tem. We still have a tax system, a monetary policy, an employment policy, and a trade policy that are barely adequate for controlling national firms at a time when big business has gone global. There has thus developed a structural lag between the public and private sectors of our social system. The very machinery of government, whoever operates it, is currently inadequate to cope with the globalization of Big Business. As we shall see, the government planners do not have enough knowledge about the activities of global corporations to make the crucial planning decisions for the society. Thus the managers of the corporations have become the principal planners for the society by default.
It has been a persistent theme of this book that knowledge is the critical component of power. In Latin America, as we saw, global companies are able to build their power and, at an accelerating rate, to neutralize government control because their near monopoly of the technologies of production, finance, and marketing permits them to elude government's relatively feeble efforts to regulate them. The same power that enables corporations in Latin America to conceal their ownership, plans, and intracorporate dealings and hence frustrate government control over them operates also in the United States. It is one key structural reason, in our view, why the world's richest society is looking more and more like an underdeveloped country.
Existing disclosure requirements are hopelessly inadequate to permit government to exercise power over global corporations. In March 1972, to give one example, Senator Lee Metcalf attempted to obtain from the Securities and Exchange Commission a list of the largest shareholders of what are probably the two most strategic companies in the American economy, GM and Exxon, and was told that the Commission did not have that information. When the Senator wrote the companies directly, he was told that the information was "privileged and confidential." The U.S. Government now has no way of knowing how and by whom the largest corporations in the country are controlled.
But the business-government interlock has been so strong that controlling the misuse of corporate power has been something less than an obsession. The dominant role of Big Business in both political parties, the financial holdings of certain key members of Congress, the ownership of the mass media, the industry-government shuttle in the regulatory agencies, and, most important, the ideology prevailing throughout the society of salvation through profits and growth all help to explain why the government of the world's mightiest nation musters so little power to protect the interests of its people.
James O'Connor. International corporations and economic underdevelopment.
United States, European, and Japanese international corporations presently own or directly control between 20 and 30 per cent of the monetized resources in the underdeveloped countries (including Canada). Indirect control of local capital in Asia, Latin America, and Africa is equally pervasive: the mobilization of local capital,1 control of subcontractors and other suppliers, "management contracts" which afford foreign capital day-to-day control of joint ventures,2 and licensing agreements which restrict the use of technology by prohibiting "fundamental investigation and research"3 extend the sway of foreign capital still further, and multiply the quantitative impact of the international corporations on the misutilization of resources abroad.
The general reasons for the expansion of foreign capital during the 1950s and 1960s, especially capital organized by the giant United States international corporations, are