Globalization and the New "Corpocracy"
By Charles Derber
Charles Derber is professor of sociology at Boston College and author of Corporation Nation: How Corporations Are Taking Over Our Lives and What We Can Do About It (St. Martin’s Press, 1998). He is a principal advisor to the Center in developing the spring 2001 conference series, “Economics for Human Well-Being: Advancing a People’s Agenda.” As an introduction to this article, which explains the theme of the first conference, Professor Derber offered the following comment on a growing grassroots commitment to economic justice:
Consider the following: 450 billionaires today own more wealth than half of all humanity. And think about this: the three wealthiest shareholders of Microsoft own more wealth than all the people living in Africa. Or this: Wal-Mart is bigger than 163 countries. GE is bigger than Israel or Finland.
Globalization is creating a new corpocracy—a worldwide nexus of financial markets and corporations that now dominates the world. There are over 45,000 corporations on the globe today, but the 200 largest companies rule, with sales comprising over 25% of the total GDP of the world. Financial institutions are especially important, and not just because the 100 largest banks control 21 trillion dollars in assets, about three-fourths of the world’s wealth. With over $1.5 trillion racing around the planet for maximum profit each day, the financial markets are the ultimate masters of the universe, controlling not only government but the corporations themselves. Corpocracy is about money making money, a departure from the days when the economy was driven by producing useful goods.
The corpocracy unites economic, political, and ideological power, much as the Catholic Church did in the Middle Ages. The Church owned the most land, dominated new nation states, and created a global faith. Along with its awesome concentration of wealth and political power, today’s corpocracy creates a new religion of the market.
But the best historical model of corpocracy is the U.S. Gilded Age, when Robber Barons such as John D. Rockefeller and J.P. Morgan created a ruthless, financially-driven corporate economy in the U.S. Then as now, government, unions, and other "enemies of the corporation" were weakened and ultimately taken over by the corpocracy. The U.S. became a democracy in name only, as both Republican and Democratic parties became handmaidens to the wealthy. Today, globalization spreads nominal free election systems around the world while undermining any prospect for meaningful democracy.
Corpocracy ultimately justifies itself by the magic of new technology and dynamic growth, promising prosperity for all. But global corpocracy, which grows out of the legacy of four centuries of European colonialism, is actually transferring wealth from the Third World to the U.S., Europe, and Japan where the big corporations are headquartered. The per capita gap in income between rich and poor countries tripled from 1960 to 1993. Three billion people mainly living in the global Southern Hemisphere now live in dire poverty—half of all humanity. The World Bank’s own statistics indicate that there are more poor people in Africa, Latin America, and Southern Hemisphere Asia than there were two decades ago. The global economy is growing, but mainly by turning most of the Third World into a gigantic sweatshop and dumping ground for pollutants.
A worldwide popular movement against corporate globalization is inevitable. In the Gilded Age, the populist movement mushroomed to challenge Rockefeller’s monopolies and to expose the contradictions between corpocracy and democracy. It was defeated but led to the progressive and New Deal reforms that created rights for labor and a new 20th century middle class.
The “Battle of Seattle” signaled the rise of a new global populism. The twenty-first century will be the story of the contest between the new global corporate elites and the post-Seattle movement. The new forces of resistance combine the anti-colonial movements of the Southern Hemisphere that helped define the last century and today’s labor, minority, feminist, and environmental movements that have become the main hope for democracy and social justice in the U.S. and Europe.
The new movement aims to base the emerging global society on principles of human rights and democracy rather than property. The corpocracy—through the World Trade Organization (WTO) and the International Monetary Fund (IMF)—is drafting a global constitution with no Bill of Rights. At Seattle it became clear that ordinary people are insisting on a global charter of human rights that will protect people over property.
The new movement is different than any prior social movement. It is made up of a worldwide coalition of labor, environmentalists, women, minorities, students, and others who have not spoken with one voice before. This reflects the enormous transformative impact of globalization on all the planet’s people, and the growing recognition that they must come together to oppose global elites. Feminists and students, for example, increasingly understand that corporate globalization’s exploitation of female and child sweatshop labor has become a priority for the new century. The labor movement in the U.S. now sees that repressive working conditions in Mexico and Indonesia are undermining fair working conditions in the U.S. Virtually all grassroots social movements see the same global corpocracy as their principal new enemy.
How to organize and sustain a truly global social justice movement is the great current challenge. We know that it must be a democratic coalition based on tolerance and diversity. It must be led from the Southern Hemisphere, so as not to create yet another neo-colonialism, but it must engage workers and communities all over the Northern Hemisphere as well. It must become as skilled in the technology of the Internet as in the art of democracy. This improbable movement has already had more success than anyone anticipated, striking terror in the hearts of the corporate and financial elites who never expected it. Whether it can survive and change the world is the great challenge of social justice activists in the coming century.
Ikeda Center for Peace, Learning, and Dialogue