Bushco’s Warrantless Wiretap Scam Rolls On

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jperryam

Please contact your senators and demand that they vote NO on the new wiretapping legislation that not only grants immunity to telecoms who helped the Bush administration illegally spy on innocent American citizens, but also allows the illegal spying to continue with no accountability whatsoever.

And please share this info with all your friends and family.

Thanks – JP

Robert Wexler on Hannity & Colmes June 26, 2008

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videocafeblog

Robert Wexler appearing on Hannity & Colmes. Why any Democrat comes on this show is beyond me because Hannity does not do interviews. He does gotcha’ game hit pieces.

Victor’s Justice Vs. Morality – The Hitchens Conundrum

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by Patrick J. Buchanan
Global Research
June 26, 2008
Post Chronicle

Did Hitler’s crimes justify the Allies’ terror-bombing of Germany? Indeed they did, answers Christopher Hitchens in his Newsweek response to my new book, “Churchill, Hitler and the Unnecessary War”:

“The stark evidence of the Final Solution has ever since been enough to dispel most doubts about, say, the wisdom or morality of carpet-bombing German cities.”

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Advanced Imperialism: A Phase of Capitalism – A Marxist perspective

Dandelion Salad

by Carl Pinkston
Global Research
June 25, 2008

On April 26, 1917, V.I. Lenin published a major piece on imperialism titled “Imperialism – Highest Stage of Capitalism“. Lenin was able to draw from J.A. Hobson, Imperialism, and Rudolf Hilferding, Finance Capital. Lenin conducted extensive research on imperialism from wide array of writers, but he was very critical of many writers including Hobson and Hilferding. Lenin’s work on imperialism remained a premier until Harry Magdoff published The Age of Imperialism in 1969 and Kwame Nkrumah, Neo-Colonialism-The Last Stage of Imperialism, in 1965.

Since 1990, the world has changed and considerably more so since the inter-imperialists rivalry of the classical imperialism period of 1870-1945. There have been changes in the development of capitalism, finance, resource control and international investments. Along with the changes in capitalism there have been a series of world wide financial and economic crises. In other words, we are in the period of advanced imperialism. It is not fundamentally ideological, military, or social but principally socio-economic – a new phase of capitalism.

In what follows is the examination of the development of capitalism from competitive capitalism to international oligopoly- advanced capitalism. Also, capitalist development is not limited to the concentration of international production but also to the development of finance domination – finanancialization of capital. The international oligopoly and finance domination are forging new imperialist centers that are slowing re-dividing the world by a new map making machine – Foreign Direct Investment. Proxy wars and American form of colonialism will attempt to conceal international struggle of advanced imperialism today. However, advanced imperialism will expose its naked actions in one form or another and no neo-imperialism apologist can hide its cloths.

Advanced Capitalism

Modern capitalism or super-capitalism (as coined by a liberal economist Robert Reich) is a phase of capitalism. The history of modern capitalism can be described as follows: 1) 1860-70, the apex of development of free competition; 1870-1945, the period of monopoly capitalism, cartels, trusts, syndicates and finance capital; 2) 1945-1973, the US dominated oligopoly capitalism, multi-divisional corporations; and 3) the 1973-75 crisis and the boom of the 1990’s cultivated the massive growth of giant multi-national corporations. By 1870, it was clear that capitalism had developed from a competitive capitalism to monopoly capitalism. Capitalism development is not only internal but is express internationally in the form of imperialism. Lenin said, “that capitalism has been transformed into imperialism;” [1]

Prior to 1920, the management of large enterprises was centralized in a few hands (called Tycoons) that managed production, secure raw resources for the industry, and marketed a few products. Giant enterprises were managed by Tycoons with small staffs. Andrew Carnegie ran the Pennsylvania Railroad and Carnegie Steel; John D. Rockefeller ran Standard Oil Company (whose descendant is ExxonMobil) and Henry Ford ran Ford Motors. Very few giant enterprises were corporate in structure; that gave the ability to have internal financing; and multi-divisional in operation As Michael Reich noted, “Of the Fortune 500 largest corporation in 1994, more than half were founded between 1880 and 1930.” [2]

The events of the two world wars and the success of the Bolsheviks revolution ended the phase of monopoly capitalism and transformed capitalism into US dominated oligopoly capitalism-the rise of giant corporations. Marxist’s economists Baran and Sweezy noted, “Under capitalism the highest form of success is business success, and under monopoly capitalism the highest form of business is big corporation.”[3]

The characteristic features of a giant corporation as defined by Baran and Sweezy is: 1) control rest in the hands of management (ie Board of Directors and Chief Executive Officers), 2) management is self-perpetuating, and 3) each corporation normally achieves financial independence through the internal generation of funds which remain at the disposal of management.

“The replacement of the individual capitalist by the corporate capitalist constitutes an institutionalization of the capitalist function. The heart and core of the capitalist function is accumulation: accumulation has always been the prime mover of the system, the locus of its conflicts, the source of both its triumphs and disasters.”[4] Baran and Sweezy made clear.

Along with the rise of giant corporations was the change in administrating giant corporations and the development of a multi-divisional structure. During the monopoly period, centralization of management was the norm and a few men were entrusted with very complex decision making. Stephan Hymer, a Marxist economist, said,

“Thus, product development and marketing replaced production as a dominant problem of business enterprise. To meet the challenges of a constantly changing market, business enterprise evolved the multidivisional structure. The new form was originated by General Motors and DuPont shortly after World War I, followed by few others during the 1920s and 1930s, and was widely adopted by most of the giant U.S. corporations in the great boom following World War II. As with the previous stages, evolution involved a process of both differentiation and integration. Corporations were decentralized into several divisions, each concerned with one product line and organized with its own head office. At a higher level, a general office was created to coordinate the divisions and to plan for the enterprise as a whole.”[5]

The diversification movement in the 1960, multi-product lines, complex internal financing and the need to plan the market are basic features of multi-divisional corporations. As Stephan Hymer indicated,

“The new corporation formed has great flexibility. Because of its decentralized structure, a multidivisional corporation can enter a new market by adding a new division while leaving the old divisions undisturbed. (And to a lesser extent it can leave the market by dropping a division without disturbing the rest of its structure.) It can also create competing product-lines in the same industry, thus increasing its market share while maintaining the illusion of competition. Most important of all, because it has a cortex specializing in strategy, it can plan on a much wider scale than before and allocate capital with more precision.” [6]

From 1945-1961, the increase in mergers and internal growth forged a greater concentration of production – US dominated corporations.

“It is fair to assume that the greatest increases in manufacturing concentration have come in the three periods of greatest mergering. But increased concentration can also come from internal growth either through the reinvestment of earnings or from the sale of new securities, provided, of course, that growth from these sources is more rapid for larger companies than for smaller companies.”[7], as noted liberal economist Gadiner Means.

Means also reported that by 1969,

“The top 10 firms account for fully one-seventh of total industrial sales and almost one-quarter of total industrial after-tax profits. The top 100 firms account for more than 40 percent of total sales and almost 60 percent of total.”[8]

During the period US dominant oligopoly capitalism, giant multi-divisional corporation practiced priced leadership, sabotage of production, and all without entering into trusts, syndicates, or associations. Michael Reich, another liberal economist, says it well that,

“Besides, the largest companies had grown so vast that prices could be maintained and output controlled by the simple expedient of collusion among the two or three biggest ones in each industry (or, to use the more technical and less alarming language of economics, ‘oligopolistic coordination’). Steel was controlled by three giants – United States Steel, Republic, and Bethlehem; the electrical equipment and appliance industry by two – General Electric and Westinghouse. In basic chemicals, there were three – DuPont, Union Carbide, and Allied Chemical. In food processing, three dominated – General Goods, Quaker Oaks, and General Mills. In tobacco, three – R.J. Reynolds, Ligget & Myers, and American Tobacco; in jet engines, two – General Electric and Pratt & Whitney; in automobiles, three – General Motors, Ford, and Chrysler. In the new industry of television broadcasting, there were three networks – NBC,CBS, and ABC. This consolidation took place all across the vast expanse of American industry.”[9]

The economic crisis of 1973-75 transformed US dominated oligopoly capitalism to internationalization of oligopoly. Manuel Castells argued that the cause of the 1973-75 crisis or rupture is as follows:

“The capitalist mode of production is an expanding contradictory system. Capitalist societies are shaped by the particular way these contradictions develop through the conflicts and interactions defined on the social classes and by their political expression. The major structural problems created by the process of capitalist accumulation in the United States were determined by the upheavals caused by new economic policies and the transformation of the system on the basis of a new relationship between the sate and the large corporations. The internationalization of capital, the creation of debt economy, and the decisive role of the state in the process of accumulation and realization of profit were major structural trends that allowed for sustained capitalist growth during almost three decades. But the introduction of these countertendencies to fight stagnation triggered new contradictions that were increasingly expressed through monetary crisis and the sprawl of structural inflation. In this particular situation, dominated by the defeat of imperialism in Indochina, increasing intercapitalist competition, and the development of social unrest within advanced capitalist societies, the new structural contradictions came together in certain conjunctural factors that, in return, made them more acute and precipitated the latest crisis.”[10]

The transformation to the internationalization of oligopoly was driven principally by the development of multinational corporations. Stephen Hymer said,

“Since the beginning of the Industrial Revolution, there has been a tendency for the representative firm to increase in size from the workshop to the factory to the national corporation to the multidivisional corporation and now to the multinational corporation.”[11]

Multinational corporation was pioneered by Standard Oil at the beginning of 1900 and today the top 50 US giant corporations operate internationally. Paul Baran and Paul Sweezy best described a multinational corporation as follow:

“It is not enough that a multinational corporation should have a base of operations abroad that; its true differentia specifica is that ‘its management makes fundamental decision on marketing, production, and research in terms of the alternatives that are available to it anywhere in the world.”[12]

Multinational corporations concentrated production on an international level. Capitalist apologist economists Fatemi, Williams and Saint-Phalle pointed this out:

“The significant impact of the multinational corporation is the internationalization of production and in the incipient development of a world economy. In this process the investment decisions and operations of companies are increasingly viewed in terms of world allocations of resources and of maximizing world welfare.”[13]

Translation for maximizing world welfare is maximizing profit.

Once the internationalization of production was the exception, today, multinational corporations have made it the rule. The United Nations report titled “World Investment Report 2007”, stated;

“The world’s 100 largest TNCs[14] play a major role in international production. In 2005, they accounted for 10%, 17% and 13% repectively of the estimated foreign assets, sales and employment of all TNCs worldwide…..The top 10, with about $1.7 trillion in foreign assets (i.e almost 36% of the total foreign assets of the top 100), include four TNCs in petroleum and three in automobile production.”[15]

Also, the United Nations Conference on Trade and Development (UNCTD) stated,

“Of the top 100 TNCs, 58 belonged to six industries; motor vehicles (11), petroleum (10), electrical and electronic equipment (10), pharmaceuticals (9), Telecommunications (9), and electricity, gas and water services (9)…If ranking were to be based on foreign sales or foreign employment they would yield different result. Ranking by sales would move the petroleum TNCs into the top four positions on the list and another four motor vehicles TNCs into the top 10 .The largest TNC in terms of foreign sales (ExxonMobil) is 10 times larger than the firm ranked 55 in the list. Ranking the companies by foreign employment would present yet another picture, placing three retail TNCs in the top position. On average, the largest TNCs had affilates in 39 foreign countries. Deutsche Post (Germany) was the leader in this regard, with value-added activities in 103 host economies, followed by Royal Dutch/Shell (United Kingdom/Netherlands) with 96.”[16]

In 2006, America’s Fortune 500 largest corporations generated over $10.6 trillion in revenues and over $645 billion in profits. The world’s 100 largest corporations in 2005 generated over $10.2 trillion revenues and $696.8 billion in profits. The world’s profits represent about 100 underdeveloped countries Gross Domestic Product. In other words, 100 underdeveloped countries Gross Domestic Product would double if the profits were shared.

As reported in the Fortune 500 May 5, 2008 edition, the largest corporation in the United States in sales for 2007 was Wal-Mart Stores, Inc (a consumer product company) with a total revenue of $379 billion and generated a profit of $13 billion. Wal-Mart Stores Inc employs over 1.9 million workers worldwide and operates 4,750 stores (3,600 in the US). It is the largest private employer in the world and operates in Mexico as Walmex, in United Kingdom as ASDA, and in Japan as Seiyu.[17] The Wal-Mart monopoly is both horizontal and vertical. From the vertical side 20-30 percent of the manufacturers sell their product to one big box – Wal-Mart. Ray Bracy, Wal-Mart Vice President for Federal & International Public Affairs said.

“Wal-Mart prefers to deal directly with Chinese and other suppliers and ‘If there’s a middleman in our process, even if it’s a Wal-Mart middleman, we try and eliminate those. Wal-Mart inherited a massive list of global suppliers, from PREL which is Pacific Rim Export Limited that now is winnowed down to 6,000 global suppliers which is 80 percent in China.”[18]

In addition, Wal-Mart has used computerized supply chains to master the science of global sourcing.

Wal-Mart horizontal monopoly is shown by the various subsidiaries – Wal-Mart Stores Divisions in the US (Discount stores, Super-centers and Neighborhood markets); Sam’s Club, and Wal-Mart International. On the international side Wal-Mart operates in 13 countries with 2,757 locations, employs about 550,000 and generated sales of about $77 billion.

“Wal-Mart’s marketplace clout is hard to overstate. In household staples such as toothpaste, shampoo, and paper towels, the company commands about 30% of the U.S. market, and analysts predict that its share of many such goods could hit 50% before decade’s end.”, as reported by Business Week.[19]

Wal-Mart is three times the size of the No. 2 retailer, France’s Carrefour. Once again as Business Week noted, “Every week, 138 million Wal-Mart.” shoppers visit Wal-Mart’s 4,750 stores; last year, 82% of American household made at least one purchase at Wal-Mart. Wal-Mart is an example of the modern corporation – modern capitalism.

Not only the massive growth of multinational corporations has had profound impact but also one of the characteristic features of modern capitalism is the continuing process of the concentration of production. The international concentration of production is driven by the global merger and acquisition activities.

“A new surge of corporate concentration is in the process in the United States and abroad, driven in large measure by a restructuring of global markets through mergers and acquisitions (M&As)”[20] as reported, by Richard B. Du Boff and Edward S Herman.

In 1999, the worldwide merger deal (also know as megamergers) were $3.4 trillion, but by 2007 worldwide merger deal reach $4.7 trillion. Global consolidation was in the area of Materials, Financials and Energy/Power sectors. A record-breaking 47% of all mergers were cross-border mergers and acquisitions. Even capitalist advisors, Merger and Acquisition Review described the massive concentration of multinational corporations, as follows

“Consolidation in the Materials and Energy and Power sectors combined for nearly 29% of worldwide activity largely due to BHP Billiton’s US$193 billion bid for Rio Tinto. The deal, which ranks as the second biggest deal of all time, bolstered the all time, bolstered the already high level of activity in the Materials sector. Financials accounted for 16% of activity during 2007 driven by the takeover of ABN Amro by a consortium led by the Royal Bank of Scotland, which ranks as the biggest financial merger on record. Activity in the Industrials sector topped all industry groups, by number, with over 5,600 deals announced during 2007.”[21]

Du Boff and Herman give us a very clear picture of the merger and acquisition of multinational corporations.

“Unlike those of the 1980s, the current mergers are financed primarily with corporate stock, not borrowed money, and companies are not being broken into pieces for sale but are merging to enlarge their size. Today’s M&As are based on long-term strategic and economic motives. This involves acquiring the scale and resources to compete at home and abroad, protecting and enlarging market share, reducing competition and attaining greater pricing power, in what large corporations see increasingly, often primarily, as a global market …eiither way, excess capacity squeezes profitability, and mergers and takeovers are effective ways to reduce it, if temporarily, by shedding labor and closing down less profitable facilities.”,[22] said Du Boff and Herman.

Since the 1970s technological revolution, the multinational corporation has developed advanced cargo ships, cargo planes, overseas cables, steel containers, satellites communication and micro-computers to increase production and transportation. Even a liberal writer such as William Greider pointed out that

“Fast, lean, flexible – these familiar buzzwords are modern corporate management’s response to the revolutionary conditions. Rigorous contests for design efficiency. Continuous suppression of costs including labor costs. Redeploying elements of production overseas to capture local advantages, from low wages and taxes to other political favors. Securing access to the hot new markets in the world where rising demand exceeds supply and per unit profit margins can be widened. Reducing the fixed costs by dismantling corporate assets – selling plants and properties, shrinking middle-level bureaucracies, converting jobs to temporary status. Sharing cost burdens by forming alliances with putative rivals who will jointly finance the overhead of research and development, even share production.”[23]

During the hey day of monopoly capitalism trusts, syndicates and agreements were the norm of giant enterprises but modern giant multinational corporation practice joint ventures, cutting subsidiaries and price leadership. Joint venture is a corporate practice of sharing the cost of research, development and production. William Greider indicated that

“Corporations hedge against the risk of future rivals by globalizing – forming partnerships with their potential competitors, the new producers in emerging markets. The major multinationals hope to guide their evolution and, if it comes to that, to share the future markets with them in transnational corsortia of producers. Even if this corporate strategy should succeed, it still leaves out one group: the industrial workers back home whose jobs were traded away.”[24]

Also, multinational corporations engage in market leverage.

“Market leverage, in its usual application, provides domestic enterprises with greater economies of scale, allowing them to produce for their shelter home market, then sell surplus production into the other guy’s market, often at competitive discounts. Japan had used market leverage to brilliant advantage, relentlessly capturing market share and sometimes entire sectors, from automobiles to consumer electronics.”[25], as presented by William Grieder.

Today, advanced capitalism – multi-national corporation – is international oligopoly. Advanced capitalism was developed during the period of giant multi-division corporations. Capitalism has been transformed into imperialism and advanced capitalism has been transformed into advanced imperialism. Samir Amin also noted the change in capitalism – advanced capitalism, he said:

“Capitalism today is totally different. A handful of oligopolies alone occupy all the dominant heights in the conduct of national and global business. These are not strictly financial oligopolies but ‘groups’ within which the production activities of industry, agribusiness, commerce, services, and of course financial activities coalesce.”[26]

International oligopoly cannot abolish crisis or international crisis in particular. However, economic and financial crisis in turn increased the tendency for concentration of international oligopoly. Lenin pointed this out over 100 years ago when he said,

“The statement that cartels can abolish crises is a fable spread by bourgeois economists who at all costs desire to place capitalism in a favourable light. On the contrary, monopoly which is created in certain branches of industry, increases and intensifies the anarchy inherent in capitalist production as a whole.”[27]

Reinhart and Rogoff identified the following post 1973-75 crises during the international oligopoly period: Spain (1977), Norway (1987), Finland (1991), Sweden (1991) and Japan (1992), Australia (1989), Canada (1983), Denmark (1987), France (1994), Germany (1997), Greece (1991), Iceland (1985), Italy (1990), New Zealand (1987), Mexico (1982), United Kingdom, (1974, 1991, 1995) and United States (1984).[28] The Economist reported the 2007-08 financial crises wiped out $5 trillion value from worldwide public companies balance sheet.[29]

International oligopoly is the latest phase in the development of capitalism. But to understand the significance of international oligopoly is to take into consideration the financialization of capital.

…continued

© Copyright Carl Pinkston, Global Research, 2008

The url address of this article is: www.globalresearch.ca/index.php?context=va&aid=9453

see

Revolutionary Organization Today: Part One

Revolutionary Organization Today: Part Two