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Mr. Chairman, I include the following for the RECORD:
A `Grotesque' Gap Between the Global Economy's Winners and Losers
As the global economy grows, rich nations are getting richer than ever, and poor ones are stuck in shantytowns on the outskirts of the global village.
``Global inequalities in income and living standards have reached grotesque proportions,'' the UN Development Program said in its annual global overview, the Human Development Report.
For instance:
The richest countries, such as the United States, have 20 percent of the world's people but 86 percent of its income, 91 percent of its Internet users, 82 percent of its exports and 74 percent of its telephone lines. The 20 percent living in the poorest countries, such as Ethiopia and Laos, have about 1 percent of each.
The three riches officers of Microsoft--Bill Gates, Paul Allen and Steve Ballmer--have more assets, nearly $140 billion, than the combined gross national product of the 43 least-developed countries and their 600 million people.
The United States, meanwhile, has more computers than the rest of the world combined. Lesser-developed countries are not likely to catch up any time soon: the same computer that costs a month's wages for the average American takes eight year's income from the average resident of Bangladesh.
The 200 richest people in the world more than doubled their net worth between 1994 and 1998. But in nearly half the world's countries, per capita incomes are lower than they were 10 or 20 years ago. Some of these are oil-producing nations hit by the long slump in oil prices, but many are in sub-Saharan Africa , where per capita income has fallen to $518 from $661 in 1980.
In 1960, the richest fifth of the world's people had 30 times as much income as the poorest fifth. By 1997, that proportion had more than doubled, to 7-1.
The key to a solution to these problems, the UNDP said, is not to stamp out the global economy but to embrace it with the rules and institutions that will ensure it serves people and communities, not just markets and their manipulators.
``Competitive markets may be the best guarantee of efficiency but not necessarily of equity,'' it said. ``Markets are neither the first nor the last word in human development.
``Many activities and goods that are critical to human development are provided outside the market, but these are being squeezed by the pressures of global competition.
``When the market goes too far in dominating social and political outcomes, the opportunities and rewards of globalization spread unequally and inequitably--concentrating power and wealth in a select group of people, nations and corporations, marginalizing the others.
``The challenge,'' the report said, ``is not to stop the expansion of global markets. The challenge is to find the rules and institutions for stronger governance ..... to preserve the advantage of global markets and competition but also to provide enough space for human, community and environmental resources to ensure that globalization works for people, not just for profits.''
The gap between people, like the one between nations, also is growing in the global economy, the UNDP report said. Inequality is growing both in industrialized nations--especially in the United States, Britain and Sweden, it said--and in newly industrializing countries, such as China and the formerly communist countries of Eastern Europe.
One result of globalization, it said, is that the road to wealth--the control of production, patents and technology--is increasingly dominated by a few technology--is increasingly dominated by a few countries and companies.
Of all the countries in the world, only 10, including the United States, account for 84 percent of global research-and-development spending. Businesses and institutions in the same 10 control 95 percent of all patents issued by the U.S. government over the past 20 years, it said.
Among corporations, the top 10 controlled 86 percent of the telecommunications market, 85 percent of pesticides, 70 percent of computers and 60 percent of veterinary medical products, it said.
The major countries and the global corporations may have earned their dominance, but, the report said, this monopoly of power is cutting poorer nations off from a share of the economic pie and, often, from decent health care and education.
``The privatization and concentration of technology are going too far,'' the report said. ``Corporations define research agendas. ..... Money talks, not need. Cosmetic drugs and slow-ripening tomatoes come higher on the priority list than drought-resistant crops or a vaccine against malaria.''
Many new technologies, ``from new drugs to better seeds,'' are priced too high for poor nations, it said. Global patent laws, intended to protect intellectual property, are blocking the ability of developing countries to develop their own products.
Even within the Third World, inequality is sharp. Thailand has more cellular phones and Bulgaria more Internet users than all of Africa except South Africa , the report said.
The report was not all gloom and doom. Even as gaps between nations grow and some countries slide backward, the quality of life for many of the world's poor is improving, it said.
Between 1975 and 1997, life expectancy in Third World countries rose to 62 years from 53, adult literacy rates climbed to 76 percent from 48 percent, child mortality rates to 85 per 1,000 live births from 149, and some countries--Costa Rica, Fiji, Jordan, Uruguay and others--``have overcome severe levels of human poverty.''
The UNDP report said uneven and unequal development around the world is not sustainable and risks sinking the global economy in a backlash of public resentment.
Without global governance that incorporates a ``common core of values, standards and attitudes, a widely felt sense of responsibility and obligations,'' the major nations and corporations face trade wars and uncontrolled financial volatility, it said, with the Asian financial crisis of the past two years only the first of many upheavals.
At the moment, new rules and regulations are being written in talks at the World Trade Organization, the International Monetary Fund and other powerful global bodies. But these talks are ``too narrow,'' the report said, because they focus on financial stability while ``neglecting broader human concerns such as persistent global poverty, growing inequality between and within countries, exclusion of poor people and countries, and persisting human-rights abuses.''
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They are also ``too geographically unbalanced,'' with an unhealthy domination by the U.S. and its allies.''
The UNDP report called instead for a ``global architecture'' that would include:
A global central bank to act as a lender of last resort to strapped countries and to help regulate finance markets.
A global investment trust to moderate flows of foreign capital in and out of Third World countries and to raise development funds by taxing global pollution or short-term investments.
New rules for the World Trade Organization, including anti-monopoly powers to enable it to keep global corporations from dominating industries.
New rules on global patents that would keep the patent system from blocking the access of Third World countries to development, knowledge or health care.
New talks on a global investment treaty that, unlike talks that failed last year, would include development countries and respect local laws.
More flexible monetary rules that would enable developing countries to impose capital controls to protect their economies.
A global code of conduct for multinational corporation, to encourage them to follow the kind of labor and environmental laws that exist in their home countries. The report praised voluntary codes adopted in Asia by Disney World and Mattel, the toy company.
The leading industrial nations already are considering new global rules on investment, banking and trade. The UNDP report, in effect, endorsed these efforts but urged that they be broadened to include the needs of poorer nations.
--
Introducing H.R. 772, ``HOPE for Africa''
To overcome a nearly 400 year legacy of unregulated business, investment and trade that gave us slavery, colonialism and widespread human and economic exploitation, today we introduce H.R. 772, ``The HOPE for Africa Act of 1999,'' based on Human Rights, Opportunity, Partnership and Empowerment as the basis for a new respectful and mutually beneficial human and economic relationship.
Unregulated business and investment, structural adjustment programs built on debt service, is the status quo or worse. This status quo formula has given Africa : wealth in the hands of a few; followed inevitably by civil wars (both ethnic and tribal) over food and economic security; undemocratic regimes; and economic and political instability.
We support bilateral, multilateral and international trade. We are not economic isolationists or economic protectionists. By introducing this legislation today, we seek to establish a new principle that should underlie every trade bill in the United States--that the benefits of trade must be shared widely by the majority of the common working people in every participating society, not just benefit the business and financial interests of an elite few.
We support business and investment in Africa . Indeed, our business development and trade provisions are more expansive than the provisions in Rep. Phil Crane's African Growth and Opportunity Act. HOPE for Africa insures that the average African worker will be paid a minimum wage; has the right to organize for their own protection and economic security; has the right to work in safe and healthy working conditions; can produce goods and protect the environment at the same time so business development and economic growth can be sustained indefinitely; and so the common people of Africa might be able to work their way out of their poverty and underdeveloped condition with dignity.
The HOPE for Africa legislation provides trade remedies that can be embraced by both working Americans and working Africans because it raises the living standards of both. It does not raise some African living standards at the expense of lowering some American living standards. It is also good for long-term business development and economic investment because average workers on both continents will be able to buy the goods and services that they produce and, in the process, build a fairer and more perfect economic world.
First, H.R. 772 affirms each African nation's right to economic self-determination. The HOPE for Africa legislation is built on the principles and goals developed by African finance ministers in cooperation with the Organization or African Unity, and with input by African workers' organizations such as COSATU in South Africa .
Second, H.R. 772 offers a solution to Sub-Saharan Africa's crushing $230 billion debt--unconditional, comprehensive debt forgiveness. Excluding South Africa , with upwards of 20 percent of sub-Saharan nations' export earnings going to debt service, few resources are left to devote to development and urgent local needs.
Third, H.R. 772 addresses the AIDS crisis by replenishing and targeting assistance from the Development Fund for Africa for AIDS education and treatment programs; making it U.S. policy to assist Sub-Saharan African countries in efforts to make needed pharmaceuticals and medical technologies widely available; and prohibiting the use of U.S. funds to undermine African intellectual property and competition policies that are designed to increase the availability of medications. Since the beginning of the AIDS epidemic, 83 percent of AIDS deaths have occurred in Sub-Saharan Africa .
Fourth, H.R. 772 restores Africa's budget line item for foreign aid with a set guaranteed amount, not to decline below 1994 levels. This would restore parity for Africa with U.S. foreign aid treatment of other vital regions. Currently, Africa is the only region not a line item in the budget.
Finally, President Clinton says we must put a new and human face on trade--and I agree. But the new face must be based on a new foundation. The policies regarding Africa that the Congress sets now will deeply affect the economic future of the continent and, thus, the future of the African people for decades to come. With such high stakes, it is vital that we get the initial policy right. With this in mind, I submit H.R. 772, which has the broad-based support of African and U.S. development, trade and economic experts and also organizations in Africa and the U.S., representing the interests of the majority of the people who will be affected.
--
A Human Face on the Global Economy--The HOPE For Africa Act of 1999
President Clinton in his State of the Union Address said: `` ..... trade has divided us, and divided Americans outside this chamber, for too long. Somehow we have to find a common ground on which business and workers and environmentalists and farmers and government can stand together ....... We must ensure that ordinary citizens in all countries actually benefit from trade--(applause)--a trade that promotes the dignity of work, and the rights of workers, and protects the environment ....... We have got to put a human face on the global economy. (Applause.)''
I agree completely. However, the only piece of legislation mentioned in the President's Address, and the first trade bill being pushed by the administration, is the Republican-sponsored African Growth and Opportunity Act (AGOA), H.R. 434--which is a continuation of the old face of trade.
The new face of trade must be based on a new foundation. That is why I introduced a Democratic alternative, H.R. 772 ``The Human Rights, Opportunity, Partnership and Empowerment (HOPE) for Africa Act of 1999.''
The old face of the AGOA has been dubbed ``NAFTA for Africa'' by the trade press, and represents the failed status quo trade policy that has lost the support of the American people and was rejected last fall by Congress. Like Fast Track, the AGOA's chief sponsor is conservative corporate-oriented Rep. Phil Crane (R-IL).
When this legislation was introduced last year, I called it the ``Africa Recolonization Act'' and joined 185 of my colleagues in opposing it. Opposition to the AGOA is widespread in Africa . The Congress of South African Trade Unions declared this bill worse than no bill at all. Indeed, South African President Nelson Mandela declared the bill ``not acceptable to us'' in a joint news conference with President Clinton.
This bill is not the first time that developed countries have sought to do business with Africa . Slavery and colonialization were long-standing international commercial policy with Africa , and the results are the desperate poverty, environmental devastation and civil unrest plaguing Africa today. There is a long history of U.S.-Africa economic relations that must be overcome.
My HOPE for Africa bill promotes sustainable, equitable development in Africa , and fair and mutually beneficial trade between our two regions. Specifically, HOPE represents the new approach to international commercial policy that the President says he is seeking: access for African countries to U.S. markets; broad benefits to ordinary Africans; corporate adherence to labor, human rights and environmental standards; employment of African workers; promotion of African capital accumulation and investment partnership; emphasis on establishing small and medium-sized businesses in Africa ; and partnerships between Africans and Americans.
HOPE provides for mutually beneficial trade by taking a holistic approach to interlocking trade, investment, business facilitation, debt relief and aid elements that are vital to any successful economic relationship between sub-Saharan Africa and the U.S. Indeed, the bill is based on the principles of the Lagos Plan on economic development created by the African finance ministers and the Organization of African Unity.
Moreover, HOPE includes the purchase, at the significantly discounted market rate, and cancellation of African debt which has a face value of $230 billion and annual debt service that devours over 20% of all African export earnings. Cancellation of this debt would provide a clean slate--and working domestic credit markets and resources for education, infrastructure and health--for African countries facing the challenges of the global economy. HOPE also targets U.S. foreign aid toward uses with broad public benefits, such as the prevention and treatment of the AIDS epidemic ravaging Africa. The AGOA does not even mention AIDS.
The AGOA extends short-lived trade ``benefits'' for the nations of sub-Saharan Africa. In exchange for these crumbs from globalization's table, the African nations must pay a huge price: adherence to economic policies that serve the interests of foreign creditors, multinational corporations and financial speculators at the expense of the majority of Africans.
Specifically, the AGOA requires sub-Saharan Africa to adopt a range of policies
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AGOA provides no relief from Africa's crushing debt burden, and does nothing to ensure that African workers and businesses, as opposed to foreign corporations, will enjoy the benefits of expanded trade.
Whose interests will the AGOA advance? Look at the coalition promoting it--a corporate who's who of oil giants, banking and insurance interests, as well as apparel firms seeking one more place to locate their low-paying sweatshops. Some of these corporations are already infamous in Africa for their disregard for the environment and human rights.
Africa is a region of tremendous human creativity, vast natural and cultural wealth, and enormous economic potential. More than 750 million people live in sub-Saharan Africa, compared to 250 million in the United States. The standard of living for most of Africa's people has been falling. The region's per capita income is less than $500 annually--versus $752 in 1980 when the IMF first began to work its will on African economic policy.
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