1:57 PM Apr 25, 1995

MAIN POLITICAL INSTRUMENT OF THE GOVERNMENTS OF THE WORLD

Bretton Woods institutions and the World Trade Organisation should be brought under the guidance of the UN General Assembly, according to a senior analyst of international affairs.

"The public should insist that the United Nations take charge of international policy setting, taking an overview of politics, economics, social and other parameters," said Chakravarthi Raghavan, chief editor of the SUNS (South-North Development Monitor) and Third World Network representative in Geneva.

In a keynote address to an annual staff conference of the World Council of Churches here on 24 April, Raghavan said the Bretton Woods institutions (BWIs) and the World Trade Organisation must be made accountable to the UN.

"They should be treated as technical institutions in the economic and financial sphere, just as the WHO is in the area of health and the ILO in labour issues. But the overall policy thrust and global policy guidance must be set by the UN General Assembly as the main political body of the international community, and these institutions must be guided by such policy."

Raghavan added that the BWIs must be accountable and be willing to pay the price in the market for their bad policy advice to countries. "They can't be the judge in their own cause, and independent panels should be established to hear disputes between them and their clients, the governments who borrow from them."

The TNCs, which are now beyond national control, should also be brought under international controls in the UN. The Centre for Transnational Corporations (now merged in the UNCTAD secretariat), was originally created to provide this countervailing force. But now it was in effect duplicating the job of the IMF/World Bank and the WTO in promoting the interests of such TNCs and Foreign Direct Investment. If the UNCTC is not to provide such a counter-vailing international power, it may as well be wound up.

Raghavan traced historically how the UN's influence over global economic and social policy had been eroded by the major powers, and given over to the BWIs and the WTO. He recalled that the UN Charter did not envisage the UN to be only a peace-keeping body. The Charter's scope extends to every area of human activity, political and security but also economic, social and cultural, he said.

And whilst the Charter envisaged separate bodies to deal with these issues, it does insist on the UN's overarching role of political guidance, through the General Assembly and the ECOSOC. Whilst the special role of the five big powers was recognised, this was confined to peace and security issues. In all other respects, there was no hierarchy recognised.

The BWIs were allowed a special decision-making principle based on "one dollar one vote" as they were envisaged to be financial intermediaries raising short-term capital to relend to governments at favourable longterm rates.

"But their current role of being the determinants of economic policy (for the South and now Eastern Europe), for the drastic downsizing of governments and expanding the space and power of the transnational corporate system, was not at all envisaged." said Raghavan.

For a while, from the late 1950s to the early 1980s, the UN's economic and social sectors (including UNCTAD and specialised agencies) tried to evocate the problems and concerns of the developing world and seek to reform the international system.

"Their secretariats were able to provide a different viewpoint and facilitated intergovernmental discussions," said Raghavan. "But soon they were silenced." The Big Powers asserted their rights in areas not related to Chapter VII peace and security decisions.

"Through the denial of funds or the threat of denial by some developed countries in utter violation of their Charter obligations, the secretariats have been virtually silenced and forced to fall in line," added Raghavan. "The intergovernmental bodies and organs of the UN have been converted into mere debating societies or learned seminars. Over the last 50 years, the UN has been considerably emasculated."

Raghavan commented that even the primary peace-keeping role of the UN had been rendered an illusion, with the UN now becoming a mere handmaid of the US and its interests.

The UN was founded on the principle of sovereignty of nation states and non-interference in internal affairs. While UN bodies asserted the right to discuss issues relating to human rights and even adopt resolutions, this was intended to be within a process of suasion through peer and moral pressures.

"But over the last decade, with the collapse of Soviet power, some new doctrines have been enunciated, purportedly based on humanitarian law, enabling the coercive use of power beyond security issues."

In this context, added Raghavan, proposals for a UN Economic Security Council (to match the political Security Council) would, if implemented, really enlarge the coercive power of the dominant powers and reduce the scope for plurality among nations in the international system.

Raghavan said the original architecture or vision that motivated the UN system had collapsed. "There is no vision in the various UN reform proposals, either those emanating from think-tanks set up by the UN Secretary General or private ones like the Global Governance Commission."

On the BWIs, Raghavan said a special role was envisaged for them at their founding but it was never intended that they should be beyond the purview and scrutiny of the UN. With the collapse of the Bretton Woods system in 1971, the BWIs no longer have any authority over the OECD countries and they now assert power only over the South and former Socialist bloc.

"The BWIs have turned the majority of Southern countries into bonded labour. It is not only the power of the money-lender over his debtor that they exercise.

"Their vast profits and resources, which now come from profits earned by lending to the South, have enabled them to hire professionals and academics (at 25% more than what the UN system can pay) and utilise them in self-serving research and analysis to push their ideology and to produce glossy publications to proclaim their wisdom and drown out other viewpoints."

Through structural adjustment programmes of the BWIs and the new rules of the WTO, the colonial era division of labour is sought to be revived. This, said Raghavan, is facilitated by a Northern-driven globalisatioon process aimed at further empowering transnational corporations.

"This globalisation and new interdependence are created by a few major powers which have chipped away and removed the international instruments of governance.

"Through the BWIs and the WTO, they are forcing 'unilateral disarmament' of nation states, forcing them to withdraw from the economy and creating new rules of the game favouring the foreign transnational system of production, distribution, consumption and culture over national systems and people. It is being created by reducing the space of national societies and governments and expanding the space of the transnational actors."

Raghavan also warned against the growing Northern-led reinterpretation of the UN Charter as implying a division of labour between the UN (supervising peace and security) and the BWIs and WTO (looking after economic matters).

The BWIs and WTO which now remain virtually outside the UN, should instead be made politically accountable to the General Assembly, he said. NGOs, various religious Churches and organizations like the WCC, he added, should not blindly support the UN, as in the past, but offer discriminating support, and denounce where needed the UN and member-governments, including governments of the South, in their blind pursuit of neo-liberal economic order and marginalisation of the people.

"In short," he said, "we must all stand up and bear Witness".