Politics and Economy: Global Capitalism and the Death of Democracy

[Guest guest]

http://www.pbs.org/now/transcript/transcript_hertz.html

 

 

7.05.02

Politics and Economy

Transcript: Bill Moyers Interviews Noreena Hertz

 

MOYERS: All over the world there have been outbreaks of protest

against globalization like those we just saw in Bolivia. My next guest

knows first hand about those protests, and she's written a book on why

people have taken to the streets. It's called, THE SILENT TAKEOVER,

and it's already a best seller in England where the Sunday TIMES OF

LONDON named it one of the year's best.

 

Noreena Hertz was born in England, received her MBA from the Wharton

School of Business and her Ph.D in economics from the University of

Cambridge, where she is Associate Director of the Centre for

International Business. Ten years ago she helped Russia organize its

first stock market. Welcome to NOW.

 

HERTZ: Thank you.

 

MOYERS: Tell my audience what you mean by THE SILENT TAKEOVER.

 

HERTZ: Governments have been ceding power to big multinational

corporations in the market. We see the manifest in a variety of ways.

Where governments are giving up power to big international

institutions like the World Trade Organization or NAFTA, which are

disabling governments' ability to protect the rights of their own people.

 

MOYERS: How much is the real issue, those international finance —

institutions that you talk about, the World Bank, the IMF,the World

Trade Organization. I mean, to whom are they ultimately accountable?

THE ECONOMIST of London says that the World Trade Organization is an

embryo world government which no one has voted for. Now how much are

they the problem?

 

HERTZ: Well, the World Trade Organization is an organization that

defends trade interests. I think the problem is less that they exist.

The problem is that internationally we've only got an organization

that protects trade interests. Surely we need some kind of

counterweight to protect human rights and the environment too.

 

MOYERS: In Bolivia, we saw that effort at privatization. Would you

place that into the category of the silent takeover?

 

HERTZ: Well that's a case of public utilities, public goods being

increasingly handed over to private enterprises to run. Now there's

nothing wrong per se with things being handed over to the private

sector to run, if you have, for example a really strong regulator in

place.

 

MOYERS: But take the situation in Bolivia. Those people before Bechtel

arrived there did not have good, clean water. Bechtel was trying to

set up a system that would deliver then safe, clean and abundant

water. I mean, do you think that the effort at privatization of that

natural resource was wrong?

 

HERTZ: Well, Bechtel was trying to set up a situation that would

realize to its corporation — profit — which, you know, is not

necessarily the same thing as delivering clean water to everyone out

there.

 

MOYERS: It is the natural task of the corporation to gather the

capital needed for projects that cannot come elsewhere. I mean, why

shouldn't the corporation in tandem with the government of Bolivia be

trying to do — to capitalize that water project?

 

HERTZ: There's nothing wrong with what a company is doing. Companies

have to realize profit to their shareholder. They have a legal

responsibility to do so, their fiduciary duty. It's the responsibility

of states to ensure that in that in that process the poor are still

being served and looked after. In Bolivia, the price of water doubled

almost overnight. A quarter of an average Bolivian's salary was now to

be spent on accessing water. So it's not that there's anything

necessarily wrong with private companies providing these functions.

It's just that when we have a weak state, no regulator, no competition

and you leave it to companies. The poor, the marginalized will often

be the losers.

 

MOYERS: You talk very sensibly. You talk very reasonably and yet the

subtitle of your book is a very dire one, Global Capitalism and the

Death of Democracy. What do you see that justifies such a dark

description?

 

HERTZ: Well, I think if we look at patterns of voter turnout over the

past decade, we see this real disillusionment and lack of faith in

governments. Seventy-five percent of Americans believing that big

business has more influence over their lives than government…Part of

the problem is the embeddedness that big business now has with

politics. Funding of political parties, campaign finance.

 

MOYERS: You're talking to a true believer on that.

 

HERTZ: Well, I mean you know that creates huge conflicts of interest.

George W's environment policy clear dictated by the interests of the

energy companies that bankrolled his campaign. So part of what would

be needed would be the disenfranchisement of corporations. Would be...

 

MOYERS: What do you mean by that?

 

HERTZ: ...the breaking of the financial stranglehold that big business

has on politics.

 

MOYERS: What does this do for what you call in your book, " The social

contract? "

 

HERTZ: Well, it completely destroys the social contract, this idea

that government and citizens together have a relationship to provide

public goods, a sense of community, a better world. The social

contract has been privatized, has been handed over to the private

sector to safeguard with incredible conflicts of interest. Scientific

research. Scientific research, something that, you know, we want to be

able to trust, to believe in, increasingly being funded by private

corporations. When the FDA tried to remove saccharine off the list, or

decided to remove saccharine off the list of cancer inducing

chemicals, its work was based on the findings of the University of

Nebraska researcher who was funded by Sweet and Low.

 

MOYERS: And therefore...

 

HERTZ: And therefore the conflict is we can't even trust the

information we now receive. We need to have much clearer regulations

on things like corporate funding of scientific research. Things need

to be made explicit which are implicit. We don't want the takeover. We

shouldn't allow the takeover to be kept silent any longer.

 

MOYERS: Have you been out to any of the protests? The protest in

Seattle or Genoa or in Quebec?

 

HERTZ: Yeah. I was-- the last protest I was at was in Genoa, where I

got tear gassed and I hate tear gas and I hate being in crowds. But...

 

MOYERS: Why were you there?

 

HERTZ: Because I'm really supportive of the protest movement, because

I think it's capable of changing the political agenda and because we

already see signs of its success. In Europe, Guy Verhofstadt, the

President of the European Union when he was, talked about a need for

global binding agreements on ethics in the environment. He hosted a

one-day session last October to which he invited me-- other people who

are seen as voices of the movement, but also Bill Clinton.

 

MOYERS: Have you seen any evidence though, Miss Hertz, that the

protests are actually making a dent...

 

HERTZ: Yes.

 

MOYERS: ...in the market ideology, the globalization that girdles the

world now?

 

HERTZ: Yes. I see it in terms of changing political rhetoric in the

United Kingdom. Gordon Brown, our Chancellor of the Exchequer, his

willingness now to double Britain's aid to least developed countries.

 

I see it on the lips of every CEO of every big company I see today.

They're all saying we cannot ignore the voices of this protest

movement. One third of CEOs of big multinationals polled say that they

view the anti-globalization movement as a serious threat.

 

MOYERS: Who's on the side of those people in Bolivia?

 

HERTZ: The people in Bolivia unfortunately only have each other, but

the international activist community is doing something in keeping

their story alive. As we saw in the film, it's an activist who through

the Internet and using technology for globalization in a positive way

managed to get the story of Bolivia across to very many constituencies.

 

MOYERS: A Bill Finnegan goes there, the mass media pay no attention to

that sort of thing.

 

HERTZ: And that is the tragedy of our times. That's the tragedy of a

public information environment that is increasingly being

commercialized. It's so hard to get those kind of stories on the

airwaves. Broadcasters are so desperate for ratings, for advertising

revenues, but they don't really wanna run stories about the poor

somewhere else, or even for home.

 

MOYERS: Is that why you say in your first chapter, " The revolution

will not be televised " ?

 

HERTZ: The revolution may not be televised, but word of the revolution

is getting out.

 

MOYERS: I was gonna say you're too young to be a pessimist. Are you a

pessimist?

 

HERTZ: Oh, no. I'm very optimistic. I think that we already see signs

that the world is changing. I think in the context now in the United

States of Enron, of Tyco, of Adelphia, that 75 percent of Americans

who already thought that big business had too much influence over

their lives is beginning to say, " You know, hey. Maybe it's not such a

good thing that these big corporations are running amok. "

 

So I think we're seeing a ground swell dissent and we're seeing the

mainstreaming of a lot of these ideas.

 

MOYERS: Well, thank you very much for joining us on NOW and thank you

for THE SILENT TAKEOVER.

 

HERTZ: Thank you.