Free market policy has failed, observes Brazil’s Lula

Free market policy has failed, observes Brazil’s Lula
Written by Larry Moonze
Saturday, September 26, 2009 6:07:55 PM

BRAZILIAN President Luiz Inacio Lula da Silva has said the world is in a transition to multilateralism that will not conflict with the United Nations. And President Lula said the on-going economic recession was more than a crisis of big banks but the crisis of big dogmas.

He said the senseless way of thinking and acting which dominated the world for decades had proved itself bankrupt. Addressing the 64th UN General Assembly in New York, USA last Wednesday, President Lula said the world was in a period of transition in international relations.

He said that multipolar world would be based on experience of regional integration. President Lula said leaders pushing for such a multipolar world were not wishful thinkers. He said it took political will to confront and overcome situations that conspired against peace, development and democracy.

"Unless the political will is present throwbacks like the embargo against Cuba will persist," President Lula said.

"Unless there is political will we will see more coups like the one that toppled the constitutional president of Honduras, Jose Manuel Zelaya, who has been granted refuge in Brazil's embassy in Tegucigalpa since Monday. The international community demands that Mr Zelaya immediately return to the Presidency of his country and must be alert to ensure the inviolability of Brazil's diplomatic mission in the capital of Honduras. Unless political will prevails, threats to the world like climate change will continue to grow.

"All countries must take action to turn back global warming. We are dismayed by the reluctance of developed countries to shoulder their share of the burden when it comes to fighting climate change. They cannot burden developing countries with tasks which are theirs alone. Brazil is doing its part. We will arrive in Copenhagen with precise alternatives and commitments."

President Lula said the new world was a political and moral imperative.

"We cannot just shovel away the rubble of failure; we must be midwives to the future," he said. "This is the only way to make repairs for so much injustice and to prevent new collective tragedies."

President Lula said it was a need to build a new international order that was sustainable, multilateral and less asymmetric, free of hegemonies and ruled by democratic institutions.

"This multipolar world will not conflict with the United Nations," President Lula said.

"On the contrary, it could be an invigorating factor for the United Nations. For a UN with the political and moral authority to solve the conflicts in the Middle East, assuring the co-existence of a Palestinian State with the State of Israel. For a UN that confronts terrorism without stigmatising ethnic groups and religions, but rather dealing with underlying causes and promoting dialogue between civilisations.

"For a UN that can really help countries like Haiti trying to rebuild its economy and social fabric after achieving their political stability. For a UN committed to the African Renaissance we are now seeing. For a UN able to implement effective policies that preserve and expand Human Rights. For a UN that can make real progress towards disarmament in true balance with non-proliferation. For a UN that can truly lead in initiatives to protect the planet's environment."

On the economic and financial crisis, President Lula said the free market policy had failed.

"I refer to the absurd doctrine that markets could regulate themselves, with no need for so-called "intrusive" state intervention, and to the thesis of absolute freedom for financial capital, with no rules or transparency, beyond the control of peoples and institutions," he said. "It was an iniquitous defence of a minimal, crippled, weakened state, unable to promote development or fight poverty and inequities. It included the demonisation of social policies, an obsession with precarious labour relations and an irresponsible co-modification of public services. The real cause of the crisis was the confiscation of most of the sovereignty of peoples and nations through the state and democratic governments - by autonomous networks of wealth and power."

He said controlling the crisis and changing the course of the world economy could not be left to the usual few.

"Developed countries - and the multilateral agencies they run - had been unable to foresee the approaching catastrophe, much less prevent it," President Lula said. "It is not fair that the price of runaway speculation be paid by workers and by poor or developing countries, who had nothing to do with it."

President Lula said rich countries were putting off reform at multilateral agencies like the IMF and the World Bank. He said no one could understand the paralysis of the Doha Round whose conclusion will above all benefit poor countries.

President Lula said there were also worrisome signs of return to protectionist practices while little had been done to fight tax havens.

He said since the global economy was interdependent, it was an obligation for states to intervene across national borders and was a must to re-found the world economic order.