David Korten worked for the U.S. Agency for International Development, USAID, and has been a consultant to the World Bank. He and Thom spent a week together with the Dalai Lama. He's the author of "When Corporations Rule the World" and his most recent, "The Great Turning: From Empire to Earth Community".

Thom Hartmann interviews David Korten 07 May 2007

[Thom]: David Korten is with us… he's a 30 year veteran of the foreign aid system. He lived abroad for 21 of those years. He worked for the U.S. Agency for International Development, USAID, has been a consultant to the World Bank. He's a friend. David and I spent a week together with the Dalai Lama a couple of years ago in Dharamsala. A movie is being to be made about that; it's going to be coming out in, actually, this month, in about three weeks. It's premiering in the Telluride; "Dalai Lama Renaissance" with Harrison Ford.

And he's the author of a couple of books that you really need to check out; "When Corporations Rule the World" and his most recent, "The Great Turning: From Empire to Earth Community". David Korten. David, welcome to the program.

[David Korten]: Thom, it's great to be back on the number one progressive talk show in the nation.

[Thom]: Well, thank you David. Great to have you with us. You're also chairman of the board of Yes! Magazine, which is another great publication.

David, you're the guy that I turn to when I don't get this stuff and there's a lot of stuff that I get but there's a lot that I don't, and so my question to you, and we had this conversation off the line, you know, a week or so ago, and I was so fascinated by it, I just wanted you to share your thoughts about it with our listeners.

What is the World Bank? How did it come into being? Why should any of us give a hoot? I mean, you know, there's all this stuff about Wolfowitz, which seems like it's payback for his role in the "Iraq War", and why is the media assiduously not discussing any of the real stuff that the World Bank is doing?

[David Korten]: Well, of course, we're talking about the corporate media here, and they're not inclined to criticize institutions that are solidly behind the corporate agenda. You know, the bank history started out, you know, actually even before World War Two was over. The policy planners in the United States were trying to figure out how to assure that after World War Two, that the United States would displace Britain as the leading imperial power in the world. They were very concerned about the consequences of the great depression; didn't want to replicate that, and felt that what they needed to do to avoid that was to have control of the world's markets and resources.

[Thom]: Now, these were people, let us know it, unless you disagree with this, these were people who thought that what they were doing was the best thing for world peace and for the United States over the long term.

[David Korten]: Well, I think there was a split there between people who really believed that the United States needed to be bringing prosperity and democracy to the rest of the world, and those who, like George Kennan, who were totally focused on realpolitik interests …

[Thom]: Just building empire.

[David Korten]: … of power and control and you know, of course, that played out as the public image in contrast to the secret or hidden purpose.

[Thom]: Right. So, what… Go ahead.

[David Korten]: Now the Bank itself was actually originally created to support the reconstruction of Europe and was originally called the International Bank for Reconstruction and Development. But as it turned out, the Europeans weren't really interested in financing their reconstruction through loans, which was very smart, and the U.S. also developed the Marshall Plan which was based on grants and so that totally superseded the bank.

[Thom]: So the bank had to reinvent itself to continue?

[David Korten]: Yes, exactly. And so they basically reinvented themselves in terms of making loans to what were then called underdeveloped countries; low income countries. But there again, they ran into resistance because the elites of those countries were divided between those who were economic nationalists and wanted to maintain control over their own economies, were very, very leery of foreign entanglements, and of course this was, you know, as the colonialism was being dismantled and so there was very good reason for suspicion of foreign entanglements with the rich countries.

On the other hand there were also groups of economic globalists that saw their interests as tied to the, essentially to the foreign colonial powers, and who were quite open to bank borrowing. So the bank undertook a very concerted effort to build its region constituency by aligning with the globalist elites and also by bringing lots of young people from these countries to the United States for economics training and training in the bank and essentially built up its constituency.

[Thom]: Kind of Chicago School economics. I mean, this is what led the whole generation of the economic hit men.

[David Korten]: You know, the whole thing is around the idea of global markets, of open markets, foreign financing; the whole neo-liberal agenda of privatization, minimization of public services and so forth.

[Thom]: Right: "let's do away with the commons, let's let the corporations handle everything, Avino, or whatever the company is, Afina, the French company [ Veolia, formerly Vivendi, formerly Compagnie Générale des Eaux? - ed.] will own our water, Enron, were they still around, will own our power, etc. etc.'

David, you've mentioned that there are, under Wolfowitz, that really Bush didn't put Wolfowitz in as a friendly favor to a good guy or as a way of, you know, paying him off for helping him have his Iraq war, that really he put Wolfowitz in charge of the World Bank to move forward two very neo-conservative agendas.

[David Korten]: Yes. Basically to, you know, to continue pushing the economic, the neo-liberal agenda, and as you were noting earlier, to hinder the family planning programs and to begin, you know, it's hard to know what the inside was, but the bank is now going through another process of trying to reinvent itself., so far as I can determine from friends who follow this closely.

[Thom]: This is the trade facilitation infrastructure and the Paris declaration.

[David Korten]: Yeah.

[Thom]: These are meaningless to most people, but can you give us the essence of what this is all about?

[David Korten]: Well what, you know, you've got to trace a little bit more of the history of the bank that they, when the borrowing countries got into a deep debt crisis at the end of the 1970s, partly as a result of previous World Bank loans but also borrowing to cover the rising prices of energy, they introduced what they called "structural adjustment" lending, which was lending to countries basically in return for giving over their policy to the bank to impose this neo-liberal agenda which, of course, had devastating consequences in terms of increasing inequality, environmental devastation and so forth, and so...

[Thom]: Right. Neo-liberal what we would today, in America, call a Conservative agenda.

[David Korten]: Yeah, very much so.

[Thom]: The ? world calls it neo-liberal, but this is kind of Reaganism writ large.

[David Korten]: It is, and it's sometimes referred to as the Washington consensus because it reflects the set of policies consensus between the US Treasury Department, the World Bank and the IMF.

[Thom]: We have less than a minute left, David, just to summarize this.

[David Korten]: Yeah, well OK, as you've noticed, the Paris Declaration is an effort to, for the bank, essentially, the bank and the neo-liberal force of the OECD to take back control over the policies of low income countries by consolidating foreign aid all into, under one office under U.N. administration but run by bank personnel. In a sense, the bank is infiltrating the…

[Thom]: Is this helping build a larger factory floor for the multinational corporations, more cheap labor?

[David Korten]: Yes, absolutely. It's all to facilitate the further take-over of every kind of corporate interest.

[Thom]: Of the world. David Korten… in particular get his new book, "The Great Turning: From Empire to Earth Community ". Thank you, David.

[David Korten]: Thank you, Thom.