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Lester Pearson at the World Bank

Western governments aggressively imposed privatization packages upon Southern states during the latter half of the 20th century

Canadian PoliticsEconomic CrisisEnvironmentGlobalization

Lester Pearson at Germany’s accession to NATO, 1955. Photo courtesy NATO.

In August 1968, the World Bank assembled a team of “stature and experience” to study the impact of twenty years of international development aid, identify missteps in its allocation, and offer recommendations for the future. President of the World Bank Robert S. McNamara asked former Canadian Prime Minister and Nobel Peace Prize recipient Lester B. Pearson to chair the committee.

After 11 months of research, Pearson’s team presented their suggestions to the World Bank. The report was titled Partners in Development, but it is more widely known as the Pearson Report. Shortly after its publication, Pearson went to Washington and summarized his team’s arguments before the World Bank and the International Monetary Fund. Many of the team’s suggestions will be familiar to those who have studied the post-war history of Global North development aid, both private and public, and its insistence on resource privatization and industrial capitalist modes of production in recipient countries.

Ivan Illich, an important forerunner of the degrowth movement, directly challenged the Pearson Report’s recommendations. In 1969, he delivered a speech for the Canadian Foreign Policy Association titled “Outwitting Developed Nations” in which he argued that the authors’ notion of “development” (the expansion of the Western model of industrial capitalism into Latin America, Africa, and Asia) was in fact a model for social and economic underdevelopment.

Underdevelopment and the global food crisis

A recent study in Global Environmental Change found that, between 1990 and 2015, the total value of resources drained from the South by Northern countries equaled $242 trillion, roughly one quarter of combined Northern GDP. The authors of this study note that such unequal exchange “is a significant driver of global inequality, uneven development, and ecological breakdown.” In this context, the Bretton Woods institutions continue to push for neoliberal austerity in the Global South, even as the United Nations warns that the number of people enduring famine conditions has increased fivefold since 2016.

Atlantic Council writer Rama Yade notes that “[t]he Bretton Woods Institutions—the IMF and the World Bank—clearly represent a world order centered on the Global North.” Through these institutions, Western governments aggressively imposed privatization packages upon Southern states during the latter half of the twentieth century, particularly following the publication of Lester B. Pearson’s recommendations in 1968.

Throughout the 1970s and 1980s, loans from the World Bank and IMF were conditional on the adoption of neoliberal policy packages. These reforms dramatically worsened the crisis of food production in these countries. This is because, after instituting the reforms, “indebted countries across the Global South had to convert from prioritizing indigenous crops that the local population depended on, to producing cash crops for export [which meant] local populations and farmers became more vulnerable to food scarcity—due to the negative ecological effects and decline in food accessibility.”

Structural adjustment programs and the agricultural “Green Revolution” attacked the autonomous livelihoods of small farmers in the Global South and made their food systems dependent on inputs from the North. These interventions mean that many small farmers in underdeveloped countries no longer possess the means to weather crises such as the ongoing upheavals in global food production.

As the head of the World Bank’s committee to review and criticize the development goals of the Bretton Woods institutions, Lester B. Pearson had the opportunity to foreground an alternative form of Northern engagement with the South. Instead, he reaffirmed all the most harmful aspects of these institutions and argued for their greater involvement in the lives of people in Latin America, Africa, and Asia.

Lester B. Pearson and the underdevelopment of the South

The development strategy that Pearson posited in Washington was one in which “developed,” “enlightened” countries—what he called “the civilized societies of the world”—offer technological assistance and development aid to “developing” countries in order to wake them from their centuries-long “slumber” and integrate them into global trade patterns. To this end, he urged governments in the Global North to channel roughly one percent of their Gross National Product (GNP) through multilateral aid institutions for the purpose of “developing” the South.

In Washington, Pearson stated that developed countries have a responsibility to “help the developing countries to help themselves,” thus forwarding a values-based history of foreign aid in which the concept of “development” becomes a non-relative and non-temporally-fixed category, a timeless noble pursuit united by “two strands of human thought: the belief in progress and the conviction that man can master his destiny.”

Whose idea of progress? Whose idea of mastery? These are questions that Pearson did not interrogate.

Elsewhere, Pearson contradicted his assertion that the countries of the Global North undertake foreign aid initiatives due to their commitment to an eternal and honourable notion of “progress.” While speaking to the House of Commons about Ottawa’s investment in the Colombo Plan, Canada’s first overseas aid initiative, Pearson warned that “Communist expansionism” was fated to overtake the entire world if Canada did not take a leading role in its suppression. “It seemed to all of us at the [Colombo] conference,” he said, “that if the tide of totalitarian expansionism should flow over this general area [then] it would not be easy to contemplate with equanimity the future of the rest of the world.” He added that representatives “agreed that the forces of totalitarian expansionism could not be stopped in South Asia and South-East Asia by military force alone,” indicating the strategic Cold War value of foreign development aid.

As a reactionary document, the Pearson Report is more measured than some of its principal author’s statements in the House of Commons. Nevertheless, it clearly argues that the model of “progress” that should be implemented in the Global South is one based on industrial capitalist production, the rampant exploitation of resource wealth, and integration with global trade flows organized from North America and Europe.

“[T]he paramount, long-term interest of all nations,” said Pearson in his speech to the World Bank and IMF, “is in the creation of a world in which all the world’s resources, human and physical, are put to the greatest possible use.” In Pearson’s view, both foreign aid from capitalist states and private capital investment would help inaugurate such a world.

“This emphasis on official aid in no way means that we minimize the importance of private flows,” he declared to his audience in Washington. “On the contrary, we feel that private foreign investment and the transfer of knowhow are important and need to be stimulated.” Such “stimulation” would be based on privatization, investment from Western companies, and the technology-driven growth of production, with the eventual goal of turning recipient countries into “outward looking and competitive” economies.

Once this goal was achieved, Pearson announced that “the deprived and disadvantaged will join the mainstream of technological and social progress.”

The refrain recurs once more: whose mainstream?

In the agricultural sector, Pearson praised the so-called Green Revolution, a pro-agribusiness production model that relies on the exorbitant usage of agrochemicals and water resources to create monocrop export economies, as “promising.”

In India, where Green Revolution techniques were first tested, smallholder farmers became dependent on the expensive chemical inputs used in larger farms, which forced many of them into debt. Today, millions of farmers in India are smothered by the debt they accrued while trying to keep up with this high input cost. Approximately 30 farmers die by suicide every day in India, many because of despondency over these debts.

Another preoccupation of the Pearson Report’s authors was population control in Global South countries. “[N]othing we do in the development field in low-income countries will be of lasting significance unless and until there is a substantial slowing of the rate of population growth,” Pearson argued. As such, he encouraged the enforcement of “family planning” policies in Latin America, Africa, and Asia, plus the creation of a UN Commissioner for Population to “help direct population control programmes in the various UN agencies.”

One of the report’s thirty suggestions was that “Birth rate control must be stressed by both donors and recipients when planning aid programmes” because “no child should be born unwanted.” Again, the question of “unwanted by whom?” appears not to have entered the authors’ thinking.

Other recommendations of the Pearson Report include the “vigorous expansion of world trade” and the suggestion that “developing countries should remove impediments to foreign investment and assure stability and improved administrative procedures affecting foreign firms.” None of the report’s recommendations addressed the issues of inequality, unemployment, environmental impact, increasing urbanization, or poor public health.

Overall, the report as well as Pearson’s speech in Washington drip with paternalistic rhetoric. While claiming to want to help the Global South, the report constructs its peoples as backward, child-like, and in need of “civilized” Western instruction and technologies to best organize their production and trade—a production paradigm which, not coincidentally, has disproportionately benefitted Western capitalists and consumers.

As Austrian philosopher Ivan Illich stated in 1974, rhetoric of this kind reveals nothing more than “the missionary-imperialist conviction about ‘the rich man’s power to help,’” which “developed to protect the rich man’s confidence in his industrial delusion.”

Ivan Illich and autonomous development

While attacking both the Pearson Report and the John F. Kennedy administration’s Alliance for Progress, Illich said that the only ‘progress’ they produced was “the progress of the consuming classes.” Far from eradicating need in the recipient countries, such programs were simply “a major step in modernizing the consumption patterns of the middle classes in [the Global South] by integrating them with the dominant culture of the North American metropolis.”

One should not assume that Illich is irreproachable. A heavy dose of libertarianism complicates some of his contributions, but it does not nullify them. On the contrary, his radical critiques of many of the institutions we take for granted, most famously the institution of schooling, motivate readers to envision sweeping alternatives to present modes of living, even if the reader doesn’t arrive at the same conclusions as Illich.

As humanity slogs through the seemingly unending doldrums of a modern capitalist society built on underdevelopment and unequal exchange, this is a kind of intellectual audacity we need more of.

In his most valuable analyses, Illich takes aim at the industrial capitalist mode of production, which he dubbed “heteronomous” production, and argued that the “autonomous” form of production and consumption (such as production and consumption patterns that are not implicated in industrial commodity manufacturing or national or international resource flows) is the most equitable mode of living available to humans.

Illich warned that “basic needs are increasingly shaped by industrial commodities,” and that “growing dependence on mass-produced foods and services gradually erodes the conditions necessary for a convivial life.” He wrote that the modernizing notion of “development” put forward by the authors of the Pearson Report:

has had the same effect in all societies: everyone has been enmeshed in a new web of dependence on commodities that flow out of the same kind of machines, factories, clinics, television studios, think tanks. To satisfy this dependence, more of the same must be produced: standardized, engineered goods, designed for the future consumer who will be trained by the engineer’s agent to need what he or she is offered.

“We have embodied our world-view in our institutions and are now their prisoners,” said Illich. “We—the rich—conceive of progress as the expansion of these establishments.” Meanwhile “[t]he consumer is trained for obsolescence, which means continuing loyalty to the same producers who will give him the same basic packages in different quality or new wrappings.” He cited Marx and Freud in arguing that the heteronomous mode of production triggers the mental process of “reification” in the minds of consumers, in other words “the hardening of the perception of real needs into the demand for mass-manufactured products… the translation of thirst into the need for a Coke.”

Illich’s polemic cuts through the noise of Pearson’s paternalism and gestures toward a simple question: how can we associate the word “development” with the economic prescriptions of the World Bank and IMF when their main effect has been to exacerbate hunger, food dependence, and class division?

“Traffic jams develop in Sao Paolo,” said Illich, “while almost a million northeastern Brazilians flee the drought by walking five hundred miles. Latin American doctors get training at the Hospital for Special Surgery in New York, which they apply to only a few, while amoebic dysentery remains endemic in slums where 90 per cent of the population lives.”

Clearly, the solution to such problems lies outside the realm of accepted Northern stratagems.

Laugh at accepted solutions

How could Lester B. Pearson claim that he was helping the peoples of the Global South when he was clearly doing nothing but helping transnational capital assail their ways of live?

For that matter, how can Justin Trudeau or Pierre Poilievre claim that Canada is or can be a model for anyone else in the world?

Canada produces more waste per capita than any other nation and ranks as the largest or second-largest polluter in the world. In Canada, there are around 17,000 people living in conditions of slavery—about one out of every 2000 people in the country—and the Canadian government has yet to pass any legislation that would compel companies in the supply chain to disclose the use of slave labour. This is to say nothing of the horrific underdevelopment that daily assaults the livelihoods of millions of people in countries where Pearson’s recommendations have been enacted, and from whom the material well-being of most Canadians derives.

We must join with Illich in asking: what kind of “developed” society would allow this situation to persist?

We in the Global North must conceive of new, just, ecological ways of living. Hewing closer to Illich’s notion of autonomous production would be far more humanitarian and ecologically beneficial than the two paths currently on offer from our leading parties: the Conservative Party’s cultic adulation of “ethical” fossil fuels, and the Trudeau government’s decision to pin any and all hopes for ecological conviviality to a “clean and digitized economy” dependent on the extraction of finite materials from Southern countries underdeveloped by the international financial institutions that Lester B. Pearson helped build.

We must redefine the terms of development that we have imposed on the rest of the world. We must take Illich seriously when he states: “The only way to reverse the disastrous trend to increasing underdevelopment, hard as it is, is to learn to laugh at accepted solutions.”

Owen Schalk is a writer based in Winnipeg. He is primarily interested in applying theories of imperialism, neocolonialism, and underdevelopment to global capitalism and Canada’s role therein. Visit his website at


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