Lords of the Global Economy: Stateless Corporations

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In the noise and nastiness of the election just past, it was not widely noted that the world's 358 billionaires have a combined net worth of $760 billion, equal to that of the bottom 45 percent of the world population; or that the average C.E.O. in the United States now brings home about 149 times the average factory worker's pay, or that in recent years an estimated 18 percent of American workers with full-time jobs earned poverty-level wages, or that every other black baby in America is born into a family living below the poverty line, or that, since 1973, the number of American children living in poverty has increased by 50 percent, so that 22 percent now grow up poor, and the number keeps increasing.

Despite such statistics and many more like them, it remains an article of faith among most politicians and in boardrooms that what is good for General Motors is still good for America. Yet global corporations chartered in Delaware and flying the American flag now see themselves, even advertise themselves, as "stateless." Corporate executives disavow any special relationship to the United States or to its people. As Martin Davis, former chairman of Paramount Communications, put it, "You can't be emotionally bound to any particular asset." As mega-companies search the world for bargain labor, sell their stock on exchanges from London to Hong Kong and pin more and more of their hopes on customers in the emerging markets, most of them in Asia, they are walking away from the enormous public problems their private decisions create for American society.

At the same time, the influence of business giants over the daily lives of Americans is growing as ownership of the media is concentrated in fewer and fewer corporations, while big money plays an ever more decisive role in the political process. With the continuing decline of unions in the private sector, widespread disillusionment with government and the resurrection of unfettered free-market ideology, transnational corporations now exercise more power over the U.S. political system than at any time since the early decades of this century.

Because of the growth of corporate power, the accountability of private enterprises to workers, managers and the communities where they operate has declined markedly in the past twenty years. More than a quarter of the world's economic activity now comes from the 200 largest corporations. Up to a third of all world trade takes place among different units of a single global company. This means that prices are set not by the mystical forces of the free market but by corporate administrators who can arrange to have …