Wednesday, April 19, 2006

The losers (part III)

Nahid Hattar's book (the losers) contains other issues which the author considers to be indicators of an undemocratic usurpation of the economic and social course of the country. The last post on the subject reviewed five of these, and herein I will cover the rest. If any reader has more information about these issues, I will be happy to read your comments.

6- The cooperative movement. Actually, the book contains little to explain the background of the issue. Reading of the section suggests that the government somehow undermined the cooperative movement in Jordan to the benefit of establishing Irada. The implication is that funding that used to go to the coops has been diverted to this project. One specific claim is that the government imposed the sales tax on cooperatives.

Cooperatives are meant to be ways of pooling individual savings to the benefit of the member of organization, for the purpose of investment. So, while lofty in their goals, they are not charitable organizations. This 1999 document describes the state of affairs at the time. It states that
In 1995, in an effort to reduce public expenditures, GOJ dissolved the ineffective parastatal apex body, the Jordan Cooperative Organization (JCO), and replaced it with the Jordan Cooperative Corporation (JCC). To a large extent, however, the change was only in form. Like its predecessor, JCC has continued to consume large amounts of public funds, but it has not been successful in strengthening the cooperatives or in providing them with effective services. The failure of the Jordan Cooperative Bank (JCB) resulted in the termination of JCC's commercial services, which in turn forced most of the agricultural cooperatives to suspend their operations. Although the enactment of new cooperative legislation in 1997 was intended, at least in theory, to lead to a reduction of government involvement, in practice, the cooperatives continue to be tightly controlled. This is due to the climate of dependency created by several decades of subsidized programs (with the resulting sense of insecurity among the cooperatives when the subsidies were discontinued), and the continued operation of the state agencies established to control the cooperative sector.

In essence, the government seems to have decided to lift the failing organizations off of life support. I know that there are still cooperatives out there, so the government didn't cancel these organizations, but lifted subsidies off of the failing ones.

Irada seems to be an attempt at stimulating small businesses to start and grow. I can't imagine why anybody would be against the principle, or why this program represents competition to the coops. While there is merit to the argument that supporting the coops with government funds might help poor families who otherwise would have no source of income, this argument might be held for any small family business. Does Hattar want to insure all businesses against failure?

7- The professional syndicates. Hattar explains how the government has been working to "professionalize" these syndicates, as their political activities (such as fighting "normalization" and organizing events for Iraq and Palestine" are both beyond the scope of their mandates and contrary to the stated positions of successive governments. Moreover, he suggests that the objective of these efforts is to control the vast funds which are held in the investment portfolios of these syndicates.

The premise is that the syndicates are using their political activities to "protect their political and organizational independence, and to protect their money". I find this difficult to understand. Since these same activities are the excuse that the government is using to undermine the organizational and financial independence to these syndicates. If the unionists want to remove the government's excuse, they would simply refrain from their political activities.

The role of professional syndicates is to improve the living conditions of their members and to advance their professional skills. The "black lists" that were issued in the past by these syndicates, libeling people and companies which supposedly dealt with Israel, were illegal and unconstitutional. Moreover, these efforts were totally outside the mandate of these syndicates. These black lists harmed many people who had no business dealings with Israel, and hurt trade relations with Arab countries. I am not surprised that Hattar avoided the embarrassment of mentioning these black lists and their harm to the country.

9- Press freedom. Hattar highlighted a statement by ex-interior minister Awni Yervas, who once said that the parliament was wasting the government's time (when they were fighting the Badran government), and that press freedom should be within the bounds of decency (and not the law, as the constitution stipulates).

Don't ask me the moral of this story. I don't know.

10- The attempt to control the monies of the Social security fund. Here Hattar relates the story of an attempt to delegate the investment arm of the SSF (with a 4 billion dinar portfolio) to an independent entity which would largely be controlled by the private sector. He correctly points out that it is the workers money that will be controlled by representatives of their employers. While the idea was scuttled under the pressure from many forces in society, many people are worried that the social security monies are not administered correctly. I agree with the point that this trust fund should be run with the utmost integrity and transparency.

11- Freedom of the press. Hattar rails against an American initiative to support "community press", which he feels is an attempt to divide society along regional, ethnic and gender lines.

Apparently Hattar believes in the freedom of the press as long as he agrees with its contents.

The conclusion I draw from these examples is not particularly compelling. It is true that Jordan has gone through a period of economic liberalization conducted through undemocratic decision making processes. However, nobody in the political parties or the press (including Hattar) has been able to formulate a coherent alternative. Many of the arguments presented are poorly presented, lack intellectual rigor, use partial facts and lack internal logical consistency.

Hattar does a better job mapping out the current political scene in the country. I will describe that in the next post on the subject.

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