An increasingly corporatised economy is marginalizing people and placing premium on profits for the few, thereby altering the goals of governance. MAQBOOL AHMED SIRAJ uncovers the seamy underside of the development campaign and argues for restoring c
Most of us do have some vague perception of the people’s problems but a clear understanding of the root causes eludes us. We agree that poverty, crimes, ill health, violent crimes and environmental degradation stare into the people’s eyes. Popular press spits outs these clichés ad nauseum and ordinary people lap them up. Common man’s mental resources are limited and cursory glances at the headlines is what brings to him something by way of knowledge and analysis. Poor readers are oblivious of the fact that the corporatised press is a handmaiden in the larger game of brainwashing in an increasingly corporatised economy.
But even our leaders do not seem to go beyond superficial issues and ineffectual solutions – accelerating pace of economic growth, reducing taxes, lifting trade barriers and offering incentives and even subsidies to the industries, constricting welfare benefits, enhancing policing and building more jails.
The Third World’s economic development is dangerously superficial. The so called economic dynamism and competitiveness criminally obscures the deeper reality of impoverishment of masses and serious disruption of ecological balance. The pursuit of spiritual fulfillment has been displaced by an all-consuming and increasingly self-destructive obsession with the pursuit of money. This model of the economic development borrowed from the West sees people as consumers rather than beneficiaries. It does boost the mega indices of economic growth but does not ensure a better life to the people. Look at the contrast:
Between 1950 and 1995
The Global economic output increased from $6.4 trillion to $35.5 trillion World trade soared from $0.4 trillion to $5 trillion (1997 dollars) – a 11.5 fold increase. More than a billion people now enjoy abundant affluence.
These are some of the mega indices of economic growth. But the following facts may enable one to perceive the gravity of the iniquitous world we live in:
20 per cent of the world’s people who live in the world’s richest countries received 82.7 per cent of the world’s income in 1992. Simultaneously 1.4 per cent of the world’s income goes to the 20 per cent of world people who live in the poorest countries. The richest 10 per cent of the world (living in Western countries and in Japan) consume 58 per cent of the world’s total energy, 84 per cent of all paper, 45 per cent of all meat and fish, and own 87 per cent of all vehicles. Nearly 80 per cent of the world stock of foreign direct investment is located in the industrialized countries of the North. The bulk of global trade occurs within three regions, namely Europe, North America and Asia-Pacific. Each time a corporation cuts down its workforce, the income of the owners goes up while the incomes of the employees who have been retrenched, declines. 1.2 billion of the world’s poor survive on less than $1 a day income. Nearly one billion people go to bed hungry each night. More than 50 per cent of children in the US are being raised in single-parent homes. On an average day, one lakh children carry gun to the school and 40 of them are wounded or killed daily. Private guards or security have become the major growth businesses. 20 million people have died since 1945 in armed conflicts in what is called as the era of peace. Of the 82 armed conflicts between 1989 and 1992, one-third were between states. Others were within the nation-states in which nationals killed their compatriots. In 1992, the world had 18.2 million refugees. Another 24 million people were displaced within the borders of their nations. Nike, a major footwear multinational has only 8,000 people on its payroll. These people work in management, design, sales and promotion. Production is handled by independent contractors who employ 75,000 workers. Most of the outsourced production happens in Indonesia where a pair of shoes which sells at $73 to 135 in the shopping malls of the US or Europe is produced for $5.60 by young women paid as little as 15 cents an hour. The Nike company paid 20 million dollars to basketball star Michael Jordan in 1992 for promoting Nike shoes. This sum exceeded the entire annual pay packet of the Indonesian factories that made them. Nike example is a classic instance of how rewards are shifted away from those who produce to those who create marketing illusions to sell products to those do not need them at an inflated price.
WHAT LED TO THIS INIQUITOUS WORLD?
In short, the factor responsible for all this is: Accumulation of excessive power in the hands of a few. Accumulation of power breeds arrogance. It is true not only with the military might alone. Dams, business corporations, media, legislature, lobbies, armed forces, all have the tendency to gather power and abuse it. And its mightiest manifestation is the United States of America, the sole superpower. It wields power without ideology, without moral underpinnings, without principles. For the equilibrium to return, it must be resisted, not by violence but with merely a plea for justice.
Economists can today barely think beyond the American model of economy. Indeed the situation is so very serious that America’s success is today emerging as the root cause of the problems of the world. Globalisation and Free Market is shifting power away from governments and as a result financial institutions are gaining. They are driven by a single imperative, the quest for short term financial benefits. This has concentrated massive economic and political power in the hands of a few elite.
What the so called Free Market is out to destroy is not merely sovereignty, but democracy. The MNCs on the prowl for enormously profitable deals know fully well that they can push through those deals and administer those projects in developing countries only with the active connivance of state machinery, the police, the courts, sometimes even the army. Each one of them can compromise its integrity. There is a price for all of them. Today these MNCs need a clique of loyal, corrupt, authoritarian governments in poorer countries to push through unpopular reforms. They need a press that pretends to be free and courts that pretend to dispense justice. They want money, technology, goods and patents to move freely across borders, but not the free movement of people, not the respect for human rights, not international treaties on racial discrimination, or chemical nuclear weapons, or greenhouses gas emissions, or climate change, or even covenant against genocide. The Union Carbide can kill any number of people in Bhopal through criminal leak of poisonous gas. But its chief Arthur Anderson cannot be tried under India’s national laws. It is as though even a gesture towards international accountability would wreck the whole enterprise. Since war industry has to sell weapons, so wars have to be manufactured at frequent intervals for test of ever new missiles and bombs. And to manufacture wars, the diplomats, the corporate media have to create justification. Iraq offers the classic instance of as to how the West first propped Saddam in his confrontation with Iran, then highly monopolized US media demonized him, kicked up the chimera of WMDs and then the two liars—Bush and Blair—pounced upon the poor nation to devastate it, only to sell the contract for reconstruction to Bechtel, Halliburton, Chevron et al. A campaign against Iran is currently on to surround it on faked charges of supporting insurgents within Iraq.
Globalisation has rendered many of the political roles of the government obsolete. Companies with globalised operations routinely and effortlessly sidestep governmental restriction based on old assumptions about national economies and foreign policy. For example, Honda circumvents restrictions on importing Japanese cars into Taiwan, South Korea and Israel by shipping Honda vehicles to these countries from its US plant in Ohio.
Globalisation mantra is a fusion of neo-liberalism with neocolonialism. Colonialism in its original form meant grabbing the lands and resources of the developing world, enslaving the people and dumping surplus goods there. The undermentioned two quotes elaborate the West’s sinister agenda in its own words:
“We must find new lands from which we can easily obtain raw material and at the same time exploit the cheap slave labour that is available from the natives of the colonies. The colonies would also provide a dumping ground for the surplus goods.”
(Ref. Cecil Rhodes, founder of Rhodesia quoted by The Ecologist 22 no. 4 (1992), page 131-47 )
“Strong growth in the poorer parts of the world will be needed to sustain enough growth in the West to maintain adequate levels of employment and to enable Western governments to deal with their pressing social problems.”
(Felix Rohatyn quoted in “World Capital: The need and the risks “ New York Review of Books, July 14, 1994)
Today it is all about creating enclaves of rich in those lands, fencing off those areas from the poor and the ugly, tapping all their energy resources, shifting all the polluting industries there, exploiting the lax labour, environmental and tax laws, and curbing people’s freedom in the very name of protecting them. Mexico had its Maquildoras and we are trying to have ‘Special Economic Zones’. Land is being usurped for setting up these SEZs in a country whose record of agrarian land redistribution is dismal. Those that defy the ingress of MNCs have therefore to be branded terrorists. So ‘if you are not with George Bush, you are with Saddam, if you are not with America, you are with terrorists’. No neutral space has to be allowed. And those who fund the war campaigns on the either side of the political divide have to be rewarded with cushy post-war contracts in the lands devastated by wars. Between 1990 and 2002, the Bechtel contributed $3.3 million to campaign funds of both Democrats and the Republicans. Since 1990, it has won more than 2,000 government contracts worth more than $11 billion. An incredible return on investment! Only the very naïve would then expect a respite from wars. Sample a few more :
Former Defence Secretary Caspar Weinberger was Bechtel general counsel and director Former Deputy Energy Secretary W. Kenneth Davis was Bechtel’s founder president. Riley P. Bechtel the company president is on the president Bush’s Export Council. Former secretary of State George P. Shultz who is on the Bechtel group was the Chairman of the Advisory Board of the Committee for ‘liberation’ of Iraq’. Jack Sheehan, a retired marine Corp General is a senior vice president at Bechtel. No wonder why Bechtel was awarded reconstruction contracts in Iraq to the tune of $ two billion.
Between 2001 and 2002, nine out of 30 members of the US Defence Policy group were connected to companies. They were awarded military contracts worth $76 billion.
Earlier there used to be rich and poor countries. Globalisation has made one difference. Now there are fully fortified enclaves of rich, with five star hotels, sylvan 16-hole golf courses, and shopping malls in poor countries and enclaves of the poor, very meagrely served by civic amenities in rich countries. And our corporate press indulges in unbridled adulation of this illusory economic success through pampering of the wealthy and their lifestyles. Quo vadis?