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Once considered dangerous and untrustworthy
by governments, corporate enterprises are now the key players in the globalised
economy, excerpting substantial influence over governments and international
organizations the world over. Their financial success seems endless; despite a
widespread economic downturn in recent years, corporate profits are at an all
time high, with the largest banks, oil, pharmaceutical and retail companies
regularly reporting record turnovers. A significant proportion of these profits
are reinvested not only in influencing politics and economics, but ensuring
that people continue to consume their products.
Economic
and Political Influence
Despite employing less than one percent of
the global work force, 200 of the largest multinational corporations (MNCs)
have sales equivalent to almost 30% of the world's GDP. Given their sheer
economic might it is unsurprising that, in a period where economic growth is
considered a panacea for development success, governments increasingly adopt
pro-market policies and facilitate commercial activity. The result is a firmly
established mutual-interdependence between corporations and governments, a
phenomenon which is most evident in the United States which increasingly
undermines a truly democratic representation of public interest.
While corporate-friendly policies of
privatization, government downsizing and market liberalization continue to be
propagated, large swathes of the public in both the North and South are
suffering. As a result, there is now a
significant worldwide backlash against many of the principles and effects of economic
globalization. Transnational corporations, in their relentless drive to
maximize profits and bolster share prices, have been re-locating their
production facilities to developing countries where tax, labour and
environmental restrictions are negligible - creating large-scale unemployment
in the industrialized countries.
Many argue that this is a necessary
sacrifice in order to secure economic growth and opportunity in the developing
world, but in many cases the result is merely a glut of labourers working in
inhumane factory conditions for comparatively miniscule pay. These workers
often give up their families and rural life to migrate en masse to overcrowded
cities, inadvertently buying into an economic state of play which promotes unsustainable
over-consumption in already wealthy countries.
At the same time, food security has sharply
declined in many developing countries as large-scale agribusinesses out-compete
local farmers, exporting cash crops and not growing food for those who need it
locally. Consequently, communities are no longer able to grow the food they
need to eat, must import food instead, and are therefore at the mercy of
increasingly volatile international markets - a factor at the heart of the
current food price crisis.
Influencing
the public
Far from supplying public demand,
corporations actively dictate cultural habits and create demand by influencing
the public through a sophisticated and well-funded combination of research,
marketing, advertising and media manipulation. The result is the subtle, but
quite apparent, alignment of public and corporate interest. This cultural
homogenization of society both nationally and globally is fertile ground for
maximizing profit. Whilst levels of unnecessary and unsustainable consumption
increase globally, corporate longevity is secured.
The sophistication and effectiveness of
advertising and marketing methods is well understood. The ubiquity of the
television and the increasing number of hours it is watched, especially by
children, is particularly disturbing. In the US, watching TV is the third most
time-consuming pastime after sleeping and working.
As domestic markets become saturated, or
public opinion turns against a particular product, corporations - using the
same aggressive marketing tactics - shift their attention to developing
countries with devastating effect. Nestle is notorious for its aggressive
marketing of infant milk formula in poor countries in the 1980s. Because of
this practice, Nestle is still one of the most boycotted corporations in the
world, and its infant formula remains controversial. In recent years, as public
awareness of dire health consequences of smoking tobacco have come to light in
industrialized nations, tobacco giants have also had to shift their focus to
increasing demand in developing countries. The WHO has reported that 84% of an estimated
1.3 billion smokers live in developing and transitional economy countries. A
1994 WHO report estimated that the use of tobacco resulted in an annual global
net loss of US $200 billion, a third of this loss being in developing countries
which consequently hampers development efforts.
Corporate
Greed or Public Good?
The battle for control of the democratic
process is clearly being won by those with the greatest financial and economic
leverage, and the phenomenon of market forces is becoming more entrenched in
every aspect of public life. As many industrialized nations call for democracy
to be spread abroad, the economic ideologies they have vested our future in are
cancerous to these same democratic principles. True democracy can only be
established if the global public is empowered to make decisions that favour
cooperation and economic efficiency over competition and self interest.
After 30 years of economic globalization
and the decadent rise of multinational corporations, almost half the world is
still denied even the most basic of goods and services such as clean water,
basic food, energy and medicine. Whilst small to medium-scale business is
crucial in a thriving and interdependent society, the commercialisation of all
resources and their distribution through a tiny number of oligarchic
corporations will never supply the most essential resources to those who need
them most. Small-scale, localised industry combined with international economic
sharing is likely to play a significant role in creating a sustainable future. This will only be possible, however, when
corporate rights are scaled down to a level where corporations act in a limited
and regulated capacity to serve the public's economic needs.
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