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	Corporate Lobbyists Threaten Democracy by Julio Godoy Inter Press Service   Aug 2012   Over a month has passed since the United Nations summit on sustainable development concluded in Rio de Janeiro, Brazil, but the world still appears to be unaware of one of the most important statements made during the conference that drew some 50,000 delegates from all over the world.   Louise Kantrow, permanent representative of the International Chamber of Commerce, received thunderous applause when she told her audience on Jun. 19 that “businesses are taking the lead” in global negotiations on climate change and sustainable development.   For many observers, Kantrow’s blunt words highlighted just how strong of a grip private multinational companies have upon supposedly democratic processes.   In a statement aptly titled ‘Reclaim the U.N. from corporate capture’, the environmental organisation Friends of the Earth (FoE) complained that, “There are … real concerns about the increasing influence of major corporations and business lobby groups within the U.N.”   The report went on to detail the extraordinary level of businesses’ influence over the positions of national governments in multilateral negotiations.   “Business representatives dominate certain U.N. discussion spaces and some U.N. bodies; business groups are given a privileged advisory role; U.N. officials move back and forth (from) the private sector; and – last but not least – U.N. agencies are increasingly financially dependent on the private sector.”   One blatant example of this “corporate capture” of the U.N. is the Anglo-Dutch oil giant Shell, which, thanks to senior executive representatives in several corporate lobbying groups, was omnipresent during the Rio+20 negotiations.   Shell sent delegates to the discussions and round tables of the above-mentioned International Chamber of Commerce, the International Petroleum Industry Environmental Conservation Association, the U.N. Global Compact, the World Business Council for Sustainable Development, and the International Emissions Trading Association.   Yet, according to Paul de Clerck, campaign coordinator at FoE, “More than one year has passed since the U.N. presented its report on Shell’s pollution of Ogoniland (Nigeria). But we are still waiting for a comprehensive plan from Shell to clean up its mess.”   The first step recommended by the U.N. was the establishment of a one billion-dollar emergency fund to clean up the region.   “So far, Shell has committed to nothing, despite its participation in all kind of environmental and sustainable development debates,” Clerck told IPS.   “It is not acceptable that companies like Shell should be in the driving seat of processes for sustainable development,” Nnimmo Bassey, of FoE International, told IPS. “That is a recipe for disaster for our planet and peoples. Corporate polluters should not (be drafting) laws, they should face the laws.”   But the U.N. is not the only international institution threatened by the influence of multinational businesses.   Tightly woven groups of professional go-betweens and loyal supporters of multinationals who have passed through the revolving doors that link governments and private corporations are now facing growing scrutiny from civil society activists.   In Europe, the head of the European Central Bank, Mario Draghi, is facing a formal inquiry by the European Union (EU) ombudsman because of his membership in a well-known international banking lobby group.   On Jul. 24, the ombudsman’s office announced that it was launching the investigation following allegations that Draghi’s membership in the so-called Group of 30 “is incompatible with the independence, reputation and integrity of the ECB”.   The EU has been the subject of multiple complaints, because, according to civil society groups, many of its agencies allow a revolving door to admit and dispatch senior executives who bring corporate agendas to democratic fora.   One of the leading critics of this policy, the Corporate Europe Observatory (CEO), a multinational and public policy watchdog group, claims that many “senior European decision-makers leave office and go straight into lobby jobs, or (alternately) lobbyists join the EU institutions.”   In such cases, Olivier Hoedeman of CEO told IPS, “The risk of significant conflicts of interest is great, undermining democratic, public-interest decision making.”   According to Hoedeman, CEO “is working with the Alliance for Lobbying Transparency and Ethics Regulation to challenge the revolving door and to demand that it is effectively regulated”.   CEO was the first group to complain about Draghi’s membership in the Group of 30, whose members include heavy-hitters in the international banking sector like William C. Dudley, former managing director at Goldman Sachs and former president of the Federal Reserve Bank of New York.   European activists and analysts have been growing more anxious about the influence of private investment banks on public financial policies, especially as the European sovereign debt continues to spiral out of control.   As CEO put it, “Given the euro crisis, the huge bailout operations of big banks, and the on-going debate on how to regulate banks in the light of the financial crisis, it should be obvious that safeguards are needed to ensure that the President of the European Central Bank remains independent.”   CEO argues that Draghi’s participation “in a closed, club-like structure with representatives from big international private banks could damage the integrity and reputation of the ECB.”   Indeed, Goldman Sachs’ links to numerous present officials at ministries of finance and other state agencies in Europe are extraordinary and worrisome. In a recent debate in Berlin, sociologist Wolfgang Streeck, director of the prestigious Max Planck Institute for the Study of Societies, denounced what he called “the diarchy in financial capitalism.”   Streeck said that European democratic states are presently suffering under the dictatorship of the deregulated financial markets, controlled by corporations like Goldman Sachs, while at the same time, most of their institutions are led by former executives of those very same corporations.   A salient example of Streeck’s thesis is the current, non-elected Italian head of government Mario Monti, who was the international adviser to Goldman Sachs from 2005 until 2011. In Goldman Sachs’ own words, Monti’s mission was to provide advice “on European business and major public policy initiatives worldwide.”   Given that Goldman Sachs and similar investment banks are pivotal in managing the sovereign debt of numerous European countries, it seems almost absurd that they are simultaneously preparing speculation schemes against the solvency of those very same states.   Following the announcement that the EU ombudsman had launched an official investigation into Draghi’s professional past, CEO has urged him to step down as president of the ECB.   In a letter addressed to Draghi, the group wrote, “Any president of the ECB has to make it absolutely clear that he or she is not under the influence of the financial lobby at any time. In particular at this dramatic point in the history of the EU, with the euro crisis and an ailing banking sector – recipient of trillions of euros in aid – it is completely unacceptable if doubt can be cast on the independence of the Bank’s president from the financial lobby.” Visit the related web page
	Privatizing the Planet by Noam Chomsky Professor emeritus at the MIT USA   The peak of U.S. power was after World War II, when it had literally half the world"s wealth. But that naturally declined, as other industrial economies recovered from the devastation of the war and decolonization took its agonizing course. By the early 1970s, the U.S. share of global wealth had declined to about 25%, and the industrial world had become tripolar: North America, Europe, and East Asia (then Japan-based).   There was also a sharp change in the U.S. economy in the 1970s, towards financialization and export of production. A variety of factors converged to create a vicious cycle of radical concentration of wealth, primarily in the top fraction of 1% of the population -- mostly CEOs, hedge-fund managers, and the like. That leads to the concentration of political power, hence state policies to increase economic concentration: fiscal policies, rules of corporate governance, deregulation, and much more. Meanwhile the costs of electoral campaigns skyrocketed, driving the parties into the pockets of concentrated capital, increasingly financial: the Republicans reflexively, the Democrats -- by now what used to be moderate Republicans -- not far behind.   Elections have become a charade, run by the public relations industry. After his 2008 victory, Obama won an award from the industry for the best marketing campaign of the year. Executives were euphoric. In the business press they explained that they had been marketing candidates like other commodities since Ronald Reagan, but 2008 was their greatest achievement and would change the style in corporate boardrooms. The 2012 election is expected to cost $2 billion, mostly in corporate funding. Small wonder that Obama is selecting business leaders for top positions.   While wealth and power have narrowly concentrated, for most of the population real incomes have stagnated and people have been getting by with increased work hours, debt, and asset inflation, regularly destroyed by the financial crises that began as the regulatory apparatus was dismantled starting in the 1980s.   None of this is problematic for the very wealthy, who benefit from a government insurance policy called "too big to fail." The banks and investment firms can make risky transactions, with rich rewards, and when the system inevitably crashes, they can run to the nanny state for a taxpayer bailout, clutching their copies of Friedrich Hayek and Milton Friedman.   That has been the regular process since the Reagan years, each crisis more extreme than the last -- for the public population, that is. Right now, real unemployment is at Depression levels for much of the population, while Goldman Sachs, one of the main architects of the current crisis, is richer than ever. It has just quietly announced $17.5 billion in compensation for last year, with CEO Lloyd Blankfein receiving a $12.6 million bonus while his base salary more than triples.   It wouldn"t do to focus attention on such facts as these. Accordingly, propaganda must seek to blame others, in the past few months, public sector workers, their fat salaries, exorbitant pensions, and so on: all fantasy, on the model of Reaganite imagery of black mothers being driven in their limousines to pick up welfare checks -- and other models that need not be mentioned. We all must tighten our belts; almost all, that is.   Teachers are a particularly good target, as part of the deliberate effort to destroy the public education system from kindergarten through the universities by privatization -- again, good for the wealthy, but a disaster for the population, as well as the long-term health of the economy, but that is one of the externalities that is put to the side insofar as market principles prevail.   Another fine target, always, is immigrants. That has been true throughout U.S. history, even more so at times of economic crisis, exacerbated now by a sense that our country is being taken away from us: the white population will soon become a minority. One can understand the anger of aggrieved individuals, but the cruelty of the policy is shocking.   Who are the immigrants targeted? In Eastern Massachusetts, where I live, many are Mayans fleeing genocide in the Guatemalan highlands carried out by Reagan"s favorite killers. Others are Mexican victims of Clinton"s NAFTA, one of those rare government agreements that managed to harm working people in all three of the participating countries. As NAFTA was rammed through Congress over popular objection in 1994, Clinton also initiated the militarization of the U.S.-Mexican border, previously fairly open. It was understood that Mexican campesinos cannot compete with highly subsidized U.S. agribusiness, and that Mexican businesses would not survive competition with U.S. multinationals, which must be granted "national treatment" under the mislabeled free trade agreements, a privilege granted only to corporate persons, not those of flesh and blood. Not surprisingly, these measures led to a flood of desperate refugees, and to rising anti-immigrant hysteria by the victims of state-corporate policies at home.   Much the same appears to be happening in Europe, where racism is probably more rampant than in the U.S. One can only watch with wonder as Italy complains about the flow of refugees from Libya, the scene of the first post-World War I genocide, in the now-liberated East, at the hands of Italy"s Fascist government. Or when France, still today the main protector of the brutal dictatorships in its former colonies, manages to overlook its hideous atrocities in Africa, while French President Nicolas Sarkozy warns grimly of the "flood of immigrants" and Marine Le Pen objects that he is doing nothing to prevent it. I need not mention Belgium, which may win the prize for what Adam Smith called "the savage injustice of the Europeans."   The rise of neo-fascist parties in much of Europe would be a frightening phenomenon even if we were not to recall what happened on the continent in the recent past. Just imagine the reaction if Jews were being expelled from France to misery and oppression, and then witness the non-reaction when that is happening to Roma, also victims of the Holocaust and Europe"s most brutalized population.   In Hungary, the neo-fascist party Jobbik gained 17% of the vote in national elections, perhaps unsurprising when three-quarters of the population feels that they are worse off than under Communist rule. We might be relieved that in Austria the ultra-right Jörg Haider won only 10% of the vote in 2008 -- were it not for the fact that the new Freedom Party, outflanking him from the far right, won more than 17%. It is chilling to recall that, in 1928, the Nazis won less than 3% of the vote in Germany.   In England the British National Party and the English Defence League, on the ultra-racist right, are major forces. (What is happening in Holland you know all too well.) In Germany, Thilo Sarrazin"s lament that immigrants are destroying the country was a runaway best-seller, while Chancellor Angela Merkel, though condemning the book, declared that multiculturalism had "utterly failed": the Turks imported to do the dirty work in Germany are failing to become blond and blue-eyed, true Aryans.   Those with a sense of irony may recall that Benjamin Franklin, one of the leading figures of the Enlightenment, warned that the newly liberated colonies should be wary of allowing Germans to immigrate, because they were too swarthy; Swedes as well. Into the twentieth century, ludicrous myths of Anglo-Saxon purity were common in the U.S., including among presidents and other leading figures. Racism in the literary culture has been a rank obscenity; far worse in practice, needless to say. It is much easier to eradicate polio than this horrifying plague, which regularly becomes more virulent in times of economic distress.   I do not want to end without mentioning another externality that is dismissed in market systems: the fate of the species. Systemic risk in the financial system can be remedied by the taxpayer, but no one will come to the rescue if the environment is destroyed. That it must be destroyed is close to an institutional imperative. Business leaders who are conducting propaganda campaigns to convince the population that anthropogenic global warming is a liberal hoax understand full well how grave is the threat, but they must maximize short-term profit and market share. If they don"t, someone else will.   This vicious cycle could well turn out to be lethal. To see how grave the danger is, simply have a look at the new Congress in the U.S., propelled into power by business funding and propaganda. Almost all are climate deniers. They have already begun to cut funding for measures that might mitigate environmental catastrophe. Worse, some are true believers; for example, the new head of a subcommittee on the environment who explained that global warming cannot be a problem because God promised Noah that there will not be another flood.   If such things were happening in some small and remote country, we might laugh. Not when they are happening in the richest and most powerful country in the world. And before we laugh, we might also bear in mind that the current economic crisis is traceable in no small measure to the fanatic faith in such dogmas as the efficient market hypothesis, and in general to what Nobel laureate Joseph Stiglitz, 15 years ago, called the "religion" that markets know best -- which prevented the central bank and the economics profession from taking notice of an $8 trillion housing bubble that had no basis at all in economic fundamentals, and that devastated the economy when it burst.   As long as the general population is passive, apathetic, diverted to consumerism or hatred of the vulnerable, then the powerful can do as they please, and those who survive will be left to contemplate the outcome.   * Noam Chomsky is Institute Professor emeritus in the MIT Department of Linguistics and Philosophy. He is the author of numerous best-selling political works. His web site is www.chomsky.info.
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