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privatisation is neither economic efficiency or improved services to
the
consumer but simply to transfer wealth from the public purse--which
could redistribute it to even out social inequalities--to private
hands. The majority of privatised company shares are now in the hands 
of financial institutions and very large investors. Consequently, all 
that money is now going to private shareholders. Service in the 
privatised industries is often disastrous.
Exactly the same mechanisms have been at work throughout the world. 
British aid, USAID and the World Bank have pushed the privatisation 
doctrine in the South. By 1991 the Bank had already made 114 loans to 
speed the process, and every year its Global Development Finance report 
lists hundreds of privatisations carried out in the Bank's borrowing
countries.
We should stop talking about privatisation and use words that tell the 
truth: we are talking about surrender of the product of decades of work 
by thousands of people to a tiny minority of large investors. This is 
one of the greatest hold-ups of our generation.
Another structural feature of neo-liberalism consists in remunerating
capital to the detriment of labour and thus moving wealth from the
bottom of society to the top. If you are, roughly, in the top 20
percent of the income scale, you are likely to gain something from
neo-liberalism and the higher you are up the ladder, the more you gain.
Conversely, the bottom 80 percent all lose and the lower they are to
begin with, the more they lose proportionally.
In the US, Reagan's neo-liberal doctrine and policies changed American 
income distribution between 1977 and 1988. Over the decade of the 
1980s, the top 10 percent of American families increased their average 
family income by 16 percent, the top 5 percent increased theirs by 23 
percent, but the extremely lucky top 1 percent of American families 
could thank Reagan for a 50 percent increase. Their revenues went from  
$270.000 to $405.000. As for poorer Americans, the bottom 80 percent 
all lost something; true to the rule, the lower they were on the scale, 
the more they lost. The bottom 10 percent of Americans lost 15% of 
their already meagre incomes: from an already rock-bottom average of 
$4.113 annually, they dropped to an inhuman $3.504. In 1977, the top 1 
percent of American families had average incomes 65 times as great as 
those of the bottom 10 percent. A decade later, the top 1 percent was 
115 times as well off as the bottom decile.
America is one of the most unequal societies on earth, but virtually
all countries have seen inequalities increase over the past twenty years
because of neo-liberal policies. UNCTAD published some damning evidence
to this effect in its 1997 Trade and Development Report based on some
2600 separate studies of income inequalities, impoverishment and the
hollowing out of the middle classes. The UNCTAD team documents these
trends in dozens of widely differing societies, including China, Russia
and the other former Socialist countries.
There is nothing mysterious about this trend towards greater
inequality. Policies are specifically designed to give the already rich 
more disposable income, particularly through tax cuts and by pushing 
down wages. The theory and ideological justification for such measures 
is that higher incomes for the rich and higher profits will lead to more
investment, better allocation of resources and therefore more jobs and
welfare for everyone. In reality, as was perfectly predictable, moving
money up the economic ladder has led to stock market bubbles, untold
wealth for the few, and the kind of financial crises we shall be
hearing a lot about in the future. If income is redistributed towards 
the bottom 80 percent of society, it will be used for consumption and 
consequently benefit employment. If wealth is redistributed towards the 
top, where people already have most of the things they need, it will go 
not into the local or national economy but to international 
stockmarkets.
As you are all aware, the same policies have been carried out
throughout the South and East under the guise of structural adjustment, 
which is merely another name for neo-liberalism. At the international
level, neo-liberals have concentrated all their efforts on three
fundamental points:
--free trade in goods and services
--free circulation of capital
--freedom of investment
Over the past twenty years, the IMF has been strengthened enormously.
Thanks to the debt crisis and the mechanism of conditionality, it has
moved from balance of payments support to being quasi-universal
dictator of so-called "sound" economic policies, meaning of course neo-
liberal ones. The World Trade Organisation was finally put in place in 
January 1995 after long and laborious negotiations, often rammed through
parliaments which had little idea what they were ratifying. Thankfully,
the most recent effort to make binding and universal neo-liberal rules,
the Multilateral Agreement on Investment, has failed, at least
temporarily. It would have given all rights to corporations, all
obligations to governments and no rights at all to citizens.
The common denominator of these institutions is their lack of
transparency and democratic accountability. This is the essence of
neo-liberalism. It claims that the economy should dictate its rules to
society, not the other way around. Democracy is an encumbrance,
neo-liberalism is designed for winners, not for voters who, necessarily
encompass the categories of both winners and losers.
I'd like to conclude by asking you to take very seriously indeed the
neo-liberal definition of the loser, to whom nothing in particular is
owed. Anyone can be ejected from the system at any time--because of
illness, age, pregnancy, perceived failure, or simply because economic
circumstances and the relentless transfer of wealth from top to bottom
demand it. Shareholder value is all. Recently the International Herald
Tribune reported that foreign investors are "snapping up" Thai and
Korean companies and Banks. Not surprisingly, these purchases are
expected to result in "heavy layoffs".
In other words, the results of years of work by thousands of Thais and
Koreans is being transferred into foreign corporate hands. Many of
those who laboured to create that wealth have already been, or soon 
will be left on the pavement. Under the principles of competition and
maximising shareholder value, such behaviour is seen not as criminally 
unjust but as normal and indeed virtuous.
I submit that neo-liberalism has changed the fundamental nature of
politics. Politics used to be primarily about who ruled whom and who
got what share of the pie. Aspects of both these central questions 
remain, of course, but the great new central question of politics is, 
in my view, "Who has a right to live and who does not". Radical 
exclusion is now the order of the day, I mean this deadly seriously.
I've given you rather a lot of bad news because the history of the past
20 years is full of it. But I don't want to end on such a depressing
and pessimistic note. A lot is already happening to counter these
life-threatening trends and there is enormous scope for further action.
I believe we must go into an ideological offensive. It's time WE set the
agenda instead of letting the Masters of the Universe set it at Davos.
I hope funders may also understand that they should not be funding just
projects but also ideas. We can't count on the neo-liberals to do it,
so we need to design workable and equitable international taxation
systems, including a Tobin Tax on all monetary and financial market 
transactions and taxes on Transnational Corporation sales on a pro-rata 
basis. The proceeds of an international tax system should go to closing 
the North-South gap and to redistribution to all the people who have 
been robbed over the past twenty years.
Let me repeat what I said earlier: neo-liberalism is not the natural
human condition, it is not supernatural, it can be challenged and
replaced because its own failures will require this. We have to be
ready with replacement policies which restore power to communities and
democratic States while working to institute democracy, the rule of law
and fair distribution at the international level. Business and the
market have their place, but this place cannot occupy the entire sphere
of human existence.
Further good news is that there is plenty of money sloshing around out
there and a tiny fraction, a ridiculous, infinitesimal proportion of it
would be enough to provide a decent life to every person on earth, to
supply universal health and education, to clean up the environment and
prevent further destruction to the planet, to close the North-South
gap--at least according to the UNDP which calls for a paltry $40
billion a year. That, frankly, is peanuts.
Finally, please remember that neo-liberalism may be insatiable but it
is not invulnerable. A coalition of international activists only 
yesterday obliged them to abandon, at least temporarily, their project 
to liberalise all investment through the MAI. The surprise victory of 
its opponents infuriated the supporters of corporate rule and 
demonstrates that well organised network guerillas can win battles. Now 
we have to regroup our forces and keep at them so that they cannot 
transfer the MAI to the WTO.
Look at it this way. We have the numbers on our side, because there are
far more losers than winners in the neo-liberal game. We have the
ideas, whereas theirs are finally coming into question because of 
repeated crisis. What we lack, so far, is the organisation and the 
unity which in this age of advanced technology we can overcome. The 
threat is clearly transnational so the response must also be 
transnational. Solidarity no longer means aid, or not just aid, but 
finding the hidden synergies in each other's struggles so that our 
numerical force and the power of our ideas become overwhelming.