Saturday, December 8, 2007

Consumerism, Corporatism, and 3rd World Oppression

I recently spent several weeks vacationing in a 3rd world country with several friends. This 3rd world country was well known for their ancient civilization which was very advanced for its time. I had a wonderful time, and also had a life-changing realization.

While I was there I read John Perkins's book "Secret History of the American Empire", which is a follow up to his bestseller "Confessions of an Economic Hit Man". Reading his book while in a 3rd world country, seeing all the poverty, makes it very in-your-face. That was the reason for my realization.

Economic Hitmen are international consultants whose main job is to convince the corrupt elite of LDCs (less developed countries) around the world to accept multibillion-dollar loans for infrastructure projects and to see to it that most of this money ends up at Halliburton, Bechtel, Brown and Root, and other United States engineering and construction companies.

The loans, which come from the IMF/World Bank, are designed so that the poor nations will never be able to repay them, but will forever be enslaved by only being able to pay interest on the loan. (This is a lot like the US middle class, and the Federal government's debts - ultimately unpayable - because of the Federal Reserve and the fundamentally corrupt monetary system. The root is the Compound Interest Paradox, aka the "Debt Virus". Here's an excellent summary.) Indeed the IMF and WB are simply a part of, and controlled by, the central banks, most especially the Federal Reserve. Many, many poor nations spend more on paying interest on their foreign debt, than they do on education, basic medical care, micro-loans, and other grassroots programs for the poor.

John Perkins goes on to say that this system relies on corrupting the elite in these poor nations. These elites benefit directly by siphoning a small portion of these multibillion dollar loans, and by remaining in power. This is the carrot.

The system is driven by the corporatocracy - a term coined by Perkins to mean the collective of the transnational corporations. Wall Street benefits directly from the enslavement of the 3rd world, as they are able to tap the natural resources of these 3rd world nations at low cost. Carrol Quigley had written in his book, "Tragedy and Hope", that the world's elite keeps the 3rd world poor in order to keep the prices of natural resources low.

http://www.commondreams.org/views04/1119-24.htm:
“The system is set up such that the countries are so deep in debt that they can’t repay their debt,” Perkins said. “When the U.S. government wants favors from them, like votes in the United Nations or troops in Iraq, or in many, many cases, their resources – their oil, their canal, in the case of Panama, we go to them and say – look, you can’t pay off your debts, therefore sell your oil at a very low price to our oil companies. Today, tremendous pressure is being put on Ecuador, for example, to sell off its Amazonian rainforest -– very precious, very fragile places, inhabited by indigenous people whose cultures are being destroyed by the oil companies.”

John Perkins goes on to say that if the elite of a 3rd world country begins to resist or go nationalistic, the stick comes out - the CIA jackals are sent in. This is the fate that befell Jaime Roldos in Ecuador, Omar Torrijos in Panama ,and Allende in Chile. They were assassinated. Note that the CIA and Wall Street are intertwined. The jackals then install a new puppet government.

If the jackals fail, the US Military is sent in to finish the job. Young men and women are sent in to die "for their country", to kill people who "hate us for our freedoms", and to "spread democracy". This is what happened to Saddam Hussein, who, ironically, was trained by the CIA to assassinate his predecessor Qasim who was anti-corporatist, and to be a counter balance against Iran. And don't forget that in 1953, Iran's popular democratically elected Mossadegh was ousted, and the Shah put in power, by the CIA, at the behest of British Petroleum, because Mossadegh wanted his people to get a larger share of BP's oil income.

The US Military as Wall Street's attack dog has been written about back in the 1930's. Smedley Butler, perhaps the most decorated major general in the Marine Corps, wrote a book, "War is a Racket".

Such activities are those of an empire. Of all the characteristics of an empire, only one doesn't describe the USA - the presence of an emperor. However, Perkins points out that the corporatocracy acts as a virtual emperor. The root is that corporations have been conferred the rights of an individual, and none of the responsibilities. As an entity, they always look out for the bottom line. If the bottom line is helped by oppressing people in other nations, and transparency is not required, they will do it. The result is that the American Empire is hated by many people in the world.

All of this empire building is completely unbeknownst to the vast majority of the American public. This is because the mass media is controlled by the same corporations that run the corporatocracy, by the same people that run the government. This is a crucial point to understand. America is not hated for her people, who are misled by the so called free press. America is hated because of her government's foreign policy and covert operations; her government that is run by the corporatocracy; a government that does not represent "we the people".


Reading Perkins's book while visiting a 3rd world county gave me a new perspective. It doubled the intensity of my feeling that needless human suffering is very, very offensive. As a technologist, I feel there is no good reason that anybody on this planet should not have access to food, clean water, shelter, and basic medical care. The poverty in this world is a man-made, artificial creation of the people in power. They believe in materialism - that in order to have a bigger piece of the pie for themselves, they have to steal someone else's. They believe that life and economics is a zero-sum game.

I believe that wealth comes from knowledge, as Plato said. If we need more wealth, we can make the pie bigger for everyone. Almost all the wealth we have today comes from technology - medicine, transportation, communications, mass production of goods, and so on. Keeping huge swaths of the world poor, results in tremendous swaths of untapped human potential. Human potential that could have been generating more wealth for everyone.

If parts of Asia and Africa were not desperately poor and had access to higher education for the past 40 years, then technology, which is accelerating, would probably be 20 years ahead today - we'd probably have had the Internet boom in the 80's, and have the technology of the 2020's here today. The world's power elite are killing the goose that lays the golden egg, so to speak. Keeping the 3rd world poor is counter-productive. Even though natural resources would be more expensive, technological advancements continually make use of smaller and smaller amounts of natural resources to make the same product, offsetting the increased prices of resources. Ironically, by now some bright young scientist in Asia or Africa may have discovered the cure for a fatal cancer that one of the elite in the first world may be dying of today.


During my trip, an incident struck me. We had just come from a 4 day boat cruise where our group had had a discussion about how much to leave as a tip for the crew. We had settled on $8 from each of us for 4 days. This was a very paltry sum given the wonderful service we got from the crew, and the local culture's very warm-hearted manner.

The next day, while our group was hailing a taxi, some rejected a taxi because the driver wanted to charge $0.50 more than what was considered to be a good price. Our destination was Hard Rock Cafe, because 2 women in our group had wanted to purchase a Hard Rock cafe shirt or blouse with the name of the city we were vacationing in. When we got there, I was shocked at the price of the blouse - $60, in a 3rd world country. It struck me that these same women had haggled our taxi fare for 4 of us down by $0.50, and had only wanted to give $8 total tip for 4 days on a boat cruise. This was money for people who were working to feed their families. And yet, they readily coughed up $60 for a blouse made by a wealthy corporation, for a product that probably cost them $1 to make.

It was offensive to watch. I asked them about wasting time haggling $0.50 for a cab ride - they said they "don't want to be ripped off". Yet they didn't feel ripped off paying $60 for a $1 blouse.

I understand that they are exercising their own freedom and that was their free choice. However it struck me just how pervasive consumerism is. The constant barrage of "buy buy buy", and the brainwashing and instilling in consumers the idea that acquisitiveness is a good thing, is disgusting. I have posted about this before, that the educational system and the media turn people into good little consumers.

I don't think there's anything wrong with wanting to have high quality stuff to enjoy per se - but making what-you-have a substitute for who-I-am is creepy. "Me, me, me", "Look at me in my enormous 4,000-lb SUV, which I bought on credit, for carrying my 30-lb child", while soldiers die for the gas that runs it. "Look at my fancy $1,000 signature purse which I bought with my credit card, because I have been brainwashed into thinking that having some Italian fashion guru's name on my bag makes me feel good about myself", all the while a big chunk of the world lives on less than $1 a day. And all this consumerism is the result of brainwashing, to enrich the loan and credit card companies and the corporatocracy.

I'm not saying you should live the life of a pauper and be happy you don't have to walk 10 miles a day to fetch water. All I'm saying is you should see through the consumerism and think twice about useless "feel-good" purchases. Especially if you have to borrow money to "afford" it.


John Perkins' proposal to end the oppression by the corporatocracy, is to effect a legal change in corporations' charters, basically requiring them to have the same responsibilities as a person, to go with their rights. Another is to greatly increase corporate transparency, so that consumers are aware of their activities, and can vote appropriately with their wallets. I have a proposal to add, that managers and members of boards of directors have reduced liability protection for a corporation's actions which are a direct consequence of their decisions.

Despite all the horror stories, Perkins is positive. He says we can turn the empire into a good thing. When an empire collapses a new one takes its place - he says we can instead turn the corporations into good corporate citizens. Corporations have many strengths - such as efficiently turning scarce resources into products that consumers want.


Today, Ron Paul is the only presidential candidate that has called a spade, a spade. He said the USA cannot afford to continue empire building. All Empires end. The ancient civilization of the country I was visiting ended, and today they are a 3rd world country. Empires end because they go bankrupt, from printing too much fiat money, and forgetting the principles that made their pre-empire nation great to begin with. In the USA, these are the principles of Individual Freedom, limited government, and the free market. Ron Paul has always voted against meddling in the internal affairs of other nations. He voted against the Iraqi Freedom Act, signed by Bill Clinton in 1998, which paved the way for the Iraq invasion. He has consistently voted against the Patriot Act, the spying powers act, and all the other acts that increase the power and spending of the government and all acts that reduce our freedoms; all of this while Hillary and Obama and most of the Democrats voted the opposite.

I believe that if Ron Paul gets elected, and if John Perkins's suggestions come to fruition, that America, followed by the rest of the world, will enter a new golden age. America can again become the shining beacon she once was, leading by example.


Before I end this post I need to say a caveat - Perkins seems to confuse capitalism and corporatism. There is a pervasive myth that capitalism always leads to corporatism. Corporatism happens when big business and government collude so that government writes laws and regulations that favor certain corporations, or favor large corporations, over small business. This leads to cartelization, which is the goal of any "regulation" that is pushed by corporations. This could either happen by government being misled, or bribed, by lobbyists. Government meddling in the free market is almost always corporatist. Many industries in the USA are heavily regulated, thus, the free market does not truly exist.

Here is a good book review that says exactly this:
http://www.mises.org/story/2416
Perkins's primary problem is in assuming that all global capitalism is sinister in the sense described in his book. Any creation of wealth that depends on coercion can hardly be considered market capitalism. It truly is sinister when a US firm, funded indirectly by taxpayer dollars, forces indigenous people offs their land in South America because geological tests suggest that oil deposits there surpass those of the Middle East. It is sinister because it violates the property rights of both the taxpayers who fund the politically well-connected firms and of the displaced peoples and cultures whose property rights are violated when they are removed from their land (often with much suffering).

But Perkins's anticapitalism really shows when he equates such activity with (say) the opening of a Nike plant a third world country. No one dies, and no cultures are killed off, when a factory opens and workers living near it can voluntarily sell their labor for wages that (economic theory tells us) exceed their next-best opportunity for work.

In developing countries, a new Nike plant is a godsend, not only because it increases capital flows to a region, but because it means that families can become autonomous, or that daughters do not have to resort to prostitution to put food on the table.

In this sense, it is perverse to assume that a Wal-Mart in China or a McDonald's in South Korea is analogous to a Bechtel in India or a Halliburton in Iraq.

Perkins's biases also show when he assumes that the West stays rich because poor countries are kept poor. This zero-sum thinking ignores those factors that cause wealth to become created in the first place. The America of the Founding Fathers — whose anti-imperial instincts Perkins rightly lauds throughout Confessions — didn't depend on international development loans or the expansion of social welfare programs to fuel the industrial revolution, but on the protection of property rights, which then rewarded saving and attracted capital. For that reason, it is no coincidence that poor countries that eschewed such loans and nurtured property rights institutions 20 years ago are those that are quickly joining the wealthy countries of today.

3 comments:

Jason726 said...

Everything you said was spot on. The question is, how do we get this information into the public eye. The media will not show anything like this, and the fact that they don't says it all. This is more interesting than 99% of the stuff in the news today, yet no one even mentions it in the media. How can we raise the public awareness?

Anonymous said...

Fantastic post. You have everything that is known to be true. How can we change the world so that this is no longer the case?

redpillguy said...

To Anonymous:
Get people to vote for Ron Paul in the PRIMARIES.

To jason726:
Spread the word.