How to free the world of these 'terrorists'

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By Madhav Nalapat (China Daily)
Updated: 2009-08-28 08:01

Those responsible for the 9/11 attacks on the US and the November 26,2008, attack on India should be brought to justice. Until the world is free of such terrorists, we cannot enjoy peace and feel safe. But there are others, too, who are destroying human happiness. They are the market manipulators who seek to push up prices of food and petroleum products and other commodities.

After George W. Bush assumed the Oval Office in 2001, his administration passed a series of policies that helped speculators in the oil industry to push up prices. First, they tried to remove Hugo Chavez in Venezuela by mobilizing hundreds of thousands of people and paralyzing that country's oil industry. That was in 2002. The next year, saw the US-led invasion of Iraq, and the mysterious trickling down of oil production from the already ebbed flow under 12 years of UN sanctions (1991-2003). By 2004, Iran, another significant oil producer, had become the target. A year later tempers frayed over Russian pipelines after some countries refused to pay what appeared reasonable prices for gas.

The Bush years saw global oil giants behaving strangely. For example, they shut down refineries in Nigeria when challenged by a few ruffians who could have easily been dealt with by security forces. They created a hellish scare over routine storms in the Mexican Gulf, not at all a new weather phenomenon. These helped the speculators, who succeeded in raising oil prices from $23 a barrel before the Iraqi invasion to about $150 a barrel - a more than six-fold increase in five years - bring misery to many and super-profits to a few. The resultant decline in consumer demand, because of very high commodity prices, combined with speculative greed of the US housing and financial sector executives pushed the world toward an economic crisis second only to the Great Depression.

But sadly, in the US and the European Union (EU), these speculators were not only allowed to go scot-free, some of them were rewarded, too, for pushing hundreds of millions of people toward starvation.

What did the speculators do next? They blamed India and China for the steep rise in commodity prices, and alleged that increased demand from the two countries had pushed up oil prices. China and India were growing at a fast pace even before Bush took over the reins of the US administration but oil prices didn't shoot through the roof then. Instead, they were close to real market levels.

It is clear that China and India are being made scapegoats to divert world attention from the market manipulators. As a result, international institutions that ought to take a global view have sided with a few countries against the interests of most of humanity. This is the main reason why the BRIC countries - Brazil, Russia, India and China - need to form new organizations with a truly global perspective.

The "economic terrorists" have been able to draw fresh blood by forcing the US administration to grant them hundreds of billions of dollars in easy money, which (or at least a big part of which) they are likely to use to speculate further. Oil prices had fallen and settled to real market levels at the beginning of the year. But thanks to these speculators it is now hovering above $70 a barrel. China, too, has announced a huge ($586 billion) economic stimulus package but not paid a single penny from it to private parties as bailout money.

The BRIC countries were relatively silent when the "first wave of speculation" hit the world economy during the Bush years, even though China and India suffered greatly because of a fall in their GDP growth rates and the slowing down of the efforts to lift millions out of poverty.

They should not let a "second wave of speculation" strike and wreak havoc on their economies, and join hands with Brazil, Russia and other developing nations to demand stern action against further market manipulation, and ask the US and the EU to bring those responsible for the global economic crisis to justice instead of rewarding them with handouts from taxpayers' money. The international community, on its part, needs to enact laws that will prevent the greedy "economic terrorists" from damaging the future of the world, and the BRIC powers need to take the initiative to bring that about.

Apart from the speculators, the world has another set of "economic terrorists": people who seek to make profit from epidemics that can kill millions. Take the (A)H1N1 flu virus, for example. Some pharmaceutical giants are preventing smaller companies from producing detection kits and anti-H1N1 drugs, because they want to squeeze the last penny of profit from billions of poor people across the world. The BRIC countries should protest against such monopoly practices, and ask the US and the EU to stop protecting drug companies desperate to make as much profit as the oil firms made during the Bush years.

The US has seized about 20 shipments of drugs from India this year, and the EU has prevented low-cost manufacturers in developing countries from accessing markets in Africa, where millions of people cannot afford the high prices charged by the few US and EU companies operating there. The H1N1 virus is enough reason for the BRIC countries to put pressure on WHO to declare that the epidemic has given the right to low-cost manufacturers to make detection kits and drugs so that millions of lives can be saved. After all, WHO represents the entire world not just a few drug companies.

The voice of the billions of poor people across the world needs to be heard, and the BRIC powers are best positioned to increase the volume and prevent commodity prices from shooting through the roof again and a few drug companies from using their clouts to deny affordable medical treatment to patients.

The author is professor of Geopolitics and UNESCO Peace Chair, Manipal University, India.

(China Daily 08/28/2009 page9)