June 12, 2013
|
Many now know the rhetoric of the 1% very well: the imagery of a
small elite owning most of the wealth while the 99% take the table
scraps.
In 2006,
a UN report revealed
that the world’s richest 1% own 40% of the world’s wealth, with those
in the financial and internet sectors comprising the “super rich.” More
than a third of the world’s super-rich live in the U.S., with roughly
27% in Japan, 6% in the U.K., and 5% in France. The world’s richest 10%
accounted for roughly 85% of the planet's total assets, while the bottom
half of the population – more than 3 billion people – owned less than
1% of the world’s wealth.
Looking specifically at the United
States, the top 1% own more than 36% of the national wealth and more
than the combined wealth of the bottom 95%. Almost all of the wealth
gains over the previous decade went to the top 1%. In the mid-1970s, the
top 1% earned 8% of all national income; this number rose to 21% by
2010. At the highest sliver at the top, the 400 wealthiest individuals
in America have more wealth than the bottom 150 million.
A 2005 report from Citigroup coined
the term “plutonomy” to describe countries “where economic growth is
powered by and largely consumed by the wealthy few.” The report
specifically identified the U.K., Canada, Australia and the United
States as four plutonomies. Published three years before the onset of
the financial crisis in 2008, the Citigroup report stated: “Asset booms,
a rising profit share and favorable treatment by market-friendly
governments have allowed the rich to prosper and become a greater share
of the economy in the plutonomy countries.”
"The rich," said the report, "are in great shape, financially.”
In
early 2013, Oxfam reported that the fortunes made by the world’s 100
richest people over the course of 2012 – roughly $240 billion – would be
enough to lift the world’s poorest people out of poverty four times
over. In
the Oxfam report,
"The Cost of Inequality: How Wealth and Income Extremes Hurt Us All,"
the international charity noted that in the past 20 years, the richest
1% had increased their incomes by 60%. Barbara Stocking, an Oxfam
executive, noted that this type of extreme wealth is “economically
inefficient, politically corrosive, socially divisive and
environmentally destructive...We can no longer pretend that the creation
of wealth for a few will inevitably benefit the many – too often the
reverse is true.”
The report added: “In the UK, inequality is
rapidly returning to levels not seen since the time of Charles Dickens.
In China the top 10% now take home nearly 60% of the income. Chinese
inequality levels are now similar to those in South Africa, which is now
the most unequal country on Earth and significantly more unequal than
at the end of apartheid.” In the United States, the share of national
income going to the top 1% has doubled from 10 to 20% since 1980, and
for the top 0.01% in the United States, “the share of national income is
above levels last seen in the 1920s.”
Previously, in July of
2012, James Henry, a former chief economist at McKinsey, a major global
consultancy, published a major report on tax havens for the Tax Justice
Network which compiled data from the Bank for International Settlements
(BIS), the IMF and other private sector entities to reveal that the
world’s super-rich have hidden between $21 and $32 trillion offshore to
avoid taxation.
Henry stated: “This offshore economy is large
enough to have a major impact on estimates of inequality of wealth and
income; on estimates of national income and debt ratios; and – most
importantly – to have very significant negative impacts on the domestic
tax bases of ‘source’ countries.” John Christensen of the Tax Justice
Network
further commented that
“Inequality is much, much worse than official statistics show, but
politicians are still relying on trickle-down to transfer wealth to
poorer people... This new data shows the exact opposite has happened:
for three decades extraordinary wealth has been cascading into the
offshore accounts of a tiny number of super-rich.”
With roughly
half of the world’s offshore wealth, or some $10 trillion, belonging to
92,000 of the planet's richest individuals —representing not the top 1%
but the top 0.001% — we see a far more extreme global disparity taking
shape than the one invoked by the Occupy movement. Henry commented: “The
very existence of the global offshore industry, and the tax-free status
of the enormous sums invested by their wealthy clients, is predicated
on secrecy.”
In
his 2008 book,
"Superclass: The Global Power Elite and the World They Are Making,"
David Rothkopf, a man firmly entrenched within the institutions of
global power and the elites which run them, compiled a census of roughly
6,000 individuals whom he referred to as the “superclass.” They were
defined not simply by their wealth, he said, but by the influence they
exercised within the realms of business, finance, politics, military,
culture, the arts and beyond.
Rothkopf noted: “Each member is set
apart by his ability to regularly influence the lives of millions of
people in multiple countries worldwide. Each actively exercises this
power and often amplifies it through the development of relationships
with other superclass members.”
The global elite are of course not
defined by their wealth alone, but through the institutional,
ideological and individual connections and networks in which they wield
their influence. The most obvious example of these types of institutions
are the multinational banks and corporations which dominate the global
economy. In the first scientific study of its kind, Swiss researchers
analyzed the relationship between 43,000 transnational corporations and
“identified a relatively small group of companies, mainly banks, with
disproportionate power over the global economy.”
In
their report,
"The Network of Global Corporate Control, researchers noted that this
network – which they defined as "ownership" by a person or firm over
another firm, whether partially or entirely – “is much more unequally
distributed than wealth” and that “the top ranked actors hold a control
ten times bigger than what could be expected based on their wealth.” The
“core” of this network – which consists of the world's top 737
corporations – control 80% of all transnational corporations (TNCs).
Even
more extreme, the top 147 transnational corporations control roughly
40% of the entire economic value of the world’s TNCs, forming their own
network known as the “super-entity.” The super-entity conglomerates all
control each other, and thus control a significant portion of the rest
of the world’s corporations with the “core” of the global corporate
network consisting primarily of financial corporations and
intermediaries.
In December of 2011, the former deputy secretary
of the Treasury in the Clinton administration, Roger Altman, wrote an
article for the Financial Times in which
he described financial
markets as “a global supra-government” which can “oust entrenched
regimes... force austerity, banking bail-outs and other major policy
changes.” Altman said bluntly that the influence of this entity “dwarfs
multilateral institutions such as the International Monetary Fund” as
“they have become the most powerful force on earth.”
With the
formation of this “super-entity” – a veritable global supra-government –
made up of the world’s largest banks and corporations exerting immense
influence over all other corporations, a new global class structure has
evolved. It is this rarefied group of individuals and firms, and the
relations they hold with one another, that we wish to further
understand.
According to
the 2012 report,
"Corporate Clout Distributed: The Influence of the World’s Largest 100
Economic Entities," of the world’s 100 largest economic entities in
2010, 42% were corporations while the rest were governments. Among the
largest 150 economic entities, 58% were corporations. Wal-Mart was the
largest corporation in 2010 and the 25th largest economic entity on
earth, with greater revenue than the GDPs of no less than 171 countries.
According to the
Fortune Global 500 list of corporations for
2011, Royal Dutch Shell next became the largest conglomerate on earth,
followed by Exxon, Wal-Mart, and BP. The Global 500 made record revenue
in 2011 totaling some $29.5 trillion — more than a 13% increase from
2010.
With such massive wealth and power held by these
institutions and "networks" of corporations, those individuals who sit
on the boards, executive committees and advisory groups to the largest
corporations and banks wield significant influence on their own. But
their influence does not stand in isolation from other elites, nor do
the institutions of banks and corporations function in isolation from
other entities such as state, educational, cultural or media
institutions.
Largely facilitated by the cross-membership that
exists between boards of corporations, think tanks, foundations,
educational institutions and advisory groups — not to mention the
continual "revolving door" between the state and corporate sectors —
these elites become a highly integrated, organized and evolved social
group. This is as true for the formation of national elites as it is for
transnational, or global, elites.
The rise of corporations and
banks to a truly global scale – what is popularly referred to as the
process of “globalization” – was facilitated by the growth of other
transnational networks and institutions such as think tanks and
foundations, which sought to facilitate these ideological and
institutional structures of globalization. A wealth of research and
analysis has been undertaken in academic literature over the past couple
of decades to understand the development of this phenomenon, examining
the emergence of what is often referred to as the "Transnational
Capitalist Class" (TCC). In various political science and sociology
journals, researchers and academics reject a conspiratorial thesis and
instead advance a social analysis of what is viewed as a powerful social
system and group.
As Val Burris and Clifford L. Staples argued in
an article for the International Journal of Comparative Sociology (Vol.
53, No. 4, 2012), “as transnational corporations become increasingly
global in their operations, the elites who own and control those
corporations will also cease to be organized or divided along national
lines.” They added: “We are witnessing the formation of a ‘transnational
capitalist class’ (TCC) whose social networks, affiliations, and
identities will no longer be embedded primarily in the roles they occupy
as citizens of specific nations.” To properly understand this TCC, it
is necessary to study what the authors call “interlocking directorates,”
defined as “the structure of interpersonal or interorganizational
relations that is created whenever a director of one corporation sits on
the governing board of another corporation.”
The growth of
“interlocking directorates” is primarily confined to European and North
American conglomerates, whereas those in Asia, Latin America and the
Middle East largely remain “isolated from the global interlock network.”
Thus, the “transnationalization” of corporate directorates and,
ultimately, of global class structures “is more a manifestation of the
process of European integration – or, perhaps, of the emergence of a
North Atlantic ruling class.”
The conclusion of these researchers
was that the ruling class is not “global” as such, but rather “a
supra-national capitalist class that has gone a considerable way toward
transcending national divisions,” notably in the industrialized
countries of Western Europe and North America; in their words, "the
regional locus of transnational class formation is more accurately
described as the North Atlantic region.” However, with the rise of the
"East" – notably the economic might of Japan, China, India, and other
East Asian nations – the interlocks and interconnections among elites
are likely to expand as various other networks of institutions seek to
integrate these regions.
The influence wielded by banks and
corporations is not simply through their direct wealth or operations,
but through the affiliations, interactions and integration by those who
run the institutions with political and social elites, both nationally
and globally. While we can identify a global elite as a wealth
percentage (the top 1% or, more accurately, the top 0.001%), this does
not account for the more indirect and institutionalized influence that
corporate and financial leaders exert over politics and society as a
whole.
To further understand this, we must identify and explore
the dominant institutions which facilitate the integration of these
elites from an array of corporations, banks, academia, the media,
military, intelligence, political and cultural spheres.
Andrew
Gavin Marshall is an independent researcher and writer based in
Montreal, Canada. He is Project Manager of The People’s Book Project,
head of the Geopolitics Division of the Hampton Institute, Research
Director for Occupy.com’s Global Power Project and hosts a weekly
podcast show at BoilingFrogsPost.
No comments:
Post a Comment