ConsumerismEconomicsSociety

The Corporation

"If corporations are legally human – what kind of people are they?"

No green website should go without making a mention of the ‘The Corporation’ movie. We’ll go a step further, and make it easy for you to watch it. Many of you will have seen it – but if you haven’t, take some time to do so. Below you’ll find the complete, highly acclaimed and appropriately disturbing documentary.

If this topic is very new to you, read a little background info in the passages below, as I’ll share some text that may help demonstrate why we need to soberly consider The Corporation presentation. Large corporations, particularly trans-national corporations, have become a law unto themselves – the consequences being that this global corporate system is controlling world governments and labour, damaging the environment, destabilising society, escalating global warming, and more!

The Corporation – Duration: 3 hours

I’d also encourage you to make a donation to the makers, or purchase a ‘hard copy’ for yourself (the actual DVD provides a lot of extras).

The Corporation at work:

Easily the biggest environmental concerns we have today are from the developing world – countries of ‘The South’ – China and India in particular, along with large parts of Asia, south and central America and Africa. Why? Well, first consider that our present environmental dilemma (which includes major food and water insecurity) has been almost single-handedly been brought about by pollution from industries of ‘The North’ – predominantly the United States, Western Europe and Japan. Right? If we have, in such a short expanse of time, managed to create such a bloated problem with such a small percentage of the world’s population, then, factor in the runaway freight-train exponential growth of the countries of the South, and you’ll see we’re facing an unprecedented surge in pollution and environmental abuse that will magnify the damage we’ve already done in ways that are hard to imagine, let alone calculate.

In short, just as we’re, finally, (almost collectively) acknowledging that our lifestyle is unsustainable, the rest of the world has started aggressively reaching out for it. But, guess what – transnational corporations of the North are orchestrating all of this ‘progress‘:

The outline of today’s globalized economy was designed at the 1944 Bretton Woods conference, where Western leaders met to design a new financial architecture for the post-war period. The aim was to draw the world’s smaller economies into the orbit of the industrial superpowers, thereby greatly increasing the number of Western-style consumers, expanding the market for manufactured goods, and assuring unfettered access to the planet’s natural resources. With these ends in mind, three supranational institutions were established: the World Bank, the International Monetary Fund (IMF) and the General Agreement on Tariffs and Trade (GATT).


1944 UN Conference that took place
at Bretton Woods, New Hampshire

The Bretton Woods scheme called for the World Bank to provide funding for major development projects – first to rebuild war-torn Europe, then to build up the so-called underdeveloped parts of the world. World Bank projects have generally focused on the infrastructure requirements of a global trading system, including huge centralized energy plants, long-distance transport networks, and high-speed communications systems. The IMF, meanwhile, has worked to impose a standardized economic architecture – with unbridled economic growth as the foundation – on every national economy. Strict structural adjustment policies have been imposed on borrowing countries that did not adhere to that plan. At the same time, the GATT has served to increase every nation’s dependence on long-distance trade by keeping tariffs low, removing other perceived barriers to trade, and turning more realms of life into globally tradable commodities.

For the South, this framework ushered in the era of development. Though ostensibly more noble in its aims than colonialism, its goals and policies actually joined seamlessly to those of the previous era, and the results have been strikingly similar: a Northern economic model, based on industrial production, trade, and economic growth, has been systematically imposed throughout the Third World. And just as in the colonial period, resources and output have steadily flowed from South to North.

One measure of the impact of these institutions is the degree to which national economies are now dependent on international trade. Since the 1940’s, world trade has grown twelve-fold – almost two-and-a-half times faster than the growth in output. Imports and exports now make up a much larger proportion of economic activity than ever before, with international trade amounting to some $5.5 trillion annually. Not all of this trade consists of consumer goods, military hardware, and natural resources: trade in food, too, is steadily expanding, with more than 600 million metric tons of food crossing borders in 1998, triple the amount traded in 1965.

This explosive increase in global trade has fed the growth of the trading bodies – transnational corporations (TNCs) – while systematically stripping power from local authorities. Many TNCs, in fact, are now more powerful than entire nations: a study by the Canadian Centre for Policy Alternatives showed that 51 of the 100 largest economies in the world in 1999 were corporations, not countries.


click to enlarge

While global trade and TNCs have been nurtured and supported, local economies and the food systems embedded in them have been seen as little more than anachronistic impediments to economic progress, and have been systematically dismantled. In the South, farmers have been encouraged, pushed, and cajoled by development experts into using chemicals, hybrid seeds, and farm machinery, and to orienting an ever larger proportion of their production toward national and global markets. Since these modernized farms need far less labor than traditional farms, people have been displaced from the land in phenomenal numbers. In 1979, for example, 92 percent of China’s population was on the land; China’s abondonment of collectivized agriculture and its efforts to integrate rapidly into the global economy have reduced that number to less than 40 percent today. In one recent year alone, 10 million Chinese peasants left their farms. This may sound like an extreme example of social engineering, but it is not so different from what has happened in Northern, market-based economies: in the United States, for example, some 2.5 million rural inhabitants have been similarly uprooted since the end of World War II. – Bringing the Food Economy Home, p. 12-14 (Norberg-Hodge, Merrifield, Gorelick).

Remember, democracy is about the government serving the interests of the people, all working for the betterment of society. Democracy is not the people, and the government, catering solely to the interests of a few powerful industries whose primary objective is maximising profit at any cost to the public or environment. This latter situation, the one we are in today, could instead be described as a return to feudalism – corporate feudalism – on a grand scale.

The last century has seen a huge shift from people living self-sufficient, sustainable, low-carbon-footprint lives in rural settings to an urban environment where all of life’s needs must necessarily be provided at huge environmental and social cost.

When farmers produce a small but diverse range of crops, their entire harvest can be marketed within their own local economy; but when swallowed up into the global food system, farmers need to market single crops in amounts far larger than the local economy can absorb. Those farmers can no longer market their own production and have come to depend on agribusinesses to do it for them.

Corporate agribusinesses have thus taken control of the entire food system. Not only do they supply almost all the needs of industrial farmers (in some cases owning the farms themselves), they also act as middlemen, processors, distributors, and retailers – buying, packaging, and selling food on markets that have grown to encompass the entire planet.

In countries where agricultural progress has proceeded furthest, many agribusinesses have become huge, vertically integrated enterprises, with subsidiaries profiting from every aspect of a farm’s operation. For example, consider this hypothetical American farmer growing wheat and raising some cows and chickens, described by Joel Dyer in Harvest of Rage. The farmer purchases a new tractor from a company owned by the Cargill corporation and some irrigation equipment from a second Cargill subsidiary. He also needs seeds, chemical fertilizers, and feed for his livestock, all of which are purchased from still other Cargill subsidiaries. At harvest time he brings his wheat to Cargill’s milling operation; unhappy with the price he is offered, he decides to store his crop in a grain elevator, also owned by Cargill, hoping for a price rise in the future. The storage charges are eating into any return he will eventually receive, so he sells his crop to a trading company, owned by Cargill, which ships it to Europe or Japan. His cattle, meanwhile, are sold to a feedlot owned by a Cargill subsidiary, which in turn sends them to a Cargill-owned meatpacking plant. He sells his chickens to one of Cargill’s poulty-processing plants. Unfortunately for him, the prices he has received for his wheat, his cattle, and his chickens are too low for him to make ends meet, so he goes to a local bank for a loan. The bank, as it turns out, is also owned by Cargill.

Although the farmer just described is imaginary, Cargill is involved in all aspects of farm production mentioned – and many more besides. And while this farmer could have purchased some of his needs from a cargill competitor, chances are this company also would have been a huge agribusiness corporation. – Bringing the Food Economy Home, p. 9 (Norberg-Hodge, Merrifield, Gorelick).

Corporations are the most developed in the North, so examples of their ‘system’ in western nations become the template of what to expect in the South – or you can even say the ‘best-case scenario’.

In order to get a contract with Continental, Tyson, or ConAgra, the corporations that now control the [US hog and poulty] industry, farmers must agree to the companies’ terms. And those terms are the equivalent of the farmer becoming a hired hand on his own land.

…[The] Companies tell the farmers what type of chicken houses or hog buildings they must build, forcing them into more and more bank debt as they struggle to keep up with the technological advances demanded by the company. The hog industry is particularly expensive. Modern operations consist of giant buildings, where hogs live out their entire existence without ever having been outdoors or having breathed fresh air. High-tech systems feed the animals and remove their excrement. The hog simply stands in one place and grows until it is killed….

Many hog and poulty farmers no longer own any animals. The farmers get the chicks and hogs from the multinationals. Even the grain the animals are fed is provided by the company. At the end of the season, the full-grown animals are trucked to the company’s processing plants where they’re weighed. After rating each farmer’s performance in pounds, the company deducts its charges for the chicks or hogs, feed, transportation, and any other services or products it supplied, such as propane to heat the buildings. If there’s anything left over the farmer is compensated. The only things that the company allows the farmer to own are the heavily indebted buildings and land where the company raises “its” animals. And those buildings never get paid off. Farmers say that nearly every year, the company requires innovations in exchange for the all-powerful contract it knows the farmer must have to avoid bankruptcy. Once in the system, there’s no way out except foreclosure – a sad reality that the companies exploit to the fullest. – Bringing the Food Economy Home, p. 13 (Norberg-Hodge, Merrifield, Gorelick).

I’ve focused on agricultural aspects above, as this is the foundational industry for all cultures – the choice of system applied in agriculture has the greatest subsequent economic and social effect on the populace – but, corporations are of course involved in every aspect of our lives, with similarly wide-ranging effects.

Let us know your thoughts.

Further Reading:

 

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