Jackson, Harder line in a declining institution

For the first time in a very long time, Brazil is getting by without a contract with the International Monetary Fund. Panama hasn't had an IMF agreement since late in the Pérez Balladares administration.

Meanwhile at the World Bank, the United States has nominated right-wing ideologue Paul Wolfowitz, one of the major architects of the Iraq War, to be the new boss. There may be other nominees --- Irish rock singer, businessman and activist Bono has been mentioned --- but the World Bank is no democracy and in the end the American candidate will get the job. What it's likely to mean is that the bank will become increasingly less relevant as countries look for financing options without the neoconservative strings attached.

In a related development last year, a group of countries led by Brazil, China, India and South Africa scuttled a US-European initiative to use the World Trade Organization's Doha Round talks to impose an international agricultural structure that would have essentially made the less developed countries dependent on the highly mechanized and heavily subsidized farmers of just a few countries for their food.

In recent weeks we have seen rioting in those Central American banana republics that have accepted the Central American Free Trade Agreement with the United States that Mireya wanted Panama to join; an impasse in talks for a free trade deal between the Americans and the Andean countries; and free trade negotiations between Panama and the United States suspended after eight fruitless rounds with no date set for resumption. Time has run out on much of the fast track legislation, and President Bush will have to go to Congress to get it renewed. No date been set for Congress to consider CAFTA.

When one thinks about international law, the Geneva Conventions, the Slobodan Milosevic trial in The Hague and the precedent-setting Nuremberg trials are usually the first things that come to mind. However, international law from the very start has been primarily commercial. When the Dutch jurist Hugo Grotius first expounded the doctrine of international waters, he was thinking about how a world enmeshed in religious wars and rival claims of ownership of the high seas might reopen and secure the lanes of international maritime commerce. Before that Islamic law --- founded as such by Muhammad, who before he received his call from the angel Gabriel was an international merchant running caravans between Mecca and Damascus --- incorporated its own version of international law, much of which was commercial. Earlier still, the archaeological records left behind by many ancient civilizations refer to treaties among city-states, nations and empires, generally over economic matters.

The Bush administration is notoriously hostile to international law. It flouts the Convention Against Torture, argues that Geneva Convention does not apply to the United States, seeks to destroy the newborn International Criminal Court, refuses to sign global environmental treaties and even violates trade agreements with Canada. The current US administration is by no means the first to dispense with the maxim that independent countries have the right to run their own affairs without American interference, but the Bush assertion that the United States has the right to demand "regime change" and its steadfast assault on Venezuelan democracy do add up to the most forthright claim of US imperial prerogatives in at least seven decades.

The problem is that the United States lacks the economic or industrial might to rule the world for very long. The dollar is kept afloat by foreign central banks. American manufacturing has largely been exported to low-wage countries for the benefit of a few wealthy owners but to the detriment of the American people in general. Much of the US technological lead over the rest of the world has been squandered, in large part thanks to a television-oriented mass culture whose adherents often have trouble sorting fiction from fact and who sometimes maintain that it's unfair competition when Chinese, Japanese, Jewish or Arab parents insist that their kids do homework and treat school as a place to learn rather than as a social separation filter.

Yes, the United States Armed Forces comprise the most dangerous military organization on the planet --- though so far not strong enough to subdue a minority of Iraqis bent on resisting them. But true power is not so much the ability to inflict suffering and death on the recalcitrant, but rather the ability to impose and maintain an order that almost everybody respects.

Yes, Wolfowitz and the rest of the neoconservatives have this odd vision of a new world order under US hegemony. The former American ambassador to Indonesia's bygone Suharto dictatorship will surely be placed in a position to leave the imprint of his sort of thinking on the world economic scene for some years to come. But doubts are cast upon the power that he and the political faction he represents will actually be able to wield. The emergence of China as a major economic power, the expansion of South America's MERCOSUR and Europe's reluctance to follow American leadership on all things are creating a new set of alternatives for little countries that find the US offer unpalatable.

So look for a World Bank with fewer clients, a US-Panama free trade deal --- if there is one at all --- that doesn't turn our poultry industry over to Tyson and Holly Farms, and increasing South American, European and Asian influence in our region.

In the near term, the Third World protests against the World Bank and its policies may become larger and more violent. But if the Wolfowitz appointment is the sign of a prolonged trend what's likely to happen is that the World Bank will gradually become a quaint little anachronism, whose policies will be so inconsequential that it could hold a convention in Panama City without the slightest fear of angry demonstrators.

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