Capitalist crisis in Asia
Western 'experts' admit they have no solutions
By John Catalinotto
A worldwide crisis of capitalist overproduction
has struck Asian countries like a cyclone. Confused about what
to do to stem this collapse, the economic experts of the
powerful imperialist countries are certain only that they want
to make the region's workers pay the costs of recovery.
But the first response of Thailand's workers has been to
fight back.
In Bangkok on Jan. 21, over 1,000 auto workers demanding
higher year-end bonuses set up barricades and blocked the main
road between Bangkok and the east coast. They burned vehicles
and met police attacks with stones and Molotov cocktails.
Unemployment is expected to jump by 200,000 this year, to 2
million out of Thailand's 60 million people.
In Indonesia the collapse is even greater. Millions of
workers have already been laid off. The Indonesian currency,
the rupiah, remains in free fall.
It was trading at 13,000 to the U.S. dollar as of Jan. 26,
as opposed to 2,500 last August.
There are some reports that the Indonesians might declare a
moratorium on their debts if the rupiah continues to fall. Many
Indonesian companies have already stopped servicing the $65
billion in foreign loans.
Some analysts fear Indonesian banks will stop functioning
altogether, bringing commerce in that country of 200 million
people to a halt.
On Jan. 21 in south Korea-the biggest economy in
trouble-negotiators for big business, the government and the
labor unions announced an agreement that would change the labor
laws and allow mass layoffs. The Kim Dae Jung government and
the bosses needed this agreement as one of the conditions for a
$57 billion International Monetary Fund bailout.
A spokesperson for the Korean Confederation of Trade Unions,
however, told reporters: "It is merely a statement declaring
that the three sides will put in their best effort guiding the
economy back to recovery. We are definitely against mass
layoffs."
While the union leaders have been under tremendous pressure
to cooperate to legalize mass dismissals, south Korean workers
want none of it. This puts them in direct conflict with the
IMF.
Bailouts succeeded in 1980s- but now?
The usual demands of the Washington-based IMF involve
tightening government budgets, cutting social services like
food subsidies, laying off workers-especially in the public
sector-and cutting wages so as to cut internal consumption. The
IMF imposed this type of austerity on Latin America in the
1980s and succeeded in keeping the crisis confined to that
region, with the suffering borne by the working class.
In Asia the IMF has been even more specific about its
demands. It insists that the south Korean conglomerates open up
to foreign capital and that the Suharto government in Indonesia
stop subsidizing firms owned by Suharto's family.
In general it wants to open up these countries to takeovers
by Western and Japanese capital while making the workers of the
region suffer even more.
Yet the architects of these economic policies openly express
their doubts that such tactics will succeed in containing this
crisis as they did in Latin America.
Reuter reported from Washington Jan. 26 that the U.S.
approach to Asia's financial crisis has generated no new
approaches and has received a cool response by Western Europe,
Japan and Canada.
"They have no ideas whatsoever,'' said a government official
from one of the Group of Seven imperialist powers. "I guess
that's why they want to talk about it.''
In a recent speech Treasury Secretary Robert Rubin said the
United States is trying to "develop a consensus on further
steps'' with its G7 partners and other nations linked to the
Asian rescue effort. But when asked what steps he might take
and how this would change the financial system, Rubin laughed
and admitted, "The answer to that I do not know.''
And there is contradictory advice. While the IMF was
insisting these countries cut their budgets, Defense Secretary
William Cohen was nevertheless pressuring south Korea to keep
up its military spending. Cuts "would send a wrong signal" to
socialist north Korea, Cohen said Jan. 22 in Seoul.
These military expenses include Seoul's share of costs for
the 37,500 U.S. troops still occupying the country 45 years
after the Korean War ended.
Role of U.S. workers
Politically conscious workers in the U.S. need to show
solidarity with their Asian sisters and brothers against the
IMF-imposed conditions.
Speaking to students at Mexico City's National Autonomous
University Jan. 22, AFL-CIO head John Sweeney attacked the IMF
plans. He said: "[The IMF] seeks to restore the confidence of
investors and speculators, to placate the fickle barons of
finance, by bailing out those whose loans are at risk.
"The bill for this treatment is then passed on to workers-in
depressed wages, lost jobs, crushed hopes. The Fund is like the
medieval doctors at the time of the Black Plague who applied
the only remedy they knew-bleeding their patients," Sweeney
said.
This article is copyright under a Creative
Commons License.
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