When corporations rule the world

Reviewed by Rabab Naqvi


When corporations rule the world is not the cry of some banner-carrying, placard-waving left-winger against the current economic order whose genuine concerns are usually condemned by corporations and governments alike as nothing more than the venting of their own personal failures and frustrations. This is an in-depth analysis by a person with impeccable credentials.

David Korten’s academic credentials include an MBA and a PhD. He has been associated with prestigious institutions such as Harvard and Stanford. Through his involvement with the US Agency for International Development, he has been able to gain personal insight into the real impact of the misguided economic policies and failed models of economic development in Asia and Africa. He is an associate of International Forum on Globalization, publisher of Yes and co-founder of Positive Future Network. The powerful and mighty cannot dismiss this book as nothing more than an expression of cynicism and despair. This is a serious and incisive study by a sensitive and caring person.

First published in 1995, it was well received by enlightened political and business leaders, consumer advocates and activists. The Financial Times (London) listed it as the ‘must-read’ book and Toronto’s Globe and Mail hailed it as the book that could make this world a better place for all of us. It sold over 90,000 copies in thirteen languages within five years of its release. This revised and updated version has three new chapters and an epilogue which outline alternatives to the present mess. The detailed proposal for change includes guaranteeing an adequate income for everyone. The book ends on an upbeat mood with hope of a better future however remote it may be.

It is not all doom and gloom. If corporations are raping the earth and depriving the people of any shred of dignity and security, the counter movement is also picking up steam. Cultural awakening is changing the way people think. In America, David Korten lists 26 per cent of the population or 50 million comprising the ‘cultural creatives’ and the number is growing. The term is derived from a book by the same title which deals with the awakening of the cultural consciousness in America. The awareness is also growing around the world. In Beirut the counter-congress, “Our world is not for sale”, was organized from November 6 to 8.

Consumerism may or may not be the path to happiness for some. It is definitely the path for spiritual, emotional, and moral bankruptcy for all. In 1992, in its article, “Pollution and the poor,” The Economist justified the dumping of the pollution on the poor countries by the rich countries on the grounds that it provided economic opportunities to the otherwise deprived.

Since September 11, activists and an increasing number of ordinary people are connecting terrorism not so much to fundamentalism as to economic deprivation. Like David Korten, these people are also very critical of the World Trade Organization, International Monetary Fund and the World Bank. These institutions instead of fighting poverty are justifying their existence by exploiting the poor for the benefit of the rich. As David Korten says, the corporate culture has elevated the ‘pursuit of greed’ to the ‘level of a religious mission’. It is destroying democracy, undermining human rights and stripping the powerful of social and moral consciousness.

Just one example will suffice. In 1989, James Stewart, CEO of Lone Star Industries, laid off workers and cut off their dividends. But he still did not let go the 2.9 million dollars expense account for himself.

It is only once in a while that we come across a book such as When corporations rule the world. This brilliant, penetrating, courageous, rational, and path-breaking study torments the soul, agitates the mind, evokes the civic consciousness and uplifts the spirit. It is not an ordinary book, it is an eye-opener. David Korten’s message is precise and clear. “We must break through the veil of illusion and misrepresentation that is holding us in self-destructive cultural trance and get on with the work of re-creating our economic systems in service to people and the living earth.”

It is a blueprint for the twenty-first century. A framework for maintaining the right balance between the natural world and its inhabitants. It is an agenda for change and community empowerment. Scholarly and engaging, it draws on everyday life and human experiences not on boring statistical surveys and planning models. It is rich in both historical background and recent events. The history of corporations is covered from the days of the British and Dutch trading companies in the fifteenth and sixteenth centuries to the present. With computerization books do not go out-of-date by the time they are printed. The information is current, detailed and at times lively.

Did you know that whenever Henry Kissinger goes travelling he sends his dog, Amelia, to Maryland in a limousine to stay as a houseguest in a private room?

Naomi Klein’s No logo has been called the Das Kapital of the anti-corporate movement and When corporations rule the world has been referred to as the bible of the living democracy movement. More appropriately it should be called the bible of the movement with no name. The anti-globalization movement though strong has yet to organize under one name. Naomi Klein is also very critical of globalization, but offers no concrete proposal for change.

David Korten has many realistic and practical suggestions. It is surprising that he does not attach much importance to the power of the poor, ordinary workers around the world who are coming together under the brand identity.

With travel and free flow of information there is a new awareness, people are able to see through the system that exploits them and are not willing to accept their lot as the will of God. They may be powerless, but they are well aware of their rights.

Political and business leaders will be wise to heed its message of a civil society and not to ignore this exposition as an idealistic discourse. This book will appeal most to people who want a point of view other than those published by the advocates of globalization: Fortune, Business Week, Forbes, The Wall Street Journal and The Economist.

When corporations rule the world
By David Korten
Berrett-Koehler Publishers, Inc. and Kumerian Press
ISBN 1-887208-04-6
408pp. $15.95

A study in revolution

By Sami Saeed


Revolutions are important landmarks in the history of civilization although the process of social and political change goes on continuously. The forces of continuity are constantly pitted against those of change. It is not possible to maintain the status quo beyond a certain point, as every system generates its own contradictions. Revolutions occur when progressive forces are too dynamic to be controlled.

The French revolution (1789-1799), that not only sealed the fate of feudalism in Western Europe but also generated modern ideas of democracy and liberalism throughout the world, was the culmination of a process that had started three centuries earlier. The power of the privileged classes, the nobility and the clergy, had gradually eroded under the expanding wealth and influence of the bourgeoisie. The winds of change started to blow in the fourteenth century when Europeans engaged in trade on an ever increasing scale and towns began to emerge all over the continent. The clergy and the nobility were confronted by a new class rapidly growing in power and resources. This was the middle class consisting of tradesmen and professionals seeking social status and political power commensurate with their newly acquired wealth.

A third element was the monarchy. The monarchs had traditionally been engaged in an internal struggle for power with the turbulent nobility but their own authority was deeply embedded in the feudal system. The monarchies, faced by this dilemma, reacted mainly in two ways. Where the monarch and the middle class stood together against the feudal aristocracy, the way was paved for a steady political evolution. This underlay the peaceful evolution of constitutional monarchy in England, where the monarch played into the hands of the feudal aristocracy to deny the bourgeoisie their share of social recognition and political authority. In France the monarch, irresolutely wavering between the assertive bourgeoisie and the obstinate aristocracy, set the stage for a bloody revolution that swept both the monarchy and the nobility out of political power. The revolution steered by the bourgeoisie and supported by peasants and urban riffraff generated its own momentum and ignominiously led to dictatorship. The revolutionary army secured victories and suffered setbacks on the battlefield against conservative Europe and at home Napoleon Bonaparte rode the crest of absolute power that even monarchs would envy.

Vaulting personal ambition combined with revolutionary ardour to determine Napoleon’s actions and led him through a hectic life of romance and adventure to a lonely death on the remote and rocky island of St Helena. The revolution passed through various vicissitudes, from republicanism through terror to benevolent despotism. But revolutionary ideals proved irresistible and caught the imagination of the modern world and became the very basis of its society, politics and culture.

Revolutions are extremely complex movements in which events, personalities and institutions interact in unprecedented situations. As such, it requires minute analysis of historical facts to identify the true face of a revolution. Historians of the French revolution have advanced three main theories on the genesis of this upheaval.

First, it has been looked upon as the doing of an active minority who, having imbibed the sceptical spirit of the age, wanted to overthrow established institutions. Secondly, it has been considered as an expression of popular aspiration for political reform. Lastly, it has been held that the origins of the revolution lay in the widespread dissatisfaction of the underprivileged classes which struggled to rectify the injustices to which they were being subjected.

The British statesman Edmund Burke put forward the conspiracy theory in his Reflections on the revolution in France published in 1790. He regarded monarchy and aristocracy as sacred institutions that a mischievous minority poisoned by the doctrines of the philosophes sought to overthrow. This view obviously reflects the conservative bias of Burke; it is also out of tune with the universally accepted fact that the revolution was fairly broad-based and involved a vast majority of the French people. It would also be unfair to consider the philosophes the villain of the piece, as their role in the making of the revolution could hardly be overemphasized.

The philosophes were a group of French writers and intellectuals who popularized the ideas put forth by contemporary philosophers. Prominent among them were Fontenelle, Bayle, Voltaire and Diderot. Though men of divergent views and interests, they were all imbued with the sceptical spirit of the age. They criticized traditional Christian faith, protested against injustice and intolerance, upheld the rights of man and the rule of law, and deeply cherished the freedom of opinion. Voltaire made a scathing indictment of the superstitious aspects of Christianity: “Ecracez l’infame! (wipe out the infamous thing)”. Diderot wrote in the first volume of his Encyclopedie: “No one man has received from nature the right of commanding others.” There is no doubt that the philosophes contributed to the general climate of doubt about traditional values and institutions but they were basically reformists.

The intellectual impetus of the revolution in fact came not so much from the nagging scepticism of the philosophes as from the romantic movement sparked by Rousseau, developed by German idealists and inspired by a new school of English poets. In his Discourse on inequality, Rousseau held that man is naturally good, that inequality is caused by privileges authorized by convention, and that all men should be made equal before law.

What lends weight to the second explanation is a widespread dissemination of democratic ideas in Western Europe throughout the eighteenth century. Spearheaded by the middle class as they made a determined bid to capture political power, the rising spurred forward under the stimulus of patriotic sentiment triggered by foreign invasion of the motherland. Thomas Carlyle, though writing from an opposite standpoint, called the revolution a tragedy of the frenzied mob.

Marxist historians, taking their cue from De Tocqueville, trace the genesis of the revolution to sharp class distinctions in French society. There were mainly three social classes at that time: the clergy was the first estate, the nobility the second and the commoners the third. A tiny aristocracy was poised on the mass of the people. It was a highly ascriptive society in which class entailed a host of rights and privileges that were denied to the lower strata of people.

The clergy possessed large land holdings that amounted to one fifth of the total landmass of the country. They also received from their landed parishioners a tax called tithe. The clergy rolled in wealth and lived in luxury. The nobles were also a landholding class and occupied elevated positions in government. The commoners at the base of the social pyramid were mostly townsmen and peasants. The tillers of the soil constituted an overwhelming majority. The townsmen included not only merchants but also professionals. They were the most vocal and enterprising section of society.

The peasants chafed under the triple burden of taxation. They paid customary dues to the nobility, tithe to the clergy and a host of taxes and levies to the king. They were the most depressed section of society.

The whole system was based on discrimination involving privileges and immunities for the clergy and the nobility. The commoners were burdened with taxes and levies imposed by both and denied their rightful share of representation in civil and military establishments. Rightly was it said that the clergy prayed, the nobles fought and the commoners paid. The first two estates numbered half a million out of a total population of 26 million but owned most of the land and monopolized high positions in church and state. The peasants believed that they could earn a decent living from the fertile French soil but for the triple burden of taxation slapped on them by a parasitical minority. Against this background of sharp class cleavages, French society was bound to disintegrate.

Although a complex of motivational forces lay behind the revolution, it could not have ignited without the undertow of popular resentment against the privileged classes. This was translated into action as peasants in rural areas and commoners in towns found leaders in the middle class who nurtured political ideals and aspirations. The social background of the revolution was as unmistakable as perhaps its almost universal popularity in France, but both the facts militate against the highly prejudiced version of Burke.

No minority, however active and enterprising, could trigger such a powerful and profound movement as the French revolution without popular support.

The current of revolutionary ferment rode high in France and even spilled over into the neighbouring countries, but the old order of things was too deeply entrenched to be overthrown summarily. The counter-revolution petered out and it was around the middle of the nineteenth century that Western aristocracy finally succumbed in an industrialized Europe.

The French revolution ran a chequered course but it was a unique event of far-reaching consequences for modern history. Its most enduring legacy was the Declaration of the Rights of Man and Citizen which held aloft the liberal values that distinguish modern culture — rule of law, equality of opportunity, intellectual freedom. It engraved the ideals of liberty, equality and fraternity on the minds of men.