"What happens is a country comes to the IMF for a loan. The
IMF says ok, but the conditions are that you have to lower
any barriers to imports (because free trade is a good thing).
The country says ok. So what happens is in comes a flood
of foreign goods, esp. U.S. food, produced by corporate
agri-business. These come in at prices lower than foods
can be produced domestically and as a result the Jamaican
farmers are driven out of business. At first I found myself
thinking -- "So what? The consumers are getting the benefits
of lower food prices." -- but then I realized the problem --
the U.S. exports are being produced with very large government
subsidies."
Which is why most free market supporters are against government
subsidization of business, it is usually referred to as corporate welfare
and disguised under the need to protect domestic interests. However, the
requirement to protect domestic interest comes directly from the tribalistic
attidude that these isolationist policies perpetuate. Its a catch 22.
"If that wasn't bad enough, the IMF loans to Jamaica are at
outrageous rates (19% was quoted) and there are clauses
in the contracts that Jamaica cannot loan the money out
at a lower rate to its farmers (so they could in theory
modernize their farms with machinery to compete effectively
against American imports). So the system is setup to *keep*
a 3rd world country in that position."
This particular system might be, but a true free market economy would
benefit all involved. Most free market supporters think that the government
should keep its nose out of business all - together, is the IMF funded by
the U.S. government? I'm sure it must be, and if so these policies would
have been set in place by the big business using the law to ensure thier
monopolies. Just like the phone companies trying to make it illegal to make
phone calls over the internet or the cable companies successfully making it
illegal to broadcast local channels over satelite. The law should be used
to protect the rights of the individual, not to ensure corporate interest.
Michael
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