The Promise of Prague

Bankers, Bono, and Bomb Throwers Battle It Out on the Streets of the Czech Republic

 PRAGUE—The Prague Castle, seat of power in the Czech Republic for the last one thousand or so years, hovers over this medieval city, aloof and dominant in the skyline. Closed to the public during the communist era, when party leaders met behind steel doors, the castle was opened to the public by President Vaclav Havel when he took office after leading the 1989 Velvet Revolution, a mass nonviolent ejection of communism in favor of social democracy and, ultimately, Western-style capitalism—epitomized, perhaps, by the McDonald's and KFCs scattered among the towers and steeples throughout the city.

As the 55th annual World Bank and International Monetary Fund meetings unfolded in his city at the end of September, the former playwright and dissident found himself in the strange position of hosting both some 14,000 global financiers and 12,000 protesters. To keep the peace, he called in 11,000 police and 5000 soldiers.

"Havel used to say, before the revolution, that the new struggle was not between capitalism and communism," says John Keene, author of the biography Vaclav Havel: A Political Tragedy in Six Acts, "it was between the integrity of an individual living as a citizen in the truth, and on the other side, the use of power." Now, as the leader of a privatized economy, Havel believes that "if there's going to be a global economy, it has got to be embedded in civil society," Keene explains. "This is one of his more appealing moral ideas."

Between Friday, September 22, when delegates and demonstrators began arriving, and Wednesday, September 27 when, after mass protest, the official meetings were closed one day early, questions of power and civility were of grave concern to protesters and finance ministers alike. Should activists try to shut down meetings with a show of force? Should the World Bank and IMF make on-the-spot concessions to protesters to maintain their public image?

It is perhaps the irony of globalization itself that what offends—the economic dominance of a few nations over many—also allows global-scale criticism. When protesters chant "The whole world is watching," it often is. It did in 1989, when hundreds of thousands of Czechs shook their keys in Wenceslas Square, unlocking themselves from communism. And it did again in Seattle, as tens of thousands protested against the ravages of capitalism.

This annual meeting of the World Bank and the IMF was planned long before the backlash against them (and the WTO) made itself heard, at a time when convening in this Eastern Bloc country was ripe with the symbolism of Western triumph. Delegates arrived from the 182 member nations, prepared to work and peruse the winding streets of Prague, a city remarkably preserved, having escaped the bombs of World War II. But in the days leading up to this meeting activists flowed in—mostly from Europe, although from as far as Tanzania and Japan as well—to make it known that they see these institutions as undemocratic, escalating poverty rather than alleviating it through their draconian loan programs. The anticipation of confrontation sparked a surge of international surveillance, and readied spin machines on both sides.

On Saturday morning, three days before the opening of the official meetings, the streets are deserted, except for the 11,000 police. Many are themselves disoriented, having been imported from the hinterlands of the Czech Republic. Residents have obeyed the call to go to the country, schools have been shut down, shop windows boarded up. Hardly a scenario for engaging in populist dialogue.

Nevertheless, later that day, Havel sets the stage for an unprecedented debate between the global bankers and a handpicked selection of their critics. The critics—from Jubilee 2000, Focus on the Global South, and Neshenuti (a Czech human rights group)—have never had the opportunity to talk face to face with World Bank president James Wolfensohn and IMF managing director Horst Kohler. In the Ball Game Hall, Wolfensohn implores them not to consider the bank evil. "Our self-image is that we're actually doing good," says Wolfensohn. "Our goal is to fight poverty. . . . Our objectives are similar to those of the people in the streets."

At a press conference later, Ann Pettifor, U.K. director of Jubilee 2000, says, "They had to admit quietly under their breaths that they'd made mistakes, but they didn't want to take the responsibility. We don't want better PR, we want fewer children to die each year."

The way they want this to happen is through debt relief. All week long, critics will recite a single, chilling statistic, released by the United Nations Development Program (UNDP): 19,000 children die each day as a result of unpayable debt. If any message of these protests rises through the conflicting rhetoric, it is this: at the dawn of the new millennium, wealthy nations should make history by releasing poor nations from unpayable debts, so that another generation will not be lost to poverty, malnutrition, and preventable disease. This means both that the stingiest—among them the United States—need to funnel more money into the World Bank and the IMF, and that the World Bank and the IMF need to loosen the loan conditions that strangle poor countries.

The World Bank's Heavily Indebted Poor Countries (HIPC) initiative promises to provide debt relief to poor countries that are able to comply with tight economic controls. In the last two years Wolfensohn has promised that the program would be made "deeper...faster... stronger." He predicted that 20 countries would be approved by year's end. Ten countries have entered the program thus far.

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