An interesting parallel is the solution that is being offered by the
Southeast Asian governments to their industrial sector. Bec of the more
than 50 percent decline of the home currencies against the US$, the
export sector has been exhorted to export as the way out of the current
economic crisis they are in now.
However the snag is that before the crisis had enveloped the economies,
the production capacity of the export sectors were already at the
limits. Also exporting their way out of the current economic crisis may
not be fully taken advantaged bec of a credit squeeze which is already
happening with interest rates creeping upwards.
It remains to be seen if Southeast Asia will be able to attract US MNCs
to invest in factories or other FDIs similar to the Japanese in 1995
when the yen appreciated against the US$ to about 90Y per US$.
Aidi
> ----------
> From: Walter Daum[SMTP:[EMAIL PROTECTED]]
> Reply To: [EMAIL PROTECTED]
> Sent: Monday, December 29, 1997 11:55 AM
> To: Multiple recipients of list
> Subject: re: drawing a line
>
>
> On: Sun, 28 Dec 1997 14:05:31 -0500, Doug Henwood
> <[EMAIL PROTECTED]> wrote:
>
> >Except that these international bailouts, unlike the S&L resuce,
> don't cost U.S. taxpayers anything. The Treasury made a profit on
> the Mexico bailout, and the Bretton Woods institutions are also
> profit-makers.>
>
> I know Doug is wary of talk about U.S. capitalism being in
> economic crisis when profits are up, but don't forget the
> political end. Here's part of a recent column by the beloved Pat
> Buchanan (NY Post, 11/29):
>
> "How is Mexico to repay the IMF? The devaluation of the peso by
> 50 percent doubled the price of U.S. goods and cut by 50 percent
> the price of Mexican exports. Devaluation thus wiped out the tiny
> U.S. trade surplus. And when U.S. companies saw the price of
> Mexican labor had been cut in half in dollars, they laid off
> their workers, shut down their U.S. plants and headed south for
> the Rio Grande.
>
> "This, then, is the great trade-off of the Global Economy. Wall
> Street gets reimbursed, while Main Street loses its export
> market, its factories and its jobs, and is put on the hook by the
> IMF so "investors" on Wall Street do not have to swallow really
> bug losses. We do it all -- to make the world safe for Goldman
> Sachs!"
>
> I suspect this sort of argument will get a strong response in the
> wroking class. People do have a sense there's a crisis out there
> that can hit them, and that they will pay for the financiers'
> fun and games.
>
> If the workers' movement, and left theorists, don't sharply point
> the finger at capitalism as responsible for enormous economic
> uncertainty as well as growing working-class misery, then right-
> wing populists will win with their line and aim U.S. workers' anger at
> their brothers and sisters abroad.
>
>
> Walter Daum
>
