A Tale of Two Conferences

The first was A Conference to Support Wealth and Prosperity. The second was A Conference to Support Poverty and Destitution.

Of course I'm being facetious. Those weren't the real names. Journalist Rick Sterling, in an article posted at Socialist Action, tells the truth in his lede paragraph,

Last week (June 8-10) there were two summits in Los Angeles, California:  the Summit of the Americas hosted by the US State Department and the Peoples Summit hosted by US and international activist organizations. The two summits were held in the same city at the same time but could not be otherwise more different.

The Summit of the Americas is the one I'd like to call A Conference to Support Wealth and Prosperity. Unfortunately the name doesn't really fit. Mr. Sterling describes it this way.

Begun in 1994, in the heyday of US international dominance, the Summit of the Americas is officially a function of the Organization of American States. It is meant to coordinate and consolidate US economic, political and cultural interests.

Of course there is nothing wrong with this. "US international dominance" is a given, what with the USA having a bigger population than any other country in the hemisphere, with by far the biggest military in the world, along with a GDP that that is 4x bigger than all Latin American & Caribbean countries combined.  Countries that can trade with the United States will definitely be richer than countries that can't. 

Compare, e.g., the Dominican Republic and Bolivia. Bolivian per capita GDP is $7,900, while Dominican per capita GDP is $17,000. The difference is that the DR has extensive trade with the US, while only 6% of Bolivian exports go to the US. The US is a huge market in which to sell, and a similarly huge agricultural and industrial powerhouse from which to buy. Countries that can trade with the USA have more money, and more products to buy with that money.

Nevertheless, two possible issues rendered the conference a failure. Mr. Sterling reports on one of them.

Despite threats to boycott the gathering by many Latin American and Caribbean presidents, the US chose to exclude Cuban, Nicaragua and Venezuela. This resulted in seven country presidents choosing not to attend: Mexico, Bolivia, Honduras, St Vincent, Antigua, Guatemala, El Salvador.  Mexican President Andres Manuel Lopez Obrador (AMLO) said simply, “There cannot be a summit of the Americas if all the countries of the American continent do not participate. Or there can be, but …. it is just a continuation of the old policy of interventionism or disrespect of nations and their peoples.”

Of these, Antigua and St. Vincent are too small to matter, and, as mentioned, Bolivia has no trade with the US anyway. Honduras, Guatemala and El Salvador are "shit-hole" countries--to use Mr. Trump's impolitic but apt phrase--whose citizens are risking life and limb for the chance of a better life in the USA. For that matter, Mr. Trump's moniker applies equally well to Cuba, Nicaragua and Venezuela, from all of which large numbers of people are fleeing across the Rio Grande. Collectively, these new immigrants are the "Future Republicans of America." They know what it's like to live in a "shit-hole" country, and they don't want their newfound home to turn into one.

So only Mexico's absence is worthy of note. Mexico is our second largest trading partner, trailing only Canada. Perhaps AMLO is sincere in his demand that all countries participate--including even Antigua and St. Vincent! On the other hand, perhaps he realized the whole affair was a gigantic waste of time and not worth his attention. Besides which he doesn't have much respect for Mr. Biden.

Mr. Sterling links to two articles that make this case. (In this he distinguishes himself from Socialist Action's editor, Jeff Mackler, who rarely cites external references and usually just makes stuff up.) One of them, in The Atlantic by William Neumann, states what I think is the true reason for AMLO's absence.

None of that [preparation--ed] seemed to occur with this year’s meeting, which close observers said was marked by poor planning and a lack of preparation. Despite daunting challenges, such as countering the growing influence of China and Russia and addressing deep poverty that has been exacerbated by the pandemic, the proposals that would normally have been hashed out in detail months ahead of time were, in many cases, slapped together late in the process and not shared in advance with other nations. The whole enterprise evoked the image of a privileged but lazy student who figures he can get an A on the test even if he doesn’t study or do his homework. On the final day, a South American diplomat summed up the meeting in a word: “improvised.”

In other words, Mr. Biden's characteristic incompetence was on full display. On top of which Kamala Harris gave a speech. No wonder Mr. Lopez Obrador didn't bother showing up.

By contrast, the second conference, the Peoples (sic) Summit, fits my description to a tee. It really was A Conference to Support Poverty and Destitution.

Mr. Sterling describes the proceedings this way.

A wide array of domestic and international issues were addressed at the Peoples Summit.  They included Health as a Human Right, Gender Violence, Food Sovereignty and Climate Justice, Cultural Resistance, Youth Organizing Strategies, Justice for TPS and Undocumented Community, Lessons from Below and Organizing Unhoused Communities.  Plus many more.

What's notable is the complete absence of any discussion about how to earn a living! They're all ways in which the money is supposed to get spent. Even assuming all the items on Mr. Sterling's list were beneficial, they all require money to become reality.

Take Honduras as an example. In 2019 the country had exports totaling $7.16 billion, and imports totaling $11.5 billion. This is augmented by remittances representing about a fifth of GDP, or approximately $10 billion. What's amazing is how tiny these numbers are! By comparison, Walmart's revenue in 2019 was $514 billion--or roughly 30x Honduras' foreign exchange earnings.

Obviously, on such a minuscule budget none of the items on Mr. Sterling's wishlist can come to fruition. "Health as a Human Right" is obviously impossible without the cash to pay for it. "Organizing Unhoused Communities" makes no sense with no money. Etc.

Even in an American context Mr. Sterling's remarks make no sense. Walmart generally fixes its operating margin at 3%, which means that 97% of total revenue is used to pay expenses. The biggest expense is cost of sales (mostly paid to product suppliers), which is roughly 75% of revenue. Most of the remainder is paid out as wages to employees--let's estimate the wage bill at about $80 billion spread amongst 2.3 million employees.

The average wage is thus about $35,000 per annum. That has to include benefits. Any additional amount that Walmart pays in taxes will reduce the amount that Walmart can pay in wages. Mr. Sterling wants to tax Walmart--i.e., Walmart employees--so that the "unhoused" (who contribute nothing to the economy) can get "free" housing. This is deeply unfair and makes people poorer.

A Honduran working at Walmart sends money home to support her family--that's a remittance. Mr. Sterling proposes to take away her money and give it to the "unhoused."

"Food Sovereignty and Climate Justice" is just a plea for more subsistence farming. After all, only a peasant on two acres of land is "sovereign," and "climate justice" demands that he work without fertilizers, seeds, and mechanization. I don't think too many peasants will sign up for that lifestyle--and it's a little rich coming from an American journalist who gets all the food he wants from the local grocery store.

I don't doubt Mr. Sterling's intentions--of course he wants a better world. But he has no clue how to get there.

Further Reading:

• Jeff Mackler Channels Michael Roberts
• Socialist Action Believes American Children Should Freeze to Death
• Book Review: Walmart