Carlos Slim can be found at work in many places. In the US, he may share the stage at elite events with LULAC. Here he is at work theorizing for Felipe Gonzalez's, Global Progress Comission. GPC is actually sponsored by the Socialist International. The GPC web site is below the article by Slim, and the article comes off that site.

Both Felipe Gonzalez and Carlos Slim are sponsors of Vicente Fox and Alejandro Toledo's new faces for US imperialism. They've all been celebrating the election of their candidate to the Mexican presidency these last couple of weeks. Been doing a lot of 'chats' together in Mexico City, and talking to reporters.

Carlos Slim is a real progressive sort of guy like Bill Gates. He wants to help his fellow Mexicans out, as the article below shows. How great that socialists like Rigoberta Menchu and Felipe Gonzalez have friends such as Slim to humanize the capitalist world. If Slim can make a few extra tens of billions off his 'humanitarianism', maybe he deserves it?

Hey, Slim. Where's your buddy, Salinas de Gortari, hanging out these days?

Tony _______________________________ Crisis and national regulation of investment flow
Carlos Slim
There is no doubt that globalization is a process inherent to all manifestations of human activity. It is not an option but a reality. Globalization, which covers so many activities, has been generally accepted in many of its manifestations for hundreds of years, for example in science, art, ideas and thought.

I will mention three activities capable of curbing major conflict between nations, above all because they are so assymetrical=A0: trade, investment and labour.

1. It is the area of labour where underdeveloped countries are most at a disadvantage because, although trade and investment continue, labour is still restricted - with respect to working abroad under more attractive conditions, or because there simply aren't enough jobs back home. It is striking that when people from the developed world come to work in our countries they are received with open arms (and of course usually they are managers, directors, white collar workers), but those who wish to go to work in other countries as less skilled labour have many problems. It is a factor worth studying.

2. As to the commercial factor clearly we have moved on from the stage =96 an important one for Latin America =96 of nationalization of companies, of investment in different countries, almost always with excessive protectionism which obviously affects the consumer, to the stage of direct investment and commercial globalization, when all our countries are calling for production to be competitive at the world level.

3. We are in a situation where globalization, in a post-industrial era, has induced companies not just to invest in other countries' markets but to seek locations where the conditions make their products more competitive worldwide. Trade is without doubt, together with investment, another of the fundamental problems to be anaylsed.

I think that globalization, although apparently making society similar everywhere, has a strong element of individual freedom, above all in this civilization of information and knowledge. They are without doubt the enemies of fundamentalism, intolerance and censure. I believe that the opportunities of globalization are fundamentally positive, and that we can study and resolve the three problems creates.

3.1 The financial aspects of globalization have been developing since the seventies with the rapid development of the Eurodollar by the commercial banks, a development boosted by the involvement of the investment banks and, more recently and above all in the last fifteen years, by the revaluation of assets and major investment funds which arrived in our countries over the last ten years in search of big returns. We should I believe also set limits to these investment funds and try to detect where the real problem lies. Some of these funds are without doubt to be welcomed, above all those destined for direct investment, long-term loans with favourable conditions to the government and businesses, and those for market access to capitalize on the productive apparatus. These are important financial resources which should in general be well received.

What causes crises =96 and I believe that in general they are avoidable or if not, that they can be minimized =96 are short-term capital flows in search of big pay-offs, which paradoxically come from retirement funds whose fundamental condition is security and long-term conditions but which, equally paradoxically, deal in high short-term risks. We must work on improving the market of these big capital flows which move too rapidly, those that are abused when they arrive in a country and which cause crises when they withdraw.

As for direct investment, perhaps certain countries need to fix priorities so that some of their fundamental or strategic activities are placed the hands of their nationals. However, all direct productive investment, the fundamental intention of which is to actively compete in the global market place, needs to be supported, well received and stimulated.

There is also the case of developed countries which are not competitive, which have outgrown their industrial past. Few wish to work there, there are few jobs and any remaining are at risk of being rapidly transferred to our part of the world. The workers of these developed countries are not attracted by boring jobs. These jobs move to our economies, where the companies become more competitive.

Returning to the financial aspects, the problems arising therefrom cannot be settled by international bodies. Moreover it is difficult to find general rules which are universally applicable. I think that there needs to be rational access to financial resources and markets, regulating the flow of these resources in our countries rather than internationally. We should try to get international bodies to act not to resolve crises but to improve the functioning of markets and international savings.

These resources that flow violently through our countries are like the flooding of the great rivers. River water is untamed, abundant in the rainy season but can fall terribly low in a drought, and cannot be controled at the source up in the mountains but in the places where the problems are. I am convinced that we ourselves have to manage this glut of resources. Fundamentally the way to do so is by detecting which ones the recipient country has access to, which ones are material for national investment and which for general investment. For example, ten years ago in Mexico treasury bonds were investment material for Mexicans alone causing major upheaval when they were opened up in 1989. I also think that these resources should be long-term. If we look at the differences in interest rates, for the United States the reference rate is the thirty year treasury bond, and for Mexico the 28 day bond. It is absurd for such resources to move within such short periods.

3.3 On the other hand I believe that investors should also take on board the risks inherent to their interests, so that it is not society that has to respond when the institutions they invest in get into trouble. As far as international institutions are concerned, whenever there is a crisis in our countries, be it of liquidity or economic, rather than solving the liquidity problem they come to punish our society for its excesses, introducing excessively drastic measures to curb consumption, bringing about cuts between 10 and 12%.

We experienced this in 1995 in Mexico with a drop in consumption of almost 15% and Brazil is experiencing it right now. 3.4 I have the impression that as far as crises go there is a major distinction between developed and underdeveloped countries. In the developed world savers pay for financial crises, whereas in the underdeveloped world consumers pay. We saw the interest rate at the beginning of the nineties in Japan was 4%, 2% in the United States, plus negative interest rates with a transfer from the financial economy to the real economy - paid for by the saver. In our countries the consumer pays, and we often see excessive transfers from the real economy to the financial economy at real rates of 20 or 30%. By maintaining this sort of pressure, with such high nominal and real rates, fiscal deficits are triggered by definition, so that even by sacrificing consumption countries have no possibility of resolving their finances without simultaneously bringing down the rate. For example, Brazil is unlikely to knock its finances into shape with a rate of 40% and expected inflation at 15% to 20%, with real rates of 20 or 25% and a hefty internal and external debt.

3.5 In conclusion in my view regulation should not occur at the international level but every country should adopt its own rules and decide on the form in which these resources move around. It is very difficult to find general rules which are universally applicable. I think that these resources will serve to develop our countries if they are used intelligently, rationally, paying attention to the size of the country, the structure of its current account deficits and the way in which they are financed, as long as it is possible to gain access to large parts of these funds.

4. The fact that the markets are out there, that production of agricultural and now, above all, industrial goods is relocating are opportunities that our countries can use without having to lag behind the new digital era. The era of information and knowledge which is moving ever faster and generalizing globalization is becoming accessible to the entire population as technology develops.

5. Finally, I believe it is important to point out that for many years, probably since the last century=A0and mainly following the First and without doubt the Second World war, the problem for the economy and business has been developing and strengthening markets. In the agricultural era both the land and labour were there to be exploited and the labourers' wages were an ethical issue of social justice. In our era, to gain a market you need income and to gain income you need a job. I believe our era is increasingly calling for mutual benefits for the developed and developing world, so that there are clients to whom we can sell our products. This circuit is an economic necessity and improving it puts an adequate level of development within reach.

=A0It is said that changes of civilization spark off great crises. I believe that the problem is not so much the actual change in civilization so much as the way in which it is done. Now that these changes are happening faster than ever, the solution to these problems must be found more rapidly than ever in past history.

--WebTV-Mail-17705-1109 X-URL-Title: the Members of the Global Progress Commission
http://www.globalprogress.org/ingles/miembros.html