APSN Banner

Globalization and human rights

Source
PBS Special Report - May 1998

[The following is an interview with Allan Nairn, Journalist and Indonesian Specialist by Danny Schechter.]

Schechter: Suharto is out. What happens now in Indonesia?

Nairn: Suharto is out, but the army is still there. It's the army who runs the police state. Until people break their power through protest, there is really no real chance for democracy.

Schechter: In what way did globalization help structure these crises?

Nairn: The Asian currency crises led to the collapse of the rupiah in Indonesia. That pushed already poor people over the brink, made Suharto vulnerable and the democracy movement took advantages of it. They staged protests. The army struck back with it's appearances, but then when the army opened fire on a group of students, Jakarta exploded and Suharto was ousted. But the battle continues because the army is still intact and they're the ones who run the torture centers and who have intelligence agents down to the village level. They are the real obstacles to free speech and to labor organization.

Schechter: Now what about the International Monetary Fund. Suharto was resisting the International Monetary Fund. What role have they been playing?

Nairn: The International Monetary Fund and Suharto clashed over the public subsidies Suharto gives his children. Suharto's children are billionaires. He shuffles them billions; the International Monetary Fund was against that. The International Monetary Fund has been pushing to move Indonesia from crony capitalism, dominated by the Suharto family, to global market capitalism, dominated by multinational investors. So they would own the roads and the factories instead of the Suharto children. That's been their clash. But the real impact of the International Monetary Fund plan is the mass lay-off ending the food and the fuel subsidies for the poor of Indonesia. Even though 45 percent of the 1-year-olds are malnourished according to UNICEF. When they upped the fuel prices by 70 percent (under pressure from the International Monetary Fund) that touched off the popular explosion – ironically – that brought down Suharto.

Schechter: So in a sense, the International Monetary Fund helped bring down Suharto?

Nairn: The International Monetary Fund was trying to phase in the subsidy cuts that would cause misery. They didn't want to do it so fast that it would bring down the regime, but it didn't work. They raised the fuel prices 70 percent and it helped touch off an explosion. It brought Suharto down. Now if Indonesia succeeds in creating a more democratic government, they are still going to deal with the International Monetary Fund. The International Monetary Fund is going to be ordering them to do mass lay-offs and ordering them to sell their assets to multinationals. It's the opposite of democracy. It's coercion and it's exactly the wrong thing for a country that's just trying to see it's political freedom.

Schechter: Can we see this as a kind of crises of globalization from above, leading to the globalization from below, rejecting what's been happening?

Nairn: Well, it's not clear yet whether the Indonesian public will succeed in defeating the International Monetary Fund and defeating the global corporate forces, but they have a chance. Indonesia is a very big country. It's a wealthy country. If Indonesia gets a democratic government they could stand up to the International Monetary Fund in a way that a small country like Haiti or Nicaragua never could.

Schechter: For years they were calling Indonesia one of the Asian Tigers and praising it's economy – the next day it was a corrupt mess. What happened?

Nairn: The idea of the Indonesian economic miracle was largely myth. In the same period that Indonesia grew economically per capita, South Korea grew more. And they did it with fewer outside subsidies and a more equal distribution of income. The Indonesian system is based on personal control by the Suharto family; business partnerships between Suharto and multinationals. And most of all, the Indonesian system is based on repression of labor – artificial holding down wages by crushing unions – so companies like NIKE can come in and pay their workers a couple of dollars per day.

Schechter: NIKE now says that they are going to increase their minimum wages or at least not use child labor.

Nairn: Just to make up for the currency collapse, NIKE would have to double the wages in Indonesia. If they were going to give a real living wage to workers, they would have to do much more than that.

Schechter: The currency crises were also triggered by a lot of speculators and global forces, wasn't it?

Nairn: Yes, the currency crises started with the collapse of some banks in Thailand, then it spread to Indonesia. There was a run on the rupiah. In one day it lost 26 percent of its value. And suddenly the Suharto regime was in crisis and the democracy movement stepped in and took advantage of that.

Schechter: What about the American role here?

Nairn: The United States was the last one off the sinking ship of Suharto. Just hours before he left, the United States made a statement suggesting he should resign, but they backed off – even off of that weak statement. The United States was trying to preserve Suharto but when he lost control of the population – when he became bad for business – they had to abandon him. They are still backing the Indonesian army. They're pressing the civilian democracy activists to make a deal with the army to have them be the basis of the new regime. The United States is still arming, training and financing the Indonesian army, which is one of the most ruthless in the world.

Schechter: What is this crisis in Indonesia going to mean for globalization?

Nairn: The tremendous pressures that the Suharto regime faced will now be brought to bear on any new regime, and if it is a democratic government in Indonesia, they will find that the International Monetary Fund will demand that they surrender control over their own economic and social policy.

Schechter: Why doesn't the International Monetary Fund call for a linkage with human rights?

Nairn: Because human rights cuts against the International Monetary Fund program. The International Monetary Fund program involves holding down wages. If you have human rights, you have free labor organization that drives up wages.

Schechter: So this whole idea of linkages – which has been proposed and rejected by the American government – do you see that as a continuing demand?

Nairn: It's a demand. I don't think the International Monetary Fund will ever do it because it cuts against the core of what they are about. They are about the profit of multinationals and holding down wages. Human rights means free labor organization and it's just impossible under the International Monetary Fund structural readjustment plans. You can't have both an International Monetary Fund structural readjustment and human rights and free labor organizations because they are pushing in opposite directions.

Country