‘Hot Money’ No Basis For Development

Neoliberals have long argued that countries need to attract foreign investment as the main way of securing growth and development. To do so governments were to ‘liberalise’ their economies, meaning reducing regulation, allowing the free flow of capital in and out and privatizing state industries.

The recession affecting Europe and the US led to the use of very low interest rates to try to revive these economies. This resulted in much investment moving to ‘emerging economies’ such as Argentina, Brazil, Turkey, India, South Africa and Indonesia. But as the US economy has recovered, at least enough for the US Central Bank to reduce quantitative easing and increase interest rates, the ‘international investors’ have moved their money back into the US causing the value of currencies in those countries to fall significantly.

They are now faced with the dilemma of either large increases in interest rates reducing their growth or large devaluations of their currencies which increases import costs and causes inflation. In the case of Argentina this is made worse because the country had a positive balance of trade from the export of soya and other products. Soya production however, is controlled by a few capitalists, who will profit from a devaluation of the peso and so have stopped exporting.

Significantly Bolivia, Ecuador, Venezuela and other ALBA nations, which have not relied on foreign investment but used their own resources and control strategic industries, have retained economic stability. Sovereignty and self-reliance is, in the long term, the real answer to growth, development and equality.

The Workers’ Party Twitter Feed

Liberals & many on the 'left' exaggerate differences between Trump & Biden; click to see what would make a real difference.
There is no effective “freedom” in a society in which working people live in poverty & billionaires live like parasites.
https://m.facebook.com/story.php?story_fbid=10221826359541925&id=1045558919&sfnsn=scwspmo

Biden opposed moves to rebuild Afghanistan, advising a policy of fighting terrorism in the country. He also opposed withdrawal of US troops, which Trump carried out.
https://tolonews.com/afghanistan/biden’s-comments-rile-afghans-internationals

Arfasprout@arfasprout

@theworkerorguk Which international conflicts has biden spoken more violently than trump on? Evidence please.

Biden's regime will hold on to enclaves in the North East and work alongside Turkish invaders, continuing sanctions against the Syrian government. In general, Biden wants US global leadership, which he sees as being diminished by Trump's inconsistencies.
https://www.atlanticcouncil.org/blogs/menasource/limited-and-constrained-the-biden-administration-and-the-prospects-of-a-syria-policy/

Arfasprout@arfasprout

@theworkerorguk Which international conflicts has biden spoken more violently than trump on? Evidence please.

Biden intends to have tighter sanctions on DPRK, and to have stricter preconditions with respect to engaging on talks. The Democrat's president also intends to strengthen an alliance against North Korea. https://www.reuters.com/article/us-usa-election-biden-northkorea-analysi/biden-on-north-korea-fewer-summits-tighter-sanctions-same-standoff-idUSKBN25G2QO

Arfasprout@arfasprout

@theworkerorguk Which international conflicts has biden spoken more violently than trump on? Evidence please.

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