Benjamin Franklin said that the real cause of the American Revolution was the British passing the Currency Act of 1764. This outlawed the paper money the colonists had started using, Colonial Script. Colonial Script was fiat money in that it had no backing like gold or silver. But its use created a booming economy that was completely depressed by the new Currency Act. Franklin said that in one year, a depression set in that filled the streets with unemployed.

What the Currency Act actually did was force the colonies onto a gold standard which immediatly sucked the money supply back to the Bank of England.

The Bank of England was the first centralized bank. Economic hardship, inflation, and inequitible distribution of wealth has followed centralized banks wherever they are allowed to exist. The World Bank is the final implementation of that process.

In the context of Argentina, it is inaccurate to just lump the IMF=World Bank with "free trade". In fact, while many IMF policies are pro free trade, many of their policies have nothing to do with trade. At least not in the conventional sense.

Greg Palast, who many don't know was a member of the little elitist group of students who were allowed to study under Milton Friedman at the U. Chicago in the late 60s, has done a great job of accumulating the cold, hard facts about the effects of IMF/World Bank loans and their consequent requirements on developing countries.

The record is clear: get money from IMFWB and follow their little four step plan to prosperity and watch you country implode.

Reduced spending is really lower wages and contraction of the money supply. Foreign investment is really the privatization of utilities like Water!!! only to be sold to monster transnats like Enron.

And then there's the really good one, Step 3, something like civil control. This is where they bring in the army to stand down the inevitable riots that follow such prosperity like water rates going up somewhere around 1000%. Peasants die of dehydration while transnats reek profits and pepsi uses up all the fresh water for 50 square miles. Desease spreads from people drinking free water.

The whole process results in international banks owning these countries and their most prized assets like damns, power stations and national banks (not to mention presidents, sound familiar? Check W's top contributors). Exactly what our centralized, privately owned bank, the Federal Reserve, did to us in the late 20s and 30s. Contract the money supply, foreclose on the bankrupters and own the entire country.

People talk about the some 40 billion 1930 dollars being lost during the Depression. It wasn't lost. It was transfered to banks. Through foreclosures.

Did you know if you pull a dollar out of your wallet on the top it reads, 'Federal Reserve Note'. That seems normal till you know that the Federal Reserve is a privately owned corporation. Our national currency is issued by a private corporation, the Federal Reserve Bank.

All this doesn't make the news much here in the US. Surprise. But the evidence, just like in Argentina and Venezuela, is that if you don't want your country to fall into economic slavery to giant transnational corporations and foreign banks, stay the fuck away from the IMFWB. This is why many up and coming countries, like India, are telling the IMFWB to piss off.

Now, much of what I've just discussed has very little to do with tariffs. Or the usual shit we talk about free trade. But it's all entangled under the term globalization. But opponents of glabalization often miss one of, if not its most, evil components: international banks.

Andrew Jackson's successful killing of the centralized bank is one of the most relevant in US history. Ever heard of it? Surprise.

Ever wonder why the dollar continues to buy less and less. It's been happening so long we see it as a force of nature. It's not. It's the result of a continuing descent into abysmal indebtedness to the bank. Not just our national dept. Consumer dept, family dept, business dept.

The banks have slowly gained ownership over our entire country. How much? Subtract American's meager equity from everything we think we own, property, cars, student loans, businesses, and what's left is owned by banks. I havewn't seen those figures, but I would guess it exceeds 90%. Its not a study you see floating around much. Surprise.

It wasn't always this way. And it doesn't have to be this way forever. Banks planted their tentacles into our currency and economy through corruption and subversion. The Federal Reserve Act of 1913 was passed on Christmas Eve by three senators. Everyone else was home for the holiday.

Since we still resemble a democracy, the banks here are heavily regulated robber barons. In Bolivia they are not. Nor in Brazil. Argentina is only defying economic expectation to those who either don't know about the effects of IMFWB's failed policies, or those who have a vested interest in those failed policies.

Failed policies like our current trade policies (sm).

PS I have no idea what (sm) stands for.

Cheers.

This is a must read.

Stiglitz's book is a devastating critique as to how the IMF lost sight of its original mission as it got overrun during the Reagan/Thatcher era by those who "champion market supremacy with ideological fervor" (his words).  

But after reading this article, I wouldn't say Argentina is out of the woods yet.  The last passage was somewhat ominous: "the turnabout here has inspired such a sense of confidence that the government is not only talking about cutting its last ties to the I.M.F. but also insisting that any payback to bondholders be linked to Argentina's continued good economic health."

I don't think the credit markets are going to like that attitude too much.

Before he the won the Nobel Prize, the World Bank fired Stiglitz because he woke up and refused to drink the neo-liberal kool aid anymore.  Laugh all you want at the Bush Administration (they deserve it), but that constellation of international economics -- globalization and neoliberalism -- was the original faith-based community.  

Like people in the Bush Administration, many (though not all) neo-liberal economists ridicule and snark at academics who conduct behaviorial research to test assumptions about how people act -- assumptioms that are the foundations of neo-liberalism.  Do people lose their incentive to work and invest if they can't pass all their accumulated wealth to their heirs?  You better not try to find out.

"Opening up a third-world economy to unrestricted foreign investment is like dropping a shark in a fishtank."

Paints a nice simple picture for people to, uh, chew on.

and the world bank and persue government programs to help the poor in his country.  That is what freetraders like Tom Friedman want to put an end to.  He wants to impose a peace based on free market fundyism. He really loses sleep when people like me get health insurance. He is a twat.

Why is globalization a good thing? Thomas Barnett says that globalization is good because it connects a country with the rest of the world economy. His studies indicate that war is an issue in the non-integrated gap, but has almost disappeared in the connected, globalized economy. So, globalization reduces violence and leads to peace

the facts seem to strongly disagree with that contention. In fact its pretty easy to argue just the opposite. The power barons of the world are quite happily funding,starting, or fighting wars around the world in order to keep populations as supplies of cheap labor, or to control a resource etc etc. Iraq, Indonesia, Africa...

Why should free trade be the ultimate goal? Because it leads to the greatest efficiency of production. In other words, it makes things cheap for the consumer. Of course, it also brings down labor rates. That's bad for producers

Free trade as we speak is enriching the largest and most repressive tyranny on earth as we speak. China. It is rewarding India and pakistan for the abuse of their people and massive population problems. It is punishing americans for being efficient, having labor and environmental standards , etc etc. The reality is quite a bit different than the theology.

I agree with both of your final two paragraphs completely. But you're calling for Fair, not free, trade.