Zack Gross
Zack Gross

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Capital Cowboys Ride Roughshod over Globe

Brandon Sun “Small World” Column, Sunday,  May 18 / 08

Zack Gross

The recently published book Rogue Economics, by economist, journalist and bestselling author Loretta Napoleoni, points to the unfettered growth of capital and free trade as the cause of a humanitarian crisis in the world today. 

The author of Terror, Inc.: Tracing the Money behind Global Terrorism argues that, after the fall of the Berlin Wall, the end of the Cold War ushered in an era of corporate deregulation, economic crime and human exploitation in the name of democracy and prosperity.

 With the fall of the Soviet Empire, a mafia-like entrepreneurial class was able (or allowed) to step in where the state apparatus had died.  Suddenly, an aggressive, out-of control economic system replaced the old Communist one, with huge and often difficult consequences for the ordinary person.  Russian “oligarchs” stripped the country of its resources and deposited their profits in foreign banks.  As an example, Russian women were virtually 100% employed in the late Eighties, but were 80% unemployed in the early Nineties.  This led to an exodus of desperate women to Europe and elsewhere to “employment” in foreign sex markets.

The entrepreneurial Chinese state has made its money in part by the worldwide selling of poisonous toothpaste, lead-laden toys and cheap, illegal knockoffs of purses, watches, gems and CDs.  Chinese exports dwarf all others – Wal-Mart is a showcase of Chinese products
but have been implicated in numerous scandals, from fake medicines and herbal remedies, to a range of products made in slavery conditions by pre-teens.  So-called “work-study” programs ship school children from poor provinces to factories where they work from early morning to late at night without pay.

One of the horror stories of Chinese exports is the production of herbal teas.  In order to dry these quickly for market, trucks were used to drive over the tea leaves.  Of course, the exhaust added lead to the supposedly healthy product.  A former Deputy Commission of the US Food & Drug Administration, William Hubbard, has established his own watchdog agency in the face of massive cuts to food inspection in recent years.  He estimates that only one percent of food imports entering the US are actually inspected by FDA officials.  The UN World Health Organization estimates that unsafe knockoff medicines kill one million people per year.

A final example is the great capital investment in and spread of the internet around the world.  While this new means of communication has revolutionized the way we do things and brought benefit to many societies, Napoleoni calls it a mixed blessing.  The biggest “business” on the internet globally is pornography.  It is also a haven for crime, prostitution and gambling. 

Global poverty, child slavery and the current world food crisis are also the product of rogue economics, argues Napoleoni and other commentators.  She uses the example of child labour in the cocoa plantations of Ivory Coast.  In a world where markets are “self-regulating
, ” consumers don’t know that they are participating in crime and oppression when they buy a chocolate bar, some new clothes or a toy.  She estimates that there are well over 30 million slave labourers today who are easy to hide and move around the world.

As 100 million people are driven toward starvation with rising food prices, giant agribusiness and oil companies are enjoying soaring earnings.  As companies speculate on the price of food commodities, while turning food-growing land over to bio-fuels and export specialty crops (cut flowers, tropical fruits), the UN Food & Agriculture Organization estimates that 37 developing countries are in urgent need of food and are enduring food riots. 

Monsanto profits have increased from a three-month period this past winter compared to last winter from $1.44 to $2.22 billion. 

Cargill’s net earnings increased by 86% and Archer Daniels Midland by 42%.  The Mosaic Company, one of the world’s largest fertilizer companies, increased its profits, due to a “fertilizer shortage
,” by 1600%. 

Meanwhile, oil companies Shell and British Petroleum recorded profits of $28 billion between them in the first three months of 2008.  The idea of feeding the world in sustainable and affordable ways would seem to have been lost in unfettered greed.

Napoleoni’s book has been refuted by some as “over the top
.”  No powerful interest is going to accept her criticism. 

Some say that she uses emotional examples and doesn’t give credit for modern advances and the growth of democratic institutions. 

What those who control capital may fear is that consumers will turn against them, choosing to buy local, shop fair trade, or even lobby their politicians for greater control and taxing of the “corporate sector

What people may see, by reading her book, is that slavery, pornography, hunger and other scourges of today’s world are not aberrations, but rather are often the norm and part of an oppressive system of exploitation.

Zack Gross is program coordinator at the Manitoba Council for International Cooperation (MCIC), a coalition of 36 international development organizations active in our province.

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