Countering The Power Of Multinational Corporation

The financial crash of 2008 and the turmoil that followed, brought to light grave failings in a capitalist system of political and economic management. The recovery in the years that followed write the rules for the Capitalist world to follow.

This feature of modern day Capitalism represents social failure in terms of justice, democracy, liberty and sustainability. Yet the mainstream media, politicians, academics and power brokers, doggedly act and speak as if this system is the optimal system to be continued, reinforced and celebrated. There has been little or no debate relating to the need for an alternative and refined global economic system.

The onset of Covid-19 pandemic in 2020, has accentuated this out the pandemic on ocean front estates, mountain hideaways and yachts and feasted on the calamity, buying up real estate, shares of stock and other companies at depressed prices. They have applied their lobbying muscle to turn taxpayer-financed bailout packages into corporate welfare schemes for the billionaire class. In the process they plundered health care systems and stripped governments of resources to deal effectively with the pandemic .More than ever before large multinational corporations (MNCs) and those they enrich wield evermore power over the political and cultural realms of society.

Historically, capitalist economies everywhere have displayed a recurring pattern of oscillation. Periods of state political and economic intervention followed by period of less state intervention. During the past 100 years, two mainstream theories have arisen to explain recurring economic crises and propose solutions to deal with them:

1. Keynesian Economics that suggests unregulated private markets have limits and imperfections that periodically push capitalist economies into inflationary spirals recessions or even depressions. Keynesian economics identifies key mechanisms that produce a crisis and recommends state intervention (regulation of monetary and fiscal policies to prevent and overcome the crisis.

2. Neoclassical economics based on the ideas of 18th century Scottish philosopher and theorist Adam Smith, that stress the benefits of unregulated private capitalism. Neoclassical economists claim that free markets accommodate the multiple demands of competing services more efficiently than the state.

These theories have shaped the debate over the causes and effect of the social suffering that follows each crisis. Such constricted debate keeps the public from considering alternative solutions and a different system of economic management

Since the late 1970s the free marketeers led by the Chicago school of economists have been in the ascendant. Sadly, the disparities that ensued have resulted in widespread distrust of political institutions and rebellion in the recent years.

When economic downturns cut deep and persist as in the 1930s and again in the Covid -19 era, stark inefficiencies become apparent. Millions of displaced workers alongside idled productive capacity, yield massive waste and social consequences. The bailouts of large enterprises by government turn sceptics into critics, who become mobilised into political opposition, when subsequent government austerity policies shift the cost of such crises and bailouts onto the mass of the people. Blaming government and bureaucrats becomes a catch cry; portraying them as wasteful, incompetent, power hungry and oppressive.

In capitalist societies corporations and the rich use their resources and power to shape government to their advantage and influence government decision making. The common refrain is that private enterprise is more efficient and should be left unrestrained to improve efficiency. One could ask; efficient for whom and are such enterprises really efficient?

Efficiency problems had little to do with the longer term economic declines troubling the United States, Europe and much of the western world in recent times. Rather the decline and social unrest that followed were as much to do with decisions of large corporations to relocate production and services offshore to China and other nations where the cost of labour is low.

Efficiency is a misnomer and has nothing to do with the economic and social

Throughout the history of capitalism, major decisions have been justified by claims that all society would benefit. Sadly, the opposite tends to occur. When new machines arrived and automated production followed during the industrial revolution, the gains went mainly to the entrepreneurs and managerial class , while workers, their families and their communities suffered unemployment. When large corporations s settle into new communities they may create jobs, but also make demands for tax breaks, subsidies and loans to be persuaded to stay. When large corporations dump toxic wastes into the air, land and sea they tend to walk away, leaving massive clean-up costs often lasting years which become a responsibility governments and their tax payers. The structure of modern capitalist economy has put almost exclusive power in the hands of large corporations that drive decisions and advance the interest of the corporation their directors and shareholders at the expense of the community at large.

A prime argument of capitalists is that they bring economic development to poor countries. This fails to recognise that economic underdevelopment in what has been termed the third world is largely the result of colonialism and neo-colonialism practiced by empire builders and buccaneers intent on plundering local resources .The current development in the former third world is replicating the colossal waste, inequities of wealth distribution and inhuman conditions that attended the capitalist development of the past.

Now in the fifth decade of this global shift the means of production has seen the transformation and follow on effects of rapid development in China and other former third world countries. Wages and social conditions have improved in sectors of those societies , to the extent that such nations are now exporting production to other lower cost nations where labour is cheap, in a downward spiral to oblivion.

Sustainability and growth (a contradiction in terminology )has become the common mantra of the capitalist brigade, but the power and influence they exert is far from sustainable and is undemocratic. A solution lies in taking the best aspects of capitalism and converting capitalist enterprises into co-operative ones, where workers are involved in governance, management and decision making. Democratising an economy in such a manner could yield results that capitalism has long promised, but failed to deliver.

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