The global kleptocracy: 'free trade' and corporate economic imperialism

Whilst arguments rage in the UK about the aftermath of the horrific and senseless murder of a soldier in Woolwich, around the world corporations are continuing to push ahead with globalisation by looting the natural resources of developing nations and destroying the livelihoods of indigenous peoples. This is capitalism actively creating poverty in action. A recent article in the Guardian reported that:

"Land conflicts between farmers and plantation owners, mining companies and developers have raged across Indonesia as local and multinational companies have been encouraged to seize and then deforest customary land – land owned by indigenous people and administered in accordance with their customs. More than 600 were recorded in 2011, with 22 deaths and hundreds of injuries. The true number is probably far greater, say watchdog groups."

When this happens, there is invariably collusion between local politicians,  and the police and army, and the corporations, resulting in deaths and injuries to people trying to defend their land and resources. These are the very same corporations we are told we should be supporting, because they provide jobs and create wealth. But this is simply theft. This is the 'free' market in action, showing its true face.

Not so long ago this is what the empires of Britain, France and other colonial powers were doing, but since then nothing has really changed apart from the fact that this naked exploitation is hidden behind a veil of corporate respectability and underpinned by a raft of secretive trade agreements, supported by global organisations like the WTO. The impact of this, long evident in developing nations, is now being felt in western countries, in Europe and the UK, as the same corporations loot our pensions and asset strip our public services, putting profit before people. One of the best explanations of this process I've read 'Globalisation and Democracy' by Michael Parenti which I can't recommend highly enough. Parenti nails the mechanisms by which the 1% and corporations, which I like to call the 'global kleptocracy' steal wealth from the rest of us:

"With international “free trade” agreements such as NAFTA, GATT, and FTAA, the giant transnationals have been elevated above the sovereign powers of nation states. These agreements endow anonymous international trade committees with the authority to prevent, over rule, or dilute any laws of any nation deemed to burden the investmentand market prerogatives of transnational corporations. These tradecommittees–of which the World Trade Organization (WTO) is a prime example—set up panels composed of “trade special ists” who act as judges over economic issues, placing themselves above the rule and popular control of any nation, thereby insuring the supremacy of international finance capital. This process, called globalization, is treated as an inevitable natural “growth” development beneficial to all. It is in fact a global coup d’état by the giant business interests of the world [my italics]."

The latest of these agreements is the Trans Pacific Partnership (TPP) , which is a further extension of corporate power, enabling corporations to bypass or overrule the democratic decision of our elected governments. Our leading politicians, including President Obama, are promoting this corporate destruction of our democratic rights. We need to raise awareness of what is happening not only because of the destructive power of globalisation, but because it is a theft, not only of land and resources but also our democratic sovereignty.

What is work and what is it really for?

What is work, what is it for, and what is it going to look like in the future? Do we need to work and how much work should we do? These are increasingly important questions, particularly in an age when we have to build a sustainable economy, adjust to climate change, and capitalism is unable to provide people with work. It's worth enlarging on that last point, what exactly do I mean by 'unable'? We can see that capitalism is unable to provide work for millions of people in Europe and America because of the failure of austerity. But austerity itself is simply a means of making the 99% pay for the failures of financial capitalism which culminated in the great crash of 2008.  Western Governments, the implementers of austerity, are working in the interests of the capitalist class, the 1%, and have no intention of returning to 'full employment', which was the policy of governments in the 1960s. Nowadays, we have to hope we can get a job, however, low paid, or we have to create one for ourselves, or we have to suffer the indignity of being treated like a scrounger, on benefits, because governments aren't actively going to intervene to create jobs like they used to. Given this current neoliberal approach to employment, we could end up with high levels of unemployment, and underemployment indefinitely, and there are good reasons for thinking that this will be the case. In other words, there will never be a return to the days of full employment and decent pay and pensions - unless we do something about it.

Neoliberal austerity is a response by the capitalist class, and their supporters in government, to the falling profitability of capitalism. So was the massive financial boom, fueled by deregulation, which started in the 1980s. The global economy is now dominated by financial capitalism and there is still an ocean of debt and dodgy bust banks. In addition, there is the tendency in modern monopoly capitalism towards economic stagnation. In short, the system is bust, and without deep-seated reform, there will be no real recovery.

So let's get back to the subject of work itself. What is it? Put simply work is what people do. It is all the things that we do to maintain our existence, build and make the things we need, and make our lives fulfilling. It includes the raising of children, housework, gardening, and caring for others. Raising children, for example, creates the next generation of workers and consumers, that is 'work' that we do for capitalists unpaid - for free. Work should not be slavery, wage slavery or drudgery. Even hard physical work can be rewarding and satisfying if it produces useful things that we need. So why is so much work that we do dull and filled with drudgery? Karl Marx had a compelling explanation. He said that work in a capitalist mode of production created alienation. A succinct explanation can be found here:

"In a capitalist society, the worker’s alienation from his and her humanity occurs because the worker can only express labour — a fundamental social aspect of personal individuality — through a privately owned system of industrial production in which each worker is an instrument, a thing, not a person."

Karl Marx: understood the alienation of workers

There is nothing natural about working in an office or factory from 9 to 5. In the early days of industrial capitalism, workers had to be schooled into working hours and into conditions they had never experienced. We have all been trained to believe that this, or some modern variant, is what 'work' is. But work should be satisfying, creative and produce useful things, and be an activity that we can enjoy with a strong measure of control over what we do. In a capitalist economy, only a relatively few people are able to produce things that they own. The abandonment of the full employment policies of the past is driving more people to create their own work. 'Free' market ideologists would have us believe that this is a success and that people are be becoming more 'enterprising'' but it is really a failure of the system.

If there is less 'work' available, can we divide it up? There has long been a debate about the amount of work there is to go around, and some people have proposed that the available work should be shared out, with people working a shorter week. The New Economics Foundation has suggested in a report that the normal working week should be reduced to 21 hours, which the average amount of time people in the UK work. One of the key findings of the paper was that -  "If time devoted to unpaid housework and childcare in 2005 was valued in terms of the minimum wage, it would be worth the equivalent of 21% of UK GDP" - which would account for a lot of the unpaid work that is carried out.

There are no easy answers, but at least three things need to happen; we have to build a green, sustainable economy which can help us adapt to climate change; we must give people control over what they produce through economic democracy and we must recognise all the socially necessary unpaid work which people do, and that means paying people to raise their children. As for the latter, there is a way of doing this which is fair and equitable and helps to deal with issues of social security which people face - pay everyone a basic income. I'm not going to discuss how a basic income would work in great detail here because that would be a post in itself but it has been successfully tried as this example from India shows. There are various ideas about how it would work and be funded but essentially it is an unconditional payment to every adult in society. But it must not be used to replace benefits. One sensible way of paying for it would be via a land value tax. 

Finally, I was interested to read an article in the Guardian by Guy Standing about job insecurity in a global economy. He suggests that job security is a thing of the past and that we need a better welfare system. Whilst I wouldn't disagree that we need a better welfare system the real answer is to take the economy out of the hands of capitalists and put it into the hands of the people through economic democracy. That is the way to create job security. We can do that by 'occupying' our economy as I have suggested in this post. And for a start, we need a Green New Deal to create one million climate jobs, a national investment bank to fund co-operatives and we need to look at providing people with a basic income. 

If you get a Labour government in 2015 you will probably be sorely disappointed

Remember Neoliberal Labour? The bad old New Labour of Tony Blair and Gordon Brown? Well, if you are planning to vote Labour in 2015, and you are hoping for a Labour government, you are likely to be very disappointed, because Ed Milliband's  Labour is unlikely to reverse any of the Tory cuts, which is exactly what most Labour supporters want. Just imagine celebrating a Labour win and then having to face up to the reality that very little is going to change.

How do I know? I've been reading John Harris in the Guardian, and its clear that Harris has been talking to John Cruddas, the alleged lefty whose been leading Labour's policy review, and it makes pretty depressing reading. The upshot is that Labour appears to have accepted that the cuts can't be reversed and the priority is the eliminate the deficit;

"The essentials go something like this. Though there will be no reversal of existing cuts, in the context of George Osborne's howling failure that loud debate about whether to stick to his post-2015 spending plans is completely misplaced. But at the same time, if Labour is to win the next election, it will have to commit to a set of iron, independently enforced fiscal commitments, perhaps to be met over a 10-year cycle, focused not just on the elimination of the deficit, but the ratio of public debt to national income – many of the consequences of which, to quote one Labour insider, could be "brutal."

Ed Milliband: little hope for the future

The problem with this is that it is utter nonsense from beginning to end, and it shows that Labour have learnt nothing in the past three years. One is tempted to scream "Its the austerity stupid!", but even this is unlikely to penetrate the density of Labour's neoliberal skull. The reality is that it has never been easier or cheaper to borrow, never been easier to have our own national(ised) investment bank, and never been easier to invest in the jobs and houses that the UK so desperately needs. What we do not need is more of the same. Austerity must end.

I'll let you into a secret. Well its not really a secret but for all the attention it got in the 2010 election it might as well have been. The Green Party had an economic plan in its manifesto to halve the structural deficit in the lifetime of a parliament, and at the same time invest £44 billion in creating one million green jobs. And guess what? No austerity either. No cuts - just let me repeat that - no cuts, except in Trident and one or two other places where cuts were needed. No tuition fees either. Just think how strong our economy would be now if that had happened. But make no mistake, it can still happen, but only if people vote for real change. If they don't we will end up with more of the same, more misery and little hope for the future.

"Democracy itself is at stake"

A while ago I wrote a post about the UK's sham democracy. My argument was that our democratic system is there to make us believe we can change our society but that we are only actually allowed to tinker at the margins. What this means is that we may be able to change social policy - like gay marriage - but the fundamentals cannot be altered. There are two main reasons for this. Firstly, our political parties, with the exception of the Green Party, are in thrall to a neoliberal consensus which revolves around austerity, deregulation, and privatisation and asset stripping of the public sector. Secondly, as a nation, we are locked into various international treaties including the WTO, and the Lisbon Treaty, which compel us to put commercial interests above our democratic sovereignty.

So I was interested to read an article by Ha-joon Chang in this weeks Guardian. Chang is always worth reading because he tells it how it really is. I have no idea what his politics are but, as far as I can see, he is a pragmatist who is interested in what makes economies work for people, and how that can be achieved. I recommend you read his post but Its worth quoting a key passage here:

"If even the IMF doesn't approve, why is the UK government persisting with a policy [austerity] that is clearly not working? Or, for that matter, why is the same policy pushed through across Europe? A certain dead economist would have said it is because the government is "in reality instituted for the defence of the rich against the poor". Dead right [my italics].

Current policies in the UK and other European countries are really about making poor people pay for the mistakes of the rich. Millions of poor people have lost their jobs and the support they received through welfare, but how many of those top bankers who caused the crisis have suffered – except for a cancelled knighthood here and a partially returned pension pot there? If anyone has suffered in the financial industry, it is its poorer members – junior analysts who lost their jobs and tellers who are working longer hours for shrinking real wages."

Adam Smith: well aware that government acts in the interests of the ruling class

The quote about 'instituted for the defence of the rich against the poor' is from Adam Smith. Smith never was the patron saint (Chang's words) of economics that the 'free' market fundamentalists have made him out to be. And, as Chang says, it is a very telling quote, one that makes clear that our government was just as biased towards the interests of the 1% in Smith's time as it is now. As Chang also says "democracy itself is at stake" when it becomes just an instrument for maintaining to power of the few - the ruling class and corporations. We have to understand that this is how our democracy works if we want to change it, and we have to re-make it for us, the 99%, rather than for them, the 1%. If we don't do this we will continue to be used for the benefit of a tiny elite, a global ruling class, which sits above the sham democratic process and is immune to it.