IT’S TIME TO STOP THE CORPORATIST RACE TO THE BOTTOM

Posted on September 15, 2003 by Dave Pollard

It’s time to make the export and the elimination of American jobs the number one political issue in the 2004 campaign. It threatens the social fabric of the country, and represents everything that’s wrong with excessive corporate power, the undue influence of the rich, the privatization of everything, and so-called ‘free trade’. There is a massive political and psychological fraud being perpetrated against the American people, and it goes like this:

The world is a single global market, and competitiveness means producing goods at the lowest possible cost.
To do that, jobs need to be eliminated as much as possible, since labour is a major component of cost.
Jobs that aren’t eliminated need to be filled with people who are prepared to work for the lowest possible wages; these people are almost invariably in third world countries.
Another way of reducing costs is to manufacture and operate in the country that has the lowest possible social and environmental standards and regulations; the damage that this creates in that country is not the corporation’s concern.
Trade barriers need to be eliminated so that the corporations that can produce a product at the lowest possible cost can dominate the global market; the labour dislocation this creates is not the corporation’s concern.
In order to eliminate those trade barriers over the objections of local country citizens and governments, all world governments need to be coerced to sign ‘free’ trade agreements that require them to eliminate any domestic social and environmental regulations that are one iota higher than the most lax regulations in the trade area, on the basis that such regulations represent ‘unwarranted restrictions on trade’.
Trade protection and subsidies given to domestic corporations need to be disguised and hidden by convoluted legal and economic agreements, so that these corporations sustain their competitive advantage over new upstart organizations, particularly those operating in low-cost, third world countries.
Corporations must minimize any social and environmental responsibility to the communities in which they operate and sell products, and simultaneously maximize their rights in these communities, by using batteries of lawyers and political influence to obtain ‘personhood’ rights.
These ‘personhood’ rights can then be used to stifle all criticism of corporations for false and misleading advertising (right of ‘free speech’), for producing defective products (right to sue anyone criticizing their product for defamation) and for buying political favours (right to contribute unlimited amounts to political campaigns).
All of these coerced advantages, and unwillingness to take any responsibility for the consequences of corporate actions, must be blamed on the corporation’s mandate and the demand of shareholders to maximize corporate profits at any cost; this allows greedy, unscrupulous, socially and environmentally negligent corporate management to be protected from litigation for any damage that any corporate actions produce.

The endgame of this insane and out-of-control abuse of power is a cowed, beaten, unemployed and underemployed American workforce, the unraveling of decades of social programs and standards, privatization of all public property to a small corporate elite, and the destruction of the environment. This is the proverbial race-to-the-bottom, achieved through a barefaced coup that turns over all power, all wealth and all resources, resources that rightfully belong to all Americans, to a tiny elite. And the final ignomy is that Americans, turfed from well-paying professional and technical jobs that are eliminated or exported to the third world, can only afford with their drastically reduced income to buy the shoddy, inferior products produced by the equally downtrodden third-world labourers who took their jobs.

It must be stopped. Americans must start working together to use the only resources that haven’t already largely slipped from their control — their votes and their dollars — to stop the coup and take back their country from rapacious corporations and their political handmaidens. To do this they must:

Demand that political leaders support aggressive programs to end corporatism and undue political influence, including the elimination of corporate ‘personhood’ and other corporate ‘rights’, campaign finance reform, and the elimination of indemnity of corporate managers and directors from litigation for corporate misdeeds. This will be the most difficult change, since it literally requires politicians to bite the hand that feeds them.
Demand that political leaders reform corporate taxation to prevent corporations from using offshore tax havens, strongly discourage them from eliminating or exporting jobs, and penalize them for environmental destruction and wasteful resource consumption.
Demand that political leaders put a total moratorium on the sale to private interests of public lands, property and resource rights, on the basis that these public resources belong to the people.
Demand that political leaders revoke ‘free trade’ agreements, and replace them with statutes that strongly discourage international trade in goods and services that can be readily provided locally (even if they can be produced elsewhere cheaper), and strongly encourage international trade in goods and services that cannot be readily produced locally.
Refuse to buy imported products when domestic products are, or should be, available, even when those imported products are cheaper in price.
Refuse to support retailers that import the majority of their merchandise.
Identify, publicize, and organize nationwide boycotts of the products and services of corporations that have eliminated valuable jobs (and hence lowered the quality of their products and customer service) or exported jobs to lower-cost countries.
Support local businesses that employ people at reasonable salaries and show social and environmental responsibility for the community.
Learn to take responsibility for their own employment by establishing new local businesses with high labour standards, and high social and environmental standards, which place a greater value on the well-being of their people and communities than on their profitability.

Politicians will only learn to behave responsibly when they are held to account by informed citizens, and forced to wean themselves off the patronage of corporate elites. Corporations will only learn to behave responsibly when they are stripped of legal and tax protections that encourage them to behave otherwise, and lose in the marketplace to businesses that put people and community welfare above profits.

This problem is not unique to the US. It is as global as the reach of the corporations that created it. But the 9-point prescription above that can solve it is universal. It applies equally in every country in the world.

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13 Responses to IT’S TIME TO STOP THE CORPORATIST RACE TO THE BOTTOM

Stentor says:

September 15, 2003 at 10:02

How do you draw the line between products that can be “readily provided” and those that can’t? The ease of provision is, in large measure, a function of cost — for the right price, you can produce almost anything anywhere. This seems to work against your complaint that the search for lower costs is provoking companies to locate offshore. If something could be “readily” — i.e. cheaply — provided at home, there’s less motivation to produce it elsewhere.As an example, I imagine that with the right kind of greenhouses, you could grow coffee in Canada. How easy and cheap would these greenhouses need to be before you said “coffee can be readily produced right here, so there’s no call to be importing it from Colombia”?
Jon Husband says:

September 15, 2003 at 14:37

Thanks, Dave. Nice, neat,clean and clear – and powerful – hard to argue against. I wish it would make all the rounds of all the blogs.Can I have your permission to use key elements of it, to point others to it, on my blog?I will also forward it to others.
ian glendinning says:

September 15, 2003 at 15:01

Err Dave, if your aim is to save the world, what is so special about the American workforce in particular ?ConfusedIan
Myke says:

September 15, 2003 at 15:25

Big corporations are always trying to reduce their workforce. Workers who lose jobs are sacrificed so the people who still have jobs can buy cheaper goods. Americans like their toys and they can buy more when they are cheaper. Most political leaders are no more “moral” than the greedy corporate leaders in the news today. They lust after power. Putting faith in them is a lost cause.Small businesses and startups are the creator of jobs. The United States needs to innovate and create new products and services, not try to resist change.
Dave Pollard says:

September 15, 2003 at 15:28

Stentor: By ‘readily’ I mean the raw materials and expertise are available locally. It would be dysfunctional for Canada to make coffee, just as it makes no sense for Colombia to make maple syrup. When you import goods that can readily made locally, you unnecessarily export jobs and hurt local employment. Importing coffee from Colombia to Canada makes perfect sense — good for Colombia, because it gives them export dollars to buy Canadian maple syrup and other products they can’t reasonably produce locally, and good for Canada, because otherwise we’d have to settle for tea.Jon: Absolutely — that’s what blogs are for.Ian: The collapse of the American economy, and possibly American social order as well, will lead to global recession and upheaval. As long as we’re preoccupied with social and economic crises, we’re not going to be able to focus on the (more critical long-term) environmental, political and population problems that ‘saving the world’ requires. And the final sentence of my post concedes that, while the American workforce is most affected by corporatism, it’s a problem everywhere. Besides, any radical change requires an informed, empowered and engaged citizenry.
Dave Pollard says:

September 15, 2003 at 15:33

Myke: I agree completely that small business is the key, though we as citizens and consumers need to help them out, by directing our spending dollars to their products (even if they’re more expensive) instead of to large corporations that make their goods overseas. And I also agree that politicans are no more moral than large corporate managers — corporatism couldn’t exist without the complicity of politicians.
Indigo Ocean says:

September 15, 2003 at 16:08

I am definitely in agreement with you regarding corporate welfare and the very notion that a corporation is a person. In general I think the link between corporations and politicians is the greatest threat to democracy. Anything that weakens the link or brings the influence of either party under the control of the citizenry is a step in the right direction.I don’t however see voluntary protectionism as a sustainable answer to US economic problems. I think the problem revoloves around 1)a consciousness of excess (out of control in the US and growing in even the farthest reaches of China); 2)an acceptance of savage inequalities by which “my” wants take precedence above “your” needs; and 3)a lack of internal discipline and responsibility in too much of the citizenry, resulting in an unwillingness to delve deeply enough into issues to discover the truth of a situation and make personal sacrifices to achieve one’s stated ideals.Above all else, I think people are frightened, lazy and selfish. They want more for less and don’t care who gets hurt along the way. The only thing I see making them change course is for them to 1)suffer more, more than they can stand, enough so that staying the same is more terrifying than changing; and 2) see working alternatives in the real world.My life is dedicated to creating microsystems of viable alternatives. I am trying to live by my values so that I demonstrate a sustainable way of life. I do this at great sacrifice and quite frankly its pretty damn scary most of the time. But in the end, whenever we go up against the fear based mentality that creates this hell in which 99% of the world’s population (including Americans) fight over crumbs while 1% owns 26 houses, each of which they live in 2 weeks out of the year, we are going to be going out on a limb. But if no one takes that risk, there is no hope that the mass of humankind can ever be free from a survivalist mentality and able to create a world in which the average experience of humans is one of abundance.
Paul Siegel says:

September 15, 2003 at 17:04

It’s not a question of globalization vs. protectionism. The point is that huge corporations are taking over the world. Workers are nothing but a cost to them. Marjorie Kelly wrote a very apropos book “The Divine Right of Capital,” and I have a review of it at http://www.learningfountain.com/blog/archives/00000057.htm.
Indigo Ocean says:

September 15, 2003 at 20:26

It is important to look at these issues both in the collective sense, what can work for “them,” and in the personal sense, what can I do.I cannot add anything beyond what I have already said in referring to the plight of the mass of workers right now. As I said, I believe the solution for the mass is going to take a major paradigm shift to be resolved. However, the steps we can take in our individual lives to decrease the chances that we will be a victim of the wage slave system are not as remote.I agree with Paul that a huge part of the problem is with the corporations and how they view themselves as persons, but people as pawns. So what do I do about that? I get out of the wage slave system. Again, I am not talking about what “they all” should do. But this is what I can do. And if I can make a success out of this choice, success being marked by happiness in life, then I can represent a viable alternative for others that over time more and more of “the masses” will choose.I believe that the nature of global systems of labor distribution is inherently flawed. No point wasting so much energy trying to rebuild an eroding shore. Better to build farther back from the beach. Let’s take “buy local” a step further. The corporate system, indeed the market system, is built around growth. Without growth, the entire stock market crashes because no stock is worth anywhere near its current value. Those values a built upon projections about a distant future. If growth slows, stocks crash. The more you buy local instead of buying from corporations the more you enrich people who need the resources you supply to live simple lives in accord with nature and the more you starve the system of “from poor many to rich few,” otherwise known as the corporate system.
Korakot Chaovavanich says:

September 16, 2003 at 01:13

I would like to suggest another view to the current situation.As globalization increases its reach, many different economies will merge.It’s unavoidable that some kind of job in a country will migrate to anotherand vise versa. Theoritically, this should benefit either sides when both canproduce what they are best at, resulting in cheaper cost of all kind ofproducts/services.So, what is the problem?In my (possibly biased) view, the gap between US and the 3rd world hasexisted unfairly for too long. Workers in the 3rd world have to work as hardand earn only a tenth of what they would earn had they been in the US.Many measures had kept this gap for decades. Eventually, however, the gapmust be bridged when the economy become more and more global.View in a global perspective, income to average people will increase, eg. inChina/India lots more people get better paid for the job. It would be unfortunatefor people in the US when they must realize the fair level they should earnfor many kinds of jobs. This is somewhat lower than the good, old, protected days.There are of course some solutions to the US problem. They must find the kindof job that will still justify their high income. Many of them could be in the hi-techindustries or any special kind of jobs that have sustainable competitive advantageto India/China in the long run.In my view, however, as the world continue to become a global village. Therecould not be any discrimination to a particular country. Anyone in any countryshould seek for the job that they are best at, therefore they can contribute mostto the global community and gain the deserved income. Any jobs that can be donebetter/cheaper somewhere else , whether in the same country or foriegn, shouldlet other people do it.
Dave Pollard says:

September 16, 2003 at 11:36

Paul: Great review — I’ll have to take a look at this.Indigo: I agree that the most important thing is for each of us to ‘walk away’ from the corporatist system. The other actions I suggest, mostly political lobbying, will be necessary to bring about the change more quickly and painlessly for all concerned.Korakot: You are buying all the discredited myths of globalization. Please read some of the books that dismantle these myths — there are lots of them about. Corporatism, globalization and ‘free’ trade all factor into the race to the bottom, destroy cultures, waste resources, displace millions of workers, encourage hidden government subsidies (see my post today), and lower living standards for all, for the exclusive benefit of a tiny elite. And tell the millions of Americans in high-tech who have lost their jobs to inferior, outsourced ‘help desks’ in India and China, that their skills ‘still justify their high income’.
William Lasley says:

September 22, 2003 at 16:51

We need a better system of education to produce educated workers at a much lower cost, low enough to educate the poor.
Wes McClintick says:

July 23, 2005 at 16:38

Couldn’t you respond in more depth to Korakot’s comments? Economics teaches very simple mathematical exercises that show the benefit of free trade through comparative advantage. Each country produces what it can produce best and there is a larger pie/GDP/total production from which to divide to the participants. As trade gets freer and fairer, that is as subsidies and restrictions are removed, the third world will be more able to compete and participate in the global economy. This necessarily entails a higher standard of living in those countries. How can this be disputed? Wes McClintick