PORTO ALEGRE — The World Social Forum was awash with debates. Lack of space prevents anything like a full account of these (some of which will be covered in future issues of Green Left Weekly), but among the most important were:
The state of the world economy. For Argentinian economist Jorge Bornstein the world economy is heading towards a crisis that may be even deeper than that of the Great Depression. This is because US consumption in the 1990s has been sustained out of consumption boosted by the increase in financial asset values.
However, these values will collapse, producing a collapse in consumption expenditure which will in turn trigger a private investment crisis. The boom of the 1990s will turn into a US equivalent of the Japanese stagnation of the same period.
Chilean economist Orlando Caputo, one the other hand, while not denying the inevitability of recession, maintains that the increase in US private investment over the 1990s will underpin sustained recovery afterwards.
What sort of trading regime?
For Mark Ritchie, president of the US Institute for Agriculture and Trade Policies, the issue was a complex one of insisting on the application of some WTO rules against dumping, while opposing others. For Philippine sociologist Walden Bello, the issue was to stop the next WTO trade round by any means necessary.
Cancel or renegotiate Third World debt? While Eric Toussaint of the Belgium-based Committee to Abolish Third World Debt supported the immediate cancellation of this debt (probably the majority sentiment) Brazilian Workers Party leader Lula was opposed to debt cancellation which would provoke the cutting-off of loans from multinational financing institutions.
Viability of a Tobin tax. While the spokeperson for the Halifax Initiative supported the viability of imposing a 0.1% tax on international financial transactions (producing income of between US$150-300 billon annually), many economists present questioned whether such a tax could ever be imposed, given that those states that refused to impose it would be the ones whose economies gained from extra capital inflows. According to such analysis the Tobin tax was at best good political propaganda.
BY DICK NICHOLS