I have read a twitter thread about Summers memo (wikipedia article) today, and trying to understand the last part (bolded).

The problem with the arguments against all of these proposals for more pollution in LDCs [Least Developed Countries] (intrinsic rights to certain goods, moral reasons, social concerns, lack of adequate markets, etc.) could be turned around and used more or less effectively against every Bank proposal for liberalization.

So, if I understand, moving toxic production to LDC to decrease world-wide cost of healthcare is a bad thing due to some argument. But there are policies that are deemed to be good and accepted by World Bank, that can be struck down using the same argument?

Question: Which policies are those? Which "Bank proposal for liberalization" does the memo refer to?

The wiki article says also that

Summers had only signed it, and that it was intended to be "sarcastic"

But I am not sure toward what policies or arguments this sarcasm was pointed.

  • $\begingroup$ The quote says "every Bank proposal for liberalization" and as I read it, that's exactly what he means. Are you looking for a summary of what arguments the Bank was making for liberalization c.1991 and how that might relate to the context of the memo? $\endgroup$ – Brian Z Apr 26 at 18:13
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    $\begingroup$ @BrianZ i am looking for an example, as I am not even clear on what "liberalization" means here, and how moving toxic manufacturing to LDC is a liberalization policy $\endgroup$ – aaaaa says reinstate Monica Apr 26 at 18:19

The context of this memo was an emerging debate about structural adjustment and its environmental implications. The World Bank has attached a wide range of liberalization policies to many of its loans. These policies were meant to increase trade and foreign investment and to decrease fiscal deficits, all of which should help countries to pay back their loans. Critics argue that imposing these forms of liberalization on LDCs forces them to prioritize repayment over other policy goals, including environmental protection.

Here is a 2003 review on environmental impacts of structural adjustment by Bank researchers which briefly mentions and dismisses the "pollution haven... hypothesis that 'dirty' industries migrate to low-income countries after trade liberalization because of differences in costs of pollution abatement and looser environmental standards (p. 27)."

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