ECONOMY: US Aid Chief Blasts Hypocrisy of Globalisation
Source Michael Eisenscher
Date 99/07/02/02:37

By Jim Lobe

WASHINGTON, Jun 29 (IPS) - The outgoing head of the US Agency for
International Development (USAID) gave voice to six years of
frustration Tuesday, attacking what he saw as isolationism and
hypocrisy in economic globalisation.

USAID Administrator J. Brian Atwood charged that the failure by
the United States and other industrialised countries to back up
their policy advice to poor countries with significant aid was
contributing to a dangerous and growing gap between rich and poor.

He further charged that no neo-liberal nostrum used to justify
the decline in development assistance - such as ''trade, not aid''
and the rising tide of foreign private investment - was reducing
the gap.

''We are sending very mixed messages to our developing world
partners,'' Atwood told the Overseas Development Council, a
prominent think tank here, in what was billed as a ''valedictory''

''We say on the one hand we want them to embrace democratic,
market economies and to enjoy the benefits of globalization and,
on the other hand, we withhold the assistance they need to help
themselves prepare for this new world of opportunity.

''It is time to end the hypocrisy. Globalisation is thus far
leaving out about two-thirds of the world. Either we should invest
real money in the global model we are promoting, or we should
begin to erect barriers to keep out these poor countries when
their internal problems boil over,'' he declared.

Atwood, scheduled to leave his post July 9, has been considered
one of the more effective USAID chiefs. Under his guidance, the
agency had begun to shed its Cold War origins and embrace
grassroots development.

Atwood had been nominated by President Bill Clinton to be
Washington's ambassador to Brazil, but he withdrew himself last
month after the far-right chairman of the Senate Foreign Relations
Committee, Jesse Helms, indicated that he would block the

Helms was incensed over Atwood's dogged three-year campaign to
prevent USAID from being absorbed into the State Department.
Secretary of State Madeleine Albright last year went over Atwood
to forge a deal with Helms.

In his remarks Tuesday, Atwood expressed regret at having
''wasted so much time'' in fighting for USAID's survival and went
on to blame ''administration colleagues who should have known
better,'' as well as ''non-passport-carrying members of the Class
of 1996.''

The latter was a reference to the crop of right-wing
Republicans who were swept into Congress as a result of the 1996
elections which produced a Republican majority in both houses.

That majority has tried to enforce rigid and declining limits
on all kinds of government spending, especially foreign aid,
despite estimates that the government budget surplus will reach
one trillion dollars over the next 15 years.

Under the Congressional caps, Washington provides only about
12.5 billion dollars a year in foreign assistance, the lowest per
capita amount for all industrialised nations.

''The politics of the budget process producing back-door
isolationism,'' said Atwood, ''and both branches of government are
responsible for the current impasse. We cannot fulfill our
international responsibilities with a 30-percent reduction from
last year's inadequate appropriation.''

The decline in aid was contributing to a growing global gap
between rich and poor.

''The industrial world is getting shamelessly rich while most
of the world's people are losing ground,'' he said, noting that
for every dollar earned in the developing world, 65 dollars are
earned in the West.

''What will it take to wake up our political leaders? More
failed states? More wars? More south-to-north migration? More
transmissions of infectious disease? More terrorism?''

The West had rationalised its declining aid, he said, by
asserting that poor countries wanted ''trade, not aid.''

However, ''as time went on, and despite many well-publicized
trade missions, we saw virtually no increase of trade with the
poorest nations...(who) could not afford to buy anything.''

The sharp increase in private capital flows to poor countries -
also cited as a reason why increasing aid was unnecessary - had
not benefited the poorest countries, he added. In any event, new
investments have been overtaken by repayments of old loans since
the outbreak of the Asian crisis two years ago.

While countries have adopted many of the reforms urged by the
West, the rich-poor gap has not narrowed, he said.

''The expansion of civil society, the increase in elected
governments, the effort to provide more autonomy at the local
level and the growth of entrepreneurism have all contributed to
development progress, but they have not yet closed the poverty

''Why? Because much of the change we are seeing is occurring
within the previous ruling classes of these societies,'' said
Atwood. ''Some in the donor community seem content to nurture
reform without equity,'' a strategy in which only elites benefit
from democracy.

''Reform without equity investments may satisfy the IMF, but it
cannot be a recipe for long-term stability,'' Atwood said,
referring to the International Monetary Fund.

The aid chief also attacked Washington's failure to pay its
arrears to the United Nations as ''unconscionable'' and assailed
administration attempts to work with Helms in tying the arrears
payments to demands for UN reform.

''This is a shameful approach designed to appease people whose
real goal is to kill the United Nations,'' he said, adding that
''yes, reform is needed, but reform never succeeds when it is
demanded at the point of a gun.''

Despite Western demands that poor countries liberalise their
trade regimes and adopt world environmental, labour and
intellectual property standards, far too little is being done to
help poor countries prepare for membership in the World Trade
Organisation (WTO), including by the WTO itself.

Only the ''vastly underfunded United Nations Conference on
Trade and Development is trying to help,'' said Atwood.


[c] 1999, InterPress Third World News Agency (IPS)

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