THE NEW ROBBER BARONS

Posted on August 5, 2003 by Dave Pollard

(posted from Miami)
Social critic and professor Charles Derber’s new book People Before Profit is a bumpy ride. Its back cover, with glowing reviews by Naomi Klein, Ralph Nader, Ted Kennedy and Noam Chomsky, raises huge expectations. What Derber delivers is a well-researched and informative study of globalization and corporate power — and a naive and unworkable prescription for change.

The best part of the book comes right after the introduction, as Derber teaches us just how much our current economic predicament parallels that of the latter half of the 19th century, the Gilded Age, when:

[US sovereignty] shifted from the people toward the large corporations and financiers. The new system of American government, essentially federalized democracy with a corporate logo was “a government by Wall Street, of Wall Street and for Wall Street.” As the robber barons integrated the economy from New York to California, they deformed democracy and unhinged the social order…The robber barons “overran all the existing institutions which buttress society…they took possession of the political government, the school, the press, the church.” Business, that is, began to absorb all of society into itself.

Derber draws the connections to today’s economy, and makes the argument against untrameled globalization and corporate power, saying:

In today’s corpocracy…business and government forge an intimate relationship, both within the nation-state and the larger world order. In the new system, government still wields sovereign authority, but sovereign power has actually been transferred to a partnership increasingly dominated by the business sector.

He also exposes the myth that globalization benefits poor nations as well as rich:

Globalization, rather than catalyzing a splendid burst of growth in Africa, Latin America, and other parts of the Third World, has slowed it to a snail’s pace…The World Bank reported that worldwide growth actually shrank in the 1990’s, the decade of accelerating globalization. The slowdown was especially notable in the Third World…”with the typical country registering negligable growth”…The 1998 Asian financial meltdown reversed much of the [Asian tigers’] gains, turning success stories like Thailand and Indonesia into economic nightmares. Meanwhile, sub-Saharan African economies actually shrank, while in much of the rest of Africa and Latin America growth hovered close to zero.

Derber then dissects the anti-globalization movement into two camps — “UN people” who support a strong United Nations as a force to balance the power of global corporations and their lackeys, the IMF, World Bank and WTO; and “barbershoppers”, who espouse relocalizing and devolving power to communities, where people’s needs and the effects of decisions are truly understood. Derber wants to unite the two factions into a “global democracy movement”.

Here’s where IMHO the book moves from excellent historical and economic analysis to technicolor dreamland. His global democracy prescription calls for five aims: (a) creating accountable ‘world governments’, (b) reconstructing national democracies, (c) democratizing global business, (d) resurrecting local community with global citizenship, and (e) creating collective security. Nothing to it! Here’s his policy and platform program to get us there:

re-regulation of global money flows and corporations
redistribution of income and wealth
resurrecting ‘global commons’
full, equal and informed political participation
rebuilding the firewall between government and corporations
revoking corporate citizenship and rights as ‘persons’
rewriting corporate charters to mandate serving the common good
end to hidden corporate subsidies
limiting US power in the world

I was almost expecting to see an end to all wars and perpetual global world peace on the list, and Derber didn’t disappoint — he sees his program as the elixir for terrorism and all our political woes, not just our economic ones. And he might even be right, if this list of pipedreams were even faintly achievable. He displays an almost unbelievable lack of awareness of how slowly cultures and economies change and how difficult it is to displace power once it is dug in. And I thought I was an idealist.

For those whose eyebrows haven’t risen too far in their heads to continue reading, Derber concludes with a 25-point set of actions comprising ‘what you can do today’. The actions fall into four discouragingly prosaic categories:

Conscientious consumerism: Think about what you buy. Buy smart. Think about the plight of women struggling in Third World streets and sweatshops. Buy green and conserve.
Education of yourself and others: Start study groups. Travel abroad.
Organization: Think global, act local. Make change from inside. Unite with others.
Activism: Support a strong UN, human rights, election finance reform. Protest against poverty, social and environmental abuses, excess corporate concentration and power, the policies of the WTO, IMF and World Bank, and US intervention and unilateralism.

I would really like to believe Derber is right, and his hopeful vision was possible. But methinks he got too caught up in the surreal world on the streets of Seattle and its wild-eyed, grass-roots romanticism. People Before Profit, like its title, reads like a manifesto from the 1960s. I know what we accomplished back then, ending the Vietnam War and sending shock-waves through every corner of society. Alas, this is not 1968, and the reactionary forces we overcame back then are back with a vengeance, and won’t be fooled so easily this time.

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9 Responses to THE NEW ROBBER BARONS

Rob Salkowitz says:

August 5, 2003 at 09:16

I guess books like this are valuable as a counterweight to equally-mindless propaganda from the right, but really, anyone who talks about globalization in black-and-white rather than shades of gray really doesn’t have a good grip on the issues. Anyone who follows the debate, for example, knows that the World Bank is a notably more progressive organization (in its intentions, if not in effect) than either the WTO or the especially eggregious IMF. Perpetuating this idea that all organizations promoting “globalism” have the same means and ends is foolish and simplistic. But this is not surprising, considering the kinds of solutions he seems to be offering. For a more substantial analysis, you may want to check out the writings of economist Joseph Stiglitz, former head of the WB and member of Clinton’s Council of Economic Advisors. He had a great piece in TNR last year, and may have come out with a book as well.
Dave Pollard says:

August 5, 2003 at 09:27

Thanks, Rob, I’ll check that out. I do agree that of the three ‘iron triangle’ entities (that’s what Derber calls them), the World Bank is clearly the least offensive and the best intentioned.
Anthony says:

August 5, 2003 at 13:44

I have not read Derber’s book. You seem to broadly accept his analysis of the downside of globalization. You call his policy and platform program a technicolor dreamland. Subsequently you suggest his remedies are merely wild-eyed, grass-roots romanticism. I’m essentially with you so far. But in your criticism you fall into a common trap of failing to suggest an alternate response to globalization. Are we simply to give up and allow the reactionary forces to assume victory? What is an appropriate response?The 25-point set of actions that you helpfully reduce to four prosaic categories each seem an entirely laudable response to me. They may not seem earth-shattering but it is difficult to deny the effect that conscientious consumerism, for instance, has had on brands that once seemed unbeatable.As you acknowledge in your “awareness of how slowly cultures and economies change”, this is a battle that will need to be fought over decades. But how better than to start with “baby steps”?
mrG says:

August 5, 2003 at 18:23

As a more practical and direct set of doable actions, my current favourite is Yoko Ono’s Peace Event
Dave Pollard says:

August 5, 2003 at 20:13

Anthony: Of course even ‘baby steps’ are better than nothing, but I believe it’s going to take a lot more than that to make any noticeable impact. I have suggested what I believe to be better alternative approaches in four previous posts, listed in the Corporatism section of my blog TOC here. My essay ‘Citizens not Consumers’ lower down in the same TOC also has some suggestions, as does my Post-Consumer Economy essay. I should have included these references in my post.
Anthony says:

August 6, 2003 at 13:50

Thank you for directing me to your suggestions. They make fascinating reading.What strikes me as the common ground between the approaches that you, Derner and others advocate is the reliance, to a great degree on individual grass-roots action. The transitions to agricultural and then industrial economic models, as I understand it, were driven by the existing political, wealthy and land-owning elite. Those fundamental changes were broadly in the interests of powerful reactionary forces, similar in tone to today’s political and corporate elite.I see little evidence in history of peaceful, grass-roots activity driving such fundamental change. Sure our ‘baby steps’ may damage individual corporations or political figures but history suggests they are quickly replaced by something more or less equally distasteful. Whilst I advocate conscientious consumerism I am not foolish enough to think it will change society.What troubles me about today’s political climate is that people, though maybe vaguely troubled by the concentration of global power, do not really want change. They like consuming. The media, corporations, governments like people consuming. Occasionally we collectively feel individual political or corporate entities go too far so we replace them with someone who proves broadly similar, in effect if not in tone.In a time of fragmenting social structures, when most people feel politically impotent, where do you find the cohesion necessary to generate a powerful grass-roots reaction? It seems to me that any major social change needs to be driven from inside the political or corporate elite. Clearly what you and others advocate would not be in their interests so will ultimately fail.For me, the issue that should be the primary focus for the individual is to attack the link between the corporate and political elite. Eliminate corporate funding of politicians, severely limit the amount that politicians can spend on winning elections, remove the attendance/influence of corporate bodies in important quangos and eliminate the media monopolies. That sort of climate may, just may, enable a suitably influential body to talk directly to and influence the consumers to get off their collective asses and work for a more sustainable future.
Dave Pollard says:

August 6, 2003 at 14:56

Anthony: Campaign finance and anti-combines reform would certainly go a long way. And if the lessons of the late 19th century are anything to go on, they’re possible. We need some enlightened leadership to get there, however. Canada has been lucky to have that, partly because the Liberal Party has no threat from opposition parties, so they can afford to reform these things. Clinton was not prepared to bite the hand that fed him, so we should not be surprised that Republicans aren’t either. I don’t think grassroots is totally hopeless, however, because it’s undermining and replacing the economic system, not the political one. In a way we’re all working from inside the economic system, since we can’t really escape it.
Paul Siegel says:

August 8, 2003 at 15:39

I’m glad you took the time to write this comprehensive review. I was a little surprised, however, when you said the author was naive to make his recommendations.Sure, reactionary forces are strong. But this is no reason not to fight them. Those who have demonstrated don’t really know what they are for; they only know they are against globalization as it is being played today. Those of us with ideas for making “fair trade” instead of “free trade” should express ourselves.It’s my opinion that globalization is the latest expression of our country’s religion of competition. We keep saying we are the best, the kindest, the greatest, the most powerful, the richest. We are better than anyone. We know how to run a business. We know how to help poor countries. (Of course, we help ourselves most in the process.)The solution rests with each individual. Become a little more cooperative. Get to think more of the common good, not only for our country, but for the world. What’s good for the world is good for our country and good for each individual in our country.
Allan says:

June 3, 2004 at 07:35

You dismiss Derber’s proposals for an alternative future because they are ‘pipe dreams’, not realistic. In discussions of visions of how the world should be, it’s not terribly productive to say ‘that will never happen’. You can say that you have other tactics which are more practical, more achievable. Or you can disagree with his goals. But to disagree with his goals because they are unlikely to be achieved is defeatist and unhelpful. And besides, Derber’s structural politico-economic suggestions are not comparable to ‘perpetual world peace’. Most of his suggestions begin with the prefix ‘re’, because they have existed in some form in the past. History, politics, social movements are non-linear and unpredictable if anything. Let’s agree on a rough agenda, and work towards it in whatever manner we each think most practical, and discuss the finer points of strategy. But don’t tell me to confine my vision to your assesment of what is achievable. Otherwise what are dreams for.