The Not-So-Free Market of Global Capitalism

IMG_0911 (Επεξεργασμένο)The belief that global capitalism today is based on a free market is a lie, claims Dr Guy Standing, the Professorial Research Associate at the School of Oriental and African Studies at SOAS. The no-so-free market claim is one of six lies of global capitalism Dr Standing discusses in his new book, The Corruption of Capitalism.

“We have the most unfree market system ever created,” he asserts at his research seminar at the University of Leeds. “There is a global architecture that is being built, and that global architecture is designing how the system works.”

Dr Standing believes that the global economy has been transformed from anything remotely like the global economy neoliberals have been claiming. Many structures such as the Trade Relating Aspects of Intellectual Property (TRIPS) and the Investor State Dispute Settlement (ISDS) have been established, and these have been rigged in favour of elite corporate interests – the Plutonic Corporations, as Dr Standing refers to them.

TRIPS has a unique structure based on patents and copyright laws. When a patent is registered, the owner of the patent has a monopoly income flow for twenty years, which can be rolled over for another twenty years if needed and so on. This means that any product, idea, or process is taken out of a free market situation. Patents can even be registered if the product has been publically subsidised. Plutonic corporations such as Google, IBM etc. have been “hoovering” patents by buying off patents in their early stages for a few million, and earning billions off them in the long run. Through copyright laws, owners are given a monopoly income for the rest of their life, plus seventy years. Therefore, copyright is churning in billions for large plutonic corporations.

The ISDS is a system where a corporation can sue a government if any government policies could threaten the future profits of the corporations. There are three judges appointed, one being a corporate lawyer who the corporation suing appoint, the other being one the government appoint and the third being one that the corporation should approve of. If neither party is able to come to an agreement on the third judge, then the president of the World Bank appoints the third judge. “Through this very procedure,” states Dr Standing, “literally thousands of millions of dollar have been passed over to the corporations.”

The corruption does not end there either. “Plagues” of tax subsidies have been reinforced by governments on corporations, which has had a negative impact on countries. Governments, such as ours, claims Dr Standing, have been gradually lowering corporation tax year by year. Claims of austerity are a lie when you are purposely cutting off potential income through tax.

“Austerity follows from the logic that you need to balance your budget and balancing your budget means that your revenue must equal your expenditure,” Dr Standing added. “But if you immediately cut your revenue, then you will create a deficit and then you will turn around and say you need to cut benefits and the NHS so that you can “balance the budget” but you are deliberately cutting the revenue. The deficit has been created by the government by their tax relief. The need for austerity is a lie.”

Jan Lewis

PHOTO Stella Taxidi

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