In fact certain information the aforementioned two books have in common what be summed up as follows:

Saddam Hussein did not have the alleged ‘weapons’, did not have production programs for manufacturing these weapons, and did not have plans to restart programs for these weapons. The most that Charles Duelfer, head of the Iraq Survey Group, was able to tell Congress in October was that Saddam might have had the “intention” to restart these programs at some point. The weapons were not destroyed shortly before the war, nor were they moved to Syria, as some still claim. They never existed. As Duelfer reported, the weapons and facilities had been destroyed by the United Nations inspectors and U.S. bombing strikes in the 1990s, and he found no evidence of “concerted efforts to restart the program” (Washington Post, October 7, 2004). In short, administration officials “hoodwinked” America, as also John Prados carefully and convincingly documents in his book by that name.

The Senate report, a valuable and solid piece of work, pulled its political punches. The committee concluded that while “most of the major key judgments” in the October 2002 national intelligence estimate (NIE) were “either overstated, or were not supported by, the underlying intelligence report,” the failures were a result of “systematic weaknesses, primarily in analytic trade craft, compounded by a lack of information sharing, poor management, and inadequate intelligence collection” as well as a “groupthink” mentality, rather than administration pressure. In other words, they blamed the lower-ranking analysts.

The president and vice president had decided even before September 11, 2001 to overthrow Saddam Hussein.  This was to be the beginning of an historic crusade to forcibly remake the geopolitics of the Middle East.  But the drive for war ran into serious opposition in summer 2003, particularly from respected Republican moderates such as retired general Brent Scowcroft’s prescient warning, that an invasion of Iraq “could turn the whole region into a cauldron and, thus, destroy the war on terrorism.”

The administration’s response, “was to craft a scheme to convince America and the world that war with Iraq was necessary and urgent, a scheme, unfortunately, that required patently untrue public statements and egregious manipulations of intelligence.” White House Chief of Staff Andrew H. Card set up a special White House Information Group chaired by political guru Karl Rove in August 2002 to coordinate all the executive branch elements in the new campaign.

The key document in the administration’s campaign was the CIA White Paper on Iraq’s weapons of mass destruction programs. The White Paper was hurriedly produced and distributed to the public in October 2002 as an unclassified version of the now-infamous NIE that was given to Congress in the same month, just a few days before the vote to authorize the use of force. These two documents convinced the majority of congressional members, experts, and journalists that Saddam had a powerful and growing arsenal. The first paragraph of the White Paper concludes that Iraq “probably will have a nuclear weapon during this decade.” This claim was then repeated endlessly to the public. Including that Iraq might acquire a bomb some time from 2007 to 2009, a time frame that is far in the future, negating President Bush’s claim that Iraq poses an urgent national security threat.

In fact early on Michael Gordon of the New York Times published a lengthy article on October 3, 2004, detailing how the administration manipulated the evidence to support a claim that Iraq had imported aluminum tubes for centrifuges to enrich uranium for nuclear weapons. David Albright, president of the Institute for Science and International Security, presented much of that research in his report, “Iraq’s Aluminum Tubes: Separating Fact from Fiction,” in December 2003. Others, have weighed in on the tubes, including Seymour Hersh for the New Yorker, Spencer Abraham and John Judis for the New Republic, and Jonathan Landay at Knight-Ridder. In fact today (Sept.25,2005) one can conclude that the way the tube allegation surfaced bears every mark of an orchestrated leak by the Bush administration.

Having set up the Times story, National Security Adviser Condoleezza Rice and Cheney were primed when they appeared on the Sunday talk shows that same day, pointing to the article as confirmation of their claims. We now know that when Rice said that the tubes “are only really suited for nuclear weapons programs,” she knew it was untrue. She had already been briefed on the disagreements in the intelligence community and knew that leading U.S. experts did not think the tubes were at all suitable for centrifuges.

A Senate report, next provides a fascinating exchange of e-mails between a State Department expert and an Energy Department expert fuming about the way higher-ups at the CIA were twisting the intelligence.  By exaggerating the evidence on Iraq, one expert warns the other, “the administration will eventually look foolish, i.e., the tubes and Niger.

Elsewhere I have already drawn a parallel between America’s invasion of Iraq and the old British Colonial practice of “indirect rule”, which meant giving local rulers the semblance of power but - especially when it came to questions of security - running their countries for them.

I assumed that, so long as there remained a significant US military presence in Iraq, the transfer of “full sovereignty” to a legitimate Iraqi government amounted to the same thing. In practice, the sovereignty of the Iraqi authorities would be limited at the discretion of American military commanders.

Instead, we have ended up with something closer to the disorganized Lebanon in the 1980s than one of the Indian princely states in the 1880s. What has gone wrong? History suggests two answers. The first is that the coalition forces are simply too few to impose order. In 1920, when British forces quelled a major insurgency in Iraq, they numbered around 135,000.  Coincidentally, that is very close to the number of American military personnel currently in Iraq.

The trouble is that the population of Iraq was just over 3 million in 1920, whereas today it is around 24 million. Thus, back then the ratio of Iraqis to foreign forces was, at most, 23 to 1. Today it is around 174 to 1. To arrive at a ratio of 23 to 1 today, about 1 million troops would be needed.  Reinforcements on that scale are, needless to say, inconceivable.

The second problem is qualitative rather than quantitative. The plain fact is that controlling disaffected urban populations is a great deal harder today even Iraqi dictator Saddam was in breach of 12 years’ worth of UN resolutions. And true, in January, the Iraqis held their first multi-party elections for 50 years. Further elections are to follow in December.  The absence of a serious reconstruction plan however since has shamed the entire coalition, especially as this failure has affected not only Iraqi civilians but our troops, who are having to act as de facto nation-builders.

The point of my article today however is that Naomi Klein in “No War” (2005) offer almost the same common story as outlined above, except now in context of a decidedly so called “anti-Globalization” narrative.

But first of all, as can be shown on hand of my previous articles on this website, I am not an apologist for big business. Many activities of many international companies, for example tobacco companies, deserve unqualified condemnation. There also have been a number of incidents in the past where multinationals interfered in national politics, particularly in South America.

In domestic affairs, there is clear evidence that the marketing departments of pharmaceutical companies have often brought improper pressures to bear on doctors to recommend their drugs and on editors of scientific journals to review the results of their company's research favorably. The increasing dependence of universities on financial support from industry can lead to abuse and has sometimes done so. In one notorious case, a research worker in the University of Toronto found that a drug developed by a company that sponsored her work, and which was planning to make a large donation to the university, was less effective than expected and had serious side-effects. The company sought to suppress her work and she was dismissed. After a long investigation she was eventually reinstated’ and the furore her case caused will act as a powerful disincentive for similar abuses elsewhere. Another disadvantage of academic dependence on corporate finance is the rush by academics to take out patents on their work. This prevents scientists from sharing information about research results and undermines good science. Paradoxically, the excessive scope of patents now being granted is hampering the innovation for which patents were invented.  There is no doubt, therefore, that business activities need effective regulation and control, which does in fact exist in most of the developed world. On the other hand, I reject the view of the conspiracy theorists that all multinational companies sacrifice all ethical considerations only, for the sake of profit.
 

To quote Naomi Klein,

“By now we’ve all heard the statistics: how corporations like Shell and Walmart baskan budgets bigger than the gross domestic product of most nations; how, of the top hundred economies, fifty-one are multinationals and only forty-nine are countries.  We have heard (or read about) how a handful of powerful CEOs are writing the new rules for the world economy.”

When Klein writes that ‘we’ have all heard these statistics, she represents the views of an introverted coterie who rely on each other as independent sources to confirm each other’s prejudices. The figures quoted are confused and are based on a fundamental economic misconception. As many commentators have pointed out, notably Martin Wolf and Jagdish Bhagwati, GDP (gross domestic product) is a measure of value added, which cannot be compared with a company’s sales.

The budgets that Naomi Klein cites refer to company sales. To compare sales of companies with the GDP of countries either shows ignorance or is a deliberate attempt o distort and evoke prejudice. Even the most primitive traders do not confuse sales with profits value added or would quickly go bust if they did. In fact, the value added of the So biggest companies amounts to no more than 4.5 per cent of the value added of the So biggest economies. The claim is simply untrue.

Next, if the top companies were as powerful as their critics claim, they should be able to consolidate their power. But the league of big companies is constantly changing, a fact incompatible with omnipotence. None of the top ten companies in the world today, measured by market value, were in the top ten a decade ago. At that time Vodafone and Nokia, to cite two European examples, were unknown to the world at large. Even the largest international companies are subject to control through national regulation, but perhaps the most effective check that stops them exercising monopoly power is competition. Indeed, big companies are most powerful inside closed markets.  Open borders weaken corporate power.

In countries who are members of the Organization for Economic Co-operation and Development, the countries in which international companies have invested most heavily, the average ratio of tax revenue to GDP rose by over 5 per cent between 1980 and 1999, a very substantial rise. In the European Union, the ratio rose from 33.5 per cent to 42.3 per cent between 1970 and 1996.

Again, it is claimed that multinational companies seek out countries with the cheapest labor and stop governments passing regulations to prevent exploitation of labor. Not so. Most investment is not-made in countries with cheap labor. As already mentioned, most American investment flows into Europe; companies invest in France, despite the enactment of a 35-hour week, and in Britain, despite the introduction of a minimum wage. As for investment in the Third World, of course there have been bad cases. Klein cites a number of examples where Nike, Adidas, Walmart, and other American companies have exploited cheap labor in the Philippines and even cheaper labor in China. In an appendix, she lists a rogues’ gallery of companies and their sweatshops in China, making a strong prima facie case that there is widespread abuse.

Her book performs a service in, drawing attention to malpractices and adding to public pressure to end them. But as a general argument against globalization, her case fails. Overall, foreign companies in poor countries pay higher wages than local employers; in Vietnam, for example, Nike’s subcontractors (Nike are prominent villains in Klein’s rogues’ gallery) pay their employees double the average wage and provide much better working conditions.

In Indonesia, the average wage in a foreign-owned plant is 50 per cent higher than in domestic plants.” The International Institute of Economics in Washington, a highly respected independent think-tank, has also found that people in poor countries who work for foreign affiliates of American companies earn on average double the domestic manufacturing wage. (See former UK Minister Dick Taverne, The March Of Unreason, 2005, p.238.)

In poor countries, the lowest wages are paid in the local service sector, in small industries and farming, not in the factories, mines, or plantations of multinational companies. The reason foreign companies pay higher wages is that they need to attract labour of the highest quality. It is not therefore surprising that the Pew poll quoted earlier showed strong support in developing countries for the presence of multinational corporations.

It is worth adding that the use of child labour-and Klein cites several examples-is a more common practice in the world than most people realize. The International Labour Office estimates that in the year 2000, 186 million children aged 5. (ILO Report (2002),’A Future Without Child Labour’, p. 16.)

However, to ban exports from companies that employ child labor, as some advocate, would simply increase poverty, which is the main cause for child labor in the first place. Ending the evil of child labor depends on the United Nations’ commitment in the second of its Millennium Development Goals to universal primary education. (House of Lords Committee, Evidence II Q12, p. 46. cited in Taverne, 2005, p.239.)

It is also claimed that multinational companies use their power to lower environmental standards. Not so.  Most international investment has not been made in countries with least regulation. Furthermore, as globalization has spread, so have environmental regulations. If association proved cause and effect, this would indicate that globalization increases environmental protection. In fact, nation states favor stronger environmental regulation and national sovereignty prevails; big multinational corporations cannot prevent it, even if they wish to. Again, foreign companies in the developing world generally observe higher environmental standards than local companies.

Protests yesterday however denounced among others, the ‘outsourcing’ of American jobs to low-paid foreign workers. What is this but protectionism pure and simple, and indefensible? When jobs are exported from the United States to the Philippines or Indonesia, of course American workers suffer and complain, but poorer countries gain. In fact, most blame for the decline in demand for low-skilled workers in the northern hemisphere is due not to loss of jobs to the developing world, but to technological change.

Furthermore, no one claims that the WTO is perfect. It is a small body (not a huge bureaucracy, as those who demonstrate against it imagine) with a budget of less than a quarter of that of one of its critics, the World Wildlife Fund. It is limited in what it can achieve since its decisions depend on agreement among all of its 140-plus members.

But what does the anti-globalization movement stand for? Can it offer, as some of its champions maintain, an alternative which is neither capitalist nor socialist and which avoids the mistakes of the past?  What-can this strange alliance, of Greens linking arms with trade union members representing smoke-stack industries, vegetarians allying with meat farmers, Trotskyites mixing with church groups, & co-fundamentalists joining with anarchists, possibly have in common, except what they are against?

At a meeting of the more modest offshoot of the World Forum, the European Social Forum, some 40,000 gathered, made up, according to a report, of intellectuals, students, ecological and social activists, people representing the poorest and most marginalized, radical economists, concerned individuals, humanitarians, artists, culturalists, churches, scientists, and land workers from a bewildering array of non-government groups and grassroots social movements. (John Vidal, The Guardian, 1 February 2003, p.74.)

In the circumstances it is not surprising that what has emerged so far is vague. At the first Alegre conference the emphasis was on the creation of a movement that was ‘new’, new faces, new ideas, new methods, and a determination to avoid the failures of leftwing regimes of the past. The second conference was dominated by big gatherings to hear speeches by big personalities, some of whom preached something uncomfortably close either to ‘new’ Marxism, or old-fashioned left-wing politics. President Hugo Châvez of Venezuela, for example, not at first sight a reassuring advocate of the democratic decentralization of power, declared that ‘the left in South America is being reborn’ and cited the continuation of Fidel Castro’s rule in Cuba as evidence. Castro is clearly much admired by those who went to Alegre, and even if he owes much of his popularity to his ostracism by America, identification of the new movement with the Castros and Châvezes hardly suggests that its positive programme will be either democratic or new. Indeed, Naomi Klein declared her disappointment that the second World Social Forum was usurped by ‘big men and swooning crowds’, instead of building its own version of participatory democracy. (Naomi Klein, The Guardian, 9 November 2002.)  

Unfortunately, her own alternative prescription shows little awareness of the real world of politics or economics. As disclosed in a series of essays and articles, she envisages a movement based on neighborhood councils, participatory budgets, stronger city governments, land reform and co-operative farming, referendums, constituents’ assemblies, and empowered local councils, ‘a vision of politicized communities networked internationally to resist further assaults from the IMF, the World Bank and World Trade Organization’.‘ Budget constraints, intellectual property rights, and multinational companies are conspiracies against the public that should be dispensed with. It is an eloquently articulated reaction against widely felt injustices, based on a conviction that everything is getting worse, that everywhere democracy is being trampled underfoot by monolithic capitalism, and that oppression and inequality in the world can be cured if only we abandon the ‘neo-liberalism’ of the market, put people before profits, and restore power to the people.

To point out that both analysis and prescription are simplistic and flawed is to underline the obvious.  Many forms of decentralized politics mentioned by Naomi Klein have been widely advocated by liberal democrats in many countries, but they are neither inconsistent with, nor an alternative to, globalization. Democracies have to strike a difficult balance between local powers and central decisions (local centres of power may reach separate conflicting decisions that are nationally incompatible and can only be resolved centrally) and also between the will of the majority and the rights of minorities. It is naïve to denounce budget constraints and patent rights, to fail to realize that governments that ignore budget constraints can eventually go bust and that technological innovation requires some system of patent rights. However strong the case for the reform of TRIPS, immensely costly investment in research and development of new drugs will never be made if competitors can sell copies at a price that merely reflects the cost of production.

Nor is ‘granting power to the people’ a simple remedy to prevent democracy being trampled underfoot as globalization spreads. In fact, while there are still numerous unpleasant dictatorships around the world, their number is declining, not increasing. According to the latest Human Development Report, the number of regimes considered democratic jumped from 44 in 1985 to 82 in 2000, while the number considered authoritarian declined from 67 to 26.36 This is a remarkable improvement, even if it must be conceded that democratic institutions in the new democracies are not the state, whose economic role is mainly confined to protecting property rights, and which allows greed to be the principal motivator.41 This business model has undoubtedly been successful in creating wealth in the last decade, particularly for company directors, but its claim to be the most successful model in the world is open to question.

Capitalism was a European, not an American, invention and there are many different models on show. Even in the United States many companies behave in ways very different from those expected from the American model.  Not only is ‘social capitalism’ in Europe very different from its American relative, but inside Europe itself the corporate system of almost every country is distinct. There is the German ‘Rhineland’ model (now undergoing significant alterations), the Dutch ‘Polder’ model (just as successful in the last decade in promoting growth and employment as the American model), a more dirigiste French model, separate Scandinavian models, and so on. Outside Europe, in Japan and Korea for example, there are also very different models. Nearly all the European models stress workers’ rights, recognize a measure of industrial democracy, and seek to operate by consensus. The role of the shareholder, while gradually acquiring greater substance, does not have the pre-eminence it is accorded in America, and rewards for directors, while still handsome by almost any standard, do not begin to approach the stellar heights of those of their American counterparts.  Takeovers, which often treat companies and their employees as if they were commodities to be bought and sold like chattels, are much rarer outside the Anglo-Saxon world. Indeed, champions of European-type social capitalism argue that, at its best, it reconciles the advantages of the market with the interests of a fair society.

European social capitalism is viewed by many Americans as sclerotic and inflexible, lacking innovation and enterprise, and ineffective at delivering economic growth. In time, they argue, everyone will have to copy the American model. It is not within the scope or purpose of this article (Sept.25, 2005) to diagnose the strengths and weaknesses of different capitalist systems, but on past evidence it ms a reasonable forecast that no single model will prevail.

If the test of economic success is the record, not of the last ten, but of the last thirty years, European social capitalism wins the prize. European economies have grown faster than the American economy, not vice versa. Even today, despite the recent surge in growth American productivity, production per hour is higher in several European countries, including France, the Netherlands, Belgium, and former West Germany, while it is only fractionally lower in Austria and Denmark, all of them countries which prosper despite -heir high rates of taxation, thus disproving the argument that high taxes necessarily stifle enterprise and destroy wealth.” Annual production per worker is lower because, adopting a civilized approach, European workers take longer holidays and work shorter hours.  Even Germany, which has not yet fully recovered from the enormous burden imposed by reunification and which faces the need for major structural reforms to overcome a recent spell of low economic growth, is hardly a country facing a major crisis. The German social model offers stability, security, fairness, a very high standard of public services and a civilized lifestyle, in fact the kind of social good, as Europhiles would argue, that economic growth should aim to achieve. However, past successes do not prove that European models of capitalism will prosper in the next thirty years if they fail to adapt to new circumstances and there is little doubt, as persistent high unemployment in several EU countries demonstrates, that this is a time when many traditional business practices in a number of EU countries will have to change.

The movement against globalization views capitalism as monolithic, because, like eco-fundamentalists and the back-to-nature movement, it seeks simple solutions to complex problems and prefers to talk about the general, not the particular. Its motives, justice for the poor and more equal treatment between nations, are admirable; its intellectual base is weak. It is another example of the triumph of emotion over reason.  If it succeeds in limiting free trade, abolishing the WTO, and replacing contemporary capitalism, it will not make the world a better place.

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