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Saving capitalists from themselves?

Updated Friday, 20th January 2017
Dr Joe Hanlon explains his thoughts on the EU and recent global treaties being biased toward global corporations. Do we really think Teresa May and Donald Trump will defend us? 'Talk about foxes guarding hen houses' says Joe. 

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A banner reading "Capitalism isn't working" (a pun on the Conservative election poster "Labour isn't working") at the G20 Meltdown protest in London on 1 April 2009 For the first time, one per cent of the world population controls more than half of the world's wealth, according to a Credit Suisse study released in December. And it is mark of our times that Credit Suisse, which has contributed to the increase in global inequality, proudly produces its Global Wealth Report which is one of the best studies of the phenomenon.

And our major international institutions are run by people who promote this transfer of wealth to the 1%. On 19 December, Christine Lagarde, Managing Director of the International Monetary Fund (IMF), was found guilty as French finance minister in 2007 of “negligence with public money” in approving a €400 million payout of taxpayers’ money to controversial French businessman Bernard Tapie, acting against the advice of experts. Within hours of the court’s decision, the IMF executive board convened a special meeting which gave Lagarde its full support. And on 1 January its was revealed that the president of the European commission, Jean-Claude Juncker, spent years in his previous role as Luxembourg’s prime minister secretly blocking EU efforts to tackle tax avoidance by multinational corporations.

The response of the majority being squeezed to fund the 1%, has been to look for divisions within that 1%, and vote for big rich men who claim they will defend the poor against other big rich men. In particular, these big men say they will defend us against faceless global corporations. This is linked to a growing isolationism. In the UK we have Brexit. The US elected Donald Trump on his promises to break global trade treaties.

Clearly the EU and recent global treaties are biased toward global corporations. But do we really think Teresa May and Donald Trump will defend us? Talk about foxes guarding hen houses.

And it is not just Trump in the US and Vlaidmir Putin in Russia. Across the developing world, corruption scandals are emerging as rulers feel they have a right to be part not just of the global 1%, but of the 0.1%. I write about southern Africa, where former Mozambican president Armando Guebuza took an incredible $2 bn in secret loans. Credit Suisse was a main lender and Christine Lagarde called the loans "corrupt". Faced with such a shameless elite, voters have turned to Recep Erdogan in Turkey, Narandra Modi in India, and Rodrigo Duterte in the Philippines - big men who promise to defend the poor.

In Africa, there is a tendency to elect already rich men because "they have already eaten" and might not steal more, whereas poor candidates still have to "eat". Teenagers in urban housing estates join gangs in the hope that their bully will protect them from other bullies.

The problem, of course, is that the rich are never rich enough. The 1% will not be satisfied with half of global wealth. And bullies need to escalate conflicts to maintain their positions - as we know from urban gang wars, World Wars I and II and the constant military interventions of the United States.

However, looking for splits in the elite sometimes works. At the height of the great depression, a wealthy Franklin D. Roosevelt was elected US president in 1932 by blatantly lying and saying he would continue policies of Herbert Hoover (austerity, which is now called neo-liberalism and continues to be promoted). Instead he introduced the "new deal", which he argued later had "saved the system of private profit and free enterprise after it had been dragged to the brink of ruin" by the capitalists themselves - a view supported by John Kenneth Galbraith.

So as the 0.1% of the super rich and the global corporations again drive capitalism to the brink of ruin, do we depend on May, Trump, Lagarde, Junker and Modi to save capitalism? 


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