Wednesday, 30 December 2015

essays on Crime (2): Private Power

Adam Smith, that political thinker who was in favour of the free market, so we are told, berated “merchants and manufacturers”, who went on to use the state for their own interests, so Smith said.  In chapter IV in the Wealth of Nations, he writes:

 The capricious ambition of kings and ministers has not, during the present and the preceding century, been fatal to the repose of Europe, than the impertinent jealousy of merchants and manufacturers. The violence and injustice of the rulers of humankind is an ancient evil, for which, I am afraid, the nature of human affairs can scarce admit of a remedy. Nevertheless, the mean rapacity, the monopolizing spirit of merchants and manufacturers, who neither are, nor ought to be the rulers of humankind, though it cannot perhaps be corrected, may very easily be prevented from disturbing the tranquillity of anybody but themselves.

Actually, Smith was never in favour of the free market, which we are presented with.  These “merchants and manufacturers” in today’s world would not be merchants and manufacturers but transnational corporations and concentrated private power. The sorts of people who idolise Smith today evidently never read him. If they did, they would know that if he were alive today he would be regarded as a dangerous radical.  He would, no doubt, be spewing blood at the emergence of the free market.

Deregulation, lower taxation (for the rich) and privatisation was, in a nutshell, Thatcherism. In Naomi Klein’s book about free market fundamentalism, the Shock Doctrine, she presents a very ugly picture of countries adopting this fascist framework.  These include Chile, Iraq, Argentina, South Africa, Russia, Poland, South Korea, even the United States.  This model was adopted in Chile under Augusto Pinochet.  He was a fascist, openly so, who overthrew the Marxist democrat, Salvador Allende, in a military coup, aided and abetted by the U.S.  “Make the economy scream”, Nixon said of Chile.  This “economic miracle” people speak of in referring to Chile is a myth of sorts.  American journalist Greg Palast writes:

 In 1973, the year General Pinochet brutally seized the government, Chile's unemployment rate was 4.3%. In 1983, after ten years of free-market modernization, unemployment reached 22%. Real wages declined by 40% under military rule.

In 1970, 20% of Chile's population lived in poverty. By 1990, the year "President" Pinochet left office, the number of destitute had doubled to 40%. Quite a miracle.

Pinochet did not destroy Chile's economy all alone. It took nine years of hard work by the most brilliant minds in world academia, a gaggle of Milton Friedman's trainees, the Chicago Boys. Under the spell of their theories, the General abolished the minimum wage, outlawed trade union bargaining rights, privatized the pension system, abolished all taxes on wealth and on business profits, slashed public employment, privatized 212 state industries and 66 banks and ran a fiscal surplus.

Freed of the dead hand of bureaucracy, taxes and union rules, the country took a giant leap forward ... into bankruptcy and depression. After nine years of economics Chicago style, Chile's industry keeled over and died. In 1982 and 1983, GDP dropped 19%. The free-market experiment was kaput, the test tubes shattered. Blood and glass littered the laboratory floor. Yet, with remarkable chutzpah, the mad scientists of Chicago declared success. In the US, President Ronald Reagan's State Department issued a report concluding, "Chile is a casebook study in sound economic management." Milton Friedman himself coined the phrase, "The Miracle of Chile." Friedman's sidekick, economist Art Laffer, preened that Pinochet's Chile was, "a showcase of what supply-side economics can do."

According to Naomi Klein “In 1974, inflation reached 375 percent-the highest rate in the world and almost twice the top level under Allende.”  It was only in 1988, fifteen years after Pinochet seized power that the economy stabilised.  So real economic growth was not seen until Pinochet had been President for well over ten years.  It was the “Chicago boys”, at the University of Chicago, where Milton Friedman oversaw much of the bloodshed in Chile.  Later, Thatcher would refer to Friedman as a “freedom fighter”.  A “freedom fighter” for private, tyrannical power perhaps.

 The fascist economic model Chile adopted laid the groundwork for others to follow. In the 1980s, Russia followed the model with economic advisors, such as Jeffrey Sachs.  Janine R. Wedel of Nation writes:

 Through the late summer and fall of 1991, as the Soviet state fell apart, Harvard Professor Jeffrey Sachs and other Western economists participated in meetings at a dacha outside Moscow where young, pro-Yeltsin reformers planned Russia’s economic and political future. Sachs teamed up with Yegor Gaidar, Yeltsin’s first architect of economic reform, to promote a plan of “shock therapy” to swiftly eliminate most of the price controls and subsidies that had underpinned life for Soviet citizens for decades. Shock therapy produced more shock–not least, hyperinflation that hit 2,500 percent–than therapy. One result was the evaporation of much potential investment capital: the substantial savings of Russians.

 In the 1990s South Africa, under the tutelage of Nelson Mandela, Thatcherism and neoliberal thuggery was their economic model.  Mandela’s promise of nationalisation, turned into privatisation. Mandela’s successor said of himself, “Just call me a Thatcherite”.  In Iraq, after the 2003 invasion, the country was overtaken by large U.S corporations, thus resulting in economic strangulation for the natives amidst the tremendous carnage and shock, Klein speaks of. 

This is free market fanaticism to put it mildly.  These corporate elites have this totalitarian monopoly upon which entire societies work under a certain framework.  These Company Executive Officials (CEOs) have only two choices for their business model: to maximise their profits or leave the company altogether.  To maximise their profits they do various reprehensible things.  For example, they are quite content to employ sweatshop labour and pay their workers an absolute pittance; the working conditions themselves are so despicable that not even a Milton Friedman could even justify them. Another example of state protection roughly translated into capitalism.  All these major companies are able, through criminal state law, in repugnant free market societies, to avoid paying vast amounts of taxes; many of these private tyrannies pay less than 1 percent tax.

When the British government wish to implement policies concerning these colossal companies, they must regulate themselves.  Self-regulation is an interesting phrase but is often unscrutinised.  The government can make no decisions concerning these powerful tyrannies, thus asking their permission before implementing policies, which concern them.  This ought to surprise no one because such practices go on for such a sustained period.  This goes on while economic warfare is waged on everybody else.

Banking institutions are notoriously the worst offenders. These banks are nothing more than rackets and cartels. Some of these banks operating in the city of London have been known to have committed criminal acts so serious that it has even reached the mainstream media; that is rare. Therefore, these many-monied institutions are given two options after having been “found out” after committing serious acts of fraud: they can either spend the rest of their lives in prison or pay a fine, not out of their own pocket but out of the pockets of others.  The choice is inevitable. Only a madman would choose the former option.  Even after the disgraceful practices are disclosed to the wider public fraud continues nonetheless. Incidentally, banking is one of the top professions where psychopathy is prevalent.

Oil is also another area where criminal actions occur, and as is the case with banking cartels, this is widely known.  After the First World War or the Great War, as it was known seven major oil companies known as the “Seven Sisters”, devised a plan between themselves in a perverse capitalist objective.  These companies were:

      Anglo-Persian Oil Company (United Kingdom):
      Gulf Oil (United States):
       Royal Dutch Shell (Netherlands/United Kingdom)
      Standard Oil of California (SoCal) (United States)
      Standard Oil of New Jersey (Esso) (United States):
      Texaco (United States)
      Standard Oil Co. of New York (Socony) (United States)

Emine Dilek writes:

 In 1928, three main global petroleum producers met in the Scottish castle named Achnacarry, to sign a secret contract in order to control and distribute the world’s oil and the profits from the oil business. The agreement is known as the Achnacarry Agreement, or “As-Is” Agreement, was signed on September 17th, 1928…

Their vision was that the production zones, transport costs, sales prices – everything would be agreed and shared. And so began a great cartel, whose purpose was to dominate the world, by controlling its oil.

Soon, other biggest oil companies joined them in the plot. Now, they were known as the Seven Sisters: Exxon, Shell, BP, Mobil, Texaco, Gulf and Chevron...

At the end of the First World War, through signed treaties, France and Britain divided up the Middle East that was taken over from the Ottoman Empire. American oil companies were enraged. An American oil broker, Kalouste Gulbekian, came up with a solution. The plan was to create a red zone around the oil rich areas of the Middle East, and form a new oil company to equally own shares. The company was called Iraq Petroleum Company.

Oil filled lands were bought from the land owners without disclosing the riches their lands were hiding underneath the ground. Governments of the countries, such as the Shah (king) of Iran, were bought and paid for by the oil companies through bribes and other forms of political and military support guarantees.

Oil companies became more powerful than governments. Delivery of the oil also was such a crucial matter that in USA or Britain no one could become a President unless they guaranteed the smooth delivery of the oil to the refineries and sellers.

Oil companies were so dominant that they set the rules in every aspect of the oil production, its export and prices. Together with covert agencies of USA and British Governments, they have helped create and support the monarchies in Iran and Saudi Arabia, toppled democratically elected leaders who refused to be bribed, opposed the creation of OPEC and profited from the Iran-Iraq war, leading to the ultimate destruction of Saddam Hussein and Iraq.

BP has a wicked history concerning these matters; I cite two examples.  During the time of the Red Line Agreement it was Venezuela which became the world's’ leading oil producer; after the second world war, the dynamics of strategic power and interests changed: it was Saudi Arabia which overtook Venezuela the decades that followed this, with furtive deals with the U.S which allowed America to control oil reserves in the Middle East.  In 1952 disaster struck the western world: Gamal Abdel Nasser ruled over Egypt for almost two decades, during that time he committed one particular major crime: he overthrew the yoke of western imperialism and instead opted for Arab nationalism.

Before and during Nasser’s first few years in power, parts of the region were in turmoil. In Iran, there was a spate of demonstrations by a popular uprising.  Mohammad Mossadegh led this movement.  The main reason for the protests was the oil giant, BP. They were literally controlling vast amounts of the Iranian economy, at the behest of the British government. In 1953, when Mossadegh was Prime Minister of Iran, he nationalised Iranian oil.  The response was inevitable; the British government, backed up by their ally in North America, overthrew Mossadegh and subjected Iran to a savage nightmare. 

Fifty years later BP were at it again.  It was against another enemy of the west, Muammar Gaddafi, the Libyan revolutionary or “mad dog”, if we listen to Ronald Reagan long enough.  Tony Blair, during that time, was the British Prime Minister, which is significant.  During talks with Gaddafi he decided the Libyan would relinquish his chemical weapons then he would “do business” with him.  Roughly translated as opening up the markets in Libya.  BP were once again, accruing huge profits in these somewhat clandestine deals.  It was not so long after this period that Al Baset Al-Megrahi was released from prison for one of the worst terrorist atrocities in the 1980s.  The lengths BP have gone to in order to accrue stupendous profits is quite astonishing. 

Other major oil companies tell a similar story.  However, one other area of repugnancy is the fast-food cancer factories such as McDonalds, Burger King, Pizza Hut, Domino's Pizza Hut, KFC, as well as many others.  Again, these companies have one key objective: to maximise their profits, in fact their objective is two-fold.  The other objective is to gain control over markets, thus creating smear campaigns in putting smaller competitors out of business altogether. This “junk” food which these sub-cultural, sub-human, inhumane factories operate under giving people all sorts of dietary problems and health dilemmas, including cancers, heart-attacks, strokes, and a whole array of other terrible conditions.  All this is for financial profit.  Nevertheless, one should not be so surprised because after all, we live in a world of the free market and any sort of morality seems miles away in the distant hills. 

Globalisation is an interesting term, and it ought to be tackled.  A great deal of people have written about this matter, coming to debate it from a range of different angles. One man that wrote about it was Vladimir Lenin. Nevertheless, in Lenin’s lifetime-he died in 1924-capitalism in comparison to today’s world was incomparable in terms of private power.  Enmeshed in this globalised  sort of terror is the public relations industry which Walter Lippmann and Edward Bernays wrote about, and public relations is synonymous with propaganda, and propaganda ties in with the entertainment industry, which is essentially the public relations industry anyway.  It is corporate private power that advertises throughout the entire industry.  It also goes through sport, all forms of popular culture and so on.  All advertising, or rather, what is referred to as advertising, ought not to exist. It ought not to exist because it is crypto corporate fascism, and we are forced to watch this obscenity.  With marketing, they remove all other cultures and replace them with infantile, unrelenting defecation. 

 But, why? Well it has different functions of course.  In the media, it creates better selling power; it helps to depoliticise and pacify people. It de-intellectualises the individual, and so long as they are following these puerile, irrational, frivolous trends, such as spectator sports, following a person or perhaps a group of them like a religious fanatic, they are out of harm's way.  They are not thinking about the things they ought to be thinking about and of course all of this is rationalised.  This nonsense creeps into serious journals, it is even spoken by highly respected professors in educational establishments, it is on the high street, in shops, at the workplace, even on the street.  This barbarity is inescapable. Yet when one mentions Herbert Marcuse, Edward Herman or Erich Fromm, they are laughed at, branded as extremists, and told they ought not to exist. 

Never mind Aristotle’s insights, Beckett’s absurdity, Steinbeck’s humanity, Homer’s picturesque poetry, John Stuart Mill’s liberalism or anything of the sort.  Now, we are told we must forget all this insignificant indulgence.  Instead, you must not be a dinosaur and become a “modern man”, and think “business”; everything else ought not to exist at all.  For business is the new way.  If there is no profit in this or that then it really ought not to be done; what good will come of it? 

The rules of the game have changed, so to speak.  Now, even CEOs appear on television shows, encouraging their viewers to engage in real principles: the avarice of financial greed and a lust for “free enterprise”, and not much else besides.  The person who reads Sophocles or Heinrich Boll is a danger, a danger to this whole ideology.  Thinking outside of this spectrum is strictly forbidden, and for having such iconoclast beliefs, you must be eliminated from airing your insidious and tiresome views; there is no opportunity to speak in the mainstream media; you are eliminated.  This is a model, which has been hideously successful.  The career liberal journalists would rather close their vacuous mouths and do as they are told.

This is intolerable; nevertheless, it appears indomitable.  What is this called?  It is clearly a form of totalitarianism.  Nevertheless, it goes far beyond even that.  When private concentrated power controls many aspects of our peculiar lives, and in this abominable way, it is a fundamentalist sort of fascism; that is not to be mocked at.  Fascism, many people believe, are Hitler’s gas chambers, Stalin’s gulags, and so on.  Political fascism not only exists but there is financial, as well as fiscal.  For it eliminates entire sections of society, of every society.  People call Hitler a fascist; Lenin a socialist; Thatcher, a conservative and Pinochet a benevolent dictator.  They are all fascists.

 For at the heart of their ideology is free market fundamentalism.  In fact, Lenin was perhaps a more virulent free market villain than Thatcher ever was.  So in Britain, the U.S, Germany, Spain, Italy, Portugal, and much of the world have political parties with a single thing in common: they all are part of a fascist ideology because they stick to the free market economic model.  This is seen as rational governance; it should not be. 
A great number of eminent people today have their heroes, heroines and inspirations like Milton Friedman, Jeffrey Sachs and others.  However, these same people do not worship, or at least do not claim to worship figures such as General Franco, Heinrich Himmler or Pol pot.  Yet the only difference is that the economic fascists like have not been found out.

We live in an age now where people feel the inescapable need to hide their perverse acts and views because it is not tolerated by modern society, and inevitably the public relations industry is geared to protect the “ethical” companies and “green” corporations, and so on.  When people vent their ire and tempers-it is inevitably at political power and not private power. For private power is well protected and their repugnant crimes are largely hidden, and so people become unaware of such practices.  The propaganda model, which protects these criminal acts, has even metamorphosed the legacy of Adam Smith, as we have seen. Big business and private unelected tyrannies are the order of the day, nothing else will do. 
30th March-6th April 2014
This is the second part of essays on 'crime'...see my previous post for the first part.  The third part will be posted shortly.

1 comment:

  1. As you state early on in your essay wit the quote from Adam Smith... what we have now isn't even capitalism. It is full on fascism. Ghaddafi was NOT a good man, but in comparison to the many of the people listed, he was a better alternative. That's some pretty shitty company to keep there Pinochet... :|