Media Release
12 November 2001
Approved for immediate use

The Package Deal: Paying For Trade Privileges With Body Bags?

“We have seen more wars since the formation of the WTO than before it. This belies the claims that by providing for a rule based trading system the WTO can prevent trade wars escalating into real wars,” says Radha D’Souza of the Action Research Education Network Aotearoa (ARENA).

“While trade negotiators argue about tariffs, agriculture subsidies and services and seek to ‘level the playing field’ they forget that the engine that drives the big economies like the United States today is defence and oil production.”

The former is out of bounds from the WTO trading regime. The latter is so embroiled in political tensions and economic sanctions that it is beyond the WTO’s brief.

“The US economy at least cannot revive without revival of the arms industry. The Bush administration recognizes this,” says Radha D’Souza. “Economic recovery requires new markets for the huge stockpile of unused arms. War mongering therefore walks hand in hand with trade liberalization”.

It is hardly surprising that big defence contractors like Lockheed Martin have cut down “civil” production and expanded defence production this year.

For 10 years now the US, European Union and Japan have coupled the pursuit of free trade with new defence treaties and military strategies, widening the scope for intervention in other countries and potential markets.

The Stockholm International Peace Research Institute reports a fall in defence and military spending after the Cold War ended, but rises since 1998. The largest increases were in the US: 37% or $280.6 billion in 2000 alone. Second is Russia at 6% of the world spending ($43.7 billion dollars). Between them, the powers of the US, France, Russia, Japan and UK account for 58% of the world’s military spending.

Speaking to a public forum organized by ARENA and Asia Pacific Workers Solidarity Links (APWSL) in Auckland earlier this week, Radha D’Souza drew the links between economic globalization and war.

Twenty years of trade liberalization throughout the world had seen foreign direct investment circulate mainly between the US, EU and Japan. ILO figures showed at least 30% of youth between the ages of 15 to 24 in Asia, Africa and South America are now unemployed.

‘The promised investment and jobs to poorer countries has simply not happened’. Radha D’Souza warned that ‘such massive unemployment, together with the imperatives for war in the world’s most powerful economies, is a potent mix that could escalate into a crisis on a global scale’.

There were important parallels with the 1920s and 1930s and the driving forces behind the two World Wars, which people should reflect on.

‘Globalization is a package deal, that will require us to pay for our trading privileges with body bags. Are we prepared to do this?’

Contact persons: Radha D’Souza 07 8537006 Leigh Cookson (03) 339 6341; 025 662 7174

PS. Headline: Lockheed-Martin wins $200bn fighter contract (Financial Times, October 26, 2001)

The US Gross Domestic Product is $10,202.6 billion ($10,202,600,000,000 or $10.202 trillion) (1). The cost of those fighters is almost 2% (1.96%) of the entire US GDP. It is 5 times the annual operating budget of New York City ($40.586 billion)(2). The cost of those fighters is almost 10 times the GDP of Afghanistan ($21 billion) (3). It is almost equal to the entire GDP of Pakistan ($282 billion). It is 3.5 times higher than the GDP of Iraq ($57 billion). The cost of those fighters is more than one-fourth of the GDP of Canada ($774.7 billion). It equals almost one-fifth of the annual GDP of Brazil, Latin America's largest economy ($1.13 trillion). It exceeds one- fifth of the annual GDP of Mexico ($915 billion). It exceeds the GDP of all the countries of Central America combined ($128 billion). The cost of those fighters is more than 10% of the entire GDP of every country of Africa combined ($1.921 trillion).

(1) US Bureau of Economic Analysis, September 28, 2001

(2) NYC budget for 2001; Analysis of the Mayor's Preliminary Budget for 2002: New York City Independent Budget Office

(3) All foreign GDP figures from Central Intelligence Agency World Factbook 2001; figures for year 2000

Bill Koehnlein NY Transfer News

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