The world’s food system brings us inflation, hunger and waste

Market fundamentalists would have us believe that if only we left the provisioning of all human needs to the tender mercies of unregulated markets, a cornucopia of fabulous wealth would trickle down to all. A powerful fire hose of propaganda ceaselessly proclaims this, amply funded by those whose interest lie in accumulating unlimited wealth without regard to social or environmental harm.

Friedrich Hayek, in propagating the Austrian School of economics, precursor to the Chicago School of Milton Friedman, went so far as to claim that solidarity, benevolence and a desire to work for the betterment of one’s community are “primitive instincts” and that human civilization consists of a long struggle against those ideals, and “the discipline of the market” is the provider of civilization and progress. Friedman, venerated by those made ever more wealthy and powerful through deepening corporate control of society, promoted the idea that the one and only consideration for any corporation is to maximize profits for shareholders; doing anything else would be “immoral.” So pervasive is this extremist ideology that corporations are routinely sued by “activist shareholders” for failing to extract every possible scrap of money by any means necessary, most certainly including instituting layoffs even if the company already is highly profitable.

The appalling inequality, wars, imperialism, billions without regular work, slums and a host of other ills, not least of which is global warming, are the products of allowing “markets” to determine ever more social outcomes and of making ever more human needs a commodity, even such basics as water and housing. But what of food? Along with water and shelter, nothing is more a necessity than food. Perhaps here we can find a silver lining in the corporate conquest of the world? Agriculture has made enormous strides over the past century; farms have never been so productive and a variety of foods never more available.

^{(Photo by Anubhav Sarangi)}

Nonetheless, food is a commodity in a capitalist economy. Inflation, you’ve undoubtedly noticed, has not exempted food. Food has become much more expensive over the past two years, reflected in significantly higher grocery costs and restaurant bills. In general, the corporate right-wing ideology that thoroughly dominates the mass media seldom misses a chance to blame wage increases for any incidence of inflation. Yep, it’s greedy working people who believe they should be paid a wage sufficient to actually live on in exchange for work. Seldom, if ever, is evidence presented to back these claims. Rather, it is presented as an incontestable fact of life. So it has been over the past two years of inflation that has spread around the world, as has been routine for decades.

It is as if the disruptions of the Covid-19 pandemic could not have anything to do with supply chain disruptions and production, or that the greed of financiers and those in the executive suites of corporations in raising prices could not be a factor. Food prices are not exempted from this pattern. So although there are several reasons behind the surge of inflation, the above factors can’t be discounted. Beyond that, there is the much broader, and more long lasting, question of food supply for the world.

What sort of “efficiency” sees billions going hungry?

Let’s try to tackle food supply first. As the United Nations Food and Agricultural Organization (FAO) report The State of Food Security and Nutrition in the World 2023 states, “Global hunger in 2022, measured by the prevalence of undernourishment, remained far above pre-pandemic levels.” The FAO report estimates that about 10 percent of the world’s population “faces chronic hunger” — about 122 million more people were in this category in 2022 than in 2019, before the pandemic. Using a more broad measure, more than one-quarter of the world’s population are “food insecure,” with a distinct gender bias. The report states, “Food insecurity is more prevalent among adult women than men in every region of the world, although the gap narrowed considerably at the global level from 2021 to 2022. In 2022, 27.8 percent of adult women were moderately or severely food insecure, compared with 25.4 percent of men, and the proportion of women facing severe food insecurity was 10.6 percent compared with 9.5 percent of men.”

And although the prevalence of stunting among children under five years of age due to malnutrition has declined, nonetheless the total of these unfortunate children is estimated to have been 148.1 million in 2022, or 22.3 percent of the global age cohort.

A system that leads to such inhumane, inexcusable results can’t be said to be efficient. It would be on target to say such a system is an abysmal failure. But the above numbers, appalling as they are, likely understate the actual scale of hunger. A separate FAO report, The State of Food Security and Nutrition in the World 2021: The world is at a critical juncture, while noting that between 720 million and 811 million people faced hunger, said far more were in a precarious position vis-à-vis food. “Nearly one in three people in the world (2.37 billion) did not have access to adequate food in 2020 — that’s an increase of almost 320 million people in just one year,” this report said. One-third of the world’s people! Moreover, an even larger number of people are unable to afford a healthy diet, to which we will return.

Eric Holt-Giménez, former Food First executive director in Oakland, California, and who has taught at several universities, including the University of California, argues that the extent of world hunger is understated. In an article, “Capitalism, Food, and Social Movements: The Political Economy of Food System Transformation,” published in the peer-reviewed Journal of Agriculture, Food Systems, and Community Development, said that one-seventh of the world’s population goes hungry at the same time that one and a half times more than enough food for everybody is produced. But he then explains that the estimate of one billion hungry people “is likely a gross underestimation.”

Dr. Holt-Giménez wrote that the total number of hungry people is underestimated because of how hunger is defined. He wrote, “This is due to the way that hunger is measured. People are only identified as hungry if they experience hunger 12 months out of the year. If they experience hunger for only 11 months out of the year, they’re not counted as hungry. Second, this measurement is based on caloric intake, and you can imagine that the required number of calories an individual must consume varies substantially according to height, gender, occupation, age, etc. The caloric intake threshold for determining hunger (around 2000 kilocalories) is fine if you sit quietly behind a computer for 8 hours a day. But most hungry people in the world are women farmers in the developing world who work under a hot sun all day long and are nursing one or more children. They need as much as 5000 kilocalories a day. Official estimates miss all of this.”

When the “magic of the market” yields waste, not cornucopia

Regardless of how we count, it should be indisputable that capitalist agriculture is a failure. Surely, even if “only” hundreds of millions of people, rather than billions, lack sufficient access to food, that is a monumental failure by any humanistic measure. Those seeking to absolve the “market” of any responsibility are quick to point elsewhere, with Malthusian-inspired whisperings that the problem is over-population a favorite. But such excuses are just that — excuses. The world’s farmers actually produce enough food for everybody on Earth. The problem is affordability and efficiency. And that brings us to food waste.

Here again we confront capitalist mantra. The “magic of the market” will ensure everybody has sufficient food, market fundamentalists tell us incessantly, as is promised for most everything else. But what if billions of people can’t afford food? What if food can’t reach those who wish to eat it? It is precisely “markets” that are behind the huge numbers of people with insufficient food. The United Nations Environment Programme’s Food Waste Index Report 2021 estimates that “food waste from households, retail establishments and the food service industry totals 931 million tonnes each year,” or 17 percent of total global food production. A 2011 FAO report, however, estimated that around one-third of food produced globally was lost or wasted.

Those United Nations studies, however, may be underestimating the true extent of food waste while placing blame unduly on personal behavior. A study by six scientists led by Peter Alexander of the University of Edinburgh, “Losses, inefficiencies and waste in the global food system,” calculates that nearly half of the world’s food is wasted. The authors, publishing in Agricultural Systems, argue that “over-consumption of food” should be included as waste. They write, “If human over-consumption, defined as food consumption in excess of nutritional requirements, is included as an additional inefficiency, 48.4% of harvested crops were found to be lost (53.2% of energy and 42.3% of protein). Over-eating was found to be at least as large a contributor to food system losses as consumer food waste.” Human over-consumption here is defined as food consumption in excess of nutritional requirements. But, crucially, food losses before it could be eaten comprise by far most of that total: “Losses of harvested crops were also found to be substantial, with 44.0% of crop dry matter (36.9% of energy and 50.1% of protein) lost prior to human consumption,” they wrote.

That extensive crop loss is a crucial point because standard commentaries on food waste tend to place the lion’s share of the waste on consumer behavior. By blaming personal behavior, systemic causes can be conveniently ignored. And although food certainly is wasted at the consumer level, and at the retail level as well, the Agricultural Systems study, one of the few to systematically analyze food waste, indicates that agricultural production inefficiencies are where solutions need to be found. Simply increasing agricultural areas or seeking higher yields through the use of greater inputs (such as fertilizers, pesticides or water) could cause more global warming, deteriorating soil quality, water scarcity and losses of biodiversity. The authors wrote:

“The results demonstrate that agricultural production inefficiencies (in both crop and livestock) are the dominant contributions to the overall losses within the food system, when considering either harvested crops or all biomass. … Both the total rate of primary production and also the percentage that is harvested have been increasing over time, in large part due to increasing crop yields. Livestock production efficiencies have also been increasing over time, but still are responsible [for] a substantial loss. … Both consumer behaviour and production practices play crucial roles in the efficiency of the food system. … The greatest rates of loss were associated with livestock production, and consequently changes in the levels of meat, dairy and egg consumption can substantially affect the overall efficiency of the food system, and associated environmental impacts (e.g. greenhouse gas emissions). It is therefore regrettable from environmental and food security perspectives that rates of meat and dairy consumption are expected to continue to increase as average incomes rise, potentially lowering efficiency of the overall food system, as well as increasing associated negative health implications (e.g. diabetes and heart disease).” [internal citations omitted]

The paper says livestock production is often not included in studies of food loss and waste, which is why its authors find higher results. Where consumer behavior comes in here is in what is consumed: “Changes to influence consumer behaviour, e.g. eating less animal products, reducing food waste, and lowering per capita consumption to be closer to nutrient requirements will all help to provide the rising global population with food security in a sustainable manner.”

“Free” for multi-national corporations but not for farmers

Food waste is not inevitable, nor is it necessarily a consequence of basic human failure, even allowing for consumer- and retail-level waste. Dr. Holt-Giménez, the former Food First executive director who was quoted earlier in this article, states that food waste is a part of capitalism, resulting from the consequences of relentless competition. He wrote in his “Capitalism, food, and social movements” article: “It’s often said that reducing food waste can eliminate hunger. While this is conceptually true, it overlooks the influence of our capitalist food system. Food waste is part of that system. Industrial agriculture, capitalist agriculture, has to overproduce in order to stay in the market, and food waste is a consequence.” Capitalist agriculture particularly is susceptible to overproduction because farmers are induced to produce more when crop prices fall because they need to cover heavy fixed costs and are also induced to produce more in good years to make up for the inevitable bad harvest years, Dr. Holt-Giménez wrote. Farmers can’t plant less in bad years nor move their farms.

Compounding all these inequalities is national inequality. Global South countries, where impoverished farmers and hungry populations are found in large numbers, are on the wrong side of imperialist dynamics. The World Bank and International Monetary Fund are two primary vehicles for domination and plunder. As South governments fall into debt, they take loans that always come with the same requirements to privatize public assets (which can be sold far below market value to multi-national corporations waiting to pounce); cut social safety nets; drastically reduce the scope of government services; eliminate regulations; and open economies wide to multi-national capital, even if that means the destruction of local industry and agriculture. This results in more debt, which then gives multi-national corporations and the IMF still more leverage to impose more control, including heightened ability to weaken environmental and labor laws. Subsidized food from the North is exported to the South under World Bank and IMF diktats or under so-called “free trade” agreements, bankrupting South farmers who can’t compete with Northern capital.

As only one example, almost five million Mexican family farmers were displaced in the first two decades of the North American Free Trade Agreement (NAFTA) and the number of Mexicans living under the poverty line increased by 14 million. Subsidized corn from the United States flooded Mexico, sold below the costs of small Mexican farmers. Corn imports from the U.S. increased fivefold and pork imports from the U.S. increased by more than 20 times, according to a Truthout report by David Bacon. As a result, Mexican farmers forced off their land either became seasonal workers on growing agribusiness farms, sought work in the cities or migrated north. 

Under “free trade” agreements, agricultural overproduction in the North is subsidized with tax dollars to dump the surplus in the South, Dr. Holt-Giménez wrote. “Essentially the public is coerced into destroying the food systems of Global South so that Big Grain can make its money. … In the 1970s, the Global South generated about a billion dollar surplus annually from food production. Toward the end of the century, this changed to an annual deficit of approximately 11 billion dollars.”

Yes, Africans starve but North agribusiness profits

Plenty of other examples other than Mexico could be cited, but in the interest of saving space further examples will be limited to two African countries. The dictated terms of World Bank and IMF loans, known by those lenders as “structural adjustment programs,” forces small farmers to be more integrated into global food markets to their detriment. The programs “meant indebted countries across the Global South had to convert from prioritising indigenous crops that the local population depended on, to producing cash crops for export,” Adele Walton of Progressive International wrote. “As a result, local populations and farmers became more vulnerable to food scarcity — due to the negative ecological effects and decline in food accessibility.”

Ms. Watson’s article, “Capitalism is causing the food crisis, not war,” explicates this with the examples of Zambia and Kenya. The structural-adjustment agenda included the privatization and liberalization of the seed system, leading to a decline in support for farmer cooperatives. Zambian farmers were forced to prioritize maize as a cash crop, lessening local crop variety and thus resulting in fewer food sources. “[C]orporate control of agriculture is weakening food security,” Ms. Watson wrote. “Seed systems have gone from being cooperative-led (which gives farmers more agency and fair prices) to being corporate-led (which prioritises profits).” Most Zambia smallholder farmers don’t have the resources to buy seeds at the commercial price. With more farmers forced to grow cash crops, which can be more susceptible to weather changes, about half of Zambians are reported to be unable to meet minimum calorie requirements.

Kenyan farmers have fared no better under this onslaught of imposed capitalist agriculture. Overuse of chemical fertilizers is causing land degradation that hurts food production. “As in Zambia, the disastrous legacy of [structural adjustment programs] is to blame,” Ms. Watson wrote. “In 1980, Kenya was one of the first countries to receive a structural adjustment loan from the World Bank. It was conditional on reducing essential subsidies for farmer inputs, such as fertilisers. This process instigated a shift towards farming cash crops for export, such as tea, coffee and tobacco, instead of farming key staples for the local population, such as maize, wheat and rice.”

^{Losses of harvested crops (excluding grassland and forage crop inputs to livestock production) by stage in the food system. (“Losses, inefficiencies and waste in the global food system,” Agricultural Systems, May 2017)}

As a result of farmers having to struggle, if they can afford it, to obtain agricultural inputs that were free before the IMF dictation, 3.5 million people in Kenya are already suffering crisis levels of hunger, with projections that the number will rise to 5 million, according to a report by Save the Children and Oxfam. Ms. Watson concludes, “Structural adjustment has made Kenya into a food exporter [while] malnutrition remains high.”

It is not simply a lack of food that is a problem; the unaffordability of healthy food adds to health problems. In an examination of 11 African countries, the FAO 2023 Food Security report noted that “The cost of a healthy diet exceeds average food expenditure for low- and middle-income households in both high- and low-food-budget countries in the 11 countries analysed. Low-income households living in peri-urban and rural areas are especially disadvantaged, as they would need to more than double their current expenditure on food to secure a healthy diet.” Around the world, there are a staggering 3 billion people who cannot afford a healthy diet, according to the UN’s Food Waste Index Report 2021.

Low incomes also make it extremely difficult for farmers in Africa, and elsewhere in the Global South, to keep their farms and livelihoods. Smallholder farmers, who are mostly women, produce over half of the world’s food, according to Dr. Holt-Giménez. But they are at the mercy of predatory capitalist practices, he writes:

“Although poor peasant farmers produce most of the world’s food, most of them are going hungry. Their parcels of land are too small. What they get paid for the products is too low. They sell it off right away as soon as they harvest because they’re poor and need money. Six months later, they’re buying back food at higher prices, but they don’t have enough money, and so they go hungry. The women and girls who feed most of the world make up 70 percent of the world’s hungry. And these small farms are getting smaller. … [W]e are condemning most of these women farmers to poverty because their farms are too small.”

As many of those struggling small farmers are Africans, they are seen as financial opportunities by the corporations of the advanced capitalist countries. Africa draws most of the attention when global hunger is discussed, although most of the world’s hungry are in Asia-Pacific, according to the UN’s Food and Agriculture Organization. That attention is not for altruistic reasons, Dr. Holt-Giménez says:

“There is a reason for the high profile given to the issue of hunger in Africa relative to that in Asia. The approach to end hunger routinely proffered is the Green Revolution: produce more food with more chemicals and high-yielding seed varieties. Asia already had a Green Revolution and is consequently saturated with chemical fertilizers, GMOs, and modern farming machinery. While this transition has not eliminated hunger in the region, it has saturated the market for machinery, chemicals, and industrial seed. However, Africa is a wide-open market for a Green Revolution, and there is substantial money to be made selling these technologies. And while I think it’s important to talk about the issue of hunger in Africa, I think this is why hunger in this region receives much more attention relative to Asia.”

You pay more so the vampire squid can profit more

Let’s return to price inflation, something everybody who eats has experienced in the past two years. This round of food inflation is not the first in recent times; there was a noticeable rise in food prices in the wake of the 2008 financial crash. Food prices were said to have increased 80 percent in 18 months, with the number of hungry estimated at more than one billion. After a fall in prices, 2011 saw another round of price rises. Financial speculation was behind much of this, Murray Worthy of the World Development Movement reports. By 2011, he wrote:

“Financial speculators now dominate the market, holding over 60 per cent of some markets compared to just 12 per cent 15 years ago. In the last 5 years alone, the total assets of financial speculators in these markets have nearly doubled from $65 billion in 2006 to $126 billion in 2011. This money is purely speculative, with none of it being invested in agriculture, yet it is now 20 times more than the total amount of aid money given globally for agriculture. Led to prices no longer being driven by supply and demand for food, but by the sentiments of financial speculators and the performance of their other investments. Created huge inflationary pressure in the market, forcing food prices up. The consequences have been devastating. In the last six months of 2010 alone, 44 million people were pushed into extreme poverty by rising food prices.”

“Future contracts,” the devices frequently used by investment banks and other financial speculators to profiteer on food, were created as a hedge in the 19th century for farmers as some protection against the volatility of commodity food pricing by enabling them to lock in a specific price for their crops. The Roosevelt administration enacted regulations to limit positions in a series of acts in the 1930s to curb speculation that had begun, but the regulations were weakened in the 1990s and early 2000s, in part in response to lobbying by Goldman Sachs.

^{U.S. Treasury Department under new management (photo by takomabibelot)}

As a result, speculation increased dramatically, with disastrous effects on food supply and pricing. “The number of derivative contracts in commodities increased by more than 500 per cent between 2002 and mid-2008,” wrote Tim Jones of the World Development Movement in an article titled “The great hunger lottery: How banking speculation causes food crises.” Speculators came to dominate long positions in food commodities. “For instance, speculators held 65 per cent of long maize contracts, 68 per cent of soybeans and 80 per cent of wheat, Mr. Jones wrote. “As early as April 2006, Merrill Lynch estimated that speculation was causing commodity prices to trade at 50 per cent higher than if they were based on fundamental supply and demand alone.” This is highly profitable for the speculators. Goldman Sachs, the vampire squid with tentacles jamming into wherever a dollar can be extracted, made about $5 billion from commodities trading in 2009 and Royal Bank of Scotland is estimated to have more than $1 billion. Mr. Jones continued:

“[T]he situation was probably best summarised by the famous businessman George Soros, himself no stranger to financial speculation. In an interview with Stern Magazine published in the summer of 2008, Soros reflected on the nature of the crisis: ‘every speculation is also rooted in reality. … Speculators create the bubble that lies above everything. Their expectations, their gambling on futures help drive up prices, and their business distorts prices, which is especially true for commodities. It is like hoarding food in the midst of a famine, only to make profits on rising prices. That should not be possible.’ ”

In a rational world, it would not be possible. Speculation, nonetheless, has only accelerated since then. The FAO Food Price Index rose 58 percent during 2021 and the first half of 2022, remaining well above pre-pandemic prices even with some subsequent easing. Although the war in Ukraine and pandemic-era supply chain bottlenecks contribute to food price inflation, speculation plays a large role in driving up prices. “While soaring food prices threaten food security globally, large food trading firms are profiting,” wrote Sophie van Huellen of the University of Manchester. “These companies bet on the direction of food prices by storing or trading substantial amounts of goods — making big financial gains as a result.”

A former U.S. Commodity Futures Trading Commission officer, Michael Greenberger, estimates that as much as 25 percent, possibly more, of the price of wheat “is dictated by deregulated speculative activity” involving futures markets and related derivatives. He said, “We’re in a market where speculators are driving prices up.”

If it’s a commodity, it’s for profit not your stomach

What to do? In the long run, ceasing to make food a commodity, possible only with the abolishment of the capitalist system, is necessary. That won’t be happening in the near future, so we do need practical solutions that can conceivably begin to be implemented today. The FAO, in its 2023 Food Security report, offers only tepid liberal band-aids, such as building rural infrastructure and using “behavioural science” as “an essential innovation … to develop evidence-based approaches.” Nothing wrong with those goals, but they do not touch root causes.

A much more comprehensive set of ideas has been put forth in a report commissioned by WWF Netherlands written by six authors led by Eva Gladek. “[S]imply ensuring a sufficient level of food production will not address the more entrenched impacts and humanitarian imbalances within the food system,” the report states. “All of these systemic failures present opportunities for transitioning the food system in a direction where it provides fully for the needs of people without infringing on key limits. … We can produce sufficient food, even for a much larger population, if structural changes are made to how we approach both production and consumption.”

Although not putting forth concrete proposals to accomplish the following goals, the report does detail four main challenges to a transition to a sustainable and resilient food system. These are: 1. Adaptive capacity and resilience must be built into both biophysical aspects of the system (through the preservation of biodiversity, maintenance of healthy soil systems, maintenance of buffering capacity in water bodies, etc.) and socioeconomic aspects of the system (knowledge transfer, development or organizational capacity, elimination of poverty cycles, etc.). 2. Adequate nutrition for the world’s population, including reducing food waste; shifting to lower-impact, less-resource-intensive food sources; prioritizing food production over non-food uses; improving economic access to food; and improving farmer productivity in the developing world. 3. Remaining within planetary boundaries in all of the key biophysical impact areas across the entire life cycle of food production, consumption and disposal, including investing in the development of new sustainable agricultural techniques. 4. Structurally supporting the livelihoods and well-being of people working within it; it should be possible to fully nourish and support oneself and earn a reasonable living wage in exchange for average work hours within the food system.

Can those worthy goals be accomplished under capitalism, under which food, water and other necessities of life are commodities to be bought and sold by the highest bidders, regardless of social or environmental impact? Certainly we should try, but it is more than reasonable to question whether it is possible under the current global economic régime. 

I have written this numerous times but it can’t be stressed too much that capitalist markets are nothing more than the aggregate interests of the biggest and most powerful financiers and industrialists. Capitalist markets are not impassive entities sitting loftily in the clouds, dispassionately sorting out winners and losers. And as those powerful financiers and industrialists can call on the immense power of the most powerful national governments, and the host of multilateral institutions, including but not only the World Bank and IMF, that enforce those interests with force and are also able to rely on the structures of global capitalism that enforce and intensify inequality, we should not expect results different from what we have. How many lives should be lost for someone’s profit?

When does a formal democracy degenerate into fascism?

It can happen here. “Here” being any country in which capitalism rules. When does a bourgeois formal democracy tip over into fascism? That is a question that needs an answer in many places, certainly not excepting the United States, which has already experienced a self-coup attempt with unmistakable fascist overtones.

We’re referencing Donald Trump’s attempt at a self-coup, to use the Latin American phrase, in January 2021. Many people, even on the Left, laugh at that day’s events, pointing out that the would-be putsch had no chance of success. It did have no chance of success. That does not mean it should be cavalierly dismissed; on the contrary, it should be taken with utmost seriousness. Hitler’s beer hall putsch of 1923 had no chance of success, either, and his violent movement remained on the lunatic fringe for several more years. But we know how German history would turn out.

There will be no facile comparison of the contemporary United States with Weimar Germany here. We are not living in Weimar times. There are no organized brown shirts running amuck, a military deeply hostile to democracy and ready to act on that hostility nor a significant number of industrialists bankrolling storm troops. History does not repeat itself, as tragedy or farce, neatly and certainly not precisely. We nonetheless might take a lesson from history before we take stock of contemporary political conditions.

^{Anarchist feminist and Spanish Republican anti-fascist protest at #25NFeminista event in Madrid (photo by Jack From Hell)}

One myth to be dispelled is that Hitler was elected. He wasn’t. He was handed power by the German president, Paul von Hindenburg, who appointed Hitler chancellor. Unfortunately, that was completely legal under the Weimar constitution, and enough for the biggest opposition party, the Social Democrats, to hold their powder — they refused to unleash their militia and confined themselves to a legal order that was imminently going to be destroyed. The other major opposition party, the Communists, declared “After Hitler, our turn,” a public sentiment quite a contrast with their membership forced to go into hiding or exile as the newly empowered Nazis began rounding up party members and destroying their offices.

Union leaders meekly rolled over for Hitler after he was handed power, agreeing to participate in what would now be a Nazi-led May Day celebration. Within two days of that May Day, the Nazis began arresting union leaders and banning existing unions; social democrats would soon meet the same fate. It took Hitler only three months to sweep away all opposition and assume dictatorial power. With all political opposition swept away, persecutions of Jews, Roma and LGBT communities began with results the world should never forget or minimize.

Why did von Hindenburg appoint Hitler chancellor? In the last election before the January 1933 appointment, the Nazi vote had actually declined from the previous ballot; the combined Communist and Social Democrat vote was 1.5 million votes higher than the Nazi vote, which totaled 33 percent, although the combined Left vote was a million shy of the combined vote of the Nazis and the National Party, the remaining vehicle of the traditional Right. Most of the 1920s support for Germany’s traditional right-wing parties had been transferred to the Nazis, who made a gigantic leap from 2.6 percent in May 1928 to 18 percent (second among 10 parties) in September 1930. The leaders of those traditional right-wing parties had thought they could control Hitler by having him appointed chancellor (the equivalent of prime minister) but giving the Nazis only two of 10 cabinet positions. Unfortunately, one of those positions was the Interior Ministry that controlled the police, allowing the Nazis to flood the police with their brown shirt thugs. That Interior minister, Wilhelm Frick, was a participant in the beer hall putsch but was given no more punishment than a suspended sentence.

Violence in the service of corporate profits

The stories in Italy and other countries that fell to fascism aren’t much different. Mussolini, too, was handed power. Mussolini was a socialist until he began receiving money from arms manufacturers and other business interests. Although now far to the right, he carefully allowed a variety of propaganda to be put forth and even denied having a program, allowing fascism to appear to be whatever one wished it to be. But his benefactors knew what he and they wanted. Fascists were receiving regular subsidies from shopkeepers’ associations and the Confederation of Industry. Socialists came in first in November 1919 elections but conservatives began buying the support of fascist squads and police allowed them to attack unimpeded and even provided support. Mussolini’s March on Rome could not have happened without Italian business leaders financing the fascist squads. Soon King Vittorio Emmanuel appointed him prime minister. Bans on unions and strikes swiftly followed. In Spain, a fascist-minded military overthrew the Republican government; military coups brought fascist generals to power in Chile and Argentina in the 1970s with the support of fascist squads using violent tactics. Violent suppression of working people and their organizations, and reduced wages and working conditions, followed in each case.

In none of the historical cases was a fascist takeover a sudden burst from nowhere. There was much violence by the Right amply funded by corporate leaders and backed by the military and police. The tipping point came before the takeovers — there was, and is, no easily definable point where the rubicon is crossed. Thus vigilance and pushback is always necessary. If it looks like fascism and acts like fascism, then it should be taken seriously as a fascist movement. The 2024 presidential election season has already begun in the U.S., which does not yet have industrialists and bankers bankrolling street thugs and maneuvering to overthrow formal democracy. Those corporate titans certainly appreciated all that the Trump administration, staffed by some of the most virulent ideologues from among the bourgeoisie and comprador, did for them and would do for them again if they get the chance, but that is different from backing an outright fascist movement. Given how much control industrialists and bankers have over the U.S. political process, it is hardly necessary for them to overthrow a system that works so well for them. 

^{July 2018 Stand Up To Racism rally in London (photo by Alisdare Hickson from Canterbury, U.K.)}

Nonetheless, times and conditions can change, and the very fact that a fascist movement exists — one that Trump currently heads but Florida Governor Ron DeSantis wishes to assume the leadership of — should be taken with utmost seriousness, especially as it is a movement that shows no sign of dispersing.

There is not a parliamentary system in the United States but rather a two-party system that is seemingly impregnable, and possesses a military that to all appearances, for all its use as a battering ram overseas for corporate plunder, is nonetheless a strictly constitutional body with no hint of domestic unrest. True, but we should disabuse ourselves of elevating form over function. The classical image of fascism is of storm troopers marauding in the streets, violently suppressing any opposition. But 1970s South America was different than 1920s and 1930s Europe. There were fascist gangs running loose in Chile and Argentina, but fascism was imposed through undisguised military coups.

Fascism in the United States, were it to happen, would come in forms different from all of those, with Christian fundamentalists forming a key portion of any base. But what is crucial is that a significant percentage of a country’s industrialists and financiers — its capitalist ruling class — backs the imposition of a dictatorship with money and other support. This is the crucial commonality overriding the different forms of fascist takeovers.

Empty rhetoric versus class interests

Why is this so crucial? Because fascism is a dictatorship imposed for the benefit of large industrialists and financiers. At its most basic level, fascism is a dictatorship established through and maintained with terror on behalf of big business. It has a social base, which provides the support and the terror squads, but which is badly misled since the fascist dictatorship operates decisively against the interest of its social base. Militarism, extreme nationalism, the creation of enemies and scapegoats, and, perhaps the most critical component, a rabid propaganda that intentionally raises panic and hate while disguising its true nature and intentions under the cover of a phony populism, are among the necessary elements.

Despite national differences that result in major differences in the appearances of fascism, the class nature is consistent. Big business is invariably the supporter of fascism, no matter what a fascist movement’s rhetoric contains, and is invariably the beneficiary. Instituting a fascist dictatorship is no easy decision even for the biggest industrialists and bankers who might salivate over the potential profits. For even if it is intended to benefit them, these big businessmen are giving up some of their own freedom since they will not directly control the dictatorship; it is a dictatorship for them, not by them.

It is only under certain conditions that business elites resort to fascism — some form of democratic government, under which citizens “consent” to the ruling structure, is the preferred form and much easier to maintain. Working people beginning to withdraw their consent — beginning to seriously challenge the economic status quo — is one “crisis” that can bring on fascism. An inability to maintain or expand profits, as can occur during a steep decline in the “business cycle,” or a structural crisis, is another such “crisis.”

^{Fascism is a global phenomenon, not limited to any one country. (Photo by The All-Nite Images from New York)}

No fascist movement can succeed without a sizable base convinced that those on the Left must be stopped at any cost, that the only way the mystical far Right return to the past that is dangled in front of them can be brought about is for it to be forcibly imposed and those in opposition must be suppressed with violence. This portion of the equation, unfortunately, very much exists in the United States as the unshakable following of Trump sadly demonstrates. Trump’s desire to be a fascist dictator is obvious — this should be unmistakable for anyone on the Left, but sadly isn’t as all too many either still don’t take Trump and his base seriously or, worse, are seduced by Trump’s siren songs.

I was once a guest on a respected environmental radio program discussing the Trump administration’s plans for revising the North American Free Trade Agreement when I was quite rudely interrupted and addressed in a most condescending manner by another guest, the prominent head of a Washington non-governmental organization (NGO) who purported to “correct” me by claiming that Trump’s trade advisers say they want to do away with the secret tribunals that corporations use to overturn government laws and regulations. Trump had been in power more than a year at this point, and his administration’s all-out war on working people and its strenuous efforts to allow corporations to plunder and pollute unencumbered by regulations was in full swing. Moreover, the administration’s trade policy paper had been released — this was the topic I was addressing — and there was nothing ambiguous about its intention of dismantling labor, safety, health or environmental standards upheld by other countries.

Trump’s vaguely left-sounding rhetoric was merely for show, a transparently obvious ploy to attract voters who had very good reasons for deploring so-called “free trade” agreements and the many other policies that have screwed over working people while allowing jobs to be moved overseas. Germans in the Weimar Republic had plenty of reasons to be fed up, too, but those obvious Nazi lies became unmistakably lies when Hitler wiped out those storm troops who believed the left-sounding rhetoric in the “Night of the Long Knives.” Mussolini used such tactics as well.

The records of Trump and DeSantis should be unmistakable

Four years of Trump in the White House — four years of all-out assaults on working people and the environment, incompetent bumbling and lying about the Covid-19 pandemic and giving permission to every misanthrope to act out their most obnoxious anti-social fantasies — could not be clearer. Trump remains an embodiment of the threat of fascism. And what of his main rival for the Republican Party presidential nomination? DeSantis — or DeSatan as he has been dubbed — clearly also has aspirations of becoming a fascist dictator. The governor does not have a rabid popular backing like Trump does but he seems more likely to acquire strong backing from industrialists and financiers than Trump, giving his success in reducing the Florida Legislature to his rubber-stamp. DeSantis might as well be ruling by decree considering how legislators hand him whatever he wants.

The record here needs no introduction for those paying attention. But let us “highlight” some of his doings. He’s waging a scorched-earth war against LGBT communities, denying their humanity and banning to the extent possible even discussing those communities’ interests, imposing draconian abortion bans (women always stripped of rights and reduced to baby machines under fascism), unilaterally removing from office elected officials who dare to disagree with him, banning books, whitewashing history, using immigrants as disposable props in the service of nationalism and nativism, and offering bonuses to police officers to relocate to Florida, many of whom have been accused of criminal acts including domestic battery, kidnapping and murder. So vicious is the police state DeSantis is moving to create and so hostile is the attempt to erase slavery and racism from history that the NAACP has issued a travel advisory for African-Americans to avoid the state.

Although it is inarguably true that an independent fascist party is not going to take power in the United States in the foreseeable future, it is not necessary for one to arise. The two leading candidates for one of the two parties that alternate in power, the Republicans, both have aspirations of being fascist dictators and there is a sizable base of Republicans ready for just that. Little help from the other party, the Democrats, is forthcoming as the “center-left” opposition (in actuality the “center-right” opposition to the far right) is steam-rolled time after time, their inability to stand up to the right or mount any effective opposition is not only the product of being beholden to corporate money and “American exceptionalism” ideology but the intellectual dead end of liberalism. (I’m using North American terminology here; readers in the rest of the world can substitute “social democratic” for “liberal.”)

North American liberalism and European social democracy are trapped by a fervent desire to stabilize an unstable capitalist system. They are hamstrung by their belief in the capitalist system, which means, today, a belief in austerity for working people and subsidies for corporate and financial plunder, no matter what nice speeches they may make. When Bill Clinton, Barack Obama, Jean Chrétien, Justin Trudeau, Tony Blair, Gordon Brown, François Hollande, Gerhard Schröder, José Luis Rodríguez Zapatero and Romano Prodi all fall to their knees in front of industrialists and financiers, when each speedily implements neoliberal austerity policies despite leading the supposed “center-left” opposition to the conservative parties that openly stand for corporate domination, there is something other than personal weakness at work. And this sorry record — Bill Clinton was the most effective Republican president the U.S. ever had — provides an opening for far right demagogues to offer left-sounding siren songs that fool too many.

Nonetheless, I can readily understand why so many United Statesians, not only liberals but even those who are on the Left, vote for Democrats as a tactical move, arguing that a Democrat in power, particularly in the White House, provides more space to maneuver. Although I personally don’t have the stomach to vote for Democrats, I certainly understand this tactical voting as a matter of survival, especially as each Republican administration is worse than the last. But it would be helpful if Democratic voters would put some pressure on their office holders to actually try to implement some of what they want rather than giving them a free pass. And a different strategy from the usual Democratic Party cringing and cowering shouldn’t mean cowering first and then cringing.

Voting aside — and voting should be the least of the things we do — fascism can only be stopped by a mass movement, by confronting it directly. And that means taking seriously the danger, rather than laughing at the ignorance of Trump and his blinkered followers. Fascism is never a laughing matter as its body count ought to make clear.

Call it whitewashing or greenwashing, World Bank subterfuge doesn’t fool us

Every so often, the World Bank puts out a paper that calls for better social protection or at least a somewhat better deal for working people. The public relations people there evidently believe we have very short memories.

No, dear reader, the World Bank has not changed its function, nor have elephants begun to fly. Without any hint of irony, the World Bank’s latest attempt at selective amnesia is what it calls its “Social Protection and Jobs” strategy, in which it purports to advocate that the world’s national governments “greatly expand effective coverage of social protection programs” and “significantly increase the scale and quality of economic inclusion and labor market programs.” Hilariously, the World Bank titles its 136-page report fleshing out this strategy “Charting a Course Towards Universal Social Protection: Resilience, Equity, and Opportunity for All.”

In that report, the World Bank, with a straight face, writes that it “recognizes that the progressive realization of universal social protection (USP), which ensures access to social protection for all whenever and however they need it, is critical for effectively reducing poverty and boosting shared prosperity.” Furthermore, the report builds on a previous document that allegedly offers “an overarching framework for understanding the value of investing in social protection programs and outlined how the World Bank would work with client countries to further develop their social protection programs and systems.” The report asserts goals of achieving equity, resilience and opportunity for all people, especially the developing world’s most vulnerable, and “to create opportunity by building human capital and helping men and women to access productive income-earning opportunities.”

^{A demonstration in Oslo during the World Bank conference in June 2002 (photo by Vindheim)}

We arrive at that favorite set of code words, “human capital.” We’ll return to that shortly. But before we highlight the actual record of the World Bank and its role in imposing devastating austerity on countries around the world, at enormous human cost, let’s take a brief look at the International Trade Union Confederation response. The ITUC, which represents 200 million workers in 163 countries and has 338 national affiliates, says its “primary mission is the promotion and defence of workers’ rights and interests.” Readers may recall that the ITUC issues a yearly report on the state of labor, consistently finding that not a single country fully upholds workers’ rights.

In its four-page summary of the World Bank declaration, the ITUC said it agrees with the World Bank’s stated goals, and “agrees with the Bank that the lack of social protection for the majority of the world’s workers in the informal economy is a challenge that needs to be urgently addressed.” Nonetheless, the ITUC “has a number of considerable reservations to some of the policy messages” and disputes “the rigor of the analysis underpinning some of the policies proposed.”

The ITUC writes: “The Bank’s vision of universal social protection appears to prioritise the extension of targeted non-contributory social assistance at the expense of social security, when both forms of support serve distinct and complementary functions.” Further, it “disagrees with the Bank’s critique of social security schemes, especially pensions, as an undue burden on public finances and ‘regressive’ in nature.” The World Bank’s “solution” to make pension and social security systems sustainable “mainly involve reducing public subsidies to social security, strengthening the link from contributions to entitlements through defined-contribution schemes [retirement plans in which you pay into but have no guarantees as to payout], as well as strengthening the role of voluntary and private pensions.”

In other words, it’s work until you drop! That is already a long-term goal of right-wing ideologues and corporate interests not only in the United States but around the world.

Underneath the rhetoric, the usual right-wing prescriptions

And, true to right-wing form, the World Bank places the onus for unemployment squarely on individuals. The ITUC critique says: “the onus of addressing unemployment appears to focus on the individual, rather than on the broader structural forces at play. The [bank report] disregards in particular the measures that governments can take to create new, quality jobs, such as proactive industry planning, public sector job creation, and public investment – including in labour intensive sectors with strong social and environmental dividends, such as infrastructure, care and the green economy.” Finally, the World Bank claims that labor regulations are “excessive” and threaten employment, and advocates lowering already meager worker protections.

Once again, the World Bank has not forgotten its raison d’être; it has not suddenly changed its stripes. Elephants will continue to not fly.

Did we really expect otherwise? A look at the World Bank’s record provides all the evidence anyone could want of it being one of the world’s most destructive agencies, an organization dedicated to enhancing corporate plunder and imposing punishing austerity. A one-two punch with the International Monetary Fund. Both organizations do the bidding of the Global North’s multi-national corporations through playing complementary roles.

^{Three Gorges Dam, a project funded by the World Bank that displaced 1.3 million people (photo by Christoph Filnkössl)}

When I last checked in at the World Bank, in 2018, the bank was in the process of completing its “World Development Report 2019: The Changing Nature of Work,” which opened with quotes from Karl Marx and John Maynard Keynes. That was merely a feint. What we soon read in examining the report is that the problem is “domestic bias towards state-owned or politically connected firms, the slow pace of technology adoption, or stifling regulation.” Sure, jobs are disappearing, but that’s no problem because “the rise in the manufacturing sector in China has more than compensated for this loss.” Essentially, the World Bank was advocating that we become sweatshop workers in China. What else to do? “Early investment in human capital” — in other words, pay lots of money for advanced degrees you won’t be able to use — and “more dynamic labor markets,” which is code for gutting labor protections and making it easier to fire workers.

Elephants didn’t, after all, fly five years ago, either. 

The World Bank has even declared itself above the law. Unfortunately, at least one U.S. court agrees. A lawsuit filed in federal court in Washington on behalf of Indian farmers and fisherpeople ended with a ruling that the World Bank is immune from legal challenge. The bank provided $450 million for a power plant that the plaintiffs said degraded the environment and destroyed livelihoods. The court agreed with the World Bank’s contention that it has immunity under the International Organizations Immunities Act. The World Bank thus was declared the equivalent of a sovereign state, and in this context is placed above any law as if it possesses diplomatic immunity. Another suit, however, also filed by EarthRights International against the World Bank for its role in turning a blind eye to alleged systematic human rights violations by a palm oil company in Honduras for a project it financed, was allowed to proceed by the U.S. Supreme Court in 2019. That case, however, appears to yet be decided by the trial court. So the World Bank can sometimes be sued in the United States legal system but it remains to be seen if it will have to shoulder any responsibility.

The World Bank has a long history of ignoring the human cost of the projects it funds. The World Development Movement, a coalition of local campaign groups in Britain, reports that the World Bank has provided more than US$6.7 billion in grants to projects that are destructive to the environment and undermine human rights, a total likely conservative. To cite merely three of the many examples, the World Bank:

• Loaned an energy company in India more than $550 million to finance the construction of two coal-fired power plants. Local people, excluded from discussions, were beaten, their homes bulldozed and reported reduced food security and deteriorating health as a result of the power stations.
• An Indonesian dam, made possible by the World Bank’s $156 million loan, resulted in the forcible evictions of some 24,000 villagers, who were subject to a campaign of violence and intimidation.
• In Laos, a hydropower project made possible by World Bank guarantees displaced at least 6,000 Indigenous people and disrupted the livelihoods of around 120,000 people living downstream of the dam who can no longer depend on the rivers for fish, drinking water and agriculture.

A study of World Bank policies, “Foreclosing the Future” by environmental lawyer Bruce Rich, found that:

“Drawing on Bank studies, project evaluations and sectoral reviews, it is shown that the World Bank still suffers from a pervasive ‘loan approval culture’ driven by a perverse incentive system that pressures staff and managers to make large loans to governments and corporations without adequate attention to environmental, governance and social issues. In 2013, Bank Staff who highlight social risks and seek to slow down project processing still risk ‘career suicide.’ … [The bank] has continued to binge on enormous loans to oil and gas extraction, coal-fired power stations and large-scale mining generating environmental damage, forest loss and massive carbon emissions.”

Destroying the environment in the service of short-term profits

Want more? The World Bank has provided nearly $15 billion in financing for fossil fuel projects since the 2015 signing of the Paris Climate Accords. An October 2022 report by Big Shift Global, a coalition of 50 environmental organizations across the Global North and South, notes that despite World Bank claims that it would end financing for upstream oil and gas production, it has other avenues to promote fossil fuels. One of these methods is to send funds to a financial institution, which in turns sends the money to the fossil fuel project. Another is to provide non-earmarked funds but make the money conditional on instituting reforms encouraging fossil fuels.

The biggest fossil fuel funding, according to the Big Shift Global report, is $1.1 billion for the Trans-Anatolian Pipeline, a gas distribution project in Azerbaijan. Another $600 million went toward a gas storage project in Turkey and another eight projects were given at least $100 million by the World Bank. Projects that the World Bank has financed include expansion of coal. Other work by the World Bank includes $2.8 billion so that Ghana could move its energy mix from mostly hydropower to majority fossil fuels, and pressured Ghana to enter into gas contracts that causes it to pay $1.2 billion annually for gas it doesn’t use, which also has put a greater debt burden on the country. 

The World Bank also encouraged Guyana to use a Texas law firm that has Exxon as a major client to rewrite its petroleum laws, while providing money for oil and gas development in Guyana. That development will benefit Exxon as the fossil fuel multinational snagged a contract under which Guyana doesn’t receive any of the profits until the costs of the field are paid off. In other words, the Big Shift Global report says, “Exxon can continue to charge Guyana for every newly developed oil field. It could take decades before the money trickles down to the people.” 

^{Protest at the World Bank (photo by “Jenene from Chinatown,” New York City)}

The World Bank attempted the same whitewashing stunt with its fossil fuel funding, once issuing a report lamenting global warming while completely ignoring its role in worsening global warming. At the time of that whitewashing report, the bank was providing billions of dollars to finance new coal plants around the world. By any reasonable standard, the World Bank is a key organization in the concatenation of processes that has brought the world to the brink of catastrophic climate change. The policies of the World Bank and its sibling, the International Monetary Fund, have constituted non-stop efforts to impose multi-national corporate control, dismantle local democratic institutions and place decision-making power into the hands of corporate executives and financiers, the very people and institutions that profit from the destruction of the environment.

A trail of evictions, displacements, gross human rights violations (including rape, murder and torture), widespread destruction of forests, financing of greenhouse-gas-belching fossil-fuel projects, and destruction of water and food sources has followed the World Bank. It works in conjunction with the International Monetary Fund, whose loans, earmarked for loans to governments to pay debts or stabilize currencies, always come with the same requirements to privatize public assets (which can be sold far below market value to multi-national corporations waiting to pounce); cut social safety nets; drastically reduce the scope of government services; eliminate regulations; and open economies wide to multi-national capital, even if that means the destruction of local industry and agriculture. This results in more debt, which then gives multi-national corporations and the IMF, which enforces those corporate interests, still more leverage to impose more control, including heightened ability to weaken environmental and labor laws.

The World Bank compliments this by funding massive infrastructure projects that tend to enormously profit deep-pocketed international investors but ignore the effects on local people and the environment. The two institutions are working as intended, to facilitate the upward distribution of wealth, regardless of human and environmental cost.

Right-wing attempts to eliminate constitutional protections are no joke

Donald Trump’s recent rant that the U.S. Constitution should be “terminated” so that he can be installed as president for life merits no response, given the Orange one-man crime wave’s tenuous connection to reality. Laughter is the appropriate riposte as Trump’s futile attempts at becoming the fascist dictator he clearly aspires to be become ever more futile.

But is his latest childish tantrum really something to be laughed off? Having skipped the “tragedy” phase and gone straight to “farce,” Trump is facing what is likely to become a politically terminal case of irrelevancy as new contenders for Mussolini’s crown, most notably but not only Ron DeSantis, emerge. The nascent fascist movement that has coalesced around Trump, and the varieties of extreme right menace that shade into it that are now expressed through the Republican Party, are no laughing matter. And while embarrassed silence or a quick change of subject might be Republicans’ default position when asked to comment on Trump’s increasing irrationality due to their fear of the Frankenstein monster they have let loose, eviscerating the Constitution is actually on their agenda.

Let us have no illusions about the U.S. Constitution, the world’s oldest. Hopelessly archaic and undemocratic, it is a document that was designed to keep the country’s slave owners and commercial bourgeoisie firmly in power — going so far as to enshrine slavery in its text — through setting up institutions like the Electoral College and the Senate (the world’s most undemocratic legislative body) to ensure that power could never be extracted from the hands of the commercial and plantation elite. Ambiguously written to exclude women, Blacks, Indigenous peoples and the poor, its stilted language is open to interpretation by judges who see protection of the most powerful and wealthy capitalists, and the maintenance of inequality, as their holy mission. 

^{Cartoon by Polyp.}

This mission has reached such proportions that the absurd doctrine of “originalism” is not only proclaimed with straight faces, but judges on courts up to the Supreme Court rely on it to impose their hard right political agendas. “Originalism” is the farce of an idea that asserts only those rights explicitly mentioned in the Constitution exist, and that any interpretation of its text has to be based on what the writers of the Constitution — the “Framers” as they are usually called in legal circles — intended. In other words, judges must read the minds of people dead for more than 200 years to decide cases. By a remarkable coincidence, those long-dead minds are opposed to all social progress.

It must be difficult for the rest of the world to imagine such laughably transparent silliness being offered as legitimate legal theory, but such is the state of politics in the global hegemon. We might go so far as to suggest U.S. politicians will do anything for a laugh, but as the Supreme Court erases one right after another, there is nothing funny going on here.

What is certainly not funny is the quite serious, albeit quiet, movement by the hard right to put an end to constitutional rights through wholesale changes to the Constitution. Their chosen route to do this is the convening of a constitutional convention, and this movement has moved forward by a frightening amount.

Massive corporate funding behind convention agitation

Among the leading voices for a new constitutional convention — one that would have few if any limitations on its power — is none other than the American Legislative Exchange Council (ALEC). Lavishly funded with undocumented millions of dollars, ALEC is a secretive group that writes “model legislation” for state legislatures across the United States that benefits corporate interests. The watchdog group Center for Media and Democracy’s ALEC Exposed website calls ALEC “much more powerful” than a typical lobbyist or front group. “ALEC is a pay-to-play operation where corporations buy a seat and a vote on ‘task forces’ to advance their legislative wish lists and can get a tax break for donations, effectively passing these lobbying costs on to taxpayers,” ALEC Exposed reports.

What do legislators who work with, or are members of, ALEC do with the organization’s “model” bills? According to ALEC Exposed:

“Participating legislators, overwhelmingly conservative Republicans, then bring those proposals home and introduce them in statehouses across the land as their own brilliant ideas and important public policy innovations—without disclosing that corporations crafted and voted on the bills. ALEC boasts that it has over 1,000 of these bills introduced by legislative members every year, with one in every five of them enacted into law. ALEC describes itself as a ‘unique,’ ‘unparalleled’ and ‘unmatched’ organization. We agree. It is as if a state legislature had been reconstituted, yet corporations had pushed the people out the door.”

Extreme-right state legislators met at an ALEC conference in late 2021, vowing to push for a constitutional convention. The ALEC proposal calls for a balanced-budget amendment and term limits for political office holders. The first is dangerous enough, given that forcing the federal government to balance its budget every year would mean permanent austerity would be imposed; working people would be hit hard by any such limitations on government spending. Not only would the government be unable to respond to a recession, basic programs like Social Security would be put at risk. Medicare and government pensions would also be subject to budgetary axes. That outcome is of course very much intended. But any constitutional convention would not have to limit itself to a finite set of topics. Because there are no rules or laws governing what a convention could do, a seated convention could easily become a runaway body, imposing a full set of far-right and corporate wish lists. Calls for retrogressive legislation, including bans on abortion, are routinely called for by proponents of seating a convention.

^{The movie “Greed” (1924)}

The far right drive for a convention to wipe out as many gains achieved by social movements as possible has been quietly going on for years. In 2017, for example, Truthout reported on an effort by state legislators affiliated with ALEC and promoted by another shadowy group, Citizens for Self Governance, whose co-leaders have strong ties to the Koch Brothers and who routinely label Black Lives Matter and other Left groups as “thugs” and “criminals.” A year earlier, the group practiced for a constitutional convention by holding a mock convention in which it passed a far-right wish list that included making it easier to repeal federal regulations, requiring a supermajority to impose federal taxes and eliminating federal taxation by repealing the 16th amendment. 

To help guarantee the far-right outcome desired, this initiative would “appoint seven delegates to the convention, and attempts to provide for the replacement of delegates if they go off-script,” Truthout reported. The intended script could be very dangerous. “[A]ny convention call, no matter how narrowly written, could result in a ‘runaway’ convention,” the report said. “Why? Because the Constitution doesn’t provide any guidance or constraints on how a convention would operate once called. State politicians or Congress could write their own agenda and rules about the way delegates are chosen, the number of delegates allowed from each state, and whether or not a supermajority is required to approve amendments. Once in the room, delegates to a convention can ignore [any] limits.”

As recently as last month, an ALEC conference in Washington was attended by some of the most notorious extreme-right mouth-frothers, including former House of Representatives Speaker Newt Gingrich and several current members of Congress. A rouges’ gallery of far-right pressure groups, including some who agitate for a total ban on abortion. Among the offensives endorsed at this conference were to fight “woke capitalism” (what this chimera might be was not specified) and a bill that would “bar companies with 10 or more employees from receiving state contracts if they take into account any ‘social, political, or ideological interests’ to limit their commercial relationships with fossil fuel, logging, mining, or agriculture businesses—and that instructs legislatures to ‘insert additional industries if needed.’ ” In other words, promotion of fossil fuels would become mandatory. Another ALEC “model bill” promoted at the conference was legislation intended to enforce right-wing censorship in public universities.

How close is the United States to a convention?

To seat a constitutional convention, two-thirds of the states (34) would need to ratify a resolution. Although current constitutional law mandates that three-quarters of the states (38) would then have to approve, a convention could change the ratification requirements to whatever it wanted, with no constraints. There is precedence for this — the only constitutional convention in U.S. history, in 1787, “went far beyond its mandate,” the Center on Budget and Policy Priorities (CBPP) wrote. “Charged with amending the Articles of Confederation to promote trade among the states, the convention instead wrote an entirely new governing document” and drastically altered the approval process.

How many states have ratified? Convention proponents claim that 28 states have already passed resolutions. The CBPP, by contrast, reports that since ALEC released “a handbook for state legislators that includes model state legislation calling for a constitutional convention” in 2010, only 12 states have adopted it. ALEC gets to 28 states by counting any state that has ever passed any resolution calling for a convention, no matter different wording nor that some of these resolutions are more than three decades old. “Whether Congress would agree to count all such other state resolutions is unknown” the CBPP wrote. “The question is important, because the Constitution grants solely to Congress the power to determine whether the 34-state threshold has been met.”

^{“Greed” (Nicholas Kwok)}

Alternate counts include the 19 states claimed by a pro-convention group calling itself “Convention of States Project” that avoids any mention of who or what might be behind the group but quotes Ron DeSantis and Sean Hannity among a host of far-right extremists. Another shadowy group that fails to mention its backers, “US Term Limits,” admits that only five states have ratified its favored version but claims that if other versions are included, the total reaches 19. The right-wing news magazine Newsweek claims 17 states have ratified. The liberal citizens’ group Common Cause writes that “more than a dozen state legislatures” have passed balanced-budget convention resolutions since 2011, while five states have rescinded resolutions since 2016. Fortunately, the far-right drive to re-write the Constitution has not been well organized, although there is significant danger that the backing of ALEC will likely put this retrograde movement on firmer footing.

None of the above is in any way intended to deny that the U.S. Constitution is badly out of date. A better world for United Statesians certainly would mean a far more progressive constitution, one guaranteeing democratic rights and expanding the concept of rights to economic questions, and creating new legislative bodies based on democratic outcomes. Such a document would be much different than the current Constitution. Although it would be natural for the Left to be tempted to support a convention to advance progressive reforms, the current balance of social forces quickly puts a kibosh on such ideas. Given the vast power that the corporate mass media holds, the relentless promotion of right-wing talking points as “news,” and the hold the Republican Party has on state legislatures across the country, the time for a convention is nowhere near. 

The Democratic Party certainly isn’t going to be of any help, given the intellectual dead end of liberalism that it exemplifies and the austerity it has embraced, as this month’s vote to force a bad contract on rail workers was the latest demonstration in an endless series of capitulations to capitalists.

Any move for a convention needs to wait until the balance of forces is tilted in favor of the Left, and that can only come about through a sustained mass movement sure of its goals. In such a scenario, movements would likely be aiming much higher than a constitutional convention — a better world necessitates drastically different ways of organizing politics and the economy than what currently exists. There would be no need to tinker with an archaic document long overdue for replacement; it would be necessary to re-imagine what a constitution should be. For now, we are in the world we are in, and while we remain on the defensive, any convention would be for the worse. Capitalist formal democracy is already farcical. The current backsliding toward a harder right-wing domination doesn’t need yet more impetus.

The financial industry is a lot bigger than a giant vampire squid

The size of the financial industry bears no relation to the economy. Self-mythological panegyrics aside, the finance industry confiscates money; it doesn’t create it. How much? Get out your calculators, and maybe you’ll have to find a way to add a couple of digits to what your screen can hold.

Perhaps the total amount of money extracted by financiers (or, more to the point, speculators) is not quite as large as Douglas Adams’ description of space in the, yes, increasingly inaccurately named Hitchhikers’ Trilogy, as “Really big. You just won’t believe how vastly hugely mind-bogglingly big it is.” But it’s close. 

OK, let’s put down a couple of numbers here. The numbers on their own are so absurd as to defy easy comprehension, so let’s try to find a way to situate them.

• Total amount of debt outstanding: US$305 trillion (€304 trillion).
• Total amount of financial instruments traded, on average, per day: US$9.68 trillion (€9.65 trillion).

Yep, that’s a whole lot of money. So big that the imagination struggles to grasp such numbers. One way to put those numbers in perspective is that the size of the world economy (global gross domestic product for all the world’s countries) was US$96.1 trillion (€95.8 trillion) in 2021.

^{Commodities futures trading (photo by Lars Plougmann)}

In other words, the volume of currency trading (foreign exchange), stocks, bonds and their derivatives exceeds the size of the global economy in 10 business days. (The period is almost certainly a little less, as that US$9.68 trillion in average daily trading doesn’t include most government bonds, trading figures for which are difficult to come by.) To create another comparison, the amount of debt owed by the world’s governments, businesses and households (the $305 trillion total above) is more than three and a half times of the value of all economic activity produced in a year.

Still another way to look at this activity is that foreign exchange trading (including swaps, options, spot transactions and outright forwards) in one day is bigger than the economies of all countries other than the United States and China. Given that the U.S. dollar, the world’s reserve currency, is involved in 88 percent of foreign exchange trades, trading in the dollar by itself totals more than a year’s production of all countries other than itself and China.

A multi-headed monster that is never satiated

Rolling Stone magazine once memorably described Goldman Sachs as a “great vampire squid wrapped around the face of humanity.” That makes finance capital as a whole a multi-headed monster with the attributes of a tyrannosaurus rex, killer whale, giant squid and elephant that can swallow ships at sea whole, fly through the air at supersonic speed and never stops eating. Or something like that. Perhaps some planet-eating monster in a science fiction potboiler? Maybe we can fall back on Douglas Adams after all, and just consider the financial industry vastly hugely mind-bogglingly big. 

And getting bigger. When I last did this exercise 10 years ago, it took about 11 business days for speculators to trade financial instruments and contracts valued at all the products and services produced by the entire world in one year. Now it’s 10 days. There’s progress for you.

There is no rational economic reason for a financial industry — and “bloated” would be woefully inadequate to describe it — even a fraction of this size. Most of the action on stock exchanges is simply speculation. Greed is certainly a part of the picture, but by no means the entire picture. Because there are insufficient opportunities for investment, more money is diverted into speculation. As ever bigger piles of money are diverted into speculation, the size of the financial industry and the percentage of corporate profits claimed by the financial industry steadily grows. This capital is a function of the amount of money flowing upward to the rich becoming larger than they can use for personal luxury consumption or investment; these torrents of money are diverted into increasingly risky pure speculation.

^{“Greed” (Nicholas Kwok)}

Too much money comes to chase too few assets, rapidly bidding up prices until there is no possible revenue stream that can sustain the price of assets bought at inflated levels. Not altogether different from those Warner Brothers cartoons in which the character walks off a cliff, takes several steps suspended in air before looking down, sees there is nothing but air below and then falls, at some point speculators look down and notice they have no support, mass panic commences and prices collapse, bringing on another economic downturn. One that working people, not speculators, will pay for. 

The very size of financial markets is a major contributing cause of economic instability. Financial companies, having extracted immense sums of bailout money after the 2008 collapse, have leveraged their power to become even bigger through consolidation, thereby enabling them to divert more capital from productive use. But even during the “boom” portion of business cycles financiers are destructive to an economy by rewarding manufacturers for mass layoffs, moving production to low-wage developing countries with few or no effective labor or environmental laws, and setting up subsidiaries overseas and using creative accounting to shift profits offshore to avoid paying taxes. Financiers provide rewards for such behavior in the form of rising stock prices, and those stock prices in turn provide top executives a rationale to give themselves stratospheric pay packages because they “enhanced shareholder value.”  

In turn, there is continual downward pressure on wages — an increasing share of corporate revenues go toward executive pay and profits as the share going toward wages declines. And much of those corporate profits are quickly funneled into dividends and stock buybacks, yet more ways for money to move upward into the ever grasping hands of super-wealthy speculators.

As I wrote back in June, the corporations of North America, Europe and Japan handed out an astounding US$2.75 trillion (€2.63 trillion at then exchange rates) to shareholders in 2021 through dividend payments and stock buybacks. By February 2022, the amount of money created by the central banks of five of the world’s biggest economies for the purpose of artificially propping up financial markets since the beginning of the Covid-19 pandemic totaled US$9.94 trillion (€8.76 trillion). That is on top of the US$9.36 trillion (€8.3 trillion at the early 2020 exchange rate) that was spent on propping up financial markets in the years following the 2008 global economic collapse. That’s US$19.3 trillion (€17.1 trillion) in the span of 14 years, and this astounding sum of subsidies and handouts represents only one program of the many used by the U.S. Federal Reserve, the European Central Bank, Bank of Japan, Bank of England and Bank of Canada.

Crash to crash, but it’s you who is supposed to fall down

How could a parasitic industry grow to such gargantuan proportions? In theory, stock markets exist to distribute investment capital to where it is needed and to enable corporations to raise money for investment or other purposes. In real life, neither is really true. A corporation with stock traded on an exchange can use that status to issue new shares, raising money without the burden of dealing with lenders and paying them interest. But large corporations can raise money in a variety of ways, for example by issuing bonds or other interest-bearing debt, or by selling shares directly to private investors. Nor do corporations necessarily wish to float new stock — doing so is disliked by investors because profits are diluted when spread among more shares. Instead, it is more common for large companies to buy back shares of their stock (at a premium to the trading price), which means less sharing of distributed profits. And thus the steady increase in buybacks, which combined with dividends, in some years exceeds the total of profits! 

And what of distributing investment capital to where it is needed? That is saying, in so many words, that stock markets make finance more efficient — that capital will be put to use in the industries or companies in which a high profit is seen as a good bet because a company is filling a need with a product but lacks sufficient capital to take full advantage, or that the company already has a history of delivering profits. At bottom, buying stock is a gamble on the future profits of the company in which stock is bought. An investor is betting that profits will not only rise, but rise at a faster rate than in the past. I at one time worked on a financial news wire service, and one day was surprised when the stock price of a well-known technology company fell despite announcing it had earned a profit of $800 million for the previous three months, a higher profit than the same quarter in the previous year. On closer examination, the company was punished by speculators because the rate of the increase of the profit did not increase — this gigantic profit was lower than what stock market “analysts” had predicted. 

^{What happens to rain forests when the market is allowed to decide. (Photo of Montane Rainforest in Ecuador by Gunnar Brehm)}

This illustrates that trading is primarily done for speculation, not for any rational economic reason. The beginnings of the financial industry lie in the very slow rate of business in the early days of capitalism; it could take years for an investment made on the other side of the globe to pay off. Thus financiers stepped in to provide cash liquidity. But because financial speculation doesn’t have the physical limitations of the production of tangible goods, speculation would become prominent. Indeed, financial crashes long predate the crashes of 1929 and 2008. “Tulip mania” consumed the Dutch in the 1630s, speculation fueled by the first futures contracts; uncontrolled speculation in the 1710s in the English South Sea Company and the French Company of the Indies led to the collapse of stock in both, a bubble in which short selling was born; an 1830s bubble in U.S. real estate burst when banks stopped making payments; and an 1870s bubble inflated by speculation in railroads and construction in North America and Europe burst when the Vienna stock market crashed, followed by waves of bank failures, to note some of the more well-known examples.

The world’s billionaires and multi-national corporations profited enormously from the Covid-19 pandemic, enormously inflating their wealth. Not surprisingly, debt increased dramatically as well. The 2020 increase in debt was the biggest for any year since World War II, according to the International Monetary Fund. 

Half of the 2020 increase in debt was governmental, again no surprise given the trillions handed out to financial institutions that year. According to the IMF, “Debt increases are particularly striking in advanced economies, where public debt rose from around 70 percent of GDP, in 2007, to 124 percent of GDP, in 2020. Private debt, on the other hand, rose at a more moderate pace from 164 to 178 percent of GDP, in the same period. … Public debt now accounts for almost 40 percent of total global debt, the highest share since the mid-1960s.” 

Extracting money from those who work

It should always be remembered that profit comes from a capitalist paying to employees much less than the value of what they produce. In turn, the financial industry extracts money from the producers of tangible goods and services, and often from governments as well. Finance capital seeks to profit off any and all economic activity anywhere, regardless of cost to everybody else. It’s incredibly profitable — not only are investment banks among the most profitable corporations, but speculators can rake in hundreds of millions and even billions of dollars annually — and they pay less in taxes that you do! 

Not even the biggest corporations are immune from financial industry pressure. Several years ago, DuPont, the chemical multi-national that produces many products that dominate their market, had racked up about US$17.8 billion in profits over five years, handed out $4 billion to shareholders from the proceeds of selling its performance chemicals business and boasted a one-year increase in its stock price of 20 percent. Yet a powerful hedge-fund manager declared war on DuPont management, demanding DuPont be broken up into two companies, under the theory that more profit could be extracted. The speculator did not get what he wanted, but DuPont did lay off workers to appease speculators despite its massive profitability. Ultimately, DuPont merged with Dow Chemical and then the combined conglomerate split into three companies, maneuvering done mainly to throw more cash at speculators.

Even Wal-Mart is not ruthless enough for Wall Street. After five years of massive profits (US$80 billion), speculators began driving down the price of Wal-Mart stock in part because the company had raised its minimum wage to $9 an hour. Wal-Mart did attempt to offset that news by also announcing a new $20 billion buyback of shares, but not even blowing that kiss to financiers served to lift speculator moods. Thus the company that is the most ruthless in accelerating the trend of moving manufacturing to the locations with the lowest wages, legendary for its relentless pressure on its suppliers to manufacture at such low cost that they have no choice but to move their production to China, or Bangladesh, or Vietnam, because the suppliers can’t pay more than starvation wages and remain in business, was deemed by financiers to be insufficiently brutal.

As always, it’s heads, Wall Street wins and tails, Wall Street wins. Those fantastic values of financial instruments traded don’t fall from the sky and aren’t because of some rare acumen of speculators. Those sums of money, which would put orbiting satellites at risk if they were stacked up, are the direct result of exploitation of those who work.

Corporate greed keeps the pandemic alive

More than two years on, it is hard to imagine there could be someone who is not sick of the pandemic. Although we can point to multiple reasons for the inability to bring Covid-19 under control, a prominent factor is corporate greed.

The elevation of the private profit of a few over the welfare of the many is, sadly, the ordinary course of events in a capitalist world. This is brightly illustrated by the failure of the world’s governments to prioritize health care over money as exemplified by the ongoing failure to make vaccines available to the Global South.

Business as usual, yes, and it would be easy enough to lament the standards of the United States and its wildly expensive health care system being exported to the rest of the world. The U.S. does play a role here, but this time the U.S. is not the biggest villain. The European Union, with its obstinate refusal to waive any intellectual property rule because of fealty to Covid-19 vaccine makers, has been the biggest roadblock.

As new variations and mutations repeatedly spread, achieving a critical mass of vaccinated people is the only way the pandemic will be brought to an end. Covid-19 may never be fully eradicated but it can be reduced to a background nuisance as are many other illnesses. Hesitancy among many in the Global North to be vaccinated has played a not insignificant role, whether by right-wingers believing the nonsense peddled by the likes of Fox “News” or by people on the Left who, not without reason, are skeptical of Big Pharma.

^{Nurse graffiti COVID-19 in Málaga, Spain (photo by Daniel Capilla)}

Those in the latter category see nefarious motivations behind pharmaceutical companies’ promotion of Covid vaccines. But is this another instance of Big Pharma pushing unneeded or even dangerous drugs? Such things do happen; suspicion does have a basis. But let’s consider what Big Pharma wants, which is no different from any other corporation: To accumulate the biggest piles of money possible. Given the global health emergency that arose in the first months of 2020, the surest path to achieving that goal would be to become the first to develop a cure. The pandemic was that rare instance in which the interests of Big Pharma and the general population coincided, and the vaccine makers wouldn’t be, and indeed aren’t, at all shy about taking advantage of an emergency to rack up huge profits, even by their industry’s standards. And with the whole world watching, a vaccine had better work and not cause undue harm.

Thus, because of unique circumstances, creating a safe, effective product for a real problem was actually in a corporate interest. And the profits, thanks to these rare circumstances and government largesse, are gigantic, a topic to which we will return.

Intellectual property as a weapon

It should surprise no one that the vaccine makers are doing everything they can to keep windfall profits rolling in. That means clinging to intellectual property (IP) law, heavily skewed in their favor, to maintain a monopoly. Capitalist governments have rolled over for corporate interests for decades, making IP laws ever more rigid. National legislation has played a role, firmly augmented by so-called “free trade” agreements that are used as battering rams by the United States, the European Union and other advanced capitalist countries to force open less powerful countries’ economies and force the world’s governments, including themselves, to be subordinate to multinational capital. Seeking to undermine government health care systems, and especially the ability of governments to negotiate lower prices, is often a goal of “free trade” deals, most notably demonstrated in the efforts of the U.S. government to push draconian rules in the Trans-Pacific Partnership.

These developments are anathema to the interests of working people everywhere. It is unconscionable, or should be, when IP rules are used to keep life-saving vaccines away from most of the world’s people. Struggles to make Covid-19 vaccines available to the Global South kicked off quickly, and there is no sign that this issue will anytime soon be resolved. This is not only against the interests of those for whom vaccines remain out of reach, but, given that the pandemic won’t end until a substantial percentage of the world’s peoples are inoculated and thus end the risk of still more dangerous variants arising, it is against the interests of those countries whose governments continue to elevate corporate profits over human life.

What the world needs is for manufacturers anywhere in the world to be granted the unrestricted right to manufacture the vaccines.

To achieve this necessity, what is needed is something called a “TRIPS waiver.” This will require some explanation, as once again a trip into the weeds of global trade policy becomes unavoidable.

^{Traffic in a British village is reduced from two lanes to one so there would be sufficient space for walkers to maintain two-meter distances from one another. (Photo by Martinvl)}

Under World Trade Organization (WTO) rules, IP rights are strictly enforced. As the neoliberal variant of capitalism became dominant with the decline of Keynesianism in the 1970s, economic decision-making has been separated from politics, leaving multinational corporations free to move production to the places with the lowest wages and least regulation, constantly on the prowl for locations that can be even more exploited. With components obtained from around the world, assembled in low-wage, low-regulation havens and finished products exported, barriers to trade such as tariffs were necessary and, having won those, corporate executives and financiers next sought to eliminate the ability of governments to regulate them. Thus the era of “free trade” agreements arose, and one of the institutions that was created to enforce corporate supremacy was the WTO.

One of the legs of corporate domination is IP law. How that relates to the pandemic is this: A handful of multinational corporations, interested in the biggest possible profits for their executives and shareholders, can decide who will receive vaccines and at what price. That human life is at stake — more than 6 million have died from Covid-19 — does not make for an exception. As Alain Supiot, writing on international law in the November-December 2021 issue of New Left Review, noted:

“On the one hand, the Preamble to the [World Health Organization] Constitution states that ‘The extension to all peoples of the benefits of medical, psychological and related knowledge is essential to the attainment of health.’ But on the other, since the creation of the World Trade Organization in 1994, this knowledge has become an object of private property, precisely opposed ‘to all peoples’ by virtue of the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS). Until then, it was accepted in international law that the protection of public health interests took precedence over the interests of patent-holders. The TRIPS Agreement reversed this hierarchy and gave primacy to the protection of industrial property.”

Negotiations to enact a waiver are stonewalled

A waiver of TRIPS rules, then, is what is needed. In other words, a comprehensive waiver that, even if temporary for the duration of the emergency, sets aside Big Pharma’s IP rights and allows all manufacturers of vaccines, wherever they are, to produce Covid-19 vaccines. The governments of India and South Africa proposed, in October 2020, just such a waiver to allow the production of one or more of the Covid-19 vaccines. A year and a half later, the world is still waiting, with no resolution in sight.

Sarah Lazare and Paige Oamek, writing for In These Times, recently wrote an article demonstrating the “big lie” of Big Pharma talking points as the industry, in particular Pfizer, furiously resist any weakening of their IP fortresses. They wrote:

“The lie relates to an October 2020 proposal from India and South Africa that the World Trade Organization suspend enforcement of key patent rules so that cheaper, generic versions of Covid-19 treatments and vaccines can get to more people more quickly. (The proposal is referred to as a TRIPS waiver, a reference to the WTO Agreement on Trade-Related Aspects of Intellectual Property Rights.) The pharmaceutical giants Pfizer and Moderna, concerned with maximizing their present and future profits, emerged as virulent opponents of such a measure, which still has not passed more than a year later, even as just one out of 21 people in poor countries have been fully vaccinated. It is no anomaly that the industry would reject such a proposal — pharmaceutical companies had a big hand in shaping those WTO intellectual property rules in the first place, to protect pharmaceutical monopolies and their profits.”

Negotiations have centered on four-way talks among India, South Africa, the European Union and the United States. A report surfaced in March 2022 that an agreement had finally been reached, but that has been denied, most notably by the U.S. government. Text accompanying the reported agreement was widely and loudly condemned around the world as grossly insufficient, and possibly even adding additional barriers to global vaccine access. Weeks have gone by, and there is no word that any agreement has actually been reached. What the true state of the negotiations may be can not be stated with any certainty, but there is no indication that any deal is imminent. Or that any deal will resemble what is needed by the Global South.

^{A doctor in a hospital during the COVID-19 pandemic (photo by Pablo Jarrín)}

A surprise announcement by the Biden administration in May 2021, when President Joe Biden announced support for a TRIPS waiver, in a partial reversal of U.S. policy that has consistently elevated corporate profits above all other considerations, raised hopes. But the Biden administration pronouncement is less than meets the eye, and the European Union has remained obstinately opposed to any waiver. Providing a fresh demonstration of the anti-democratic nature of the EU, that the European Parliament has three times called for a waiver to be approved and many EU countries are in support have had no apparent effect on EU negotiators.

The U.S.-based watchdog group Global Trade Watch, in its analysis, says that accepting the EU proposal would be worse than having no deal:

“The European Union has been the primary obstacle to progress on the waiver. … The EU’s position had been to basically restate existing WTO flexibilities on patents that almost every WTO member already has, while requiring additional conditionalities. … Any proposal that follows the EU position is worse than no action at all, because it could further undermine current WTO rules that already allow governments to issue compulsory licenses. The need for far greater, not less, freedom to make and use medicines in a global health crisis like the COVID-19 pandemic is precisely why more than 100 countries have supported the waiver as introduced by India and South Africa.”

The EU, however, is not the only obstacle. The U.S. negotiating position isn’t for a full waiver. The Global Trade Watch analysis states:

“The longstanding U.S. position to support a waiver for vaccines only, excluding the tests and therapeutics, is shameful, particularly as President Biden recently lauded testing and treatment as key tools in fighting the pandemic at this stage. The new proposal only covers vaccines, with tests and treatments to be considered six months after the proposal is agreed, if it is agreed. Given the already seventeen-month delay since the waiver was introduced, it is irresponsible to suggest further delay for tests and therapeutics. … The U.S. had also reportedly suggested limiting the geographic scope of the waiver, which would only further limit the ability to scale up manufacturing all over the world. This demand was apparently agreed, as the proposal now on offer would only apply to developing countries that contributed less than 10% of the world’s exports of COVID-19 vaccine doses in 2021.”

Public statements by the Office of the U.S. Trade Representative have not been encouraging. The trade representative, Katherine Tai, “assured” the U.S. Congress that her office is not “working to give away American IP.” With the usual bipartisan commitment to corporate profits, congressional Republicans and Democrats oppose a meaningful waiver, echoing industry talking points to underline their disapproval. A bloc of Republican representatives is seeking to enforce this by introducing a bill that would grant Congress more oversight over negotiations.

Most of the world’s countries back India, South Africa

As many as 120 of the WTO’s 164 countries are said to be backing India and South Africa. Yet many of these countries would be excluded even from the limited and inadequate proposals put forth by the EU and U.S. As noted above, larger Global South countries would be excluded under the U.S. proposal to limit the countries eligible, while also limiting what would be available. Médecins Sans Frontières/Doctors Without Borders, for example, calls on WTO members to “tackle the current barriers to accessing all COVID-19 medical tools, including treatments and diagnostics, and also addresses patents and non-patent barriers in an effective way.” Dimitri Eynikel, EU Policy Advisor for MSF’s Access Campaign, noting the “considerable limitations” of what is on the table, said:

“It is incredibly concerning that the leaked text currently only covers vaccines, but neither treatments nor diagnostics. Excluding treatments and diagnostics is a critical weakness, especially as access to COVID-19 treatments remains a significant problem in many low- and middle-income countries, particularly in Latin America, in part because of patent barriers and restrictive licensing deals controlled by pharmaceutical corporations. Excluding countries with significant manufacturing and supply capacity like Brazil is highly problematic as it arbitrarily blocks potential critical avenues to increase access to COVID-19 medical tools for low- and middle-income countries.”

The severe limitations the EU and U.S. are attempting to impose make it unlikely that a “deeply flawed text” can be set right, according to Professor Jane Kelsey of the University of Auckland. Noting that by the end of 2021, more boosters had been given in high-income countries than total doses in low-income ones, Dr. Kelsey wrote, “The leaked ‘solution’ agreed by the informal ‘quad’ (US, EU, India and South Africa) is insufficient, problematic and unworkable. There are too many limitations to make any significant difference and it is a far cry from the original proposal from India and South Africa that would have effectively addressed the barriers.”

Perhaps activists and medical professionals going on the offensive as part of a public-pressure effort is one way that a fair deal might be forced. Nurses from 28 countries filed a complaint in November 2021 with the United Nations alleging human rights violations by the EU and four countries for “the loss of countless lives” in the pandemic. The nurses, representing more than 2.5 million health care workers around the world, named Britain, Norway, Singapore and Switzerland in their filing — the four countries known to be standing with the EU. The nurses charge that “these countries have violated our rights and the rights of our patients — and caused the loss of countless lives” through “continued opposition to the TRIPS waiver … resulting in the violation of human rights of peoples across the world.” The complaint notes human rights obligations to which WTO member states are legally bound.

^{Nurses demand safe staffing (Photo via National Nurse magazine)}

The organizations behind the filing are mostly from the Global South, but among the 28 are ones from Canada (Canadian Federation of Nurses Unions and Fédération interprofessionnelle de la santé du Québec), the United States (National Nurses United) and Australia (Australian Nursing and Midwifery Federation)).

Deborah Burger, president of National Nurses United, which represents more than 175,000 members in the United States, was unsparing in her assessment. She said:

“The maldistribution of vaccines in the face of more than 5 million deaths, many of them preventable, is a devastating reminder of the deplorable disparity of wealth between the rich nations of the north and the global south. To refuse to act simply to protect the profits of giant pharmaceutical corporations is unconscionable, inhumane, and must be ended.”

Upon receipt of the complaint, Dr. Tlaleng Mofokeng, the UN’s Special Rapporteur on Physical and Mental Health, said, “The nurses’ core demand is one I share.” She said:

“States have a collective responsibility to use all available means to facilitate faster access to vaccines, including by introducing a temporary waiver of relevant intellectual property rights under the WTO Agreement on Trade-Related Intellectual Property Rights (TRIPS Agreement). Nurses and health care workers have been on the front line keeping us safe and have witnessed the most painful and heart-wrenching effects of the Covid-19 pandemic. Their evident commitment to the right to physical and mental health provides them with moral authority.”

No executive or shareholder is any danger of starving

Let us now return to the profit margins of pharmaceutical companies and the massive windfall profits being racked up by Covid-19 vaccine manufacturers, which will provide some context to industry arguments. The business news agency Bloomberg reports that Pfizer’s vaccine generated $20 billion in pretax profit in 2021 while Moderna “is expected by analysts to earn $12.2 billion before taxes this year.” Pfizer’s vaccine may rack up $36 billion in revenue this year.

The pharmaceutical industry was already one of the most profitable. To provide some examples, health technology was found to be the most profitable of 19 broadly defined “major” industrial sectors in the U.S. for 2015 and 2016. A BBC report found that pharmaceuticals and banks tied for the highest average profit margin in 2013, with five pharmaceutical companies enjoying a profit margin of 20 percent or more — Pfizer among them. The most profitable pharmaceutical corporations spent far more on sales and marketing than they did on research and development. With little control exerted over pharmaceutical prices in the U.S., it is no wonder that U.S. health care costs are the world’s highest, greatly exceeding any other country.

Even by these rarified standards, the boost to profit margins from Covid-19 have been noteworthy. Pfizer reported almost $22 billion in net income for 2021, only $3 billion more than it reported for 2020 and 2019 combined. Moderna, which even self-described “capitalist tool” Forbes magazine says produced a vaccine “largely funded by taxpayer dollars,” reported $12.2 billion in profits for 2021. Moderna received a billion dollars in government subsidies for its vaccine, and has, overall, received $6 billion from the U.S. government to develop, test, manufacture and deliver its vaccine.

Johnson & Johnson reported net income of almost $21 billion for 2021, a healthy gain of 40 percent over the previous year, a much larger gain than the gain it reported in revenue. And AstraZeneca reported a 37 percent increase in its core earnings per share (a comparison apparently used to exclude special one-time costs from an acquisition).

So it appears that no executive or shareholder of these four pharmaceutical makers is in any danger of being out on the street.

What is the problem in sharing the technology that would finally put an end to the pandemic? The real reason is that the maximum possible amount of profit wouldn’t be accrued. No big corporation is going to admit that, so other excuses are offered.

Debunking Big Pharma’s favorite talking points

The director-general of the World Health Organization, Tedros Adhanom Ghebreyesus, had a revealing conversation with Pfizer’s chief executive officer. As reported by Bloomberg, Dr. Tedros, on a conference call with pharmaceutical executives, said, “Honestly, I’m not seeing the commitment I would expect from you.” The Pfizer chief executive, Albert Bourla, whined that Dr. Tedros was speaking “emotionally.” Consistent with that exchange, Johnson & Johnson’s chief scientific officer, Paul Stoffels, declared at an industry lobbying group gathering that there was no need for any waivers because the industry’s efforts are “sufficient.”

Letting the pharmaceutical industry have its way quite clearly hasn’t been “sufficient,” given the small numbers of vaccines available to the Global South well more than a year since vaccines became available and the inability to stop the pandemic given that lack of availability. The Bloomberg report admitted that “Vaccine inequality didn’t happen by itself. It was the result of decisions by corporate executives and government officials.”

^{Yonge-Dundas Square in Toronto during the pandemic (photo by Sikander Iqbal)}

Big Pharma talking points have revolved around claims that restrictive patents are necessary to encourage research and development, without which supposedly nothing would be invented. (Yet Jonas Salk famously declined to pursue a patent on the polio vaccine.) A new line has emerged during the pandemic: That even if a full waiver were granted, the Global South is incapable of producing vaccines because of a lack of capability or capacity, and thus granting rights would do nothing to solve the pandemic. Government officials backing the pharmaceutical industry loudly echo these claims, among them former German Chancellor Angela Merkel, French President Emmanuel Macron, and members of the U.S. Congress who are recipients of Big Pharma donations.

The In These Times article “Big Pharma’s Big Lies About Vaccine Patents,” debunks these talking points:

“It’s clever messaging, because it has an air of expert knowledge, casting companies as patiently informing activists who are well-intentioned but don’t understand how vaccine production works. It also plays to pre-existing racist assumptions that the Global South does not have pharmaceutical sectors capable of producing quality goods, but must rely on its more sophisticated former colonizers. … We don’t have definitive proof that pharmaceutical executives sat in a room somewhere and said, ‘Let’s deceive the public about the world’s vaccine manufacturing capacity.’ But there have been enough activists, scientists, and heads of state pointing out holes in Big Pharma’s narrative to make it highly likely that the industry, at the very least, was aware of challenges to the veracity of its claims. And it was in its interest to ignore them. Remarkably, the industry has shown it would rather build its own facilities from scratch — like the BioNTech facilities in Rwanda and Senegal, which won’t even start construction until mid-2022 — than give Global South countries the ability to produce vaccines themselves.”

India, for example, ranks third in the world in producing pharmaceuticals, measured by volume, and generics already constitute 70 to 80 percent of the world pharmaceutical market. The Serum Institute of India is the world’s largest producer of vaccines by number of doses produced and sold.

It’s not only vaccines that are being held back

Beyond vaccines, what about pills that are being developed? Pfizer has developed a Covid-19 oral antiviral treatment and granted a royalty-free license for the pill to the United Nations-backed Medicines Patent Pool, but the license covers only about half the world’s population. The Associated Press reported, “The deal excludes some large countries that have suffered devastating coronavirus outbreaks. For example, while a Brazilian drug company could get a license to make the pill for export to other countries, the medicine could not be made generically for use in Brazil.”

The Medicines Patent Pool said on March 18 that 35 companies around the world will produce generic versions of the pill, which has received an emergency approval by the U.S. Food and Drug Administration. The countries where the generic producers are located include Bangladesh, Brazil, China, the Dominican Republic, Jordan, India, Israel, Mexico, Pakistan, Serbia, South Korea and Vietnam.

Nonetheless, health care activists note that the license is less than adequate. Yuanqiong Hu, senior legal policy advisor for Médecins Sans Frontières/Doctors Without Borders’ Access Campaign said:

“Pfizer’s license with the Medicines Patent Pool for its potential oral antiviral treatment offers supply to 95 countries by generic companies that take up the license, covering about 53% of the world’s population, but this again shows how voluntary licenses come up short and do not harness the full capacity available globally for sufficient and sustainable production and supply of lifesaving medical tools for all. Many upper middle-income countries, such as Argentina, Brazil, China, Malaysia and Thailand, where established generic production capacity exists, are excluded from the license territory. We are disheartened to see yet another restrictive voluntary license during this pandemic while cases continue to rise in many countries around the world. The world knows by now that access to COVID-19 medical tools needs to be guaranteed for everyone, everywhere, if we really want to control this pandemic.”

What is more important: Ending the pandemic or increasing corporate profits? Life or money? The world capitalist system is making its choice. Should that choice be allowed to stand?

The “innocence” of early capitalism is another fantastical myth

It is not unusual for critics of United States foreign policy, whether or not they feel free to use the term “imperialism,” to express regret that a previously rational system has soured. Such sentiments are routine for liberals and hardly unknown among social democrats.

Such sentiments are, to anyone who cares to pursue a study of history, quite ahistorical. Violence, force and coercion — exemplified in widespread use of slave labor, imperialist conquests of peoples around the world and ruthless extraction of natural resources — pervades the entire history of capitalism. The rise of capitalism can’t be understood outside slavery, colonialism and plunder. To follow up on my previous article discussing how U.S. domination of the world is rooted in the stranglehold Washington has over the world’s financial institutions and its possession of the dominant currency, let’s conduct a further examination of the history of how capitalism functions, this time highlighting imperialism and violence.

My inspiration for this examination is my recent reading of John Perkins’ Confessions of an Economic Hit Man. Mr. Perkins, for those not familiar with his book, provides a first-hand account of how the U.S. government employs debt, financial entanglements, bribes, threats and finally violence and assassinations of national leaders who won’t place their economies and resources under the control of U.S.-based multi-national corporations. That is no surprise to anyone paying attention, but the book became an improbable best seller, meaning there must have been many eyes opened. That can only be a positive development.

^{The conquest of the Incas (mural by FUEJXJDK)}

But even Mr. Perkins, who is unsparing in drawing conclusions and under no illusions about what he and his fellow “economic hit men” were doing and on whose behalf, shows a measure of naïveté. He repeatedly draws upon the “ideals of the U.S. founding fathers” and laments that a republic dedicated to “life, liberty, and the pursuit of happiness” has morphed into a global empire. Given the outstanding service he has provided in writing his book, and the physical danger that he put himself in to publish it (he postponed writing it multiple times fearing possible consequences), least of all do I want to imply criticism or raise any snarky accusations against Mr. Perkins. My point here is that even a strong critic of U.S. imperialism with eyes open can harbor illusions about the nature of capitalism. The all-encompassing pervasiveness of capitalist propaganda, and that the relentless dissemination of it across every conceivable media and institutional outlet, still leaves most people with a wistful idealization of some earlier, innocent capitalism not yet befouled by anti-social behavior and violence or by greed.

Such an innocent capitalism has never existed, and couldn’t.

Horrific, state-directed violence in massive doses enabled capitalism to slowly establish itself, then methodically expand from its northwestern European beginnings. It is not for nothing that Karl Marx famously wrote, “If money … ‘comes into the world with a congenital blood-stain on one cheek,’ capital comes dripping from head to foot, from every pore, with blood and dirt.”

Markets over people from the start

Although the relative weight that should be given to the two sides of the equation of how capitalism took root in feudal Europe — feudal lords pushing their peasants off the land to clear space for commodity agricultural products or the capital accumulated from trade by merchants growing large enough to create the surpluses capable of being converted into the capital necessary to start production on a scale larger than artisan production — is likely never to be definitively settled (and the two basic factors reinforced one another), force was a crucial midwife. English lords wanted to transform arable land into sheep meadows to take advantage of the demand for wool, and began razing peasant cottages to clear the land. These actions became known as the “enclosure movement.”

Forced off the land they had farmed and barred from the “commons” (cleared land on which they grazed cattle and forests in which they foraged), peasants could either become beggars, risking draconian punishment for doing so, or become laborers in the new factories at pitifully low wages and enduring inhuman conditions and working hours. The brutality of this process is glimpsed in this account by historian Michael Perelman, in his book The Invention of Capitalism:

“Simple dispossession from the commons was a necessary, but not always sufficient, condition to harness rural people to the labor market. A series of cruel laws accompanied the dispossession of the peasants’ rights, including the period before capitalism had become a significant economic force.

For example, beginning with the Tudors, England created a series of stern measures to prevent peasants from drifting into vagrancy or falling back onto welfare systems. According to a 1572 statute, beggars over the age of fourteen were to be severely flogged and branded with a red-hot iron on the left ear unless someone was willing to take them into service for two years. Repeat offenders over the age of eighteen were to be executed unless someone would take them into service. Third offenses automatically resulted in execution. … Similar statutes appeared almost simultaneously in England, the Low Countries, and Zurich. … Eventually, the majority of workers, lacking any alternative, had little choice but to work for wages at something close to subsistence level.”

Additional taking of the commons occurred in the early 19th century, when British industrialists sought to eliminate the remaining portions of any commons left so there would be no alternative to selling one’s labor power to capitalists for a pittance. As industrial resistance gathered steam, the British government employed 12,000 troops to repress craft workers, artisans, factory workers and small farmers who were resisting the introduction of machinery by capitalists, seeing these machines as threats to their freedom and dignity. That represented more troops than Britain was using in its simultaneous fight against Napoleon’s armies in Spain.

Slavery critical to capitalist accumulation

Nor can the role of slavery in bootstrapping the rise of capitalism be ignored. The slave trade, until the end of the seventeenth century, was conducted by government monopolies. European economies grew on the “triangular trade” in which European manufactured goods were shipped to the coast of western Africa in exchange for slaves, who were shipped to the Americas, which in turn sent sugar and other commodities back to Europe. Britain and other European powers earned far more from the plantations of their Caribbean colonies than from North American possessions; much Caribbean produce could not be grown in Europe, while North American colonies tended to produce what Europe could already provide for itself.

Britain profited enormously from the triangular trade, both in the slave trade itself and the surpluses generated from plantation crops produced with slave labor. Proceeds from the slave trade were large enough to lift the prosperity of the British economy as a whole, provide the investment funds to build the infrastructure necessary to support industry and the scale of trade resulting from a growing industrial economy, and ease credit problems.

^{Sheep in a meadow (Eugène Verboeckhoven)}

Spain’s slaughter of Indigenous peoples and Spanish use of the survivors as slaves to mine enormous amounts of gold and silver — the basis of money across Europe and Asia — also was a crucial contributor to the rise of European economies, both by swelling the amount of money available and enabling the importation of goods from China, which was not interested in buying European products but had a need of silver to stabilize its own economy. The Spanish priest Bartolomé de las Casas, horrified at what he witnessed, wrote in 1542, “the Spaniards, who no sooner had knowledge of these people than they became like fierce wolves and tigers and lions who have gone many days without food or nourishment. And no other thing have they done for forty years until this day, and still today see fit to do, but dismember, slay, perturb, afflict, torment, and destroy the Indians by all manner of cruelty — new and divers and most singular manners such as never before seen or read of heard of — some few of which shall be recounted below, and they do this to such a degree that on the Island of Hispaniola, of the above three millions souls that we once saw, today there be no more than two hundred of those native people remaining.”

When the Spanish were kicked out by Latin America’s early 19th century wars of liberation, that did not mean real independence. The British replaced the Spanish, using more modern financial means to exploit the region. The era of direct colonialism, beginning with Spain’s massive extraction of gold and silver, was replaced by one-sided trading relationships following the region’s formal independence in the early nineteenth century. George Canning, an imperialist “free trader” who was the British foreign secretary, wrote in 1824: “The deed is done, the nail is driven, Spanish America is free; and if we do not mismanage our affairs sadly, she is English.” 

Canning was no idle boaster. At the same time, the French foreign minister lamented, “In the hour of emancipation the Spanish colonies turned into some sort of British colonies.” And lest we think this was simply European hubris, here is what the Argentine finance minister had to say: “We are not in a position to take measures against foreign trade, particularly British, because we are bound to that nation by large debts and would expose ourselves to a rupture which would cause much harm.” What had happened? Argentina flung its ports wide open to trade under British influence, flooding itself with a deluge of European goods sufficient to strangle nascent local production; when Argentina later attempted to escape dependency by imposing trade barriers in order to build up its own industry, British and French warships forced the country open again.

The “right” to force opium on China to maintain profits

Imperialism was not confined to any single continent. Consider Britain’s treatment of China in the latter half of the 19th century. (We are concentrating on Britain for the moment because it was the leading capitalist power at this time.) British warships were sent to China to force the Chinese to import opium, a drug that was illegal back home. This was done under the rubric of Britain’s alleged “right to trade.” Under this doctrine, underdeveloped countries had no choice but to buy products from more powerful capitalist countries, even products that caused widespread injury to the country’s people. This could also be considered a “right” to force opium on China. Where else but under capitalism could such a preposterous “right” be conjured? U.S. smugglers also made enormous fortunes selling opium to Chinese as well.

A 2015 Medium article detailing the background and results of the two opium wars, noted the huge amounts of money that were made:

“Opium was big business for the British, one of the critical economic engines of the era. Britain controlled India and oversaw one million Indian opium farmers. By 1850, the drug accounted for a staggering 15 to 20 percent of the British Empire’s revenue, and the India-to-China opium business became, in the words of Frederic Wakeman, a leading historian of the period, the ‘world’s most valuable single commodity trade of the nineteenth century.’ Notes Carl Trocki, author of Opium, Empire and the Global Economy, ‘The entire commercial infrastructure of European trade in Asia was built around opium. … [A] procession of American sea merchants made their fortunes smuggling opium. They were aware of its poisonous effects on the Chinese people, but few of them ever mentioned the drug in the thousands of pages of letters and documents they sent back to America.’ ”

Eventually, Chinese authorities ordered foreigners, mainly British and U.S., to hand over all opium. After a refusal, Chinese authorities destroyed all the opium they could find. In response, British warships were sent to bombard coastal cities until China agreed to the one-sided Treaty of Nanking, in which it was forced to pay Britain an indemnity of millions, to cede Hong Kong and to open five ports to trade, where foreigners were not subject to Chinese law or authorities.

When further demands were refused, the British, French and U.S. navies launched the second opium war, attacking coastal and interior cities. They invaded Beijing, “chased the emperor out of town, and, in an orgy of fine-art and jewelry looting, destroyed the Versailles of China, the old Summer Palace.” A new treaty, more unequal than the first, was imposed, forcing open the entire country. A British lawyer enlisted to provide justification for this behavior wrote, as the first opium war was developing, “Our men of war are now, it is to be hoped, far on their way towards China, which shall be ‘our oyster, which [we] with sword will open.’ Then may we extract from the Emperor an acknowledgement of the heinous offence — or series of offences — which he has committed against the law of nature and of nations, and read him a lesson, even from a barbarian book, which will benefit him and all his successors.” 

Fantastic profits for European capital; death for Africans

Nor was Africa spared exploitation. Far from it. The exact number of Africans kidnapped and forcibly transported across the Atlantic will never be known, but scholars’ estimates tend to range from about ten million to twelve million. The human toll, however, is still higher because, simultaneous with those who were successfully kidnapped, millions more were killed or maimed, and thus not shipped across the Atlantic. This level of inhumanity cannot be accomplished without an accompanying ideology. 

Walter Rodney, in his outstanding contribution to understanding lagging development in the South, How Europe Underdeveloped Africa, pointed out that although racism and other hatreds, including anti-Semitism, long existed across Europe, racism was an integral part of capitalism because it was necessary to rationalize the exploitation of African labor that was crucial to their accumulations of wealth.  “Occasionally, it is mistakenly held that Europeans enslaved Africans for racist reasons,” Dr. Rodney wrote. “European planters and miners enslaved Africans for economic reasons, so that their labor power could be exploited. Indeed, it would have been impossible to open up the New World and to use it as a constant generator of wealth, had it not been for African labor. There were no other alternatives: the American (Indian) population was virtually wiped out and Europe’s population was too small for settlement overseas at that time.”

^{The triangular trade (Graphic by Sémhur)}

Exploitation did not end with the end of slavery in the 19th century, Dr. Rodney pointed out. Colonial powers confiscated huge areas of arable land in Africa, then sold it at nominal prices to the well-connected. In Kenya, for example, the British declared the fertile highlands “crown lands” and sold blocks of land as large as 550 square miles (1,400 square kilometers). These massive land confiscations not only enabled the creation of massively profitable plantations, but created the conditions that forced newly landless Africans to become low-wage agricultural workers and to pay taxes to the colonial power. Laws were passed forbidding Africans from growing cash crops in plantation regions, a system of compulsion summed up by a British colonel who became a settler in Kenya: “We have stolen his land. Now we must steal his limbs. Compulsory labor is the corollary of our occupation of the country.” In other parts of colonial Africa, where land remained in African hands, colonial governments slapped money taxes on cattle, land, houses and the people themselves; subsistence farmers don’t have money to pay money taxes so farmers were forced to grow cash crops, for which they were paid very little.

The alternative to farming was to go to work in the mines, where wages were set at starvation levels. European and North American mining and trading companies made fantastic profits (sometimes as high as 90 percent) and raw materials could be exploited at similar levels. (A U.S. rubber company, from 1940 to 1965, took 160 million dollars worth of rubber out of Liberia while the Liberian government received eight million dollars.) Another method of extracting wealth was through forced labor — French, British, Belgian and Portuguese colonial governments required Africans to perform unpaid labor on railroads and other infrastructure projects. The French were particularly vicious in their use of forced labor (each year throughout the 1920s, 10,000 new people were put to work on a single railroad and at least 25 percent of the railroad’s forced laborers died from starvation or disease). These railroads did not benefit Africans when independence came in the mid-20th century because they were laid down to bring raw materials to a port and had no relationship to the trading or geographical patterns of the new countries or their neighbors.

The entire territory that today constitutes the Democratic Republic of Congo was, in the late 19th and early 20th century, the personal possession of Belgium’s king, Leopold II. At least 10 million Congolese lost their lives at the hands of Belgian authorities eager to extract rubber and other resources at any cost. This genocidal plunder — the loss of life halved the local population — rested on a system of terror and slave labor. This system included forced labor requiring work in mines day and night, the chopping off of hands as punishment and “the burning of countless villages and cities where every individual who was found was killed.”

As the U.S. grew to prominence, becoming a leading capitalist power itself as the 20th century began, overthrowing governments to ensure undisputed “profitable investment” became routine. The U.S., incidentally, was the first country to recognize King Leopold’s claim to Congo.

If it’s your “backyard” you do what you want to do

The U.S. has long considered Latin America its “backyard.” Cuba’s economy was based on slave-produced sugar cane under Spanish rule, and when a series of rebellions finally succeeded in freeing the country from Spanish colonial rule, Cuban independence was formal only as the United States quickly became a colonial master in all but name. U.S. forces left Cuba in 1902 after a four-year occupation but not before dictating that Cubans agree to the Platt Amendment. The amendment, inserted into the Cuban constitution as the price for U.S. withdrawal, gave the U.S. control over Cuban foreign and economic policies and the right to intervene with military force to protect U.S. corporate interests. By 1905, U.S. interests owned 60 percent of Cuba’s land and controlled most of its industry. Just four months after the 1959 revolution took power, the U.S. government was already viewing the potential success of the revolution as a “bad example” for the rest of Latin America. The U.S. State Department defined U.S. goals in Cuba as “receptivity to U.S. and free world capital and increasing trade” and “access by the United States to essential Cuban resources.” Those goals have not changed to this day.

That follows naturally from what the pre-revolution U.S. ambassador to Cuba, Earl T. Smith, had said of the island country: “I ran Cuba from the sixth floor of the US embassy. The Cubans’ job was to grow sugar and shut up.”

When a strike broke out against the United Fruit Company in Colombia in 1929, the action was put down through a massacre of the workers. The U.S. embassy in Bogotá cabled the State Department in Washington this triumphant message: “I have the honor to report that the Bogotá representative of the United Fruit Company told me yesterday that the total number of strikers killed by the Colombian military exceeded one thousand.” Honor. Think about that.

For much of the 20th century, the effective ruler of Guatemala and Honduras was the United Fruit Company. The company owned vast plantations in eight countries, and toppled governments in Guatemala and Honduras. For many years, United Fruit had an especially sweet deal in Guatemala. The company paid no taxes, imported equipment without paying duties and was guaranteed low wages. The company also possessed a monopoly on Guatemalan railroads, ocean ports and the telegraph. When a president, Jacobo Arbenz, moved to end this exploitation and orient Guatemala’s economy toward benefiting Guatemalans through mild reforms, the CIA overthrew him. U.S. intelligence agencies declared Arbenz’s program had to be reversed because loosening the United Fruit Company’s domination of the country was against U.S. interests. The U.S. instituted what would become a 40-year nightmare of state-organized mass murder. A series of military leaders, each more brutal than the last and fortified with U.S. aid, unleashed a reign of terror that ultimately cost 200,000 lives, 93 percent of whom were murdered by the state through its army and its death squads.

^{Viñales Valley, Pinar del Rio province, Cuba (photo by Adam Jones adamjones.freeservers.com)}

But not outside ordinary policy. The United States has militarily invaded Latin American and Caribbean countries 96 times, including 48 times in the 20th century. That total constitutes only direct interventions and doesn’t include coups fomented by the U.S., such as Guatemala in 1954 and Chile in 1973. Most of these invasions were for reasons along the lines articulated by former U.S. president William Howard Taft: to ensure profits for one or more U.S. corporations or to overthrow governments that did not prioritize the maximization of those profits. 

But not outside ordinary policy. The United States has militarily invaded Latin American and Caribbean countries 96 times, including 48 times in the 20th century. That total constitutes only direct interventions and doesn’t include coups fomented by the U.S., such as Guatemala in 1954 and Chile in 1973. Most of these invasions were for reasons along the lines articulated by former U.S. president William Howard Taft: to ensure profits for one or more U.S. corporations or to overthrow governments that did not prioritize the maximization of those profits. 

The U.S. invaded and occupied Nicaragua multiple times. One of these occasions, in 1909, came as a result of a Nicaraguan president accepting a loan from British bankers instead of U.S. bankers, then opening negotiations with Germany and Japan to build a new canal to rival the Panama Canal. The U.S. installed a dictatorship, and President Taft placed Nicaragua’s customs collections under U.S. control. The disapproved British loan was refinanced through two U.S. banks, which were given control of Nicaragua’s national bank and railroad as a reward. These developments were not an accident, for President Taft had already declared that his foreign policy was “to include active intervention to secure our merchandise and our capitalists opportunity for profitable investment” abroad.

All these atrocities — and countless others — all happened before the assassinations in Ecuador, Iran and Panama of heads of state who refused to do as they were ordered to by U.S. government operatives (and, in the case of Omar Torrijos, refusing the bribes that were the first tactic to get local leaders on side) recounted by Mr. Perkins in Confessions. No, those atrocities — and the author leaves us in no doubt that those were not “accidents” but were assassinations carried out by the U.S. government — do not represent an unprecedented turn to the dark side. Those acts, as are the present-day sanctions that kill in the hundreds of thousands, are business as usual for the U.S. government and the capitalism it imposes around the world. Imperialism, brutality and violence are nothing new; they are essential tools long wielded in abundance.

Far more examples could be cited; the above represents a minuscule fraction of atrocities that could be told. Such a long history of systematic violence and brutality speaks for itself as to the “morality” of capitalism.