IN 1980, when Edward Seaga and his moderate Jamaican Labour Party (JLP) swept into office in an election marked by violence and discord, a sign of relief sounded in Washington and in the boardrooms of many multinational corporations. Seaga won on a platform promising the redirection of Jamaica's economy along lines favorable to foreign investment, especially American, and the revitalization of the private sector on the troubled island. What pleased Washington even more than the JLP's repentant capitalist slogans was that --temporarily at least--the election did away with Michael Manley and his People's National Party (PNP).

Manley, scion of the father of Jamaican independence, served as prime minister from 1972 to 1980. His tenure proved a continual source of irritation to the State Department and leaders of the business community, as he tried to lead his tiny nation along independent lines that often conflicted openly with American policy and interests. He pledged his country to the principles of democratic socialism, established a controversial friendship with Fidel Castro, and raised the taxes on the foreign aluminum companies which had substantial investments in the country. With Cuba enough of a thorn in its side, Washington was wary of tolerating another upstart in the neighborhood, and relations with the former British colony chilled.

Jamaica: Struggle in the Periphery is Manley's account of those eight years in office. It details from the driver's seat the difficulties in governing a nation in the aftermath of colonialism--the attempt to construct a viable society out of an island of former plantations and fit it into an international community characterized by superpower domination and an economic order designed to keep the little guy down. What emerges is a disturbing image of the United States and a valuable insight into the plight or the Third World.

While in office, Manley experimented with what he calls a "third path" in the Caribbean. The political setup of the region gives a government two basic choices: the "Puerto Rican" model with virtually complete economic dependence on the United States and the Cuban example of reliance on Soviet support. Manley sought to place Jamaica somewhere between these two poles. He and the PNP set out to develop a mixed economy with an emphasis on socialist techniques within the framework of Jamaica's democratic political system Meanwhile, he pursued a vigorous foreign policy in concert with the burgeoning non alignment movement.

Formidable obstacles faced Manley's economic plans. Primary among them was the need to make Jamaica's colonial economy--structured on the mining of bauxite for the aluminum industry and the export of sugar and bananas--more responsive to the needs of its own two million people. Manley sought to increase domestic production and foster popular participation in economic planning, thus wresting it from foreign control. He incurred the wrath of the business world by raising the taxes the foreign companies had to pay Jamaica, an attempt to bring more revenue to the island. This taxation and other measures. Manley charges, later prompted the multinationals to back attempts to unseat him.

THE GOVERNMENT also introduced a host of populist measures, from increased participation in local government to literacy campaigns and widescale public housing construction. The Jamaican private sector found such measures far too radical; an exodus of skilled workers and professionals ensued, and those who stayed formed a permanent opposition to Manley and his policies.

Manley demonstrated equal ambition in his foreign policy. Jamaica chaired the Non-Aligned Movement during this period and was among the most vocal in demanding the implementation of the New Economic Order and improvement of North-South relations. Manley to this day stands by his country's decision to back Cuban involvement in Angola; he argues that Castro, in offering Angola his support, was responding to requests from the legitimate Neto government trying to ward CIA destabilization efforts.

Whether Manley's policies could have worked under normal conditions will never be known. Soon after the commitment to democratic socialism, oil prices quadrupled, triggering inflation which, if it rocked the boat of industrial nations, sank the developing ones--particularly Jamaica with its total dependence on foreign oil. Simultaneously, commodity prices, the backbone of Jamaica's economy, plummeted, decreasing her purchasing power in world markets fourfold. Unemployment hovered consistently around 30 percent and crime was rampant. Efforts to build a healthy mixed economy were shelved in the struggle to keep Jamaica's economy afloat.

Hat in hand, the government approached the International Monetary Fund (IMF). Much of the book is devoted to the negotiations with the IMF and to Manley's caustic assessment of the organization. He contends that IMF conditions for aid, which include an austerity program, impose unbearable hardships on the receiving country, cutting wages and increasing unemployment. At one critical point Manley had to import either food to feed the starving or raw materials to avert economic collapse. The IMF, he concludes, is totally unresponsive to the needs of the Third World:

The IMF was created by the capitalist countries after World War II. It is designed to apply capitalist techniques and to serve the ends of those who created it...the search must be for the rapid development of its production for home needs and trade.

Discussion of the book will probably, center on Manley's allegation that the United States conducted a campaign of destabilization against his government, beginning when Manley backed Cuba's involvement in Angola and lasting until his defeat in the 1980 election. All this time, he charges, the American press false reported that Jamaica was in chaos and overplayed its ties with the communist countries. The CIA allegedly played upon the upper classes' fear of ongoing economic reforms and backed the sabotage and violence with which the JLP sought to undermine the Manley administration. The charges are bold, but Manley attaches a "Destabilization Diary" to the book which makes a strong case for U.S. interference in Jamaican affairs.

THE VALUE of Manley's book lies less in its role as contemporary history than in its unspoken call for action. The narrative indicts a system of international inequity of which the U.S. is a major perpetrator. In the process, Manley provides a glimpse of how the U.S. appears to much of the world--meddling, insensitive, and arbitrary. Jamaica exposes a basic fault in U.S. foreign policy: blinded by its free enterprise ideology. America immediately panics when some smaller nation close to home opts for a different path. Instead of endearing itself to its neighbors and endearing itself to its neighbors and its influence in more constructive ways, Washington alarmists time and again alienate would-be allies.

In opposing Manley, the United States overlooked Jamaica's spotless human rights record and healthy democratic system and concentrated on maligning her economic policies. Manley puts it succinctly: "The fact that the recourse to destabilization tactics seemed necessary throws us back again in the nexus of imperialist relations, their intolerance of ideological and economic independence of any kind." His story is but another testimony to industrial nations' failure to address the worsening world economic crisis.

THAT U.S. INTERESTS are heavily at stake in the Third World is unquestionable. Currently, one out of every 20 jobs in America is related to exports to developing nations, and 40 percent of what we sell abroad we sell to the Third World. Many of these governments borrow heavily from the U.S., and a failure to make good on one of these loans could unravel our entire financial system.

Congress's recent increase of foreign aid allocations is only a small step in reversing the decline in U.S. aid since Reagan took office. The much-publicized meeting in Cancun last summer, aimed at dealing with North-South economic problems, met with only a promise from Reagan to seek further discussions. The Caribbean Basin Initiative, the president's impressive program to promote prosperity in Central America and the Caribbean, somehow got buried in the confusion of the lame duck Congress. Though targeted nations have received some aid, many more broad-range promises remain unfulfilled.

Many developing nations still desperately need to reschedule payment of foreign loans and take out further ones; this will solve immediate problems, but the long-term picture requires more far-reaching help. Figures such as former Secretary of State Henry Kissinger and World Bank Head A. W. Clausen agree that restoring a healthy world economy will depend on long-term sustainable growth; this means that nations such as Jamaica must become more equitable participants in the international economy. To this end, the United States must give up its tunnel vision on proposals aimed at bolstering Third World nations. The miracle of the marketplace can't do it alone.