Corporatocracy

I discovered a new word this week, one which perhaps provides an apt description of the sort of "free market capitalism" real freed marketeers rail against.  Corporatocracy

I watched a film sponsored by the Georgist advocacy group the Robert Schalkenbach Foundation released in 2008 called "The End of Poverty".  I can only really link to the trailer, for my non-US readers, since the only source of the entire film on line appears to be at Hulu.com and unless like me you have a clever little VPN that allows you to pretend to have a US IP address you won't be able to watch it - I am trying to get them to release it one a more universally available service.

Basically it is meant to be a plea for Henry George's Land Value Tax as a silver bullet solution to world poverty.  It describes how ever since the discovery of the "New World" first European and then the North American nations have been the tools of and cover for the economic colonisation of the globe by a tiny plutocracy that, hiding behind such institutions as the World Bank and the IMF continues today albeit in less overt but just as exploitative and unjust ways.

But, and perhaps it is a measure of how far I have moved from Georgism to market anarchism, throughout I was screaming at the TV that the most obvious solution, in the time honoured dictum of William of Occam, to the problems it was explaining, was in fact to do away with the states who have been at the vanguard of the advance of a global plutocracy that has systematically exploited lesser developed nations' resources and peoples and continued to do so today in far more insidious ways.

Enter one John Perkins, a self-confessed former "Economic Hit Man" who is one of the "gurus" who appear in the film, alongside the likes of Amartya Sen, Susan George and Joseph Stiglitz (additionally it is narrated by Economics Nobel winning former US President Josiah Bartlett, a.k.a Martin Sheen).  

His job, he claims in his controversial and to many overly conspiratorial book "Confessions of an Economic Hit Man", was to go into countries that the northern world's plutocrats had identified as having something of interest to them, such as oil or other resources, befriend leaders and get them to take on development loans from the global "aid" cabal of the World Bank, IMF and so on.  They would hire western contractors (the ones who had persuaded them to take the loans) to build showcase infrastructure projects, say, like electricity generation and distribution capability in his case, based on overinflated figures of the benefits they would bring to the people of those lesser developed nations.  

Then when they found they could not repay them when the forecast unrealistic economic growth did not materialise they were forced into effective national slavery for western interests by handing over, as collateral strategic resources and services.  Those who didn't follow this course through were passed, he says, to the "Jackals" - mostly CIA backed people who would try and physically intimidate or even terminate them and install someone who would.  And, as in the case of places like Iraq or Panama, if even that did not bring them into US hegemony, then military power would be used.

This system he calls the "corporatocracy".  And it seems to describe to a "T" the system of crony capitalism, corporate statehood or whatever other phrase we market anarchists use to distinguish wholesome, theoretical capitalism and free markets from what actually goes on today under the guise of "free market capitalism".  Now Perkins is no anarchist.  Indeed on one occasion in his book he more or less spits the word out alongside "communism".  He and the other illuminati in the film seem to miss the irony that in a film explaining how nation states and empires have always acted in this way, their idea of a little relatively minor change in the way their tax systems work will suddenly turn them into true democracies working for their people rather than their plutocracies.

When in reality is the very rationale behind states.  It is not that some noble idea of a state has been corrupted by commercial interests but that states are necessarily part of that corporatocratic system.  States are involved at both ends of this corrupt cycle - as both the creators of the structures the commercial interests subsequently use to get their way, as well as their back up if all goes wrong, and as the targets for their predatory attentions.  If there were no state to persuade to grant you a nationwide water concession with force of law against those who try to break your monopoly, as in the recently highlighted case in Bolivia, you would not get that concession.  And on the other side if your company's president were not also a big-wig at the White House (as in the case of Bechtel) you would not get state backing for your international adventures.

Perhaps it is no wonder then that we see David Cameron's government wanting to maintain Britain's commitment to its international aid targets.  In most cases that aid flows straight back into the coffers of contractors in the countries from which it originated, and ties the recipient countries into business arrangements and dependency on those donor countries long into the future.  For protectionist conservative economics, 0.7% of our national income invested in such things seems probably a small price to pay to promote the corporate plutocracy that put them where they are in positions of power.

Incidentally, if you think I am falling for too much of a "conspiracy theory" to take John Perkins' story at face value, you might do well to have a look at what one of the USA's most decorated and celebrated military figures of the first half of the twentieth century, Maj Gen Smedley Butler, had to say, which largely confirms Perkins' main thrust anyway, in "War is a Racket".