Two Cents

Sam Pawlett rsp at
Fri Nov 3 10:13:27 MST 2000

Michael Hoover wrote:
> In sum, capitalism developed on basis of exploitation of labor *and*
> exploitation of countries.

Exactly and political/economic relations between countries are a
function of the class structure/struggle within them and vice versa.

Michael Hudson:

"The key seems to lie in the domestic class relations of Latin America
and Africa, above all in the embittered pettiness of their class
warfare. Even Britain, known for its industrial antagonisms for the the
past two centuries, never had anything like the death squads found
throughout Latin America. In any event, domestic social manoevering
shapes the attitudes and positions determining just what theories of
international trade and investment are adopted. For instance, when IMF
economists describe currency depreciation as working to transfer
resources from the domestic to the export sector, the implication is
that it favors foreign investors and large domestic landowners relative
to those who produce for the home market...

"In view of this fact I often have gotten the idea when speaking with
foreign central bankers that,like God, if their international debts did
not exist they would have to be invented. Even if the country received
absolutely no resources in exchange for its debts being run up, the very
act of repaying them serves to transfer funds from the domestic economy
to the export sector, from local taxpayers to a narrow groupd of tax
beneficiaries who might well be compared with the beneficiaries of
England's South Sea bubble and France's Mississippi bubble in the
1710's. The result has been to favor a wealthy financial layer lording
it over the rest of society to a degree not found in any of today's
metropolitan lead nations. While all this has been going on, the prices
of many third-worlds exports have been fixed at their low cost margin of
production. All the better if the resulting trauma can be blamed on
foreigners rather than on local industrialists and developers who find
their opportunism to go hand and hand with the cosmopolitanism world
system sponsored by the IMF and World Bank, backed by world diplomats in
Europe, North America and Asia.

"..The Mrrcantilists were quite right in elaborating how an ongoing
mutual interaction occurs between the varied components of the overall
economic system, defined broadly, so as to include cultural values."
Trade,Development and Foreign Debt. VII.479-80.

Sam Pawlett

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