This is what we paid for

An article by George Monbiot in the Guardian 'This Is What We Paid For', which one can read here This Is What We Paid For

Britain's foreign aid has been used to bankroll a programme for massstarvationBy George Monbiot. Published in the Guardian 18th May 2004Tony Blair has lost the election. It's true he wasn't standing, but we won'tsplit hairs. His policies have just been put to the test by an electorateblessed with a viable opposition, and crushed. In throwing him out of theirlives, the voters of the Indian state of Andhra Pradesh may have destroyedthe world's most dangerous economic experiment.Chandrababu Naidu, the state's chief minister, was the West's favouriteIndian. Tony Blair and Bill Clinton both visited him in Hyderabad, the statecapital. Time magazine named him South Asian of the Year; the governor ofIllinois created a Naidu Day in his honour, and the British government andthe World Bank flooded his state with money. They loved him because he didwhat he was told.Naidu realised that to sustain power he must surrender it. He knew that aslong as he gave the global powers what they wanted, he would receive themoney and stature which count for so much in Indian politics. So instead ofdevising his own programme, he handed the job to the US consultancy companyMcKinsey.McKinsey's scheme, "Vision 2020", is one of those documents whose summarysays one thing and whose contents quite another.(1) It begins, for example,by insisting that education and healthcare must be made available toeveryone. Only later do you discover that the state's hospitals anduniversities are to be privatised and funded by "user charges".(2) It extolssmall businesses but, way beyond the point at which most people stopreading, reveals that it intends to "eliminate" the laws which defendthem,(3) and replace small investors, who "lack motivation", with "largecorporations".(4) It claims it will "generate employment" in thecountryside, and goes on to insist that over 20 million people should bethrown off the land.(5)Put all these - and the other proposals for privatisation, deregulation andthe shrinking of the state - together, and you see that McKinsey hasunwittingly developed a blueprint for mass starvation. You dispossess 20million farmers from the land just as the state is reducing the number ofits employees and foreign corporations are "rationalising" the rest of theworkforce, and you end up with millions without work or state support. "TheState's people," McKinsey warns, "will need to be enlightened about thebenefits of change."(6)McKinsey's vision was not confined to Naidu's government. Once he hadimplemented these policies, Andhra Pradesh "should seize opportunities tolead other states in such reform, becoming, in the process, the benchmarkstate."(7) Foreign donors would pay for the experiment, then seek topersuade other parts of the developing world to follow Naidu's example.There is something familiar about all this, and McKinsey have been kindenough to jog our memories. Vision 2020 contains 11 glowing references toChile's experiment in the 1980s. General Pinochet handed the economicmanagement of his country to a group of neoliberal economists known as theChicago Boys. They privatised social provision, tore up the laws protectingworkers and the environment and handed the economy to multinationalcompanies. The result was a bonanza for big business, and a staggeringgrowth in debt, unemployment, homelessness and malnutrition.(8) The plan wasfunded by the United States in the hope that it could be rolled out aroundthe world.Pinochet's understudy was bankrolled by Britain. In July 2001 Clare Short,then secretary of state for development, finally admitted to parliamentthat, despite numerous official denials, Britain was funding Vision 2020.(9)Blair's government has financed the state's economic reform programme, itsprivatisation of the power sector and its "centre for good governance"(which means as little governance as possible).(10) Our taxes also fund the"implementation secretariat" for the state's privatisation programme. Thesecretariat is run, at Britain's insistence, by the far-right business lobbygroup the Adam Smith Institute.(11) The money for all this comes out ofBritain's foreign aid budget.It is not hard to see why Blair's government is doing this. As Stephen Byersrevealed when he was secretary of state for trade and industry, "the UKGovernment has designated India as one of the UK's 15 campaign markets."(12)The campaign is to expand the opportunities for British capital. The peopleof Andhra Pradesh know what this means: they call it "the return of the EastIndia Company".This isn't the only aspect of British history which is being repeated inAndhra Pradesh. There's something uncanny about the way in which thescandals that surrounded Tony Blair during his first term in office arerecurring there. Bernie Ecclestone, the Formula 1 boss who gave Labourpounds1 million and later received an exemption from the ban on tobaccoadvertising, was negotiating with Naidu to bring his sport to Hyderabad. Ihave been shown the leaked minutes of a state cabinet meeting on January10th this year.(13) McKinsey, they reveal, instructed the cabinet thatHyderabad should be a "world class futuristic city with Formula 1 as a corecomponent." To make it viable, however, there would be a "state supportrequirement of Rs400-600 crs"(4 billion to 6 billion rupees).(14) This meansa state subsidy for Formula 1 of pounds50million to pounds75m a year. It isworth noting that thousands of people in Andhra Pradesh now die ofmalnutrition-related diseases because Naidu h!ad previously cut the subsidy for food.Then the minutes become even more interesting. Ecclestone's Formula 1, theynote, should be exempted from the Indian ban on tobacco advertising. MrNaidu had already "addressed the PM as well as the Health Minister in thisregard" and was hoping to enact "state legislation creating an exemption tothe Act". (15)The Hinduja brothers, the businessmen facing criminal charges in India whowere given British passports after Peter Mandelson intervened on theirbehalf, have also been sniffing round Vision 2020. Another set of leakedminutes I have obtained shows that in 1999 their representatives held asecret meeting in London with the Indian attorney-general and the Britishgovernment's export credit guarantee department, to help them obtain thebacking required to build a power station under Naidu's privatisationprogramme.(16) When the attorney-general began lobbying the Indiangovernment on their behalf, this caused yet another Hinduja scandal.The results of the programme we have been funding are plain to see. Duringthe hungry season, hundreds of thousands of people in Andhra Pradesh are nowkept alive on gruel supplied by charities.(17) Last year hundreds ofchildren died in an encephalitis outbreak because of the shortage ofstate-run hospitals.(18) The state government's own figures suggest that 77%of the population has fallen below the poverty line.(19) The measurementcriteria are not consistent, but this appears to be a massive rise. In 1993there was one bus a week taking migrant workers from a depot in AndhraPradesh to Mumbai. Today there are 34. (20) The dispossessed must reducethemselves to the transplanted coolies of Blair's new empire.Luckily, democracy still functions in India. In 1999, Naidu's party won 29seats, leaving Congress with five. Last week those results were preciselyreversed. We can't yet vote Tony Blair out of office in Britain, but inAndhra Pradesh they have done the job on our behalf.www.monbiot.comReferences:1. Vision 2020 can be read athttp://www.aponline.gov.in/quick%20links/vision2020/vision2020.html2. Vision 2020, Page 96.3. Vision 2020, page 42.4. Vision 2020, page 195.5. Vision 2020, page 170. This is worded as follows: "However, agriculture'sshare of employment will actually reduce, from the current 70 per cent [ofthe population of 76 million] to 40-45 per cent".6. Vision 2020, page 158.7. Vision 2020, page 333.8. The figures have been tabulated by Tom Huppi in the document Chile: theLaboratory Test, which can be found athttp://www.huppi.com/kangaroo/L-chichile.htm9. Clare Short, 20th July 2001. Parliamentary answer to Alan Simpson MP.Hansard Column 475W.10. The full list can be read at http://www.dfidindia.org/11. Government of Andhra Pradesh, ?2002. Strategy Paper on Public SectorReform and Privatisation of State Owned Enterprises.12. Department of Trade and Industry, 6th January 2000. Byers to Help UKSMEs Foster Export Links with India. Press release.13. Government of Andhra Pradesh. Minutes of Cabinet sub-committee meetingon 10th January 2004.14. ibid.15. ibid.16. Clifford Chance solicitors, 3rd June 1999. Vizag - Meeting with theAttorney-General. Fax transmission.17. Eg P. Sainath, 15th June 2003. The politics of free lunches. The Hindu.18. Eg K.G. Kannabiran and K. Balagopal, 14th December 2003. Governance &Police impunity in Andhra Pradesh: World Bank urged not to make loan.Peoples' Union for Civil Liberties and Human Rights Forum, Andhra Pradesh.19. Government of Andhra Pradesh. Draft Report of the Rural PovertyReduction Task Force. Cited in D. Bandyopadhyay, March 17th 2001. AndhraPradesh: Looking Beyond Vision 2020. Economic and Political Weekly.20. P Sainath, June 2003. The Bus to Mumbai.http://www.indiatogether.org/2003/jun/psa-bus.htm