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.

Globalisation and austerity - so many rotten apples!

A few years ago, after more than a decade of battling with Windows, with viruses, system crashes, obscure drivers and innumerable updates I decided to buy a Mac. Now Macs are outrageously expensive compared to PCs but they do what they say on the tin, quickly, efficiently and simply, and, since then, I've had trouble free access to the web and have even been able to edit my own videos! So it was worth it. But, and the but is - that I've become increasingly disillusioned by what Apple does, and how it operates. Thanks to the iPhone and other products,  Apple has become the biggest company in the world, with billions of dollars, reputed to amount to $100 billion, sloshing around in its back pocket, so much in fact that it didn't seem to know what to do with all that dosh. Hmmm? ... after some thought Apple decided to hand over some cash to its shareholders.

No surprise there then, but what is wrong with Apple? For some time there has been growing concern about the treatment of workers who make Apple products at Foxconn in China. Workers at Foxconn, who make iPhones and iPads,  have protested about working conditions and Reuters reported today that:

"Workers at a Chinese factory owned by Foxconn, Apple Inc's main manufacturer, threatened to jump off the roof of a building in a protest over wages just a month after the two firms announced a landmark agreement on improving working conditions."

But what's more is that Apple has a huge profit margin, something that most corporations would die for. A recent article by Aditya Chakrabortty in the Guardian revealed that:

"Assembled in China, the total cost of putting together just one phone was $178.45. Compare that with a sale price (including downloads) of $630 and Apple makes $452 on each phone: a whacking gross margin of 72%."

This is mind boggling enough, but what the article also showed was that if Apple made the same product in the USA it could still make a whacking 45% profit! So why bother to outsource production to China?

Its not just Apple, because Apple is doing what every other corporation is doing nowadays, screwing every last drop of profit out of consumers and workers for the benefit of a tiny minority - the 1%. This is what globalisation and neoliberal capitalism are all about, a global race to the bottom in environmental and labour standards which is threatening the prosperity of societies all over the world, and puts commercial interests above democratic sovereignty through organisations like the WTO. If you want to know more about how globalisation works I recommend you read the excellent essay by Michael Parenti called Globalisation and Democracy. As Parenti says:

"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, overrule, or dilute any laws of any nation deemed to burden the investment and market prerogatives of transnational corporations."

Henry Ford - a capitalist who understood that workers have to be able to afford to consume

Now, the world economic barrel is full of capitalist rotten apples, corporations which are allowed to ride roughshod over social and environmental legislation whilst they devastate communities and economies. As I've pointed out in a previous post, neoliberalism is ultimately self-defeating because it is economically unsustainable, as well as being environmentally unsustainable. You can't have a consumer capitalist economic model if no one can afford to consume, and that is where we're headed -  Henry Ford realised that a hundred years ago. There is a big problem here because neoliberal globalisation and austerity are going to create a huge number of human casualties, and things are going to get a lot worse before they get better. We need an economic alternative now, with governments leading the way in Europe for investment and job creation, and providing social housing and healthcare, that is why we must hope that Hollande will become President of France and why you should vote for the Green Party in the forthcoming local elections.

A Tory driven ideological class war attack on British workers won't promote growth

It was bound to happen here, as it did in Wisconsin and other American states. First the capitalist class, or 1% if you prefer,  creates a crisis, a crisis of financial capitalism which nearly brings down the world economy. It does so through its ideology, neoliberalism; which means destruction of public services by privatisation; letting the banks and corporations run riot through deregulation; and the looting of natural assets by corporations through globalisation. Then, using their tame politicians in the UK, USA and Europe, it makes the middle and working classes and unemployed, the 99%, pay to bailout the banks and save the skins of the bankers. This is privatising the gains and nationalising the losses. Socialism for the rich, capitalism for the rest of us.

So the banks get saved but there is still a big problem because much of that debt incurred by the banks has now been transferred to governments and taxpayers leading inevitably to a sovereign debt crisis, which is where we are now. The Eurozone crisis has been triggered by the sovereign debt crisis brought about by the banking crisis. Still with me? We are nearly there.

In response to the sovereign debt crisis governments in the UK and Europe implement austerity programmes, ostensibly to bailout government debt, particularly in Greece and Ireland. But its not the poor old Irish and Greek taxpayers who are being bailed out, the money is being used, once again, to bailout French, German, Spanish and Greek banks. So taxpayers have been shafted twice, first in the bank bailout and secondly by austerity - which is just another bank bailout.

To top all this the right wing politicians who are the friends of the bankers and the 1%, are now using the crisis to try and smash workers rights. In the USA, in Wisconsin, the Tea Party backed Governor Scott Walker has used the deficit to not only slash services but to try to deny unions their collective bargaining rights. Now in the UK today we hear that the government is contemplating undermining workers rights by making them easier to sack and limiting further their already limited rights to an Employment Tribunal. This crude, class war attack on workers is being carried out in the pretence that it will encourage growth.

The real irony is that the rising unemployment, increasing poverty and lack of growth in the UK are a direct result of this government's austerity programme. Economically, this government is already a complete failure and its only to be expected that it should dishonestly try to pin the blame for that failure on working people and the unemployed, that, after all, is what class war is all about.

The free market fundamentalists are the purveyors of our poverty

I like to describe neoliberals as 'free market' fanatics or 'free market' fundamentalists. I always put the 'free market' bit in italics because there really is no such thing as a free market, and never has been. The 'free market' concept is a crucial part of the flawed ideology of neoliberalism, which is an extreme right-wing ideology that favours the rich - the capitalist class, over the rest of us. An important part of the reason why neoliberalism has been so successful is that it has successfully disguised itself as 'economics', an economics which pretends to be a mechanism for prosperity and has been sold to us as good for everyone.

We have been told by economists and politicians that the tenets of neoliberalism i.e. - globalisation; 'free' trade; privatisation; low taxes; downsizing; outsourcing; and deregulation are essential economically and that without them, we cannot have a prosperous and successful society. But prosperous and successful for who? All the aforementioned things benefit the capitalist class, at the expense of the rest of society. That is how they have gone from being the rich to the super-rich over the past 35 years or so, and these are the mechanisms by which the 1% have left the 99% way, way behind.

The simple fact is that the outcome of this neoliberal ideology, driven by the capitalist class, with the support of Western politicians, is a direct transfer of wealth from the 99% to the 1%. As wages have fallen as a percentage of GDP, profits and income for the rich have risen - see here for the recent US figures. The super rich don't need social security, they don't need healthcare, they don't need state education like the rest of us, so their view is - 'why should I pay for any of that through my taxes'? In fact, 'why should I pay taxes at all'? Furthermore, thanks to globalisation, if they can pay someone in the Third World $1 an hour to make widgets, why should they pay you, as a worker, in Europe or the USA, $10 an hour to do the same job?

But we still live in a consumer-capitalist economy, so as wages have fallen as a percentage of GDP, the 99% have accumulated more and more debt, with the help and encouragement of capitalist lenders, in order to try and maintain their lifestyles, and this is part of the debt crisis, and the economic crisis we are now in. Because if people in 'wealthier' Western countries can't afford to buy the products of capitalism, and are saddled with debt, the consumer-driven economy is bound to be depressed, which is exactly what is happening now. The 'free market' fanatics through the mechanisms of privatisation etc. are therefore purveyors of poverty, through lower wages, unemployment and austerity for us, the 99%.

In addition to the problems of the current banking debt crisis, which was caused by deregulation of the banks and financial capitalism, there is the longer-term problem for capitalism of the falling rate of profit. It has been noted by many observers that capitalism is uniquely versatile and able to re-invent itself when faced, as it always is, by periodic crises. If capitalism reaches a barrier it will find a way round it. So, the big driver for privatisation is the need for capitalist corporations to maintain their profitability, because having exhausted much of the possibilities of the private sector, through globalisation, they are now intent on devouring the public sector in the search for new profitability and never ending growth.

For the 99%, healthcare, education, pensions, housing and social security are essential. Healthcare and education are public goods - not commodities to be bought and traded like widgets. We need social security as a right, paid for through national insurance - not welfare as some kind of handout. We need social housing and pensions so that we can retire with some dignity in our old age. All these public services are best paid for through taxes, collectively, and delivered without the profit motive, for the benefit of all. If we want public services and pensions we need to pay taxes. Low taxes are only good for the 1%, and are bad for the rest of us. In addition to paying more taxes ourselves, we need to make the rich pay much more in taxes, as a prelude to permanent economic change.

Until very recently, we had all of these essential public services mentioned above here in the UK. Now the capitalist class are trying to take them away from us, they are trying to to roll back all the democratic gains our grandparents, and parents made in the 20th century. The banking crisis is being used as an excuse to pay for the failures of neoliberalism through austerity. It is essential that we resist privatisation and cuts in public services by supporting each other, and supporting the occupations, local anti-cuts organisations, student protests, and all the diverse community groups in their ongoing struggle against austerity, and the trade unions in their planned strike action on November 30th.

Last weekend, on 15 October, global demonstrations were held to show the growing discontent of the 99%, and as a result a video was produced - see below, and a manifesto, which is worth reading, and may be the start of global demand for change.



The many thousands of people involved in the occupation movements and protests which are now happening in 900 cities across the world are rightly suspicious of politicians, political parties, and ideologies. They must be able to determine their wants and their own destiny. But ultimately what they need are the things we all need, the public services which I have outlined above, plus work, and freedom of expression, and freedom from fear. What is clear is that they can only achieve their aims by breaking the stranglehold that 'free market' neoliberalism has on our economy and democracies, and to regain control over their lives they must seize control of the economy and make the global economy their economy.

Only when we control our economy will we have the freedom and dignity we all desire and need.

The Neoliberalspeak dictionary

This post was inspired by George Orwell's Newspeak. According to Wikipedia:

Newspeak is a fictional language in George Orwell's novel Nineteen Eighty-Four. In the novel, it refers to the deliberately impoverished language promoted by the state.

Over the past 30 years or so neoliberalism has contributed to the impoverishment of our language by the usage, or perhaps mis-use of certain words. The aim of a neoliberalspeak dictionary is to give some of the key words their real meaning.

• affordable housing / adj. - unaffordable housing. Mythical housing unavailable to most citizens in the UK
• bailout / n.; v. - a method of privatising financial gains and nationalising financial losses
• capitalism / n. - a gigantic global Ponzi scheme designed to benefit a small elite whilst plunging billions of people into abject poverty
• deficit reduction / n. ; v. - a means of class war by which the populations of countries are made to pay for the failures of the markets
• efficiency / n. - increasing profits by lowering the living standards of workers. This is typically achieved by cuts in pay, a reduction in holiday entitlement and reduced pension.
• efficiency savings / adj. - cuts
• Eurozone / n. - proto-European capitalist empire where commercial interests are put above democratic rights
• gig economy / adj. low paid - sweatshop labour
• globalisation / n.; v. - a process of opening up the world to Western economic imperialism. A means of looting the natural resources, exploiting labour in all the countries of the world and lowering the standard of living of workers in the West
• Labour market flexibility / adj. - attack on workers conditions, lowering pay reduction in holidays - cheap labour. 
• privatisation / n.; v. - asset stripping of the public sector by the private sector 
• quantitative easing / adj. handouts for the rich. Printing trillions of dollars to prop up a broken global economy
• Social mobility / adj. - conservative fraudulent frame which is used to legitimise inequality in society
• strong leader / n. - a weak leader i.e. someone who will do what we tell them to against the wishes of their own party and its supporters. we being the neoliberal so-called free press (corporate media)
• sustainable / adj. - unsustainable. A word that has become so debased and devalued as to have rendered it virtually meaningless
• tax / n.; v. - a levy by the state on the 99%
• Trump / n.; v. - a fart, noxious gas released from the anus
• we're all in this together / adj. - you pay for our crisis
• WTO / n. - 'we've taken over' . Global organisation for the purpose of promoting the commercial interests of global corporations above the democratic rights of nation states.

I'm sure that in time the dictionary will grow into a comprehensive guide to Neoliberalspeak. I hope that I'll be able get some contributions from some of the greatest exponents of Neoliberalspeak  such as Nick Clegg, Tony Blair, Barak Obama, David Cameron, Ed Miliband and Nicola Sarkozy.