BUSINESS

Empire of the corporations

AS EACH week reveals more corporate scandals, more criminality, greed, and plunder of public wealth, so the literature on them sharpens. John Pilger, a renowned journalist, has retained his sanity despite seeing everything the powerful do. (In 1971, his 4-inch high headline in the Daily Mirror, "This is murder", told 14 million Britons what was happening in the then East Pakistan.)

Pilger starts in Indonesia, globalisation's "model pupil", where the U.S. and the U.K. installed the former dictator Suharto in 1965; his forces slaughtered a million people. The alleged enemy was Achmed Sukarno, who had thrown the IMF and the World Bank out; no evidence was ever produced that either Sukarno or the Indonesian communist party, PKI, were such a threat that after the coup the country had to be carved up by six Chase Manhattan Bank officials in one day. With declassified U.S. and U.K. documents, Pilger shows that both governments knew they were helping mass slaughter. Suharto repeated the genocide in East Timor in 1975 and 1991.

The beneficiaries are the world's biggest corporations. Nike, Gap, Adidas, and Reebok have factories in Indonesia's Export Processing Zones. The workers get a dollar a day — half Indonesia's legal minimum wage — making trainers for sale abroad at 100 pounds a pair. Supervisors refuse them toilet breaks; they soil themselves and keep working. Pilger posed as a buyer, and one worker told him that Gap's quality controllers do not even look at the workers.As to the press, "Compliance to institutional and corporate needs is internalised early in a journalist's career". Journalists and trainees are not told of the "inevitable self-censorship and censorship by omission". At least one journalist admits to being completely deceived by U.S. and U.K. propaganda on Indonesia. The second author, George Monbiot, former Oxford fellow, now Honorary Philosophy Professor at Keele University and Visiting Environmental Science Professor at the University of East London, is a noted critic of corporate rapacity. Bookshop staff carrying his book Captive State have been refused entry by Swiss border guards. Monbiot shows the state selling itself to capital.

Given leaked documents about a shopping centre intended to destroy a community trading area in Southampton, England, Monbiot confronted two local councillors. One kept silent; the other did not even know the consultants had a financial interest in the new shopping mall. Further, only businesses and municipal authorities, not citizens, can request a British cabinet minister to review local decisions on planning and building.

In addition, proving a public body's unreasonableness (the `Wednesbury Rules') is almost impossible. Ministers are agents for industries they should regulate, and companies pay for impact surveys. The Blair-Clinton request to biotech companies not to use patent law to the full was contemptuously ignored.

Monbiot's meticulous analysis shows supermarkets destroying local economies by sending goods through hubs, trucking local produce hundreds of miles there and back. The third author, Noreena Hertz of Cambridge University, "took capitalism to the Soviet Union" in the 1980s. Now she sees the obverse. Twenty per cent of China's population earn under one dollar, and 50 per cent of Indians under 1.50 dollars a day. In both, the rural-urban divide creates separate worlds.

In poorer countries, even TNCs say the beneficiaries are �lites and officials. Hertz documents the worldwide corporate takeover of public institutions and multilateral organisations. The world's richest governments guarantee corporate profits despite incompetence, failure, and criminality, and let corporations use state security services for business espionage. Hertz, unbelievably, thinks there is hope. Consumer boycotts hurt corporations, who also neglect the purchasing power of the poor. Ultimately, Hertz is superficial. Nations and states have never been coterminous but Hertz uses the term 'nation state'. She assumes state powerlessness but says politicians evade social and environmental responsibilities. Yet she knows the private sector cannot generate reform; Jiang Zemin dismisses human rights concerns.

Third, Hertz merely asserts that privatised services are an improvement; that would get only contempt from the millions who use U.K. transport. (The new trick on Sir Richard Branson's Virgin trains is not to stop when late, so Virgin escapes fines for lateness at scheduled stops.) And while Hertz says the press are a problem, she is unaware that corporations control knowledge itself by suppressing adverse findings on medicines and foodstuffs.

Fourth, Hertz sees democracy only as a contract (do newborn babies sign up?), and the state only as a vehicle for needs and desires. She values transparency but cannot see that need itself is contestable. Hertz knows neither that her questions are ancient nor that they are centrally about the good — and, today, about our survival. All three books show that the empire of the corporations is a disaster.

Indonesia owes $262 billion. The poorest countries are poorer; half their people earn under a dollar a day. Their life expectancy is down to 25 years below the rich-country average. Even the World Bank says its programmes — privatisation, indebtedness, and the destruction of public services — have worsened the lives of billions. Hertz notes the evidence: egalitarian democracies are healthier, more stable, and more productive. Neither does the new regime generate work; the total corporate workforce has been 26 million for 30 years, while the world's population has risen from 3 billion to 6 billion. Wall Street "prefers a dollar saved to a dollar earned". What can we do? The corporations control the state and we citizens are weak.

Monbiot concludes: "The only thing that can reverse the corporate takeover is — you".

(John Pilger, The New Rulers of the World. London: Verso, 2002. George Monbiot, Captive State: the Corporate Takeover of Britain. London: Pan, 2001. Noreena Hertz, The Silent Takeover: Global Capitalism and the Death of Democracy. London: Arrow, 2001.)

Arvind Sivaramakrishnan

(The writer is Lecturer in Politics and Law at Taunton's College, Southampton, U.K., and Associate Lecturer in Social Science at the U.K. Open University.)