Finance Minister Paul Martin’s February 24 budget boosted foreign aid spending slightly. It “stabilizes foreign aid spending at 0.26 per cent of GDP after years of decline. Budget documents suggest it may be some time yet before there is progress toward achieving the 0.7 per cent target.” (Globe and Mail, February 25, 1998) This was a target set years ago by the UN’s bum-and-beggar nations for the productive lands of the First World to meet, rather like a rubbie telling a working stiff that he expects a $100 handout, rather than a quarter, A generation of idiot politicians in Canada have subscribed to this blueprint for bankruptcy. although the realities of the moment have frequently forced men, like Paul Martin, to temporarily abandon the goal. “Mr. Martin found $90-million more for the foreign aid budget for the 1997-98 fiscal year. It brings the total to $2.15-billion, or $71 for every Canadian. In the new fiscal year, Mr. Martin will restore $50-million from previous announced cuts.
That will put the total for 1998-99 at $1.96-billion — still a cut, but not as deep as the one he said he would have to make to fight the deficit when he brought in the federal budget last year. When Prime Minister Jean Chretien came to office in 1993, the annual foreign-aid budget was about $1-billion more than it is now.” C-FAR can take some satisfaction in the modest drop in foreign aid spending over the past few years. Some 19 years of gentle lobbying seem to have paid off. Still, Canada, with a huge debt and crushing unemployment, is a bigger spender than other major economies: “The United States, Japan, Britian and Italy are among the [OECD] countries that give even less in relation to their overall GDP.” (Globe and Mail, February 23, 1998)
Look East Young Man? The Mirage of Booming Oriental Markets
Remember the ridiculous Team Canada junket to the Far East in 1996? There was Chretien and the assorted hangers on posing — a deal a day. After all the fanfare and hoopla, it turned out that most of the “deals” were only scrawls on fancy paper. “The government proclaimed 194 deals or potential deals worth $8.72-billion. But, as of last June, the government calculated only that $2.45-billion had either been completed or were still under negotiation.” (Globe and Mail, January 14, 1998) Now the prize zircon in the tattered trade crown has fallen. “Bell Canada International Inc. is pulling out of a $1.55-billion joint venture to provide basic telephone services in … the southeastern [Indian] state of Andhra Pradesh.. …
[It] was the single biggest commercial agreement signed during Prime Minister Jean Chretien’s trade mission to South Asia in January, 1996.” Bell is pulling out because of crippling licensing fees that must be paid to the Indian government and because the huge consumer demand just hasn’t materialized. “The high licence fees were awarded mainly in 1994 and 1995 when many international telecom operators considered India to be their industry’s last great frontier, but the market is proving to be much smaller than originally forecast. In Andhra Pradesh, [the venture] has attracted 21,500 subscribers in little more than one year. BCI’s cell-phone operation in Colombia, a country of 35-million people, has sold 400,000 subscriptions in three yeaars. … For BCE Inc., which controls Bell Canada International, the decision to pull out of the basic telephone venture is not its first setback in India. The group’s yellow pages business run by Tele-Direct International Inc., left India in 1996 after losing $20-million over three years.” (Globe and Mail, February 28, 1998)
Bankers Unload Bad Loans on Taxpayers
“The capacity of bankers to fold up their high standards and head for the exits as soon as the going gets rough is something to behold,” wrote columnist Terence Corcoran (Globe and Mail, January 14, 1998) Remember the Olympia & York crisis of 1992? As the Reichmann TItanic tilted into vertical position, executives from their prime Canadian bank, CIBC, dashed for the first-class lifeboats and rowed all the way to Ottawa to plead for help During a secret meeting, they asked Tory finance minister Don Mazankowski to come to the Reichmann’s rescue, a move that would transfer much of the risk on the Reichmann’s bank loans to the Canadian taxpayers. Much to the Tory government’s credit, the bankers’ pleas were turned down. … The banks, subsequently, took huge writeoffs without benefit of taxpayer support. The real stunner was that the banks had the gall to make a proposal in the first place.” Now, “the big name banks in New York, Frankfurt and other power banking centres are scrambling to get out of their Asian loan meltdown by passing the costs on to the world’s taxpayers one way or another. In Frankurt [January 13], … a gaggle of German banks announced that they have agreed to roll over their Asian loans — provided the South Korean government supplies guarantees. New York bankers have similar solutions to bank lending problems in Asia. J.P. Morgan & Co. proposed converting $15-billion ($U.S.) in South Korean commercial bank debt into Government of South Korea bonds. Another $10-billion in new bonds would be issued to the government to raise its foreign exchange reserves.
A Wall Street Journal article pointed out that converting private bank debt into government debt would be a double bonanza for the private banks. Under international banking law, banks are required to keep $1 of reserves on hand for each dollar of commercial loans. No reserves are required for government-guaranteed bonds. Transferring the risk and burden of bad loans from private creditor banks — which have billions outstanding following four years of irresponsible lending to corrupt governments and their corporate cronies — onto the shoulders of all taxpayers is emerging as the grim consequence of the international rescue effort now under way. From the International Monetary Fund to the World Bank and other agencies, the cost of covering the debt burden is being passed to the general public. Citizens of the Asian countries will certainly bear the major cost, in unemployment, lost wealth and reduced purchasing power, but all the world’s citizens will pay for the massive bailouts that are being funnelled through the IMF into the coffers of destitute Asian governments. There, the money will be used in a variety of ways, including backstopping loans to the private sector banks and corporations that are scrambling for cash. Canadian participation in the bailouts exceeds $2-billion, allocated to the IMF and associated agencies. While the bankers and some of the big corporate borrowers are rescued, the average citizen of the troubled countries is being taken to the cleaners. In South Korea recently, a national campaign prompted individual owners to sell their holdings of jewelry and other items to help provide the government with hard currency reserves.
The effort — at a time when gold is at a record low — reportedly raised $400-million, a drop in the financial bucket. In another instance of public relations deception, Indonesia’s finance minister and several Jakarta tycoons staged a currency-buying event for television cameras, thereby urging Indonesians to liquidate their U.S. dollar holdings at what is likely to be the bottom of the market. These tragic instances of collective manipulation reinforce the lie of collective responsibility for the reckless lending and botched policies that have ended in financial chaos. Maintaining a country’s currency is not the responsibility of its individual citizens, nor are the lending practices of foreign and domestic banks. By bailing out banks and governments, the IMF and others are creating what economists call a moral hazard. When governments reduce risk artificially, more people are encouraged to take more risk. Past rescues — Mexico, for example — encourage bankers to indulge in high-risk behaviour, … knowing that in the extreme, the world’s taxpayers will foot the bill.”
Racial Animosity, Indonesian Style
The high priests of multicult feed us a steady prison gruel of guilt: Canadians are so racist. We’re admonished that we have so much to learn from the diverse cultures that flood to our shores and that we can thrive through some Mulligan’sStew of multiculturalism. It’s occasionally useful to touch down in the real world and discover that many other nations eschew multicult and are distinctly leery of other races in their midst. Indonesia is a good case in point. “The overseas Chinese are often called the Jews of Southeast Asia, resented for their success, victimized in times of trouble. Nowhere is this more true than in Indonesia. As Indonesia’s economic crisis deepens, rioting directed at Chinese shopkeepers has broken out in several parts of the archipelago. Shops, cars and houses have been looted and burned. Threatening graffiti — ‘Destroy those damned Chinese’ ‘Money-hungry Chinese fools’ — have appeared. Other Indonesians speak openly of their dislike of the Chinese who make up just 3 to 5 per cent of the 200-million people but dominate the economy. ‘We welcomed them to come and share our country and eat our food,’ one well-educated young tour guide told a foreign visitor last month. ‘Now they ignore us. It’s humiliating.’ …. … In 1959, the government of Indonesia’s founder, Sukarno, issued an edict banning Chinese from running shops in rural areas. More than 100,000 Chinese fled the country. Thousands more left in 1965 and 1966, when the army took power after a failed coup for which the generals blamed the Communist Party, then backed by China. But Suharto, the general who took over as Indonesia’s leader, realized he needed the Chinese to rebuild the economy. He teamed up with leading Chinese businessmen to create privileged business empires that are still dominant. Economists say four-fifths of Indonesian business groups are run by Chinese tycoons. Reckless overborrowing and over-expansion by those tycoons helped push the economy into crisis, driving up prices and causing unemployment to soar.
‘These people are becoming richer and richer compared to ordinary Indonesians,’ said Jakarta-based human rights lawyer Mulya Lubis. ‘So, it’s easy for people to hate them.'” (Globe and Mail, February 21, 1998) As for multicult, the Indonesians insist on conformity to the mainstream. No multicult grants there to pay newcomers not to assimilate. No postage stamps commemorating the Year of the Tiger! “Most Chinese families have lived in the country for generations. …Yet, Indonesia treats them as a people apart. Although some anti-Chinese regulations have been loosened in recent years, it is still officially forbidden to own Chinese-language books, magazines and newspapers. Even spoken Chinese is frowned upon. Since 1975, when the government closed the last Chinese schools, Chinese children have been obliged to attend Indonesian-language schools. Chinese, who are mostly Buddhist and Christian in a country that is 90 per cent Muslim, are allowed to have their own temples and churches. [However,] the law forbids them to celebrate traditional Chinese occasions such as the beginning of the lunar new year. Last month, as Chinese in Hong Kong, Singapore and Vancouver rang in the Year of the Tiger with fireworks and lion dances, Jakarta’s Chinatown was largely silent. … Critics say the government has not done its part to quell the anger against the Chinese. New York-based Human Rights Watch said in a report [February 20] that officials had used terms like ‘rats’ and ‘traitors’ in veiled references to Chinese business leaders, blaming them for the economic crisis. … ‘Government leaders are prepared to tolerate a degree of anti-Chinese hostility because it takes the focus offf them,’ siad Alan Dupont, an Asia scholar at the Australian National University in Canberra.”