced to reduce their decits through variousmeans, and protectionist responses. Internally,the potential for suppression of wage incomes anddomestic consumption will meet with politicalresistance. In either case, the pressures to ndmore sustainable sources of economic growth,particularly through domestic demand and wage-led alternatives, are likely to increase.

e process of global economic rebalancing was

initiated by the nancial crisis and is now likelyto get accentuated through the current fragilerecovery and potential instability of the near future.One important result is developing countries (andthe surplus countries like China in particular)can no longer depend on exports to US as theirprimary engine of growth. e US trade decit isset to shrink, and at a fundamental level it reallydoes not maer whether this occurs throughexchange rate changes, changes in domestic

savings and investment behavior or increased tradeprotectionism.

So countries must diversify their sources of growth,looking for other export markets as well as for

internal engines of growth. is is what makesarguments for a shi in strategy towards domesticwage-led growth so compelling.

In developed countries with relatively stronginstitutions that can aect the labour market,including collective wage bargaining, eectiveminimum wage legislation and the like, it is probablyeasier to think of wage-led growth and strategies toallow wages to keep pace or at least grow to someextent) along with labour productivity growth.But what about most developing countries, wheresuch institutions are relatively poorly developedand where many if not most workers are ininformal activities, oen self-employed? Howare wage increases and beer working conditionsto be ensured in such cases? And what does amacroeconomic policy of wage-led growth entailin such a context?

In fact, it is still both possible and desirable to get

wage-led growth in such contexts. ere are veimportant elements of such a strategy in developingcountries with large informal sectors:

Make the economic growth process more inclusiveand employment intensive: direct resources to thesectors in which the poor work (such as agricultureand informal activities), areas in which they live(relatively backward regions), factors of productionwhich they possess (unskilled labour) and outputswhich they consume (such as food).

Ensure the greater viability of informal production,through beer access to institutional creditto farmers and other small producers, greaterintegration into supply chains and marketingthat improves their returns, and technologyimprovements that increase labour productivity insuch activities.


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COVER STORY

Provide increases in public employment that setthe oor for wages (for example, in schemes suchas that enabled by the National Rural EmploymentGuarantee Act in India) and improve the bargainingpower of workers.

Provide much beer social protection, with morefunding, wider coverage and consolidation, morehealth spending and more robust and extensivesocial insurance programmes, including pensions

and unemployment insurance.

Increase and focus on the public delivery of wagegoods (housing, other infrastructure, health,education, even nutrition) nanced by taxingsurpluses.

e last point is oen not recognized as a crucialelement of a possible wage-led strategy, but it can beextremely signicant. Furthermore, such a strategycan be used eectively even in otherwise capitalist

export-oriented economies, as long as surplusesfrom industrialization and exports can be mobilizedto provide wage goods publicly. Indeed, this has been an important and unrecognized feature of

successful Asian industrialization from Japan tothe East Asian NICs to (most recently) China. epublic provision of aordable and reasonably goodquality housing, transport facilities, basic food,school education and basic healthcare all operated

to improve the conditions of life of workers and(indirectly) therefore to reduce the money wagesthat individual employers need to pay workers. isnot only reduced overall labour costs for privateemployers, but also provided greater exibility forproducers competing in external markets, sincea signicant part of xed costs was eectivelyreduced.

What are the macroeconomic advantages of sucha strategy? Quite apart from the obvious benetsin terms of reducing poverty, improving incomedistribution and the conditions of informal workers, there are positive implications for thegrowth process. It allows for more stable economicexpansion based on increasing the home market,and need not conict with more exports either. Itencourages more emphasis on productivity growth,thereby generating a high road to industrialization.

Clearly, if countries in which the majority of the

worlds population is concentrated are actually toachieve their development project in a sustainable way, new and more creative economic strategieshave to be pursued. Wage-led growth, includingthrough measures such as those outlined here, islikely to be an essential element of such strategies.

Jayati Ghosh is Professor of Economics at Jawaharlal Nehru

University, New Delhi, and Executive Secretary of International

Development Economics Associates (http://www.networkideas.

org/). She has consulted with many international organisations and

governments, and works actively with progressive organisationsin India and elsewhere. This article was rst published by Global

Labour University on 11 October 2010.

Protesters carry carry a mock Taiwanesebanknote with a slogan Raise salary 5 percentduring a march in Taipei.

http://www.vosizneias.com


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COVER STORY

A new era of social justicebased on decent workBy Juan Somavia

It is time to build a new era of social justice on a foundation of decent work.

Recent events ashing across the worlds television screens have brought into sharp focus demands that have beenbrewing in the hearts of people: the desire for a decent life and a decent future based on social justice.

e fault lines of the global economy, apparent for a long time, are cracking open to reveal uncertainty andvulnerability, sentiments of exclusion and oppression and a lack of opportunities and jobs, made more painful bythe global economic crisis.

Women and men without jobs or livelihoods really dont care if their economies grow at 3, 5 or 10 percent per year

if such growth leaves them behind and without protection. ey do care whether their leaders and their societiespromote policies to provide jobs and justice, bread and dignity, freedom to voice their needs, their hopes and theirdreams and the space to forge practical solutions where they are not always squeezed.

e reality is that people commonly judge whether society, the economy and the polity are working for themthrough the prism of work. Whether they have a job, or not, the quality of life it permits, what happens when theyhave no work or cannot work. In so many ways the quality of work denes the quality of society.

Yet the world of work is in taers today: more than 200 million people are unemployed worldwide, includingnearly 80 million youth, both gures are at or near their highest points ever. What is more, the number of workers

http://www.vosizneias.com


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COVER STORY

in vulnerable employment1.5 billionand the630 million working poor living with their familiesat US$ 1.25 a day or less is increasing.

At the same time, global inequalities are growing.

e crisis has cut wage growth in half, reducedsocial mobility through work and trapped moreand more people in low-paid jobs. Income gapsare growing in some countries. Youth face theincreasing likelihood of never nding a decentjob the prospect of a lost generation looms. Andthe middle class oen nds itself in the middle ofnothing and going into reverse.

Achieving a fair globalization calls for a new vision

of society and economy, with a balanced approach

to the role of state, markets and society and a clear

understanding of the possibilities and limitations of

individual action in that framework. Action must

go beyond simply recovering growth we will not

get out of the crisis with the same policies that led

to it.

We need to move toward a new era of social justice.

What will it take? In the world of work the steps are

clear:

First, recognizing that labour is not a commodity,

policies must be based on the human values of

solidarity, dignity and freedom labour is not just a

cost of production. It is a source of personal dignity,

family stability and peace in communities;

Second, make employment creation targets a

central component of macroeconomic policy

priority alongside low ination and sound scal

accounts;

ird, provide scally sustainable social protection

to the eight out of 10 people who lack any form of

social security in the world today, starting with a

basic oor of universal social protection;

Fourth, recognize that fundamental rights at workand social dialogue which belong to the realm of

human freedom and dignity are also instruments of

enhanced productivity and balanced development;

Fih, stimulate investment and investors in

small enterprises, employment intensive sectors,

inclusive labour markets and skills development;

As Tunisia and Egypt are showing us, jobs

and justice, bread and dignity, protection and

democracy, national and global security are not

unrelated demands. What happens in the future

will very much depend on whether the connections

are recognized and acted upon.

Decent work makes the connections.

Universal and lasting peace can be established only

if it is based on social justice. e cautionary words

of the ILOs 1919 Constitution resonate today.

It is indeed time to build an era of social justice on a

foundation of decent work.

Mr. Juan Somavia is Director-General of the International Labour

Organization (ILO). This article is Mr. Somavias message on the

World Day for Social Justice on 17 February 2011 (http://www.

ilo.org/public/english/bureau/dgo/speeches/somavia/2011/wdsj.

pdf).


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NEWS

Days aer o cials at the OECDmade plans towards the FourthHigh Level Forum on AidEectiveness (HLF4), more than80 representatives of civil societyorganizations (CSOs) from acrossthe globe gathered in Sweden todevelop their own strategy for theforum.

HLF4 will be held from November29 to December 1, 2011 in Busan,Republic of Korea. It will assessif commitments of governmentsmade in recent years have beenachieved or not, and stands out as akey opportunity for governments togo beyond promises and to committo more eective, sustainable

development assistance in termsof its real impact on the lives of allwomen and men.

With global development needsrocketing following escalatingglobal crises such as rising food andfuel prices, growing inequality, lackof sustainable jobs, and politicalunrest in Northern Africa, theissue of development eectiveness

cannot be ignored anymore.

As a result of last weeks civil societymeeting in Harnosand, Sweden,BeerAid and Open Forumidentied key messages to nationalgovernments as well as regionaland international institutions.

Central to the concerns of bothplatforms is the shrinking politicalspace for civil society, the multipleaacks on freedom of association,and the lack of participatoryownership of development at thenational level in a growing number

of countries.

Achieving full respect of humanrights, gender equality, decent workand environmental sustainabilityshould remain the ultimate goal fordevelopment eectiveness.

Development eectiveness isabout how best to help people helpthemselves in a sustainable way. Its

not about the short-term results ofstand-alone projects, said RichardSsewakiryanga from BeerAid andthe Uganda National NGO Forum.

e Istanbul Principles for CSOEectiveness, adopted in September2010 and based on a global processof consultation in which hundreds

of CSOs participated, should be supported and governmentsshould implement measures tocreate an enabling environmentfor civil society organisations asdevelopment actors in their ownright.

Governments and donors shouldmake the strength of civil society anindicator of successful developmentcooperation, said RubenFernandez from Open Forum and Asociacin Latinoamericana deOrganizaciones de Promocin(ALOP).

With multiple and escalating

political and natural crises globally,it takes forward-thinking tocommit to the kind of long termand sustainable developmentprogress that BeerAid and theOpen Forum are advocating for.e voice of the people must beheard and acted on in Busan.

Nine months to deliver:tipping point to make development aid effectiveBy BetterAid, Open Forum


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NEWS


Despite its o cial UN-granted

legality, the credibility of Western

military action in Libya is rapidly

dwindling.

Western air and naval strikes

against Libya are threatening the

Arab Spring.

Ironically, one of the reasons many

people supported the call for a no-

y zone was the fear that if Gaddamanaged to crush the Libyanpeoples uprising and remain inpower, it would send a devastatingmessage to other Arab dictators:Use enough military force and youwill keep your job.

Instead, it turns out that just theopposite may be the result: Itwas aer the UN passed its no-y

zone and use-of-force resolution,

and just as US, British, French

and other warplanes and warships

launched their aacks against

Libya, that other Arab regimes

escalated their crack-down on their

own democratic movements.

In Yemen, 52 unarmed protesters were killed and more than 200

wounded on Friday, March 18 by

forces of the US-backed and US-

armed government of Ali Abdullah

Saleh. It was the bloodiest day of

the month-long Yemeni uprising.

President Obama strongly

condemned the aacks and called

on Saleh to allow

demonstrations to

take place peacefully.

But while a number

of Salehs government

o cials resigned in

protest, there was

no talk from Salehs

US backers of real

accountability, of a

travel ban or asset

freeze, not even of

slowing the nancial and military

aid owing into Yemen in the nameof ghting terrorism.

Similarly in US-allied Bahrain,home of the US Navys Fih Fleet,

at least 13 civilians have been killed by government forces. Since the

March 15 arrival of 1,500 foreign

troops from Saudi Arabia and

the UAE, brought in to protect

the absolute power of the king

of Bahrain, 63 people have been

reported missing.

Hillary Clinton, the US secretary of

state, said: We have made clear that

security alone cannot resolve thechallenges facing Bahrain. Violence

is not the answer, a political process

is.

But she never demanded that

foreign troops leave Bahrain, let

alone threatened a no-y zone or

targeted air strikes to stop theiraacks.

Legality vs. legitimacy

Despite its o cial UN-granted

legality, the credibility and

legitimacy of Western militaryaction is dwindling rapidly,

even in key diplomatic circles.

For the Western alliance, and

most especially for the Obama

administration, support from

the Arab League was a critical

prerequisite to approving the

military intervention in Libya.

e Leagues actual resolution,

passed just a couple of days beforethe UN Security Council vote,

approved a far narrower military

optionessentially only a no-

y zone, with a number of statedcautions against any direct foreignintervention.

Libya Intervention threatensthe Arab springBy Phyllis Bennis

cbsnews.com


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NEWS

Of course, a no-y zone is foreignintervention, whether one wants toacknowledge it or not, but it is notsurprising that the Arab Leagues

approval was hesitantit is, aerall, composed of the exact sameleaders who are facing inchoate ormassive challenges to their rulingpower at home. Supporting theaack on a fellow dictatoroops,sorry, a fellow Arab rulerwasnever going to be easy.

And as soon as the air strikes beganin Libya, Arab League chief AmrMoussa immediately criticisedthe Western military assault.Some commentators noted thelikelihood that Arab governmentswere pressuring Moussa out of fearof Libyan terror aacks in theircountry; I believe it is more likelythat Arab leaders fear popularopposition, already challengingtheir rule, will escalate as Libyan

deaths rise.

Overlooking the African Union

Early on, the US had also identiedsupport from the African Union(AU) as a critical component.But as it became clear that theAU would not sign on to the kindof aack on Libya contemplatedin the UN resolution, the needfor that support (indeed the AU

itself) disappeared from Westerndiscourse on the issue.

Shortly aer the bombing began,the ve-member AU commieeon the Libya crisis called foran immediate stop to all theaacks and restraint from theinternational community.

It went further, calling for theprotection of foreign workers witha particular reference to Africanexpatriates in Libya (responding

to reports of aacks on African workers by opposition forces), aswell as necessary political reformsto eliminate the cause of the presentcrisis.

So within 48 hours of the bombingcampaigns opening salvos, the USand its allies have lost the supportof the Arab and African institutionsthe Obama administration hadidentied as crucial for goingahead.

Other countries turned againstthe aacks as well; the Indiangovernment, which had abstainedon the Security Council vote,toughened its stance, saying that itregrets the air strikes that are takingplace and that implementation of

the UN resolution should mitigateand not exacerbate an alreadydi cult situation for the people ofLibya.

e question remains, what is theend game? e UN resolution saysforce may only be used to protectLibyan civilians, but top US, Britishand French o cials have statedrepeatedly that Gadda must go

and that he has lost legitimacyto rule. ey clearly want regimechange.

e military commanders insistthat regime change is not on theirmilitary agenda, that Gadda is noton a target list, but there is a wink-and-a-nod at what if questionsabout a possible bombing if he is

inspecting a surface-to-air missilesite, and we do not have any idea ifhe is there or not.

What you ask for aint always

what you get

ere is no question Libyasopposition, like most of thedemocratic movements shapingthis years Arab Spring, wants anend to the dictatorial regime intheir country.

Unlike the democratic movementsin neighbouring countries, theLibyan movement is ghting anarmed military bale, somethingapproaching a civil war, against theregimes forces.

at movement, facing a ruthlessmilitary assault, has paid a farhigher price in lost and brokenlives than the non-violent activistsin the other democratic uprisings,

and even with components ofthe military joining them, they were out-gunned and desperate.So it is not surprising that theypleaded for international supportfrom the powerful countries andinstitutions most able to provideimmediate military aid, even if thataid ultimately threatened their ownindependence.

But, what they got was probably way more than even the Libyanopposition itself anticipated. Anddespite the exultation over the rstdowned tanks, questions loom.

What if some kind of stalemateleaves Libya divided and militaryaacks continuing? What ifthe opposition realises that


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NEWS


negotiations (perhaps under the auspices of newly democratising Egypt and Tunisia) are urgently needed, butcannot be convened because the US and French presidents have announced that the Libyan leader has no legitimacyand cannot be trusted?

And what if, as earlier US-imposed no-y zones (both unilateral and UN-endorsed) have experienced, the aack

leads to rising numbers of civilian casualties, killed by Western coalition bombs and an escalating, rather thandiminishing, civil war? What then?

e UN resolution clearly is looking ahead to just such an eventuality. It calls on the secretary-general to inform theUN Security Council of all military actions, instructing him to report to the Council within seven days and everymonth thereaer.

e UN, at least, seems to be preparing for another long warthat could last far longer than this years Arab spring.

Phyllis Bennis is director of New International at the Institute for Policy Studies in Washington, D.C. This article was published on IPS-DC.org (http://

www.ips-dc.org/articles/libya_intervention_threatens_the_arab_spring) on 22 March 2011.

JAPAN: vulnerability and uncertaintyprevail in wake of nuclear disasterBy Suvendrini Kakuchi

TOKYO, Mar 22, 2011 (IPS) - Accidents at four nuclear power

reactors hit by the earthquakeand tsunami in Fukushima havele thousands of residents in thevicinity facing an uncertain future asthey prepare for evacuation ordersto protect them from dangerousradiation contamination.

Fear and anger at the growingvulnerability of their situation havealso hardened public opposition to

nuclear power in Japan, with morepeople calling for a review of Japansmuch touted safety technologyand policies supporting alternativeenergy sources.

Nuclear power from 54 operatingreactors provides 30 percent of localenergy needs. Coal, oil and othersources provide the rest. Japan, a

resource-poor country, has stakedits economic future on nuclear

power. Given its almost negligentcarbon dioxide emissions, nuclearpower is becoming more importantin light of climate change as well.

In a blow to Japans nuclear industry,Katsutaka Idogawa, mayor ofFutabacho, a hamlet that bordersthe Daiichi Fukushima power plant,told the press Tuesday that it is hightime the local population begins to

move away from its dependency onthe nuclear plant that they host.

e disaster has shown us we mustreview our policy of accepting thenuclear power plant. We mustdevelop new ideas to have otherindustries to bring us a stableeconomy, he said in an article

published by the Asahi Newspaper,a leading daily.

e 7,000 people of Futabachoare, however, involved with theDaiichi Fukushima nuclear powerplantemployed either as workersor in other operations. e villageis located 10 kilometres away fromthe 20-kilometre exclusion zonedemarcated by the government.

e latest count of people leaving

Fukushima numbers 25,000,according to local authorities. ey join the overall 350,000 evacueesleaving other badly damagedareas to restart their lives in otherlocalities that have begun acceptingthe disaster displaced populations.

Ayako Ooga, 38, and her husbandare one of the aected families.


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NEWS

e couple who live in Ookuma-machi, just six kilometres from theFukushima nuclear power plant,said they le the night of the quakethat struck on Mar. 11mostly

because of fear about radiationcontamination. Our house wasdamaged but we have always beenmore concerned about safety of thenuclear plant. With the accident weface a bleak future, she told IPS.

Ooga, however, says she supportsthe statements made by Idogawa,mostly because he voicedopposition to supporting nuclearpower and illustrated sharplythe anxiety and suspicion in thecommunity that is in the process ofevacuating.

I found some hope when Idogawaexplained he would lead theevacuation which means so muchto us now, she said. Ooga is froma farming community and had

just built a new home which shewonders now whether she will everbe able to visit.

Idogawa said he would lead therst batch of 1,500 people fromhis village who will sele downin Saitama prefecture, a northernborder town of Tokyo. He also saidhis decision will pave the way forthe rest of the community to join

them and start their lives again asbefore till they can return together.

Experts explain the relocationprocess is always painful forpeople and is especially so for thethousands who must leave forsafety from the threat of radiationcontamination and face the

probability of not being able toreturn for a long time.

e situation is a human tragedy,said professor Toshikata Katada,

a disaster expert at NagoyaUniversity. Katada, who hascovered the earthquake proneregion to develop hazard mapsand other emergency measuresfor several decades, explained ontelevision the experts had just notbeen prepared.

Our preparedness showed us howknowledge is pied against thevagaries of nature. is time we seehow nature won, he said.

Reports released Tuesday indicateradiation levels are 1,600 times thenormal level 20 kilometres fromthe crippled Fukushima plant,according to the InternationalAtomic Energy Agency (IAEA).

IAEA experts arrived in TokyoFriday aer controversy eruptedover diering radiation readingsreleased by the Japanesegovernment and foreigncounterpartsraising suspicionthat authorities may have createdpanic in some cities where peoplewiped out food supplies overnight.

Another alarming development

was released today when thegovernment said it detected highlevels of radioactive material inseawater near the Fukushimapower plant fanning concern overshery products from the area.

Tokyo Electric Power Companyreported radioactive material was

detected Monday in the seawatersamples at levels 126.7 times higherthan the legal concentration limit.Levels of cesium 137, a radioactivematerial which can be dormant in

the air for over 30 years, was 16.5times higher than the limit, whiletrace amount of cobalt 58 wasdetected in a sample of seawaternear the plant as well.

Already, spinach and milk fromfarms in Fukushima are showinghigh radiation levels and will not beallowed for consumer sale.

e critical situation is causinganxiety in areas where otherplants are located as well. ChubuElectrical Power Company thatoperates the Hamaoka nuclearpower plant in Omaezaki, Shizuokaprefecture, 150 kilometres south ofTokyoalso identied as a quakeprone areaannounced Tuesdaythat it will get an emergency diesel

generator in case of power loss dueto tsunami.

Meanwhile, local residents expressalarm at the situation which is stillout of hand in Fukushima morethan a week aer the earthquakehit. Minoru Ito, a local activist, toldIPS that his phone keeps ringing aspeople keep calling him wondering what they should do now. e

ongoing tragedy in Fukushimasends chills down our spines, hesays.

This article was published by IPS News

(IPSNews.net) on 22 March 2011.


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NEWS


Uniting to Lose Our Chains:The International Festival for Peoples Rights and StrugglesBy IFPRIS Secretariat

Resistance movements aresweeping the globe in responseto the global crisis of the worldcapitalist system.

Protests and strikes againstausterity measures have spreadacross Europe (from Greece andIreland to France and Britain),South Africa, India, ailand, andthe Philippines. Food riots andprotests against rising food priceshave been reported in Algeria,Morocco, Mozambique and Chile.

In North Africa and the Middle East,peoples longstanding anger againstrepression, corruption and foreign(particularly US) intervention hascombined with the economic crisis

to set o popular revolts in onecountry aer another. e politicalcrisis in Tunisia, Egypt, Jordan, Yemen, Algeria, Bahrain, Iran,Djibouti, Bahrain and Libya arestill unfolding with repercussionsacross the globe.

Amidst this panorama of peoplesresistance worldwide, workers,peasants, women, indigenous

peoples, migrants, artists, youthand other sectors and from acrossthe globe are gathering in Manilafor the International Festival ofPeoples Rights and Struggles(IFPRIS) from July 4-6, 2011.IFPRIS will be held in various venues within the University of

the Philippines Diliman campus inQuezon City.

e IFPRIS is a space for peoples

from Asia and the Pacic, Africa,North America, Europe and Latin America and the Middle Eastto learn, share and interact withone another on the issues andchallenges to the livelihoods, rightsand liberties that they confront.

It is also an occasion to celebratethe victories and lessons of peoplesstruggles all over the world. e

IFPRIS oers a wide range ofopportunities for learning andnetworking with simultaneousforums, workshops, strategysessions, book launches, lmshowings and exhibits.

It is jointly organized by theBagong Alyansang Makabayan

(BAYAN), Concerned Artistsof the Philippines, Habi Arts,IBON, International Migrants Alliance (IMA), International

Womens Alliance (IWA), Leagueof Filipino Students, Peace for Life,Peoples Action Network, PeoplesCoalition on Food Sovereignty(PCFS), Peoples Movementon Climate Change (PMCC),RESIST, and the UP College ofMass Communications.

e Festival shall have a commonopening (see program below) on

the morning of July 5, with keynoteaddresses from Francois Houtart,Leila Khaled and Ramsey Clark,plus panels of experts on peoplesrights and struggles.

For inquiries please email theIFPRIS Secretariat at [email protected].


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NEWS

Among the Major Activities in the IFPRIS are:Seminar on the US War on Terror and Counterinsurgency

(July 5, afternoon)

is Seminar shall examine the US post-Cold War

National Security Doctrine, the various dimensionsand forms of US Intervention overseas, the latest version of its Counterinsurgency Doctrine and itsimpacts and implications on the rights of peoples invarious countries.

Seminar on Peoples Resistance and Struggles for Liberation

(July 6, afternoon)

is Seminar shall feature testimonies from leaders,activists and representatives of liberation movementsfrom around the world including Egypt, Tunisia,Palestine, and others. See proposed program below.

Workshop on the Permanent Peoples Tribunal (July 6,

morning)

is workshop shall highlight recent and ongoingcomplaints brought to the Permanent PeoplesTribunal (PPT) regarding violations of humanrights and rights of peoples. e PPT is a prestigiousinternational opinion tribunal, independent fromany State authority that examines and judges cases

that are submied by the victims themselves orgroups representing them.

Making sense of the global crisis and new world disorder:

challenges and opportunities for peoples struggles and

alternative (July 6, afternoon)

e colloquium is an opportunity for peoplesmovements, NGOs, activists and other progressiveforces to gain a deeper understanding of the globalcrises in food, climate and nance amidst the shiinginternational political and economic order.

International Womens Alliance (IWA) General Assembly (July

5-6)

e International Womens Alliance (IWA),founded in Montreal in August, 2011 by 68 womensorganizations, associations, alliances and individualsfrom across the globe will hold its First General Assembly with the theme Building a Militant Womens Alliance in the 21st Century. e IWA

as an anti-imperialist, anti-patriarchal, anti-racistand anti-sexist alliance is commied to advancinga militant global womens movement as part of the

movement for national and social liberation.

International Conference on Progressive Culture: Peoples

Art: Shaping the society of the future (July 4-6)

A unique opportunity for creative people from aroundthe world to come together, share their work, anddiscuss the role of art in the struggle for fundamentalsocial change. ere will also be an exhibit, lmshowing, workshops, and a Kafe Kultura -a spacefor jamming, mural painting, sculpting, social media,and more!

The Global Movement of Migrants: Current Situation and

Resistance against Imperialist Attacks (July 5)

A forum to generate in-depth discussion on thesituation of migrants around the world amidst thecurrent global crisis. e forum also brings intolight the various forms of resistance of the globalmovement of migrants against the aacks of theproponents of neo-liberal globalization.

International Panel Discussion on US Foreign Military Bases(July 6)

A forum that highlights how the peoples struggleto dismantle overseas US military bases fromall countries in the world has become especiallyimportant in the light of the global economicdepression and the consequent intensication ofglobal political conicts. Sharing from peoplesactions from the Asia and Oceania, Arab region,Latin America and Europe.

Peoples Speak Out for Right to Land and Life Organized bythe Peoples Coalition on Food Sovereignty (July 6 afternoon)

e Peoples Speak Out will highlight the strugglefor land and life, especially amid the food crisis andintensifying land grabbing. e Speak Out will befollowed by a peoples march to the Departmentof Agrarian Reform (DAR) which is the only massaction activity during the IFPRS.


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SPECIAL FEATURE


In one sense, the struggle over union rights in Wisconsin is over. It took some breathtaking, possibly even illegal,shenanigans, but the union-busting Budget Repair Bill has been passed, signed, and celebrated. In other ways,though, theweeks of historic protests in and around Wisconsins capitol were just the rst act of what may prove to

be a far longerand largerstruggle.

Around the country, state governments are targetingunion rights, workplace protection, social services, andthe ability of middle-class and working poor to havea voice. But, in large part thanks to the momentum ofthe Wisconsin protests, theyre nding it di cult todo so quietly. In state aer state, the Americans whoserights and services are being cut are rising up against thedecades-long shi of wealth and power to corporationsand the very wealthy.

Wisconsin Moves on to Phase Two

e passage of Wisconsins anti-union bill on March 10came aer weeks of protests, an extended occupationof the state capitol building, and the self-imposed exileof 14 Democratic senators, whose absence prevented avote on the bill as it was originally draed.

Following ursdays passage of the Wisconsin bill,hundreds of students in Madisons middle and highschools walked out to join those demonstrating at thecapitol. en, in the largest protest since the bill wasproposed, an estimated 100,000 people lled the streetsand squares around the state capitol on Saturday, March12. e Family Farm Defenders and the WisconsinFarmers Union joined the protests, bringing more than50 tractors with them.

is is the beginning of phase two, Fred Risser, one ofthe 14 Democratic senators, told the crowd.

He was referring to a rapidly growing campaign torecall eight GOP senators who supported the bill;the Wisconsin Democratic Party reported yesterdaythat over 45 percent of the necessary signatures havealready been collected. Because Wisconsin law only

Wisconsin Awakens a Sleeping GiantAs Wisconsins attack on workers spreads to other states, so does the historic uprising thatbegan in Madison.By Sarah van Gelder and Brooke Jarvis


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SPECIAL FEATURE

allows recalls of o cials who have been in o ce at

least a full year, Governor Sco Walker and othersupporters of the bill are not yet eligible to berecalledthough opponents of the anti-union laware already laying the groundwork for a recall next

year.

Other States Target Workers Rights

ough the weeks of demonstrations have focusednational aention on Wisconsin, workers rightsare on the line in dozens of states across thecountry, and workers are ghting back. Newlyelected Republicans in state legislatures and inthe U.S. Congress are pressingand in somecases, passingdeeply unpopular measures thattarget workers rights to unionize and such basicprotections as minimum wage laws.

e Ohio Senate has passed a bill that takesWisconsin union-busting one step further, Reutersreports. e bill prohibits collective bargaining fornearly 62,000 workers and blocks 300,000 others(including reghters, police, and public schoolteachers) from striking or negotiating about healthcare benets. In Indiana, House Democrats, takinga cue from Wisconsin legislators, have le the state

to prevent a vote on a bill that limits collective bargaining rights. Idaho has approved a measureto limit public school teachers right to bargaincollectively. Michigan is on track to approve alaw that would allow the state to break unioncontracts. And union dues or collective bargainingare also on the line in Iowa, New Hampshire,Kansas, Tennessee, Colorado, Nebraska, Nevada,Oklahoma, New Hampshire, New Mexico,Washington, Alaska, and Arizona.

Nor are unions the only form of workerprotection under aack. e Missouri Houseof Representatives has approved a bill that capsthe states minimum wage, even if the ConsumerPrice Index rises, essentially revoking a law thatwas passed just ve years ago and supported by 76percent of voters. Seven other states are consideringsimilar bills, according to the Progressive StatesNetwork.

Other proposed measures would cut deeply intoeducation funding, public safety, health care,and infrastructure maintenance. ese bills arepresented as necessary in order to balance statebudgets, but recent state and federal tax giveaways

to the wealthy make that a questionable claim.

Undermining the Political Power of the WorkingClass

Instead, this may be an example of what NaomiKlein describes in her book, e Shock Doctrine:Wealthy elites oen use times of crisis and chaosto impose unpopular policies that restructureeconomies and political systems to their furtheradvantage.

And many of these policies are deeply unpopularwith the American public. Recent polls show thatmore than 60 percent of Americans believe thatpubic employees should have the right to bargaincollectively; that states should not be able torenege on pension commitments to retirees; thatthe minimum wage should be raised; and thattax breaks for wealthy Americans are a bad move.According to a recent Bloomberg poll, one of the

reasons that Americans reject Republican eortsto curb bargaining rights is that they widely believethat union power is is dwarfed by corporations.

Of course, the proliferation of anti-union bills isnt just an economic blow. Unions are a bulwark ofpolitical power on behalf of middle- and working-class Americans, a long-standing counterweight tothe political inuence of the wealthy. Not only dothey give employees bargaining power within theworkplace, they allow workers to join their voices

to have some say in the political debate.

When union members economic power is weakened, so is their political voicea fact notlost on those leading the charge against them. AsWisconsin Senate Majority Leader Sco Fitzgerald,a leading proponent of the states anti-union bill,noted in an interview with Fox News, If we winthis bale, and the money is not there under the


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SPECIAL FEATURE


auspices of the unions, certainly what youre goingto nd is President Obama is going to have a muchdi cult, much more di cult time geing electedand winning the state of Wisconsin.

A Sleeping Giant Wakes Up

If there is one good thing about this bill, its thatit has brought middle class workers together, made

our unions stronger and our relationships closer,Mahlon Mitchell, the president of the ProfessionalFireghters of Wisconsin, said in an interview withYES! Magazine.

Indeed, all over the country, the aack on unionrights has awakened a dormant class consciousness.I think that whats happening in Wisconsin is sortof Ground Zero for workers, said Jane Cuer, a47-year-old teacher who aended a Wisconsin

solidarity rally in Seale. Its going to drive downwages and living standards for all dierent kinds ofworkers.

In the weeks since Wisconsin teachers andreghters began occupying their state capitol,thousands of others have been inspired to maketheir opposition more vocal. Protests manytimes the size of the Tea Party demonstrationsare spreading across the nation. Some are beingorganized by unions and their supporters; others, by MoveOn.org and Van Jones to Defend the American Dream. Still others are part of USUncut, which is organizing ash mobs to confrontcorporations that havent been paying taxes. FromIndiana to Ohio and Tennessee to Texas, workersare demanding to know why corporations and thewealthy get bailouts and tax breaks while teachersand steel workers bear the burdens of budget crisesthey didnt cause.

One of the farmers who rode through downtownMadison on his tractor summed it up on hishandmade protest sign: Walker woke a sleepinggiant.

Sarah van Gelder and Brooke Jarvis wrote this article for YES! Magazine, a national, nonprot media organization that fuses powerful

ideas with practical actions for a just and sustainable world. The piece was posted on YesMagazine.org (http://www.yesmagazine.org/

people-power/from-wisconsin-a-sleeping-giant-awakes) on 15 March 2011.

Photos by Jennifer Janviere (http://www.ickr.com/photos/jenniferjanviere/)

Unions are a bulwark of political poweron behalf of middle- and working-class

Americans, a long-standing counterweight tothe political inuence of the wealthy.


21/31


SPECIAL FEATURE

E

urope and the United States continue to suer levels of economic stagnation and joblessness not seen since

the 1930s. But the small town of Mondragn in the mountainous Basque region of northern Spain boasts an

innovative business model which has successfully weathered the global economic downturn.

e Mondragn Co-operative Corporation is a network

of co-operative rms, entirely owned and managed by

the workers employed in them. It is commercially highly

successful, exports quality manufactured goods around

the world and boasts zero unemployment.

Worker self-managed enterprises, historically, have had

a very mixed track record. ey oen start life, buoyed

by the vision and enthusiasm of their founders, and

enjoy a measure of success for a few years. All too oen,

however, the ideals of the founders fail to reproducethemselves in the next generation, and the enterprises

lose their vitality.

Mondragn is altogether dierent. It has been operating

successfully for 57 years, its workforce having grown

from its original ve founding members to its present

labour force of 85,000 worker-owners employed in

more than 120 co-operative enterprises.

Todays worker co-ops produce an impressive array

of goods, including foodstus, computers, household

appliances, refrigerators, ovens, vehicle parts and the

celebrated Orbea bikes which won gold at the 2008

Beijing Olympics. Sixty per cent of Mondragns output

is exported.

is sounds almost too good to be true. Can worker self-

management really be compatible with a commercially

competitive business operation?

Some cynics dismiss the whole scheme as utopian

without bothering to examine the evidence for

Mondragns undeniable success. Talk to them of

worker ownership and they immediately dismiss

the idea as being akin to socialism or, worse still,

communism. Nothing could be further from the truth.

Mondragn thrives in a competitive marketplace

and has no government support. Its operations are

Mondragn worker co-ops rideout global slumpBy John Ballantyne

http://www.f

lickr.com

/photos/mondragoncorporation/


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SPECIAL FEATURE


characterised by an absence of workplace conictor strikes. Workers are not likely to take industrialaction against entities they themselves own.

And, unlike the post-GFC [Global Financial Crisis

ed.] zombie banks of Wall Street, which have been put on government life-support to the tuneof hundreds of billions of US taxpayer dollars,Mondragn stands on its own feet and sponges onobody.

Mondragns business model has aractedfavourable notice from respectable bodies suchas the Peter F. Drucker Foundation, the HarvardInternational Review and Britains conservativeDaily Telegraph.

A worker, in order to become a member of a co-operative, must invest 13,400 (AUD$18,400) inshare capital. e sum accumulates interest overtime and is repaid to the worker upon retirement.So, from day one, he or she has a nancial stake inthe success or failure of the enterprise.

Every worker has an equal vote. Joel A. Barker ofthe Drucker Foundation says: e workers elect

the board of directors and the board of directorshires the managers. is has a positive eect onthe workers, because the people they elect are thepeople who hire their supervisors.

e co-ops are not cast adri on the market withoutmap or compass. Ready and eager to help them withtheir business plans is the Mondragn Corporationsown special-purpose community bank, the CajaLaboral. It produces up-to-date marketing forecastsfor co-ops, provides low-interest nance to enable

new co-ops to be launched, and makes availableexperienced sta from long-established co-ops tobe mentors for newer ones.

In most of the corporate world, it is a sad fact thatmost new small business fail. In Mondragn, bycontrast, most new enterprises succeed.

Barker observes: e Mondragon bank ... alwayshas the welcome mat out for anyone who wishes to

create more jobs. Because of this aitude and thegreat skills Mondragon has developed in nurturingstart-ups, its entrepreneurial success rate has been80 per cent! at is the failure rate for the rest ofthe world!

Today, the Caja Laboralwhich, like theMondragn co-ops, started from humble originshas grown to become one of Spains major nancialinstitutions. It has branches across the country,1.2 million clients, a sta of 2,000, 21 billion eurosworth of assets and 1.5 billion euros in equity.

Mondragn has its own university, made up of anengineering school, a technical school and whatis now considered to be one of the best businessstudies programs in the Europe Union. It also owns,and invests heavily in, a number of research anddevelopment facilities.

Greg MacLeod, writing for the HarvardInternational Review (April 4, 2009), describesthe secret of Mondragns success in achievingits annual job-creation targets and ensuring jobsecurity for all its members.

He writes: Most large global corporations...develop strategies to increase earnings through job reduction. Conventional corporate managersargue that a job creation strategy necessarily leadsto ine ciency and losses. But empirical testingsuggests otherwise.

Individual co-operatives in Mondragn, observesMacLeod, are under no legal obligation to retain workers, but jobs are eectively guaranteed. Hesays: If there is a redundancy in one enterprise, the

redundant workers have the right to available workin the other associated enterprises.

So, instead of workers being le to rot on thedole, they are speedily transferred to productiveemployment in other co-ops and assisted withretraining to enhance their value to the newenterprise.


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SPECIAL FEATURE

is emphasis on constantly improvinglabour productivity also enhances the overallcompetitiveness of Mondragns enterprises in the

global marketplace. Mondragns global director,

Mr Josu Ugarte Arregui, says: We cant oshore,

so we have to keep climbing the technology ladderand improve core engineering here.

In order to ensure that workers should have a truesense of ownership of the enterprises in whichthey are employed, Mondragns Caja Laboral bank prefers, wherever possible, to limit the size

of individual co-ops. Once a co-ops membership

approaches 500 worker-owners, the bank prefers

to launch new co-ops rather than allow established

ones to get any bigger. is is quite a contrastfrom the relentless process, seen in the rest of thecorporate world, of economic mergers, acquisitionsand takeovers.

According to Australias Dr Race Mathews classicwork, Jobs of Our Own: Building a Stake-HolderSociety (1999, republished in 2009), studies haveconsistently shown that workers in Mondragn feel

a loyalty to their rms and are prepared to make

signicant sacrices where necessary in order for

their co-operatives to remain in business.

Greater worker contentment on the factory oormeans less need for supervision. An Americanpolitical commentator, Carl Davidson, onceobserved that self-supervision was a competitiveadvantage for Mondragn. He wrote: Not having a

lot of supervisors to pay meant lower prices.

e relatively narrow pay dierentials in Mondragnare a contrast to the vast pay dierentials in many

large Western corporations, where CEOs canpocket up to 400 times the pay of the lowliestworker.

In Mondragn, top management seldom earnsmore than six times the income of the lowest-paidworker. In reality, as Mondragns global directorMr Ugarte points out, it is just three times aertax.

In eect, if the top earner wants a raise, everyone inthe co-op gets a raise.

It is true that some of Mondragns high-yersare enticed to work for outside corporations bythe prospects of much higher salaries. However,

an American writer Sergio Lub, who touredMondragn two years ago, observed: Sometimes aMondragon manager leaves for a few years to workin a higher paid job; they oen return. When I askeda senior executive why he stayed, he answered:It was an easy choice. Outside I may earn moremoney, but I would lose my community.

Ambrose Evans-Pritchard, international businesseditor of Britains conservative Daily Telegraph, ina recent article in which he praised the Mondragn

model, discussed the link between increasingeconomic inequality and the recent global slump.

He said: e solidarity ethos has its allure givenmounting research by the IMF and other bodies thatthe extreme gap between rich and poor was a keycause of the global asset bubble and nancial crisis,as well as being highly corrosive for democracies.e GINI index of income inequality has reached

The relatively narrow pay differentialsin Mondragn are a contrast to the vastpay differentials in many large Westerncorporations, where CEOs can pocket up to400 times the pay of the lowliest worker.

http://www.mondragon-co

rporation.com/


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SPECIAL FEATURE


levels not seen since the 1920s across the West.(UK Telegraph, February 16, 2011).

e Mondragn Co-operative Corporation (MCC)provides a comprehensive self-funded retirement

income package for its workers, paid for partly outof direct worker contributions but also from theprots of the co-operatives themselves. e MCCused also to provide health care for all its workersuntil the late 1980s, when the Basque regionalgovernment took over that particular responsibility.

Who was the original brains behind Mondragnspioneering worker-owned co-operative enterprises?It wasnt some high-ying MBA graduate fromHarvards business school, but a humble Jesuitpriest, Father Don Jos Arizmendiarrieta (1915-1976).Arizmendiarrieta was a farmers son, whosestudies for the priesthood were interrupted by the1936 Spanish Civil War. He edited a Republican-leaning trade union paper Eguna, was imprisoned by Francos Nationalists in 1937 and was lucky toavoid execution.

On his release he organised study groups and workshops for residents of the war-torn and

impoverished Basque region of northern Spain. Aer World War II, he started an industrialapprentice school and taught young men theimportance of applying Christian ethics andCatholic social principles to the running ofbusiness. In 1955, he encouraged ve of his mostpromising students to buy a small factory that madepara n-burning stoves. A year later they moved theenterprise to Mondragn, and from then onwardstheir pioneering experiment in Christian businesspractices and worker self-management began to

take shape.

Today, Mondragn can no longer be dismissed assome well-intentioned but impractical scheme oflimited relevance to the real world. By any standard,it has been a resounding success for a period ofalmost six decades. Aer the recent global economicmeltdown, it deserves to be studied closely.

References

Joel A. Barker, e Mondragon model: A new pathwayfor the twenty-rst century , an excerpt from Chapter 11 fromFrances Hesselbein, Marshall Goldsmith and Richard Beckhard(eds), e Organization of the Future (New York: e Peter F.Drucker Foundation/ San Francisco: Jossey-Bass, 1997).

URL: www.joelbarker.com/downloads/Mondragon.docCarl Davidson, Mondragon diaries: Five days on the

cuing edge: Studying real world worker-owned co-ops,SolidarityEconomy.net, September 19, 2010.

URL: www.solidarityeconomy.net/2010/09/19/mondragon-diaries-ve-days-studying-cuing-edge-people-and-tools-for-change/

Ambrose Evans-Pritchard, Spains astonishing co-op takeson the world, e Telegraph (London), February 16, 2011.

URL:www.telegraph.co.uk/nance/economics/8329355/Spains-astonishing-co-op-takes-on-the-world.html

Je Gates, e Ownership Solution: Towards a Shared

Capitalism for the Twenty-First Century (London: PenguinBooks, 1998).

Peter Jay, St George and Mondragon, e Times (London),April 7, 1977.

Peter Jay, Till we have built Mondragon, e Times(London), April 14, 1977.

Peter Jay, e Workers Cooperative Economy (1977) inPeter Jay, e Crisis for Western Political Economy and OtherEssays (London: Andr Deutsch, 1984), pages 5692.

Peter Jay, e Crisis of Western Political Economy (Sydney:Australian Broadcasting Commission, 1981).

Georgia Kelly and Shaula Massena, Mondragn worker-

cooperatives decide how to ride out a downturn, YES! Magazine(Bainbridge Island, Washington,: Positive Futures Network),

June 5, 2009.

URL: www.yesmagazine.org/issues/the-new-economy/mondragon-worker-cooperatives-decide-how-to-ride-out-a-downturn

Sergio Lub, e Mondragon cooperatives experience,Model Economy Community, January 4, 2009.

URL: hp://model-economy.wikispaces.com/Mondragon+Cooperatives

Greg MacLeod, e Mondragon experiment: e publicpurpose corporation, Harvard International Review, April 4,

2009.URL: hp://hir.harvard.edu/the-mondragon-experiment

Race Mathews, Jobs of Our Own: Building a Stake-HolderSociety: Alternatives to the Market and the State (Sydney: PlutoPress, 1999).

Race Mathews: a selection of his articles and lectures isavailable from his website at:

URL: hp://racemathews.com/index.htm

John Ballantyne is editor of News Weekly. This article was published by News Weekly (NewsWeekly.com.au) on 19 March 2011.


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SPECIAL FEATURE

The anniversary of the rst People Power in the Philippines is a time to reect on how the nation is 25 yearslater. e 1986 People Power uprising aer all was driven by a desire for political and economic democracy.Politically, Filipinos were emboldened to oppose the Marcos dictatorship upon years of determinedstruggle by Filipino activists. Economically, people saw that a handful of cronies and foreign elite were prospering

amid high unemployment and widespread poverty.

However outside of appearances, there has been scantprogress towards this democracy over 25 long years.

Economically, twenty-ve years would have been longenough for the economy to take o. e 1986 PeoplePower uprising created a moment of national unityand international credibility that could have been thestarting point of real economic progress.

Sweeping genuine agrarian reform should have beendone immediately while the landed families were on thedefensive against a surging mass movement. is wouldhave unleashed the countrys agricultural potential,raised rural incomes and broken the back of peasantpoverty. An industrialization program should have begun that preserved what domestic manufacturingexisted and that phased the steady development of keyand strategic industries. Foreign debts of the Marcos

administration should have been cancelled and theresources freed up poured into domestic education,health, housing and infrastructure.

Even just 10 to 15 years of progressive and nationalistpolicies since 1986 would have been enough to startbuilding solid domestic economic foundations. Instead,25 years of ve post-Marcos administrations embracedand implemented free market policies of neoliberal

globalization trade and investment liberalization,privatization and deregulation. Economic growth,foreign investments and exports were treated as ends inthemselves rather than the mere means to developmentthat they are. Prots and commerce were hyped whilethe States responsibility to deliver real social andeconomic development was disparaged.

EDSA and the Philippine Economy:25 years afterThe 1986 People Power uprising in the Philippines created a moment of national unity and

international credibility that could have been the starting point of real economic progress.By Sonny Africa

http://www.eggu

evarra.com


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SPECIAL FEATURE


e 7.2% annual growth in gross domestic product(GDP) in 2010 and the average 4.5% growth duringthe previous Arroyo administration from 2001-2009 are considerably faster than the average 3.9%growth in the period 1986-1991 under the rst

Aquino administration. Foreign direct investment(FDI) has markedly increased from US$2.0 billionin 1986 (equivalent to 6.7% of GDP) to US$23.6 billion in 2009 (14.5% of GDP). e value ofexports rose from being equivalent to 16.2% ofGDP in 1986 to average 46.1% of GDP over thedecade 2000-2009.

Yet there has also been rising joblessness,persistently severe inequality and growing numbersof poor amid economic decline. e unemploymentrate which averaged 10.6% in the pre-People Poweruprising six-year crisis period 1981-1986 has evenrisen to average 11% in the period 2005-2010,according to IBONs estimates; this increase hasonlybeen camouaged by a convenient redenitionof o cial unemployment in 2005. e 2.6 millionunemployed Filipinos in 1986 increased to 4.4million in 2010.

Inequality remains persistently severe. In 1985

the top 20% of families cornered 52.1% of totalfamily income, leaving the boom 80% to dividethe remaining 47.9% between them. is hasbarely changed over the last 25 years and in 2009the top 20% of families still claimed 51.9% of totalfamily income (with the boom 80% dividing the

remaining 48.1%). Also in 2009, the net worthof just the 25 richest Filipinos of US$21.4 billion(Php1,021 billion at the prevailing exchange rate)was equivalent to the combined annual income ofthe countrys poorest 11.1 million families or some

55.4 million Filipinos (computed with an averagefamily size of ve) of Php1,029 billion.

e number of poor is a bit more di cult tocompare because of at least two changes in themethodology for estimating poverty in the country.e government o cially counted 26.7 millionpoor Filipinos in 1985 rising to 30.9 million in 2000.A subsequent revision statistically reduced the 2000estimate to 25.5 million with this rising, accordingto the same methodology, to 28.5 million in 2009.Yet another revision statistically reduced the o cial2009 estimate to 23.1 million. In any case, in 2009some six out of ten Filipinos were trying to surviveon incomes of PhP82 or even much less per day forall their food and non-food expenses.

e explosion of optimism for change in 1986 wasfollowed by decades of missed opportunities. erewas likewise a burst of optimism in 2010 followingthe end of the nine-year Arroyo administration.

Indeed the economic lessons are there to be learnedand the next decades need not be more of thesame. For now the optimism comes from the risingnumber of Filipinos wielding People Power not justin moments of revolt but also in daily and organizedstruggles for real social change. IBON Features

Sonny Africa is Research Head at IBON Foundation, Inc.


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SPECIAL FEATURE

In the Greek town of Aphidal, people have stopped paying road fees. In Athens, bus and metro ridersare refusing to cough up the price of a ticket. On Feb. 23, 250,000 Greeks jammed the streets outsidethe nations parliament.

e Portuguese nominated the protest song A Luta E Alegria (e Struggle is Joy) for theEurovision song contest and, when judges ignored it, walked out in protest. ey also put 300,000people into the streets of the countrys major cities on Mar. 12.

Liverpool bailed from a Conservative-Liberal scheme to supplement government funding withprivate funding when it found there wasnt any of either, and the British Toilet Association protested

the closure of 1,000 public bathrooms across the country.

In ways big and small, Europeans from Greece toPortugal, from Britain to Bavaria are registering theirgrowing anger with the relentless assault inicted bygovernment-imposed austerity programs.

Wages, working conditions and pensions that unionssuccessfully fought for over the past half century arethreatened by the collapse of banking systems caughtup in a decade-long orgy of speculation that the average

European neither took part in, nor proted from. Eventhe so-called well o workers of Bavaria, Germanysindustrial juggernaut, saw their wages, adjusted forination, fall 4.5 percent over the past 10 years.

e narrative emanating from EU headquarters inBrussels is that high wages, early retirement, generous benets, and a lack of competition has led to thecurrent crisis that has several countries on the verge

of bankruptcy, including Ireland, Greece, Portugal andSpain. Now, claim the virtuous countriesGermany,the Netherlands, and Finlandit is time for thesespendthri wastrels to pay the piper or, as GermanChancellor Andrea Merkel says, do their homework.

It is an interesting story, a sort of Grimms fairy tale forthe 21st century, but it bears about as much resemblanceto the cause of the crisis as Cinderellas fairy godmother

does to the International Monetary Fund (IMF).

While each country has its own particular conditions,there is a common thread that underlines the currentcrisis. Starting early in the decade, banks and nancialhouses ooded real estate markets with money, fuelinga speculation explosion that inated an enormousbubble. In climate and culture, Spain and Ireland may be

Europes Austerity:Like Something Out of the Brothers GrimmBy Conn Hallinan

http://www.f

irst-news.blogspot.co

m


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SPECIAL FEATURE


very dierent places, but housing prices rocketed

500 percent in both countries.

e money was virtually free, with low interestrates on the bank side, and cozy tax deals cut

between speculators and politicians on the other.at kept the cash within a small circle of investors. While Bavarian workers were watching their payfall, German banks were taking in record protsand shoveling yet more capital into the real estate bubbles in Ireland and Spain. e level of debteventually approached the grotesque. Irelandsbank debts, if translated into dollars, would be theequal of $10 trillion.

e Wall Street implosion in 2008 sent shock waves around the world and popped bubbles allover Europe. While nations on the periphery ofthe European Union (EU) tanked rstIceland,Ireland, Latvia, Romania, Hungary, and Greece,economies at the heart of the EUBritain, Spain,Italy, and Portugalwere also shaken. According tothe Financial Times (FT), total claims by European banks on the Greek, Irish, Italian, Spanish andPortuguese debts alone are $2.4 trillion.

e European Unions (EU) cure for the crisisis a formula with a long and troubled history,and one that has sowed several decades of fallingliving standards and frozen economies when it was applied to Latin America some 30 years ago.In simple terms, it is austerity, austerity and moreausterity until the bank debts are paid o.

ere are similarities between the current Europeancrisis and the 1981 Latin American debt crisis. In both cases debts were issued in a currency over

which borrowing countries had no control, saysthe FTs John Rathbone. For Latin America it wasthe dollar, for Europe the Euro. Secondly, there wasrst a period of easy credit, followed by a worldwiderecession.

Bailouts were tied to the so-called WashingtonConsensus that demanded privatization, massivecuts in social services, wage reductions, andgovernment austerity. e results were disastrous. As public health programs were eviscerated,

diseases like cholera reappeared. As education budgets were slashed, illiteracy increased. And aspublic works projects vanished, joblessness wentup and wages went down.

It took several years to realize that deating wagesand shrinking economies were inconsistent withbeing able to fully pay o debts, notes Rathbone.And yet the virtuous EU countries are applyingalmost exactly the same formula to the current debtcrisis in Europe.

For instance, the EU and the IMF agreed to bail outIrelands banks for $114 billion, but only if the Irishcut $4 billion over the next four years, raised payrolltaxes 41 percent, cut old age pensions, increasedthe retirement age, slashed social spending, andprivatized many public services. When Irelandrecently asked for a reduction in the onerousinterest rate for this bailout, the EU agreed to lowerit 1 percent and spread out the payments, but onlyon the condition of yet more austerity measures andan increase in Irelands corporate tax rate. e newlyelected Fine Gael/Labor government refused.

To pay back its own $152 billion bailout, however,

the Greek government took the deal. But the priceis more austerity and an agreement to sell o almost$70 billion in government properties, includingsome islands and many of the Olympic Games sites.

But the deal will hardly repay the debt.Unemployment in Greece is 15 percent, and as highas 35 percent among the young. Wages have fallen20 percent, pensions have been cut, and rates forpublic services hiked. Growth is expected to fall 3.4percent this year, which means that Greeces debt

burden is projected to increase from 127 percent ofGDP to 160 percent of GDP by 2013. Your debtwill continue to increase as long as your growth rateis below the interest rate you are paying, economistPeter Westaway told the New York Times.

Austerity measures in Portugal and Spain have alsocut deeply into the average persons income andmade life measurably harder. In Spain, more thanone in ve workers are unemployed, and consumerspending is sharply o, dropping by a third this past


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SPECIAL FEATURE

holiday season. Portugal is actually in worse shape.It has one of the slowest economic growth rates inEurope, a dead-in-the-water export industry, and ayouth unemployment rate of over 30 percent.

In Britain, the Conservative-Liberal governmenthas cut almost $130 billion from the budget andlobbied for what it calls the Big Society. e laeris similar to George H.W. Bushs thousand pointsof light and envisions a world in which privateindustry and volunteerism replaces government-funded programs. e actual result has been theclosure of libraries, senior centers, public pools, youth programs, and public toilets. e cutbackshave been most deeply felt in poorer areas of thecountrythose that traditionally vote Labor,as cynics are wont to point outbut they havealso taken a bite out of the Conservative Partysheartland, the Midlands.

Conservative voters have organized demonstrationsto save libraries in staid communities like Charlburyand to protest turning public woodlands over toprivate developers. According to retired nancialo cer Barbara Allison, there are 54 local voluntaryorganizations that run programs like meals on

wheels in Charlbury. Were already devoting anawful lot of our time to charity and volunteers,she told the FT. Am I not doing enough? Is[Conservative Prime Minister] David Camerongoing to volunteer? In any case, as Labor Partyleader Ed Miliband points out, how does Cameronexpect people to volunteer at the local librarywhen it is being shut down?

U.S. Treasury Secretary Timothy Geithner stronglyendorsed the Cameron program last month

and said that he did not see much risk that thecutbacks would impede growth. But even theIMF warns that the formula of treating debt asthe central problem in the middle of an economic

recession has drawbacks. is past October anIMF study concluded the idea that scal austeritystimulates economic activity in the short term ndslile support in the data.

But a massive program of privatization does meanenormous windfall prots for private investors andthe banks and nancial institutions that nancethe purchase of everything from soccer elds tonational parks. ose prots, in turn, fuel politicalmachines that use money and media to dominatethe narrative that greedy pensioners, lay-aboutteachers, and freeloaders are the problem. Andausterity is the solution.

But increasingly people are not buying the message,and from Athens to Wisconsin they are taking theirreservations to the streets. e crowd in Charlburywas a modest 200, and the tone polite. In Athensthe demonstration drew 250,000 and peoplechanted Klees, or thieves. But the message inboth places is much the same: we have had enough.

A bus driver in Athens told Australian journalistKia Mistilis that his wages had been cut from 1800Euros ($2,500) a month to 1200 Euros ($1,660).

ere are more cuts coming into eect in the nextthree months, thats why the protests are heatingup. I am worried that my wages will be cut to 800Euros ($1,110) a month, and if that happens I dontknow how I will survive.

But he has a plan. e situation is reaching aclimax, he told Mistilis, because working peopleknow that the austerity measures go too far, andwith the nal rollout, they cant survive. So there isnothing to do but protest, adding, You wait until

next summer. e situation in Greece will explode.

It is unlikely that Greece will be alone.

Conn M. Hallinan is a columnist for Foreign Policy In Focus. This article was published in FPIF.org (http://www.fpif.org/blog/europes_

austerity_like_something_out_of_the_brothers_grimm) on 17 March 2011.


30/31

MOVIE REVIEW


GASLANDBy Jeff Leins

Afew years ago, an energy company approachedMilanville, Pennsylvania resident Josh Fox with a

proposition. In exchange for a cool $100,000, the

company would lease his land in order to drill beneath it and

tap the Marcellus Shale, the Saudi Arabia of natural gas.

Uneasy, Fox launched his own investigation into the maer

and uncovers a horror show of appalling imagery and gaping

industry loopholes.

As part of HBOs excellent Summer Docs series and now

an Oscar nominee, GasLand is as much an environmental

wake-up call as the personal journey of Fox, a do-it-yourself

lmmaker and accidental detective who begins his mission

as a concerned citizen only to become a rogue crusader for

awareness. A guerrilla-style opening introduces Fox in a rural

expanse plucking a banjo and wearing a gas mask between two

towering drills, a provocative picture that sets the tone for a

powerful message.

With retro visual aids, Fox explains an extraction process that

involves fracking, which sounds like Balestar Galactica

slang but is a shorthand term for hydraulic fracturing, ormanufactured minor earthquakes made underground to

release natural gas. But this unnatural method results in seepage

that clearly contaminates nearby drinking water and creates

toxic conditions for surrounding citizens, regardless of who

signed a lease contract.

Some are terried to show their face on camera, but those who

share their story, along with jars of murky drinking water, tell

of excruciating symptoms, such as headaches, loss of taste, and

even brain damage. Sickly animals show signicant weight and

hair loss. But the shocking smoking gun comes when a lighterame bends hauntingly towards a faucet stream before igniting

the tap water into a ball of re. Its fracking outrageous.

e investigation expands to other towns across the country

aected by natural gas drilling and onto New York where Fox

seeks to expose the politics behind such shameful business

practices. An

a n o n y m o u s

whistleblower

spills insider

details, stealth

shots reveal

u n c h e c k e d

p o

decent work for all- ibon release

Documents