Big lie of trickle-down theory trickles away

by John McAllion

“The broad mass of a nation... will more easily fall victim to a big lie than to a small one.” - Adolf Hitler
THE big lie at the heart of modern capitalism is that the dynamism of free markets and free trade will in the long run guarantee rising wealth and social justice for all.
In the 1960s, John F Kennedy argued that the rising tide of capitalist prosperity would float all the boats in the global harbour, benefiting rich and poor countries alike. By the 1980s, Thatcher and Reagan had refined the metaphor to their trickle-down theory of economics, but kept the same message - let the rich get richer and everyone wins as the benefits trickle down to the less well-off.
Clinton and Blair’s ‘Third Way’ kept the big lie going into the 1990s with their support for ‘wealth creation’ though privatisation, deregulated markets and savage cuts in social spending.
Bush and Brown have carried the same lie into the 21st century arguing that neo-liberalism can be turned to progressive ends by making globalisation work for the poor as well as for the rich.
Following the collapse of the old Soviet bloc countries, this big lie was re-sold around the world as the end of history and the final and historic triumph of capitalism and democracy over communism.
Yet now, as ‘end of history’ capitalism is hit by a series of global crises from the credit crunch to the ‘silent tsunami’ in the South of rocketing food and energy prices, the big lie stands exposed for all to see.
Nowhere is this clearer than in Haiti where the only successful slave revolt in history (1804) was subsequently overturned.
Firstly by a series of imperialist invasions in the 19th and 20th centuries and, more recently, by a UN-sponsored ‘humanitarian intervention’ force deployed along with an IMF economic package of privatisation, deregulation and open markets - the big lie formula to make neo-liberalism work for the poor.
Today, in this the poorest country in the Western hemisphere, unemployment and poverty wages are rampant and 80 per cent of Haitians remain impoverished.
The vast majority live in cardboard and tin homes with no running water or sanitation and with little or no electricity.
According to the World Bank, more than half of the population survive on just 44 cents a day.
As global food prices have soared, children have been reduced to just one meal a day that for most of them now consists of non-food mud cookies made from dried yellow dirt, salt and vegetable shortening, sold locally at 5 cents a time.
When thousands of poor Haitians took to the streets in protest and stormed the Presidential Palace in the capital Port-au-Prince, blue helmeted UN peacekeepers helped to restore order by shooting and killing at least five demonstrators.
The food shortages hitting Haiti today are hammering countries across the South, including the so-called successful economies of India and China.
In India, casual labourers struggling on 50 rupees (60p) a day can afford only one inadequate meal a day.
In China, food stores have been stormed by desperate consumers. In Dhaka, thousands of Bangladeshi textile workers have been dispersed by tear gas and police baton charges.
In all, food demonstrations and riots have been reported in 37 different countries in the global south from Mexico and Peru in the West, through Africa to the Philippines and Cambodia in the East.
Neo-liberals offer all kinds of reasons to explain why this is happening from global warming, droughts and the growth of bio-fuels to the increased demand for meat being generated by the new Chinese and Indian middle classes.
In other words, they argue that these are temporary dislocations that the global market will adjust to in time. In the long run, globalisation will work for the poor. We just need to be patient.
Their weasel words fool noone. In the course of one recent week, two New Labour ministers announced their response to the concurrent crises of the credit crunch in financial markets and food shortages threatening millions with starvation.
On the Monday, Alastair Darling promised between £50- 100billion in Treasury Bills to bail out greedy, incompetent and over stretched British bankers.
On the Tuesday, Douglas Alexander promised £30million to the UN World Food Programme as Britain’s additional contribution to the threat of global starvation.
The two responses speak volumes about where the real priorities of neo-liberals lie.
Deregulated and free markets are designed to work for the few and not for the many. They may generate ever more productive forces but only in the service of an elite who feast on the famine of the many.
Now, as Marx predicted, that elite have become like the sorcerer who has summoned up powers that no longer can be controlled.
The famine threatening the global South is caused by the greed that drives neo-liberalism.
The objective condition for the relief of that global famine is to root out what causes it in the first place - an economic system based on the exploitation of the poor by the rich. Greedy neo-liberals and their mouthpieces in the New Labour government are discovering that they can no longer hide that reality from public view.