protectionism

Australia, still a colony, has more supermarkets per capita than the US and nearly three times as many as the UK. [1]India, no longer a British colony, has no supermarket chains. What other country can claim this? Late last year Indian shopkeepers rioted successfully to stop foreign investment liberalisation and multinational supermarkets. Here is a mostly French-sourced article about how emerging powers are looking after their own industries, while the free-marketeers of the west sell the rest of us down the river. See also article about President Francois Holland's program to meet protectionism elsewhere with protectionism at home: ,"New French industry policy to moderate globalisation, Ministerial interview" A word of warning to vegetarians, the sacred cows of India are being sacrificed now to the mighty dollar.

(Adapted from a report entitled, "La pousee du protectionisme a l'echelle mondiale" by Pierre Monègier et Nicolas Ducrot on France2 Journal Televise, Thursday 7 June, 2000hrs.)

Presenter David Pujadas relating the phenomenon to the global financial crisis, says that according to an annual report from the European commission, world-wide, import duties are strongly increasing in number and in size. "This is particularly so among emerging powers, which have no qualms about protecting their markets."

India's export market

The France2 report centers round India.

We see film of a factory where millions of bright green gerkins are being processed. The message from Pierre Monègier is that

"This little gerkin has every chance of finishing up in [a french] plate. Indians produce more than
200,000 tonnes a year, but they don't like gerkins themselves.

The subtitle for this report, filmed in India, is, "You buy my products, I'll tax yours."

Reporter Pierre Monègier tells us,

"All these gerkins are therefore destined for export to France, the United States, Africa... 'Made in India' rolls out everywhere in the world, without obstacle. It's the same for livestock. In the Land of the Sacred Cow it would be sacreligious to put your fork in one, yet this year India will become first in the world in beef exports.

These performances signify a giant in the making. And that makes foreign investors want to have a share in the Indian cake, but in cooking, India doesn't really play fair," he concludes.

The camera shows us a French restaurant in India with a number of business-class looking male diners in the dining room and then moves to the kitchen, where the French proprietor tells us that he estimates that the cost of French products is multiplied by Indian import duties by three and a half to four times, generally. He says that it is the same for all French products - for wine, for fine delicatessen goods.

The reporter says that the result is that it is almost impossible to find french farm products in India. Furthermore, he says, one cannot rely on big supermarket chains in India to reduce the costs and put French products on their shelves.

There are no supermarkets in India

"In contrast to China and Brazil, India is still ferociously resisting foreign investment in the form of supermarket chains here. There are no supermarkets here. Carrefour [French supermarket chain] and Wal Mart have come to grief here. The government rejected them in order to protect thousands of grocery stores."

Proud democratic history of multinational supermarket chain failure in India

It began with an attempt to pass a law permitting 51% foreign investment-led multinational supermarket chains:

"NEW DELHI: Global chains like Walmart, Carrefour and Tesco may face problems in opening stores in over half of the 53 cities eligible for FDI in multi-brand retail.

The parties and alliances ruling in 11 major states with 28 cities, have strongly opposed the decision of the Central government to allow foreign direct investment (FDI) in multi-brand retail which is dominated by small traders" Source: "FDI in retail: Walmart, Carrefour, Tesco may face hurdles in 28 cities."

(25 November 2011):"Anger and indigation took over the Indian Parliament on Friday, after the Indian Minister for Industry and Commerce, Anand Sharma, announced the liberalisation of market policy towards foreign multinationals in India. The Opposition parties and the Trinamool Congress, key ally of the Congressional Party in the heart of the governing coalition (UPA), loudly protested against the green light given by New Delhi to big supermarket chains, permitting for the first time, foreign investment at 51% in the country in that sector.

...Direct foreign investment by groups like Wal-Mart and Carrefour to open a retail store would be subject to several conditions: minimum investment of 100 million dollars, of which 50 per cent must be devoted to housing infrastructure (chaine du froid etc), 30 per cent of produce would have to be sourced from small and medium sized businesses, and the stores would only be allowed to open in cities of more than one million inhabitants."
(Translation by Sheila Newman): Source: -la-polemique">25/11/2011 | Antoine Guinard ( Aujourd'hui l'Inde).

It ended with direct democracy:

Policy changes aiming at opening the market up to 51% foreign investment in the form of big multinational supermarket chains resulted on 2 December 2012 in one of those huge popular protests that India does so well and which constitute its chief form of real democracy.

"New Delhi backs down. ... Parliament was paralysed by the anger of the opposition. All the legal projects are in limbo today. Last Thursday the protests went to the streets, with one hundred thousand shopkeepers in a general strike. (Translation by Sheila Newman). Source:"India suspends the introduction of foreign supermarkets." (Article by Vanessa Dougnac.)

All translations in this article by Sheila Newman

NOTES

[1] Numbers of supermarkets in Australia per capita: http://www.stuartalexander.com.au/aust_grocery_market_woolworths_coles_wholesale.php

New French Minister for Industry in France says globalisation is extremist policy and that France, Europe and other westernised countries need to protect themselves from total free-market doctrine. He also proposes external taxes, including on carbon emissions for imported products. This is a fascinating interview for citizens of Anglophone countries who feel that free-market ideology has replaced democracy.

This is a transcript and translation of an interview with Arnaud Montebourg, the new French Minister for reestablishing manufacturing industry. The interview took place on France2's Journal Télévisé[1] on Thursday 17 May 2012 at 2000h. The interviewers were Julien Bugier (the news presenter) and Fabien Amias.

Interview with Arnaud Montebourg, the Minister for Reestablishing Productive Industry.

750,000 manufacturing jobs have been lost in the past
10 years and 900 factories have closed in the last three years in France. Ten years ago 28 per cent of France's economy was manufacturing. Now it is 13 or 14 per cent. According to Minister Montebourg, France is "deindustrialising even faster than the UK which has the reputation at the moment of having almost no manufacturing left at all."

Minister Arnaud Montebourg is the author of a book, Vote for Deglobalisation, published nearly a year ago.

He is quoted as saying in it, "Globalisation is nothing other than an extremist system."

He is asked by a France 2 news interviewer if he feels he can maintain the same position now that he is in government.

ARNAUD MONTEBOURG: "We need above all to protect ourselves. [Globalisation] is an extremism because without loyalty or law, without any limit, it has placed our territories, our industrial system, enterprises, wage earners - in direct competition with countries which have ... wages 30 times lower than ours.

Social protection there is virtually absent, whilst wage earners [in France] after two centuries of social struggle have fair working conditions. And this competition has destroyed our industrial system. Furthermore, it has not greatly progressed emerging countries either. Some countries have escaped [poverty] and others have not. They have become poor."

FABIEN AMIAS: "There are countries elsewhere where industry, as it has in Europe and France, has been reduced more than in France, despite being subjected to the same competition as their neighbours, [from] China, India, Brazil .."

ARNAUD MONTEBOURG: "It's true, because we failed to protect ourselves. The protection methods used by our competitors in that economic war are redoubtable. They use everything that we forbid ourselves to use! They control their money. Our money is left to a central bank that decides without consulting us. They use sovereign funds. We are at pains to control our businesses and we leave them, finally, to be treated as self-service by those who come and do their shopping in Europe and capture our technologies, send our patents away, and leave with them, after having closed our businesses and go elsewhere. Our work is to protect ourselves and to re-arm ourselves. That is the meaning of this 'reestablishment'of productive industry. We will reestablish industry if we ourselves find the resources in ourselves to reestablish it."

Question from JEAN-FRANCOIS ROUBAUD, President of The Federation of Small and Medium Businesses [Confederation General des Petits et Moyens Entreprises.(CGPME)]. "How do you expect to effect the reestablishment of industry in our country without the international exchanges that are necessary even if we would prefer not to have them?" [This question is answered much later in this interview.]

Unilateral protection for renewed industries

Montebourg is quoted by the interviewers as saying he would "Engage unilateral protection measures for renaissant industries." He is then asked for examples.

ARNAUD MONTEBOURG: "To start with, this is a European strategy. And Francois Hollande, besides, in his campaign expressed himself very strongly on the necessity that Europe, if she is to be 'Open' should not be 'offered'[like a sacrifice]. Today we are unprotected against globalisation. [He uses the metaphor of a 'globalisation sieve'].

EVen the European Commission is now recommending greater protection than any that existed before. Let us be clear. It is about reorienting the European Union which is currently as ineffective as a sieve against globalisation. And we will need to ask for reciprocity: that which the Chinese, the Americans, the Brazilians --.

The Brazilians have just decided come up with an incredible strategy: they have decided to tax every iPhone made by Apple in China that comes across Brazilian borders. The consequence is that Apple has decided to build a factory in Brazil. It is obvious that the European Union alone in our European continent has the power to do that. Therefore ..."

FABIEN AMIAS: "That means that we ... that Francois HOlland, the head of state, and the government and at the European level ... that kind of protectionism ...that kind of tax for every product that is produced..."

ARNAUD MONTEBOURG: "We spoke before of 'extremism'. Globalisation without limit is extreme. It has to be moderated. And I want to reply to Mr Roubaud [Refer above], by saying to him that we will not manage to survive in exports on the world market whilst wearing crutches while others are using rollerskates. We would remain handicapped. So we have, in a way, demanded what Francois Hollande has called 'reciprocity': That which you do to us, we demand the right to do it back."

JULIEN BUGIER, News Presenter: "And that's reasonable."

Externalising Carbon Taxes

ARNAUD MONTEBOURG:"It's already on the agenda. For example, the Carbon Tax - rather than inflicting it on ourselves ... we are talking about an external tax!"

FABIEN AMIAS: "Which was revoked the other day by the Constitutional Counsel ..."

ARNAUD MONTBOURG: "No, this is another... It's an external tax..."

FABIEN AMIAS: Gestures an apology, and for Montebourg to continue on...

ARNAUD MONTEBOURG: "What I want to say is that these are measures which are being put in place, including in all the European countries. It is part of the European discussion about the reorientation of the European Union."

JULIEN BUGIER,News Presenter) to interviewer, Fabien: "Last point, Fabien."

Anti-dumping and French state should buy French products

FABIEN AMIAS: "Procedure. You have spoken about procedure: 'Anti-dumping French-style'. That is, we no longer sell to those who practice disloyally low prices."

ARNAUD MONTEBOURG: Nods. "I can tell you that even President Sarkozi thought that it was necessary to use French companies for all French public purchases, that is to say, a kind of protectionism. So, today, there is a movement in all westernised countries that have lost their manufacturing industries, to organise a bit of protection!"

FABIEN AMIAS: "I have a very specific question. The Post Office very recently chose to use Taiwanese motor scooters, to the detriment of Peugeot scooters. If you had been Minister for Industry at that time, would you have allowed them to do that?"

ARNAUD MONTEBOURG: "I think that our responsibility is to reorientate public purchases towards our small and medium enterprises, which need the state to purchase [from them] in order to grow, expand, hire staff, get market share, augment their margins, in order to develop in their territory in their turn. So, this project is a project which will require that the European Union evolve its totally economic liberal doctrine. That is, the doctrine that says,'Listen, it's forbidden to give preference to to local industry.' We wish to advance this debate and I believe that opinions are evolving in Europe."

[Translation by Sheila Newman]

NOTES

Source of material: Journal Télévisé

Nicolas Sarkosi wants to reinforce European business, using the US example of giving public work to American companies. "Why should Europe forbid what America, the most economically liberal country in the world, permits itself? In this way European taxes would support European companies that have chosen to produce and manufacture in Europe." Sarkozi has also called for tighter immigration controls in Europe.

"The Castle (German: Das Schloß) is a novel by Franz Kafka. In it a protagonist, known only as K., struggles to gain access to the mysterious authorities of a castle who govern the village for unknown reasons. Kafka died before finishing the work, but suggested it would end with the Land Surveyor dying in the village; the castle notifying him on his death bed that his "legal claim to live in the village was not valid, yet, taking certain auxiliary circumstances into account, he was permitted to live and work there". Dark and at times surreal, The Castle is about alienation, bureaucracy, the seemingly endless frustrations of man's attempts to stand against the system, and the futile and hopeless pursuit of an unobtainable goal."Source.

You might take K's frightening bureaucratic predicament as a metaphor for a stateless person. And you might say that a state should welcome stateless persons and make them its citizens. But where do you turn when there are no borders and citizenship has no meaning? Then the Castle is everywhere and we are all here on sufferance.

This article is about principles of citizenship within a state.

Business Europe

French President Nicolas Sarkozi wants to shore up European commerce, taking his inspiration from the American model, by investing public money in European companies.

"Why forbid Europe what the United States - the most economically liberal country in the world - [he says with his tongue in his cheek] - permits itself? This way European taxes will reward European enterprises that have chosen to produce and manufacture in Europe."[1]

The message is that France, which leads the European Union in many policies, will no longer reward outsourcing.

Anglophone nations supine to outsourcing and capital movement

The situation is very different in Australia. Anson Cameron writes in "www.yourjob.gone," (The Age, March 10, 2012), about how the internet has made it possible, not just to outsource waged labour, but to outsource professional skills. He describes Australian small businesses using accountants in India, Australian housewives consulting Chinese-based doctors via the internet, and pretentious home-makers sourcing architectural designs from architects in Delhi. He suggests that law firms in Australia will soon be or are already using lawyers from India and China who specialise in Australian law but charge much less than Australian-resident lawyers. Comparing this process to the situation that arose with the battle of the Australian Maritime Union against Patrick and the Howard Government in the late 1990s, he says,

"There will be no brouhaha over the demise of Australian professionals. No feisty rearguard action. No blood. No barristers. The drift is too natural. Too individual. Too invisible. A movement that consists of a million small decisions made right here in Australia. Careers will just turn off, one by one, without fanfare, the same way a city goes dark at night. Not a compelling spectacle. A point of light dies in Sydney and reignites in Kolkata.

It can't even be argued that this is a tragedy. The teaching job exported to Indira Patel of Kolkata will end more suffering and create more happiness for more people in that distant city than it ever did here. And who can begrudge the export of happiness to those who have seen it least and need it most? So, not a tragedy. Just a sad Australian story." Anson Cameron, "www.yourjob.gone," The Age, March 10, 2012.

Whilst he is correct that most Australians would not mourn the passing of unaffordable lawyers, Cameron's assessment of outsourcing as the export of happiness lacks a crucial consideration. He does not look at the difference in Australian property prices for offices, warehouses, factories, shops and housing which are far higher than the same essentials in China and India. As long as Australian land prices remain astronomical, Australian labour and professionals will not be able to compete on that great "level playing field" beloved to Thatcher, Reagan, Keating and Howard and other rich Anglophone despots of recent times.

In Germany or France, however, even with outsourcing, the provision of public housing and subsidised private housing has meant that the unemployed are able to find cheap shelter. Affordable shelter is their right as citizens or legal residents and a state obligation. This is not the case in Britain, Australia, and the United States. Unemployment is not just a political embarrassment for Western Continental European governments; it costs the public sector immediately in the form of rent subsidies. This is as it should be in a democracy. Why would you privatise housing and lose citizen control over shelter if you had the power to prevent this?

Sarkozi wants tighter immigration controls for Europe

Nicolas Sarkozi also want to revise and reinforce the Schengen borders which have established free movement within Europe and control the entry of immigrants from outside.

"We cannot leave the management of world migration entirely in the hands of technocrats and tribunals."

The message is that Schengen borders must be better defined and more firmly enforced or France will reestablish her own borders at a national level.[1]

Open-borders ideology characterises Anglophone countries

In Australia - and other Anglophone countries - the message is, however, quite different. As candobetter readers know, Australia has a massive growth lobby. The growth lobby thrives on open-borders capital, open-borders mass migration, open-borders residency and unprotected labour. The mass media (owned by the growth lobby) continuously brain-washes Australians, Canadians, Americans and Britons with the mad idea that growth is good, open borders is good, deregulation is good. The result is that we have lost control over all of the things that governments are elected to safeguard. In losing this control we have lost real citizenship. If we don't have money to buy rights, then, when it comes to the crunch, rights aren't guaranteed where English is spoken.

How are immigration control and protectionism related?

This article began by citing French President Sarkozi's reelection platform of protectionism and immigration control. But, how are immigration and protectionism related?

Loss of local control over rates of immigration means loss of local control over wages. Loss of protection for local business means loss of control over imports and exports, which can then be taken over by transnational corporations which have much greater capital resources than locally based and operating businesses. Such transnational businesses have become vehicles for international capital which cruises the world looking for cheap labour and cheap resources.

Deregulation of capital has caused loss of citizen control over banks, interest and bank charges. Deregulation of foreign investment laws has given international money more control over assets and resources in Anglophone countries than citizens have.

As well as looking for cheap labour and resources, transnational capital looks for cheap land to invest in. It will drive off local landowners - farmers and villagers - in order to gain control of land. (For Australian examples, see articles about Foodbowl Unlimited.) It also seeks to influence the governments that make laws for that land to serve the interests of capital rather than those of citizens. It does this through financial inducements, industrial blackmail, and by getting control of the media which controls what the public hear about politicians.

Having taken control of land (as well as water, power and other essential resources and goods) transnational capital then drives up the cost of that land (and water, power and other resources) by influencing governments to raise immigration rates and cause inflation of land-costs, which then increases the resale profits on that land for owner-developers and the costs for the purchasers and renters (as well as for water, power and other resources).

Transnational capital also invests in agricultural land and reaps the benefits when overpopulation and the commodification of water, power and other vital resources, drives up the costs of food for local people.

Anson Cameron's article "www.yourjob.gone" (mentioned above) suggests that people in poor countries benefit from exported jobs and relatively low wages, forgetting that the people of poor countries are being driven from their land and their businesses through costs inflated by international capital investment, just as Australians are. (See also, Prof John Kozy, "Abstractions Versus the "Real World": Economic Models and the Apologetics of Greed," at http://www.globalresearch.ca/index.php?context=va&aid=29270)

In Australia housing used to be subsidised by cheap loans at fixed rates of interest and the federal government also provided public housing for industrial workers, in part to keep wages low but without impoverishing workers, so as to encourage local manufacture. This kind of policy was also once present in Britain, Canada and the United States, but is no longer.

It still prevails however in Western Continental Europe, where France and most other countries benefited from the Napoleonic system and democracy is stronger than in the Anglophone West.

NOTES

[1] Original transcription from France2 News, 12 March 2012:

"Nicolas Sarkosi veut renforcer l'Europe commerciale en s'inspirant du modèle Américaine et privilégier les entreprises nationales pour le marché public.

"Pourquoi ce que les Etats Unis, pays le plus libérale du monde, s'autorise l'Europe devrait se l'interdire? Ainsi bénéficieront de l'argent public Européen les entreprises Européennes qui auront choisi de produire et de fabriquer en Europe?

Sarkosi veut réviser et durcir les frontières de la Schengen

Nicolas Sarkosi veut réviser et durcir les frontières de la Schengen qui établit la liberté de circulation a l'intérieur de l'Europe et contrôle l'entrée des immigrés.

"On ne peut pas laisser la gestion des flux migratoires entre les seules mains des technocrates et des tribunaux."

Le Gouvernement retient donc un gouvernement de Schengen et si la France n'est pas suivie elle pourra rétablir ses propres contrôles.

"Alors la France suspendrait ses participations accord de Schengen jusqu'a les négociations auront abouti.""

Source: France2 Infos, Sunday 11 March 2012.