Peter Lyons: If underdogs stop playing by the rules

COMMENT

The politics of the rugby World Cup provide an excellent synopsis of the international economy. The reasons for growing inequalities between nations are evident for all to see. The level playing field is a cruel hoax.

The minor nations were packed off home from the World Cup having provided the cannon fodder in pool play, and the powerful nations got down to the serious business of sharing the spoils. It is worth reflecting on the reasons the vanquished are unlikely ever to be competitive against the leading nations and why some appear to be regressing.

Observing the mechanisms of the World Cup provides fascinating parallels to the politics of international economics.

In both the World Cup and the international economy, the powerful nations dictate the terms and conditions of the competition. Other nations face the stark choice of either participating or opting to be excluded. They are aware that if they choose exclusion, their game will suffer, but that the rules of participation are not of their making.

The International Rugby Board governs international rugby. To an extent the International Monetary Fund and the World Trade Organisation govern the international economy.

The IRB is dominated by the main rugby powers; the IMF and the WTO are dominated by the major economic powers.

The IRB determines the location, rules and conditions of the World Cup. The draw favoured the powerful nations. Their fixtures in pool play were more spread out and their travelling itineraries less onerous than those of the lesser nations. This was unfair, but commercial realities dictated it, according to the IRB chairman, Syd Millar.

The WTO and the IMF determine the rules of international trade and finance. This has favoured the reduction in trade barriers affecting the exports of developed countries. There has been little progress on reductions in agricultural protectionism that affects mainly the exports of developing nations.

The major rugby powers share in the commercial success of the World Cup. They also benefit from other major tournaments such as the Super 12 to which only they have access. This commercial advantage allows them to further develop their domestic game. They are able to field full-strength sides at the World Cup whereas less developed rugby nations may not have that luxury for lack of money.

In the international economy the reductions in trade barriers have been mainly to the benefit of developed nations. This boosts their export revenue and allows them to invest and develop their economies. That, in turn, enhances their competitive advantage and standard of living.

Less developed countries are denied reciprocal fair access for their agricultural exports. They become reliant on external borrowing to develop their economies. If they are unable to service those loans, they may be forced to borrow from the IMF and be subject to its structural adjustment programme.

This requires capital market liberalisation and the privatisation of Government assets. As a result, key assets of these countries, including water and power utilities, are acquired by overseas investors.

In rugby terms, what this means is that the powerful nations not only dictate the terms and conditions of the economic game, but also end up owning the stadiums, rugby fields and the balls of other nations.

The dominant rugby nations use their commercial advantage and greater wealth to acquire talented players from the less developed rugby nations. This further widens the gap in playing ability.

In the international economy, developed economies have tailored their immigration policies along similar lines. They actively encourage skilled migrants from developing countries. In effect they are poaching the human capital of countries least able to afford the loss. This further widens the gap in economic prosperity.

Growing inequalities between nations are ultimately unhealthy in both rugby and economics.

The viewing public are unlikely to be inspired by the same few nations fighting it out for ultimate honours in every World Cup. It does little to expand the game internationally.

Economic inequalities between nations curtail the capacity for world growth. If developing countries can develop their economies, this provides lucrative markets for all other countries.

Fair and free international trade is not a zero-sum game. Basic trade theory illustrates that all countries can benefit.

To rely on the benevolence of the powerful countries to make the rules and conditions equitable for all participants is naive. The powerful stack the cards in their favour. The result is growing resentment from those being exploited and excluded from the gains. This resentment can lead to a refusal to participate.

It may also result in co-operation between the disadvantaged nations to force the powerful to change the rules and address the mechanisms that contribute to the inequities.

The Cancun round of the WTO indicated that this is starting to happen in the international economy. Nations such as China, India and Brazil refused to play by the rules that for so long had been dictated by the powerful. The IRB needs to be careful that the developing nations of world rugby do not do likewise.

* Peter Lyons is a lecturer in foundation studies at Otago University.