This column is the second part of a series. To read Part One, click here.
In Part One, I argued that a healthy society requires that governments be accountable to the people for the well-being of all, and that corporations be accountable to democratic governments.
Last week, Bayer, a transnational drug and pesticide company, secured funding for its $66 billion offer to acquire Monsanto, the world’s largest producer of agricultural seeds. This follows the announced $130 billion merger of chemical giants Dow and DuPont, and ChemChina’s proposed $43 billion purchase of the seed and pesticide firm Syngenta.
Bayer, DuPont, Dow, Monsanto, and Syngenta are five of the world’s six biggest pesticide and seed corporations. There are claims, which I find credible, that the “Big 6” and their products bear major responsibility for pesticide-resistant weeds and insects, and are implicated in impoverishment of small farmers, collapse of honeybee colonies, water pollution, and loss of biodiversity and soil fertility—all serious attacks on the common good. And similar consolidation continues in most every sector of the economy.
As individual corporations grow in size, global reach, and political power, we see a corresponding shift in the primary function of national governments—from serving the interests of their citizens to assuring the security of corporate property and profits. They apply police and military powers to this end, subsidize corporate operations, and facilitate corporate tax evasion. They let corporations off the hook with slap-on-the-wrist fines for criminal actions. Rarely, if ever, do they punish top executives.
We the People never voted to yield our sovereignty to transnational corporations. Nor was the corporate takeover a response to public need.
The subversion began with the recolonization of developing countries, which I witnessed firsthand while living and working as a development professional in Asia from the late 1970s to the early 1990s. For years, the World Bank, the International Monetary Fund (IMF), and national foreign assistance programs had been luring former colonies into funding development projects with debt payable in foreign currency. They could repay only by selling their national assets and the fruits of their labor to foreign corporations.
It became evident in the early 1980s that most borrowing countries could not repay their debts and fulfill their fiduciary responsibility to their own citizens. The World Bank and IMF stepped in as international debt collectors with a corporatist agenda that forced debtor nations to:
- Slash public expenditures for health and education to provide tax breaks and subsidies to foreign investors;
Put public assets and services, including communications, power, and water, up for sale to foreign corporations;
Eliminate restrictions on foreign ownership, imports, banks and financial institutions, cross-border financial flows, and the extraction and export of natural resources; and
Roll back protections for unions, workers, public health and safety, and the environment.
Emboldened by this success, the corporatists globalized their agenda in the 1990s through international agreements like NAFTA and international organizations like the World Trade Organization (WTO). Step by step, they co-opted politicians and reduced the ability of governments of all countries—creditors and debtors, rich and poor, large and small—to protect and advance community social and environmental interests if doing so might reduce the anticipated profits of a transnational corporation.
In the United States, as corporate profits soared, working people became mired in unpayable mortgage, credit card, and student debt. It grew harder to find a meaningful and secure job at a living wage. Young people gave up expecting they would have better lives than their parents. And we experienced a host of environmental consequences ranging from violent weather events to contamination of drinking water.
There are no simple solutions to this distortion of priorities and its devastating social and environmental consequences. It will require a major restructuring of both governmental and corporate institutions to strengthen democracy and subordinate corporate power to people power. I’ll spell out key elements of a policy agenda in Part Three of this series.
David Korten wrote this article for YES! Magazine as part of his column on “A Living Earth Economy.” David is co-founder and board chair of YES! Magazine, president of the Living Economies Forum, co-chair of the New Economy Working Group, a member of the Club of Rome, and the author of influential books, including When Corporations Rule the World and Change the Story, Change the Future: A Living Economy for a Living Earth. His work builds on lessons from the 21 years he and his wife, Fran, lived and worked in Africa, Asia, and Latin America on a quest to end global poverty. Follow him on Twitter @dkorten and Facebook.