NOW with Bill Moyers

Transcript - Bill Moyers Interviews Noreena Hertz

MOYERS: All over the world there have been outbreaks of protest against globalization like those we just saw in Bolivia. My next guest knows first hand about those protests, and she's written a book on why people have taken to the streets. It's called, THE SILENT TAKEOVER, and it's already a best seller in England where the Sunday TIMES OF LONDON named it one of the year's best.

Noreena Hertz was born in England, received her MBA from the Wharton School of Business and her Ph.D in economics from the University of Cambridge, where she is Associate Director of the Centre for International Business. Ten years ago she helped Russia organize its first stock market. Welcome to NOW.

HERTZ: Thank you.

MOYERS: Tell my audience what you mean by THE SILENT TAKEOVER.

HERTZ: Governments have been ceding power to big multinational corporations in the market. We see the manifest in a variety of ways. Where governments are giving up power to big international institutions like the World Trade Organization or NAFTA, which are disabling governments' ability to protect the rights of their own people.

MOYERS: How much is the real issue, those international finance — institutions that you talk about, the World Bank, the IMF,the World Trade Organization. I mean, to whom are they ultimately accountable? THE ECONOMIST of London says that the World Trade Organization is an embryo world government which no one has voted for. Now how much are they the problem?

HERTZ: Well, the World Trade Organization is an organization that defends trade interests. I think the problem is less that they exist. The problem is that internationally we've only got an organization that protects trade interests. Surely we need some kind of counterweight to protect human rights and the environment too.

MOYERS: In Bolivia, we saw that effort at privatization. Would you place that into the category of the silent takeover?

HERTZ: Well that's a case of public utilities, public goods being increasingly handed over to private enterprises to run. Now there's nothing wrong per se with things being handed over to the private sector to run, if you have, for example a really strong regulator in place.

MOYERS: But take the situation in Bolivia. Those people before Bechtel arrived there did not have good, clean water. Bechtel was trying to set up a system that would deliver then safe, clean and abundant water. I mean, do you think that the effort at privatization of that natural resource was wrong?

HERTZ: Well, Bechtel was trying to set up a situation that would realize to its corporation — profit — which, you know, is not necessarily the same thing as delivering clean water to everyone out there.

MOYERS: It is the natural task of the corporation to gather the capital needed for projects that cannot come elsewhere. I mean, why shouldn't the corporation in tandem with the government of Bolivia be trying to do — to capitalize that water project?

HERTZ: There's nothing wrong with what a company is doing. Companies have to realize profit to their shareholder. They have a legal responsibility to do so, their fiduciary duty. It's the responsibility of states to ensure that in that in that process the poor are still being served and looked after. In Bolivia, the price of water doubled almost overnight. A quarter of an average Bolivian's salary was now to be spent on accessing water. So it's not that there's anything necessarily wrong with private companies providing these functions. It's just that when we have a weak state, no regulator, no competition and you leave it to companies. The poor, the marginalized will often be the losers.

MOYERS: You talk very sensibly. You talk very reasonably and yet the subtitle of your book is a very dire one, Global Capitalism and the Death of Democracy. What do you see that justifies such a dark description?

HERTZ: Well, I think if we look at patterns of voter turnout over the past decade, we see this real disillusionment and lack of faith in governments. Seventy-five percent of Americans believing that big business has more influence over their lives than government…Part of the problem is the embeddedness that big business now has with politics. Funding of political parties, campaign finance.

MOYERS: You're talking to a true believer on that.

HERTZ: Well, I mean you know that creates huge conflicts of interest. George W's environment policy clear dictated by the interests of the energy companies that bankrolled his campaign. So part of what would be needed would be the disenfranchisement of corporations. Would be...

MOYERS: What do you mean by that?

HERTZ: ...the breaking of the financial stranglehold that big business has on politics.

MOYERS: What does this do for what you call in your book, "The social contract?"

HERTZ: Well, it completely destroys the social contract, this idea that government and citizens together have a relationship to provide public goods, a sense of community, a better world. The social contract has been privatized, has been handed over to the private sector to safeguard with incredible conflicts of interest. Scientific research. Scientific research, something that, you know, we want to be able to trust, to believe in, increasingly being funded by private corporations. When the FDA tried to remove saccharine off the list, or decided to remove saccharine off the list of cancer inducing chemicals, its work was based on the findings of the University of Nebraska researcher who was funded by Sweet and Low.

MOYERS: And therefore...

HERTZ: And therefore the conflict is we can't even trust the information we now receive. We need to have much clearer regulations on things like corporate funding of scientific research. Things need to be made explicit which are implicit. We don't want the takeover. We shouldn't allow the takeover to be kept silent any longer.

MOYERS: Have you been out to any of the protests? The protest in Seattle or Genoa or in Quebec?

HERTZ: Yeah. I was-- the last protest I was at was in Genoa, where I got tear gassed and I hate tear gas and I hate being in crowds. But...

MOYERS: Why were you there?

HERTZ: Because I'm really supportive of the protest movement, because I think it's capable of changing the political agenda and because we already see signs of its success. In Europe, Guy Verhofstadt, the President of the European Union when he was, talked about a need for global binding agreements on ethics in the environment. He hosted a one-day session last October to which he invited me-- other people who are seen as voices of the movement, but also Bill Clinton.

MOYERS: Have you seen any evidence though, Miss Hertz, that the protests are actually making a dent...


MOYERS: the market ideology, the globalization that girdles the world now?

HERTZ: Yes. I see it in terms of changing political rhetoric in the United Kingdom. Gordon Brown, our Chancellor of the Exchequer, his willingness now to double Britain's aid to least developed countries.

I see it on the lips of every CEO of every big company I see today. They're all saying we cannot ignore the voices of this protest movement. One third of CEOs of big multinationals polled say that they view the anti-globalization movement as a serious threat.

MOYERS: Who's on the side of those people in Bolivia?

HERTZ: The people in Bolivia unfortunately only have each other, but the international activist community is doing something in keeping their story alive. As we saw in the film, it's an activist who through the Internet and using technology for globalization in a positive way managed to get the story of Bolivia across to very many constituencies.

MOYERS: A Bill Finnegan goes there, the mass media pay no attention to that sort of thing.

HERTZ: And that is the tragedy of our times. That's the tragedy of a public information environment that is increasingly being commercialized. It's so hard to get those kind of stories on the airwaves. Broadcasters are so desperate for ratings, for advertising revenues, but they don't really wanna run stories about the poor somewhere else, or even for home.

MOYERS: Is that why you say in your first chapter, "The revolution will not be televised"?

HERTZ: The revolution may not be televised, but word of the revolution is getting out.

MOYERS: I was gonna say you're too young to be a pessimist. Are you a pessimist?

HERTZ: Oh, no. I'm very optimistic. I think that we already see signs that the world is changing. I think in the context now in the United States of Enron, of Tyco, of Adelphia, that 75 percent of Americans who already thought that big business had too much influence over their lives is beginning to say, "You know, hey. Maybe it's not such a good thing that these big corporations are running amok."

So I think we're seeing a ground swell dissent and we're seeing the mainstreaming of a lot of these ideas.

MOYERS: Well, thank you very much for joining us on NOW and thank you for THE SILENT TAKEOVER.

HERTZ: Thank you.