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Foreign investment: Prejudicial incentives

Fuentes: Rebelión

Foreign investment by MNCs is highly prejudicial to most Third World countries, because of the non-market incentives that it demands. Much of what passes as favorable «market conditions» are in large part political decisions which maximize benefits to the MNC at the cost of the local economy, its tax payers, consumers and workers. The meaning […]

Foreign investment by MNCs is highly prejudicial to most Third World countries, because of the non-market incentives that it demands. Much of what passes as favorable «market conditions» are in large part political decisions which maximize benefits to the MNC at the cost of the local economy, its tax payers, consumers and workers. The meaning is clear – investments are not merely market transactions, in which MNCs justify their profits on the basis of the risks they run, the innovations they introduce, the capital they invest. Abundant evidence is available to demonstrate that most foreign investment is subsidized and risk-free, and relies on securing monopoly profits based on the appropriation of existing national (state) enterprises and control of strategic markets.

Privatized lucrative public enterprises

A great deal of foreign investment adds little to new productive or distributive systems since it is directed at purchasing existing privatized public enterprises directly or via the take-over of the same from original private national capitalists. The transfer of ownership from state to private/foreign capital increases the outflow of profits, which previously accrued to the national treasury or were reinvested in the local economy. Privatization is part of the structural adjustment policies imposed by the IMF and World Bank as conditions for refinancing debt payments. The sale of national assets more often than not is hardly transparent and the sales take place far below market value, let alone their value to the indigenous population. In other words, privatization has served to create a class of capitalists or ‘oligarchs’ who perform none of the ‘tasks’ associated with capitalist enterprises: they neither invested in training labor, invested capital in infrastructure, innovated nor located new markets. Privatization in the context of the ex-communist and nationalist countries most closely resembles pillage rather than investment. The process of privatization follows one of two paths: either direct buyouts by foreign capital or the theft in public properties by former state managers and/or their oligarchic-gangsters, the emerging ‘national bourgeoisie’. During a second phase many of the national oligarchs sell part or all their shares to foreign capitalists/MNCs. These political «incentives» for foreign capital and oligarchic groups are justified by «free-market» ideological dogma of the governing elite.

The infamous author of Russia’s disastrous privatization (Anatoli Chubais), which led to the massive disarticulation of the economy and the impoverishment of the Russian people, justified his «shock» policy by citing the need to make capitalism irreversible, to undermine any effort to sustain a mixed social economy. In other words, privatization was an ideological decision. Corruption, vast concentrations of wealth, and a vertical fall in living standards, including an unprecedented decline in life expectancy, were the accepted costs to establishing capitalism at any price.

De-Nationalization of Natural Monopolies

One of the key justification used by ideologues of FI is that is encourages «competition» with local monopolies, increases productivity, lowers costs and prices and increases employment. Most of the available data would argue otherwise.

One of the favorite targets of foreign investors and one of the prime incentives offered by neo-liberal regimes are public utilities (electricity, power, energy, gas, communications) which are ‘natural monopolies’. The real effect is to transfer public monopolies to foreign-owned private monopolies leading to an increase in charges for services, decline in services to less profitable regions or low income consumers, an end to subsidies to emerging industries and the impoverished urban and rural poor.

One of the most powerful ‘incentives’ which FI demand and pliable regimes offer is the privatization of energy sources. Once held up as strategic national assets, FI have successfully secured control over the most lucrative oil and gas fields from compliant rulers.

The obvious result has been a huge transfer of wealth from the national economy to the MNCs under the assumption that new investments and foreign ‘know-how’ will provide compensatory benefits. The problem is that energy corporations are notorious in not fulfilling their investment obligations, charge international prices for local consumers, pricing endogenous producers out of international markets and impoverishing low-income local energy users. While the privatization of energy and utilities attracts foreign investors (indeed it is one of the most favored incentives for FI), it has several strategic drawbacks: Higher charges make local competitive firms less competitive; it deprives the capital-starved state of a source of public revenues; and it heightens inequalities between the foreign rich and their local associates and the rest of the population.

Three other economic areas are targeted by FI: telecommunications (especially cell phones), transport and high demand raw materials (such as iron and cobalt) and agricultural products, like soya and forest products. Telecom contracts with FI has frequently led to the demise of local hi-tech enterprises and virtual monopolies, rather than heightened competition, leading eventually to monopoly profits. FI have also targeted all the transport sectors: railroads, airlines, ports, and highways. Once again FI gain monopoly markets and increase rates. Preceding privatization, FIs demand that the state pay the costs of the ‘transition’ period – firing workers, paying pensions or severance pay – and promise higher rates. To create the political climate for privatization the state usually dis-invests in public enterprises and runs deficits via high tax rate policies, thus worsening public services, in order to provoke popular discontent with the public sector. Given the government induced debts and deficits, the public transport systems are sold at low prices to FI, who are enticed by promises of rate increases, tax concessions, reduced staff and cuts in less profitable routes. Most important no independent regulatory system is put in place to check the inevitable abuses of the FI. The result is the disarticulation of the transport system, as only major routes to large metropolitan centers are kept operating while the outlying regions suffer severe reductions in transport, undermining local economies. Privatization and de-nationalization of airlines has led to the stripping of assets, decline of services and ultimately the bankruptcy of the firm. A case study of Iberia’s purchase of Argentine Airlines, stripping assets and running the airlines into bankruptcy, illustrates this pattern.

  Foreign investors have never shown any interest in maintaining and upgrading any railroad lines and port facilities, which fail to generate the profit ratios, which their influential shareholders demand. Where regulators are in place they either lack authority to enforce contract obligations on FI, are co-opted, or subject to political pressure to overlook FI failures to comply with investment agreements.

When foreign investment in infrastructure, for example highway construction and toll roads, fails to provide the necessary profits or their high rates force users to secondary roads, they frequently demand compensation or the re-purchase by the state at inflated prices.

The most highly publicized and disastrous privatization in which FI has been involved was in water distribution in Bolivia (Cochabamba and El Alto) and in Peru, where mass popular uprisings protested the high rates and the failure to connect the majority of working poor with water lines.

While FI has been deeply involved in most of the disastrous privatization activities in the Third World, and the ex-Communist countries, many similar experience have taken place in the imperialist countries. The privatization of the power and electricity sector in California led to major blackouts and exorbitant price hikes due to corporate malfeasance. The privatization of the passenger rail services in Great Britain led to safety hazards, exorbitant rates and unprecedented delays due to ancient equipment. The privatization of water in England led to health problems forcing public investigations and a move to re-nationalize.

In summary, by offering choice profitable economic sectors as incentives to FI, Third World regimes have fostered private monopolies, not competition, and a high-cost infrastructure, which fails to integrate regions because of narrow corporate calculations of cost-benefits. Incentives to MNCs have prejudiced long-term, large-scale industrial diversification by offering raw materials, energy and natural resources as incentives to attract FI.

Using privatization as an incentive for attracting FI has had an extremely harmful impact on the deep structures of the economy, polarizing society by privileging elite enclaves and local oligarchs and influential public figures.

Subsidies, Tax Exemptions and Export Processing Zones

Many foreign investors demand and obtain, from pliable TW regimes, direct and indirect subsidies in the form of lengthy tax exemptions or reduced tax rates for periods between 10 to 40 years on imports, exports, corporate earnings and foreign executives salaries. In addition, regimes provide land for enterprise construction free of cost or at minimum price, subsidize utility and energy prices, state-financed infrastructure, labor training and policing. The net result is that poor TW countries pay to be exploited. Frequently the only ‘benefit’ to the country is a minimum tax, and low wages to highly regimented workers confined to export processing zones. By not paying taxes, the FI deny TW states revenue for public investment in education, health and skill upgrading. States lacking tax revenues frequently resort to borrowing, setting in motion new concessions to FI, as a condition for receiving loans from the IFI.

Export Processing Zones

The most striking development in the TW has been the massive growth of export processing zones (EPZ). By 2005 there were 5000 EPZ employing 40 million workers, under the most arduous repressive work conditions and the lowest pay in absolute (living standards) and relative terms (output/productivity to wages). The EPZ are not the first step toward higher skill, higher wage, technically advanced industrialization – that takes place outside of or parallel to the EPZ. The EPZ are attractive to FI because owners and managers have absolute control over labor and the environment, free of environmental, health and safety regulations. Many regimes which conceived of EPZ as the first stage of a process of ‘deeper industrialization’ have been disappointed: EPZ are simply ‘pieces’ in the MNC production strategies – a locus for cheap labor in the labor intensive ‘assembly stage’ of manufacturing.

Tax Privileges

The tax incentives for the MNC means a higher tax burden on local workers, peasants, professionals, public employees, and small and medium sized business, if their children are to receive an adequate education and health care. The people pay to produce healthy, literate workers to be exploited at low wages by tax exempt MNC who then transfer their untaxed profits to millionaire (billionaire) CEOs, stockholders and speculators. The list of tax «incentives» or privileges is lengthy and extremely costly to the countries, and working population because what the MNC and foreign investors don’t pay, is shouldered by the local taxpayers or else public services suffer dire consequences.

Tax revenues finance on-going basic social services and pay for the maintenance of the state and infrastructure as well as potential public investment for long-term growth. Tax privileges for foreign investors lower state revenues and hence expenditures on upgrading (or even maintaining) basic services as well as undercutting national investments to diversity the economy and move beyond a FI ‘enclave’ economy.

The better known and most common tax privileges extended to foreign investors include exemptions on imports of parts and other inputs as well as exports, low or non-existent property taxes, minimal profit and revenue taxes, generous depreciation allowances, tax holidays of between five and twenty years. In addition, expatriate managers and CEOs receive their salaries, bonuses and stock options tax-free. If we add the cumulative sum of tax losses which the state does not receive to the vast expenditure of state resources invested in infrastructure, severance pay, and ‘restructuring’ costs to attract FI, it is clear that the total cost of attracting FI far exceeds the benefits in employment and future taxes which might accrue over the foreseeable future.

If we add the loss of tax revenue from displaced local business-driven to bankruptcy – we face even fewer benefits resulting from FI. Finally it is common practice of foreign investors to relocate their enterprises when their tax holidays expire, or when workers salaries begin to increase. The idea propounded by FI apologists that ‘present sacrifices and for future gainsis an illusion – an ideological ploy to secure current privileges.

Market Liberalization

Under conditions of total liberalization, the strategy advocated by the IFIs and followed by many Latin American and ex-communist rulers, all barriers to foreign investors entering the local economy have been lifted. Studies have demonstrated that where local establishments go head to head with large MNC, they almost always lose out, either going bankrupt, being bought out by the bigger firm or becoming a satellite supplier. Since most employment in the Third World takes place in small and medium size enterprises, the result of the entry of FI leads to an increase of unemployment as millions of firms providing jobs go bankrupt.

FI relies heavily on suppliers, experts and consultants from their home base to externalize costs (and maximize profits) and to maintain control, thus savaging existing local suppliers who were linked to local small and medium size producers. Only a small number of local firms survive the large-scale entry of foreign-owned MNCs. This is not surprising given the tax incentives, credit access, economies of scale and ‘monopoly tactics’ which they employ to capture markets (initially lower prices to drive out competition and then price increases once monopoly is established). The emergence of a minority of locally owned competitive firms is commonly publicized by neo-liberal ideologues as part of their success story, excluding the much bigger story of failed enterprises and the foreign takeovers of majority shares of the local market.

The invasion by foreign investors of local economies seriously compromises efforts to construct ‘regional integration’. This occurs because the principal beneficiaries of broader markets are precisely the large foreign-owned enterprises, not the national firms. This is particularly evident in MERCOSUR (the association of Brazil, Argentina, Uruguay and Paraguay). By locating in the country with the lowest labor and tax costs, the MNCs can dominate regional markets, undermine protected industries in neighboring countries and generate severe and destabilizing trade imbalances between different members of the regional integration pact.

Contrary to most ‘progressive’ opinion, regional integration, far from being a nationalist or regionalist alternative to imperial domination becomes a FI launching pad for entry into broader markets. What gives a particular reactionary cast to «regional integration» proposals is that they skip over the more obvious problems of the lack of national integration within the participating countries: the decline of the domestic rural market because of inequalities of land tenure, the concentration of wealth in the urban central city and the vast impoverishment of sprawling suburban slums, the growth of dynamic enclaves in a sea of low paid, precarious, informal economic activities.

«Regional integration», which is anchored in large-scale foreign and national owned MNC, becomes a strategy to expand sales without changing the national class structure, the unequal distribution of land and income.

Opening the economy to FI is almost always accompanied by the «de-regulation» of the economy, or more accurately, a change in rules which facilitate the movements of capital in and out of the country. In particular the ‘liberalization’ of financial markets, meaning the decline of public oversight of financial transactions, allows FI to ‘launder’ unreported revenues and profits and transfer funds overseas.

The net effect of increasing market access for FI is to replace a market attuned to transaction between local producers, to a market constructed in the image of FI – with a heavy import content and deleterious nutritional effects (like soft drinks and fast foods) accompanied by colonial ideological-cultural propaganda.

Cheap Labor: Unskilled, Skilled and Professional

One of the most striking incentives to FI offered by Third World and ex-communist states is state-promoted cheap labor in manufacturing, services and the primary sector. In order to attract FI, states frequently following IFI directions have initiated a whole series of decrees and laws dramatically favoring capital over labor: wages and salaries have been reduced, frozen or kept below the rate of inflation; job protection legislation has been abolished or severely modified to allow investors to hire and fire without any restrictions or due process; severance pay has been eliminated or reduced; the work day and working conditions have been revised, extending and intensifying exploitation; pension and health benefits have been reduced, eliminated and privatized, trade unions have effectively lost the right to strike, have been repressed or incorporated in state-run, investor-dominated ‘tri-partite’ pacts.

By concentrating power in the hands of capital (euphemistically called «labor flexibility») the neo-liberal regimes compete with each other in bidding for FI. Favorable anti-labor legislation and draconian restrictions on trade unions have lowered labor costs and have favored foreign investors in labor-intensive manufacturing.

Since the 1990’s however FI has increasingly looked toward ‘outsourcing’ skilled jobs to low-wage/salary regions. This requires state promotion of an educated low-paid work force and financing of local business elites to act as recruiters and point men for the FI. Overseas relocation, the reality and the threat, is a common policy to lower wages, pensions, health benefits and job security in the imperial countries. Foreign investors benefit from both ends: exploiting skilled and unskilled labor in both assembly plants and high tech (IT) industries in the Third World and ex-communist countries and reducing labor costs within the imperial countries, playing off one against the other and securing labor incentives from neo-liberal states in both. The net effect is to increase profitability by squeezing out greater productivity per worker at lower costs, expand market shares and create lucrative export platforms to sell back into the «home market».

The same practice and logic which applied to the outsourcing of unskilled labor to low-wage areas has been extended to high end skilled labor in an array of activities from specialized software programming, accounting, engineering, research and development and design. The notion propagated by neo-liberal apologists that the loss of manufacturing jobs would be ‘compensated’ by the growth of skilled service positions fails to recognize that corporations would follow the same logic with regard to skilled service jobs.

The net result of low-cost labor incentives to attract or retain FI has been to widen the economic gap between labor and capital, deepen the inequalities in political and social power, and dissociate growing productivity and profitability from wage returns. Wages and salaries increasingly lag behind capital gains in productivity, profits and export earnings largely as a result of the vast and profound labor incentives – privileges to FI. Under the rule of labor incentives to FI, growth of GNP has few spread effects to the rest of society, creating highly polarized growth.

One of the primary concerns of FI is securing ironclad legal guarantees against nationalization, expropriation or new regulations, no matter what the circumstances or non-compliance of MNCs. To attract FI, neo-liberal regimes legislate or decree measures, which over-rides constitutional, health, environmental and other laws, in order to provide the absolute security which FI demand. The pursuit of ‘low risk’ status by many Third World and ex-communist countries in order to attract FI, undermines the countries’ sovereignty in several ways. In the first place, it opens the country to international judicial processes, embargoes and heavy fines if and when a future government decides that the non-nationalization and expropriation agreements violated the country’s laws, were signed under duress, lacked transparency or simply gave undue privileges to FI. In other words, the pursuit of ‘low-risk’ status sacrifices future options and raises ‘risks’ for future governments intent on restructuring or transforming the country or merely altering the balance between public, private and foreign investment. ‘Low-risk’ agreements for investors may close the book or make it costly or ‘high-risk’ for future regimes designing new strategies, as the economy outgrows the FI-dependent stage.

In practice, there cannot be any durable investment ‘guarantees’ against expropriation, new regulatory or tax regimes or even confiscation because the conditions for FI vary with the fortunes of the class struggle, national liberation movements, global economic conditions and the changing priorities and internal dynamics of MNCs. The ‘low-risk’ agreements between an authoritarian regime and FI will last as long as the regime can silence or co-opt opposition.

Elected regimes which single-mindedly provide generous contracts and opportunities to FI while imposing prejudicial austerity programs on working majorities have caused the greatest damage among more highly developed economies, like Argentina and Russia, with a highly trained labor force, a developed home market, reasonably, sound infrastructure and an advanced social welfare system.

Large-scale privatization and denationalization promoted by regime ideologues, aided and abetted by US free market academics, have provided innumerable incentives for FI buyouts. In both Argentina and the former USSR, privatization and financial deregulation did attract FI but with catastrophic results for the economy and the population. FI bought public enterprises at bargain prices, especially oil and gas fields, communications and other lucrative areas; financial deregulation led to massive bank frauds, and transfers of huge sums out of the country. The economies collapsed and foreign debt payments overwhelmed the countries’ capacity to pay. Living standards plunged, with over one third of the workforce unemployed: Over half fell below the poverty line. The ranks of the truly indigent climbed to over 15%. Pension plans, advanced medical systems, educational and scientific facilities crumbled and skilled professionals fled the country in droves. Foreign investors initially prospered with their privileged access to the economy, but uncontrolled plunder led to a general crisis, which eventually engulfed the very speculators who brought it about.

Given the severe drawbacks in providing long-term, large-scale privileges to attract FI, what is the response of FI to a shift in policy, from providing corporate incentives to progressive social reforms, economic regulation, re-nationalizations, prosecution of tax evaders and money launderers and environment protection?

FI: Strategies to Counter Social Reform and Popular Responses

For policymakers intent on constructing an alternative development model to the FI centered approach it is important to anticipate the strategies of opposition, which FI will adopt and be prepared to put in place timely counter-measures.

The most likely first move of FI, to counter policies designed to enhance the national economy and popular living standards, is to threaten or practice disinvestment in local facilities. This involves lowering production, closing facilities, reducing or withdrawing capital to destabilize the economy and force the government to withdraw, rescind or not implement legislation or executive rulings. Disinvestment can be accompanied by the threat of an «exit strategy» – putting in jeopardy the employment of local workers, suppliers and other satellite enterprises.

  Knowing this is a real probability, the state can raise the stakes by insisting that disinvestment can lead to the cancellation or re-negotiation of the original investment agreement and/or state intervention into the enterprise, followed by outright state takeover in the public interest to safeguard employment, production, maintenance and shares of export markets. In other words, firm assertion of state purpose makes FI disinvestment a two-edged sword: either abide by the new legislation or lose access to the local market, exploitation of local resources and supply of strategic goods. The state can also affirm that there is ‘no return’ once an «exit strategy» is adopted.

To back up the counter-strategy and make it more credible, the state should be ready to replace senior corporate personal with local specialists from within the plant, or from other agencies or from the outside. Negotiations with suppliers and purchasers should be in place. Most of all the employees, workers and professionals in the affected economic sector should be mobilized, consulted, organized to respond favorably to the impending confrontation. They and the larger public – the workers, peasants, lower middle class, professionals — should be informed and prepared for a period of transition to the new socio-economic model, in case there are sacrifices and temporary hardships.

A reduction or the elimination of privileged place of FI in the economy will likely lead to a run of liquid assets, which will certainly cause financial disruption. Here decisive and rapid action is essential – including the freezing of assets, generalized capital controls and other restrictive measures on the movement of capital, while maximizing the role of state-sponsored policies to maintain levels of credit and to maintain production even if it means a spike in inflation and monetary emissions, requiring price controls or subsidies on basic items of popular consumption.

Failing to intimidate the progressive regime through economic threats or actions, FI will turn to their imperial state to exert bilateral or multilateral pressures. These can range from threats to cut off loans from IFI, to restrictions on imports and exports, to destabilization efforts and/or threats of military intervention. Several contingencies may influence the effectiveness of these political pressures. In many cases the key competing imperial countries may not be in agreement on these measures, especially if they affect mostly one or another imperial power. Secondly the global economy is neither homogenous nor ‘unipolar’ in trading or military policy: losses by one imperial power can be gains for another. Thirdly threats to cut off financing by the IFI is a two-edged sword: ending of financing can lead to debt default, the refusal to pay past loans, setting a precedent for other debtor countries, and escalating the conflict to the global level. Once debt payments are suspended, the ‘extra revenues’ can be used to compensate enterprises prejudiced by IFI cut-offs. The larger the debt, the greater the destabilizing impact of a debt moratorium will have on international financial markets.

Clearly in anticipating this escalation of the conflict with FI, the state must view the problem through political lens in order to best prepare its counter-attack. Imperial threats usually radicalize and mobilize popular movements, isolate elite allies of the imperial power, and polarize the country in a way favorable to the regime, if the latter has clearly defined and demonstrated the socio-economic advantages of pursuing its new development model. If the imperial state pursues a military-political interventionist strategy, the regime in consultation with its mass constituency must rapidly pursue a multi-layered national defense strategy, which can range from anti-terrorist measures, to legislation outlawing imperial funding of political parties, NGO’s and media outlets.

Clearly significant changes in one vital sector of the economy imply changes in the totality of the society and state. By regulating or redefining the state-FI relationship, new political actors are drawn in as the conflict spills over to other sectors of the economy and across frontiers, leading to the need for further changes in the economy and state security structure. Looking at the problem of FI conflict in narrow economic terms of a state-investment framework, can lead to unanticipated attacks and likely defeats and retreats.

FI can rely on their associates in the mass media to launch «scare propaganda campaigns», which demonize progressive regimes: labeling them terrorists, rogue states and communists – part of the battle of ideas. The regime must be prepared to counter elite media warfare through its own mass media within the country and via progressive social movements and media throughout the world. Internet sites, community radios, videos and international solidarity organizations can be effectively mobilized to reach the active populations who would respond to the positive changes initiated by the progressive regime. What is essential is to move beyond «critiquing» the power of the adversarial corporate media toward the creation of multiple mass outlets and activities to gain political support.

  It needs to be emphasized that ‘changes’ in relation to FI are interconnected with and activate other structures of the state and economy. The media, ideological and cultural wars are essential to sustaining or undermining efforts to limit or eliminate the dominant privileged role of FI.

A third strategy to undermine progressive legislation, which is almost always adopted by FI, is the corruption of government officials – especially regulators –, trade union officials and the political elite. This involves cash payoffs in foreign accounts, job offers to relatives or promises of managerial positions after serving office, visiting professorships to prestigious universities with lucrative stipends, and a host of other remunerative rewards. Judges appointed by the pliable executives can be expected to rule against state measures to revise FI contracts or to rule in favor of extra-territorial judicial sites (lawsuits in imperial jurisdictions).

While «international» and NGO investigatory agencies have established «transparency» ratings for countries, few if any have examined or established corruption ratings for MNCs and FI, despite their widespread use of bribes and illicit activities and the devastating effects it has in undermining progressive changes. Corruption by FI can be limited by introducing a number of institutional changes: by creating workers, consumers and environmental oversight committees with open access to all accounts, transactions and especially government contracts. Secondly, corruption can be limited by publicizing all stages of negotiations between state and MNC and making it obligatory and subject to scrutiny by the classes and organizations most affected. Auditors and investigators who have no ties to FI interests can serve a technical advisory role in preparing evaluations of contracts and state-FI agreements. The reform of the public administrative structure must include deep ethical and political changes, inculcating members with a commitment to national and class values, from top to bottom. Ultimately technical and ethical/political commitments are the best safeguard for neutralizing the FI corruption designed to undermine the implementation of progressive legislation.

Finally FI may accept regulations and reforms, but resort to increasing prices, and lowering labor costs to maintain profits. State intervention fixing rates is an obvious counter-measure, along with threats to re-nationalize if FI decides to hold back on promised new investments. Enforcement of labor legislation and price constraints monitored by organized consumers can block corporate efforts to «pass the costs» of state reform to the consumer.

Conclusion

Incentives to FI usually come at an unacceptable cost to workers, consumers, taxpayers, local producers and environmentalists – all have to pay for state subsidies which privilege FI in the way of higher taxes, lower social services, scarcer and more expensive credit, and higher prices. Alternatives to incentives and privileges to FI are readily available, feasible and beneficial when a regime is prepared to withstand the inevitable threat, pressures and propaganda, which emanate from the imperial state linked to FI. Taking a broad strategic approach prepares the state – allowing it to develop effective countermeasures to the reprisals taken by the FI or their colleagues in the IFI and the imperial state.

May 25, 2005. Corrected June 28, 2005