The cuts connection: neoliberalism home and away

The cuts connection: neoliberalism home and away

Date: 5 April 2011

Hilary Aked

Why did WDM join the demonstration opposing the government’s sweeping cuts last Saturday? Why should a group which campaigns against global poverty be concerned with the domestic economy, especially when the oversees aid budget has supposedly been ring-fenced?

The fact that the current government is channelling the 0.7% GDP that goes towards oversees aid into counter-terrorism initiatives in only a handful of countries, rather than supporting those most in need might be cause enough to take to the streets.

But the main reason is that we really are ‘all in this together’ – though not in the way Cameron and Osborne mean. Across the world people are fighting against the same economic policies advocated by global elites everywhere, and have been doing so for a long time. It’s vital to make the links between the neoliberal agenda currently being pushed in this country, and the free-market policies which have been forced on the global south for decades.

The same austerity measures which will decimate UK public services in the name of ‘efficiency’ have devastated the lives of the poorest sectors of society in countries around the world. Meanwhile huge multinationals make massive profits as a result of privatisation, deregulation and the slashing of corporate tax. The ‘wasteful and bloated’ public sector of politicians’ rhetoric is everywhere being swept away and replaced with the reality of a socially and environmentally destructive private sector.

Rich western powers, through bodies like the IMF and World Bank, forced free market policies on the developing world in the 1970s, 80s and 90s – attaching conditions to financial ‘assistance’ loans which many countries in Africa, Asia and Latin America could not afford to refuse. The economic growth and prosperity which they claimed would follow on from these ‘sound’ economic policies became a reality for only very few people in very few countries. Often the complete opposite happened. In Zambia for instance, the economy shrank 40% between 1970 and 1995 while average life expectancy dropped from 52 to 42 years. 

However, the global south also provides inspirational examples of resistance to privatisation and other policies which put profits above people. The small Bolivian town of Cochabamba, for instance, became famous when its people drove American water company Bechtel out of town. Private takeover of the water supply saw prices rise 50% – an unaffordable amount which people refused to accept. Their grassroots social movement garnered international support and eventually succeeded in returning the water supply to public hands. 

The harsh lessons learnt by the populations of Africa, Asia and Latin America are being ignored by policy-makers who continue to pursue a discredited ideological agenda of cuts and austerity. But we must make sure that we learn lessons from the experiences of the global south, now that the same policies the west pushed there are ‘coming home to roost.’