It is not the first time or the last. There would be much more thundering from pulpits if a less sound Government were to do these awful things. They are awful things. There is a philosophical problem and a problem of language at this stage in dealing with development. The philosophical problem is the extraordinary dominance of economics and economists in our thinking. It needs to be asserted again and again that economists cannot measure human well-being. Economists cannot measure development. Economists cannot measure what is good for humanity. They can only measure one small area of human need satisfaction. They have been allowed quite an extraordinary amount of latitude to extend the tentacles of their influence into all areas in which they have absolutely no competence and in which they have no expertise. They have tried to pretend to us that somehow you can use one very limited analytical tool to attempt to understand the complex nature of human activities and of human relationships which goes under the general title of development.
There are extraordinary assumptions written into this Bill about development, many of which are fly in the face of the evidence of the past 30 years, which fly in the face of the ecological crisis facing the world, which fly in the face of the appalling structural inequalities that are not only built into many developing countries but are being reinforced by the policies of one of the agencies behind this legislation. That raises fundamental philosophical questions and if people had not been almost intimidated by the dominance of econometrics and economists in their thinking, they would realise just how much of a pup we have been sold in attempting to describe something as complex and as magnificent as humanity in terms of one limited attempt at scientific analysis.
That runs through all of this Bill. I can assure the Minister I do not intend to be as abstract as in those initial remarks but they underline a lot of what is wrong with this Bill, a lot of the questions that deserve to be answered, questions that I hope the Minister will answer. There is a large number of questions that I want to ask him, particularly about the convention, because there are extraordinary statements all the way through this Bill that need very detailed scrutiny. I am sure he will be able to give me very detailed and precise answers.
There is an idea that everything we do for Third World countries is by definition a good thing, that as long as anything we do directs money in their direction it is a good thing, that as long as we feel good about development it is a good thing. The truth is that unless we understand something about the nature of the problems of developing countries, the nature of the problems of development or indeed if we even push ourselves to think about what we really mean by development we cannot at all approach the issue of what is good for developing countries and what is bad.
The usual simple answer is to say that they have subscribed to MIGA. Most developing countries are so impoverished that they have no choice but to subscribe to agencies like this. As a great Nicaraguan priest once said, poverty is the absence of choice. Those of us who are not poor have the time both to choose and articulate choice. Those who are poor have no such luxury. As I said, the Bill makes assumptions about development that fly in the face of the experience of ordinary human beings. One of the most fundamental political problems which many people all over western Europe are beginning to talk about, is the failure to appreciate what ordinary people want, need and experience.
We have an obsession with gross national product as a measure of well-being. If it goes up we are supposed to be increasing in our well-being, if it goes down our well-being is decreasing. Let me give a simple example which demonstrates how ridiculous is that concept. Let us suppose we spend £500 million or £600 million a year on overseas holidays and all that money goes out of the country. That is not going to cause a growth in our GNP. If the Irish people were to decide instead that they were not going to go overseas on holidays, that they were going to spend the £500 million or £600 million on cigarettes that would push up our GNP. Theoretically, therefore, we would be better off according to the whole simplistic, one-dimensional model of humanity that economists have foisted on us in recent years. Of course that is rubbish, because the more we smoke the more damage we will do to our own well-being. There is no way that conventional economics can measure that sort of well-being. I will come back to this later on.
It is equally true that nowhere in the stated objectives of this agency, apart from a passing reference to the development programmes of the host countries, is there reference to the ecological damage of a particular investment. Nowhere is there a reference to the effects of development on indigenous peoples. It is based on an attempt to superimpose western concepts on investment, development and improvements on countries that have very different views, and indeed very different priorities of needs. It is built around the philosophy and ideology of the World Bank.
I should at least refer the Minister and his Department to some of the recent writings on the question of development. I have in front of me a book called The Living Economy published by Routledge & Kegan Paul which ought to be compulsory reading for every economist in this country and I would like to know what their response to it would be. I would be fairly confident that their response would be to say that it is not really what they want to talk about because it involves things other than simplistic one-dimensional measurements of humanity's well-being in terms of money. It raises fundamental questions about what we want to do with ourselves, not about what a particular model would want us to do.
The book refers to another publication called Another Development: Approaches and Strategies, published by the Dag Hammarskjöld Foundation in 1977. I do not want to delay the House but what this particular book suggests to the ordinary person who has not been swamped by economics and who realises that econiomics is a tool for human beings to analyse some situations, not a control mechanism which tells them what they must do, is that, for instance, real development ought to be geared to meeting human needs, both material and nonmaterial. The trouble about economics is that any need that is not material, no matter how fundamental, cannot be measured, priced, or quantified and, therefore, cannot be considered. The assumption, therefore, is that if somebody is 50 per cent better off living in a polluted city then he is better off than somebody who is half as well off and living in a clean environment in the country because one is a less obvious need than the other. Somebody who has a good job which pays well but who is lonely, separated from his family and under stress is presumed to be better off than somebody who is in company with his or her family and has a smaller income. The first person is presumed by economics to be better off because their income is better. That is palpable nonsense. Most human beings know that that is nonsense but we are in the grip of the high priests of orthodoxy at this stage who have a stronger influence on our thinking than even the bishops of the Roman Catholic Church had in the fifties.
It is time that the new high priests of orthodoxy were challenged to return to the one area where they have competence, which is in the measurement of material production and they should leave the rest of humanity's needs to the ordinary people who understand these things far better than they do. Written into this document is an attempt to equate development with economic growth without any other reflection on any other area of human need, be it physical or spiritual. That is the fundamental philosophical flaw in this activity.
The second philosophical flaw is the contradiction between the aspiration and the reality. Article 34 on page 15 of the Bill which relates to prohibited political activity states:
Without prejudice to the right of the Agency to take into account all the circumstances surrounding an investment, they shall not be influenced in their decisions by the political character of the member or members concerned. Considerations relevant to their decisions shall be weighted impartially in order to achieve the purposes stated in Article 2.
How is one going to be impartial while at the same time taking into account all the circumstances surrounding the investment? I do not know but MIGA is part of the World Bank group. Let me remind this House of the record of the World Bank as regards being impartial. The World Bank is seen by many people as being, effectively, an extension of the United States and its financial interests. Since 1984 the World Bank has refused to loan any money to Nicaragua on the insistence of the Reagan administration that it should not do so. Despite a positive technical evaluation of the value and worth of the World Bank's projects in Nicaragua, it has refused to lend money or make money available to Nicaragua, not because they were doing anything wrong but because the Reagan administration disapproved of Nicaragua. Therefore, it could not give money to Nicaragua. It is as simple as that. The World Bank will not aid Nicaragua, not for any reason to do with objective economics, if such exists which I doubt, but because of the fact that its American masters disapprove of the politics of Nicaragua. It is an absolute mythology to insert something like that into the terms of reference of MIGA and not advert to the truth of what the World Bank does and continues to do. That is the sort of benovolence that appears to underlie this legislation but which, in fact, is not contained in it. I will come back to that again.
The Minister suggests that the Bill is a pragmatic response. It appears to me that far from being a pragmatic response it is based on assumptions, which might or might not be justified depending on one's view of the world, that a certain form of development is better than other forms of development. It is based on the assumption, and my good friend Deputy M. Higgins spent some time on this in the other House, that foreign investment in developing countries is per se a good thing. It omits any reference because it cannot, will not or because it would make it too difficult, to the meddling of many foreign multinationals in developing countries. It would be regarded as going outside the terms of reference of MIGA to refer to the fact that it was an American multinational which destroyed and was responsible for the death of the democratically elected president of Chile in the early seventies.
We are not supposed to talk about these things because foreign investment is a good thing. It is not necessarily a good thing; it may be of benefit to a country or it may not. As I said earlier, if a multinational decides to set up in Brazil in order to speed up the destruction of the rain forests, that will increase the gross national product of Brazil but it could destabilise inside 20 years the entire world ecology. However, we cannot mention the second, we must look at the first. We are told it will generate employment.
Let us look at the activities of the multinationals at present. Where are their preferred sources of investment? They talk about the low-cost developing countries, the newly industrialised countries, such as Taiwan, Singapore, Korea, etc. These are the places where we are told they like to invest because the tax regimes are attractive, because, in the Minister's words, there is a climate favourable to investment there. We are supposed to look at this in terms of what economics can measure i.e. wages, costs, infrastructural investment, etc. The truth is a large part of their attractiveness is the fact that trade unions are not allowed in those countries and if they are allowed they are severely restricted. Those who work in the sweat shops, of multinationals in these countries as they often are, have got to work for very low wages. There is very little labour relations legislation to protect their rights, to protect them on the grounds of safety, hazardous substances and so on and, in the case of Korea, they are expected to work at least 55 hours a week before they can begin to be paid overtime.
This has got nothing to do with tangible cost benefits; it has all to do with the fact that in those countries one side of the equasion i.e. the industrial workforce is severely handicapped vis-à-vis the other. It is, therefore, much easier for them to be profitable, it is much easier to make money and, therefore, it is much easier to invest there and sell goods back to the consuming countries at an improved competitive price. None of this is referred to, even by way of implication, in this legislation because it presupposes a model of development based on only those things which have a very limited view of human well-being and development. That is what is wrong with this legislation.
Chile in recent years has been quoted as a model of impeccable development, with growth rates of 5 per cent, with exports booming and so on. Of course, we are not supposed to say that Chile is no longer a democracy because that is not a term that bothers economists. They are not really interested in those sort of things. That is not the sort of thing that bothers world banks or international monetary funds. They have not shown a particular interest in differentiating between countries with a good human rights record and those with a bad human rights record; whether they are on the left or the right is irrelevant. They have not shown much interest in what countries do with this growth in GNP, whether it is used to make the already rich élite even richer or whether it is used to develop the country. These things do not matter. This is more relevant to the International Monetary Fund, but they actually conspire de facto to reduce freedom in those countries by making impossible economic demands on governments which can only be implemented by the suppression of basic freedoms. We blissfully then introduce legislation like this and say that its aim is to provide Official Development Aid.
Let us remember what this legislation is about. Not one penny of our contributions under the provisions of this Bill will go to a Third World country. Rather its provisions constitute a guarantee to overseas investors against loss. Effectively what we are doing is subsidising multinational corporations. We are saying that if their investments fail or if a country misbehaves under the four headings in Chapter III — Currency Transfer Expropriation and Similar Measures, Breach of Contract and War and Civil Disturbance — the investor will be compensated. We will compensate the investor, not the country. Therefore, the money will go to the overseas investor who will be one of the countries from category one of the list of countries in the Schedule by and large, if not always. If you like, that means that we are protecting each other from possible upheavals in Third World countries. We are not really doing much.
My good friend, Deputy M. Higgins, in the other House, adverted to this. We are effectively telling multinationals that they are safe to invest in even the most repressive of countries — even those where there are no rights — because, if it all goes wrong, and these nasty people decide to throw out their benevolent rulers, we will look after their investments. It is a regrettable fact that a lot of money has been wasted in development co-operation because we refuse to look at real models of human development. The sort of economics we are fed about investment, return on investment and so on sound lovely except for the fact that, were they to be implemented in reality, there would be nobody in agriculture in this country. It would then be much more economical and be a more efficient use of capital for a farmer to sell his farm, invest the proceeds and live off that investment. There is no economic justification for most of agriculture in this country. The money that is invested in the land could provide a much greater rate of return were it invested elsewhere. However, people do not do that because people are not economic animals alone; they are much more complex than that.
That is the underlying flaw in all of this World Bank model of development. apart from the fact that it is politically biased, it is also philosophically bankrupt because it does not appreciate either the needs or capacity of ordinary people to contribute to their development. Neither is it able to distinguish between acceptable and unacceptable forms of economic growth, unacceptable forms being those which do harm to a society, to the environment. There are many such forms being tolerated in developing countries. The more extreme are represented by the apparent continuing determination of developed countries to offload their toxic waste to impoverished Third World countries who will be paid for the privilege of storing our deadly waste. We will not have it but they are so desperately short of money they will accept it.
We do not know the extent to which this is going on. From the point of view of abstract economics, that is a good thing.
There is nothing in abstract economics to distinguish that from other forms of activity. As has been said quite rightly on a few occasions, there is nothing in economics to suggest that the heroin trade in the United States should not be aggregated as part of its gross national product. It is a convention that excludes it; the fact that it is illegal does not render it in any way not part of the development of the United States economy. We cannot base concepts of human well-being, which is what development is about, on simple straight line, one-dimensional economics.
The other side of this equation of course is represented by the extraordinary cutbacks in Official Development Aid. I presume the Minister is aware of the scale of these cutbacks. I need not refer to them again. There is the contradictory philosophy underlying our cutbacks and here I will quote the present Taoiseach speaking to the Kennedy School of Government, Harvard University on 22 April 1988:
Ireland is one of the few nations of the European Community which has suffered colonisation and because of our history in that regard we are in a privileged position in regard to most of the small and emerging nations of the modern world. Our work in the mission fields and in health and welfare projects makes us keenly aware of the plight of the smaller Third World nations with whom we have the privilege of special relationships. We stand, respected, in the middle ground between the affluent North and the underdeveloped South, ideally suited to play a valuable bridging role.
I am not allowed to use the word which I was going to use; I will think of another one in a moment. There is something distinctly distasteful about a speech like that being made by the Leader of our Government at a time when our Official Development Aid is being cut back.
