[TLDR (too long didn’t read): This Reader is about rich people who never forget they are rich and control things accordingly highlighting the implications of this for human rights. For a quick overview, just read the bolded text].
It is laws that actually create wealth and inequality (Katharina Pistor, Jomo Sundaram)
1. When plunder becomes a way of life for privileged groups of men in society, in the course of time, they create for themselves a legal system that authorizes the plunder, as well as a moral code that glorifies it. (Frederic Bastiat, 1801-1850)
2. Laws have been crucial to the creation of capital so that capital continues to survive, evolve and enhance its ability to ‘make money‘, or secure wealth legally, i.e., under the wings of the law (totally disregarding human rights…). Legal coding serves capital well –it privileges those with capital nationally and transnationally, e.g., with laws governing trusts, taxes, corporate governance, bankruptcy, contracts and other property laws. And then, surprise-surprise, capital creates more wealth —actual laws being the enablers of such transactions as those involving property, ownership and entitlements.*
*: According to Thomas Piketty, capitalism’s history can be understood as the history of seeking property ownership.
3. Capital is created behind closed doors, in the offices of private attorneys. Codifying capital into law worsens inequality between capital and especially labor –and this backed and enforced by the state. Successful lobbyists are hired to influence the legislative process, catering to the evolving nature and needs of capital. Lawyers then defend the law by legitimizing it, defending any challenges, or attempts to criticize and reform ad-hoc laws. They often opt-for and prefer going for private settlements that are cheaper than lengthy lawsuits, i.e., settlements costing way less the money that was made. In the era of unfettered globalization, private interests increasingly choose legal systems to suit their needs.
4. The World Trade Organization, trade agreements, foreign direct investment and other assorted treaties have become crucial means for extending legal coding beyond national jurisdictions –wither human rights (HR). Legal codes –essentially ideological constructs– consolidate, define and transform social relations in order to advance, extend and accelerate capital accumulation. (Pistor and Sundaram)
Rich people never forget they are rich (V.S. Naipaul, A Bend in the River)
-“A billion here, a billion there, and soon enough you’re talking real money.” (late US senator Everett Dirksen)
5. The pattern of increasingly concentrated wealth and power among the top 0.1% is a feature –not a bug– of the neoliberal system that has dominated for the last 40 years. (Kate Donald et al, A Rights-Based Economy: Putting People and Planet First, CESR, 2020)
6. The richer you are, the more you influence the allocation of resources. The marketplace is the realm of the plutocracy: it is the rule of the rich where each consumer unknowingly influences what gets produced, because it depends on how much s/he is prepared to spend. Their purchasing behavior steers the direction of the market. (T. Scitovsky) So, it is the capacity of capital to uninterruptedly create new relative needs that ends up making these needs absolute thus fueling the disastrous and ominous wheels of the consumer society. (Jacques Luzi, Aurélien Berlan)
7. Greed also fuels privatization and, in essence, the privatization mantra promoted by those rendered rich is actually an ideology; it is not an economic policy; it is a belief that governments ought to step back and let the private sector run the show. In this way, governments wash their hands of their HR obligations and get away easily passing the most relevant issues to the private sector. (Philip Alston)
‘Greed is good…’
8. Governments have a responsibility to regulate business actors**, ensuring that people are protected from any damage corporations may do –and do. Authorities must (but do not) prevent, investigate and punish the greed, as well as ensuring HR abuses committed by transnational corporations. [The UN is right now debating a binding treaty on this]. (K. Donald et al, ibid)
**: You know your country is dying when you have to make a distinction between what is moral and ethical, and what is still legal yet unregulated. (John de Armond) You also know that, instead of being regulated, corporations have been and are being bailed out of the dungeons by many a guilty-feeling-liberal-ruler who feels this is a reason for them to be congratulated. But how are the world and HR advanced by this?
9. Bottom line here is that corporate capitalism*** prevents profit-maximizing corporations’ behavior from maximizing societal welfare –if not actually causing the opposite. ‘The only business of business is business’, Milton Friedman famously said. Maximizing profits for shareholders, for him, justified ignoring all problems due to corporate practices; this legitimized a ‘greed-is-good’**** behavior. Friedman would have had us believe that power and politics are not key in free markets. But this ostensible insulation of politics and of HR from supposedly-power-free markets is but a fiction (and an insult to our intelligence). Period. (J. Sundaram)
***: The curse of the raw materials: For centuries, they awakened colonial avarice and greed and the implacable exploitation of natural resources –to start with by the colonial powers and then by transnational corporations. People in the countries rendered poor are poor, because the soil they walk-on is rich. (Eduardo Galeano)
****: Corporate capitalism proponents argue that companies have responsibilities to all stakeholders, not only shareholders, but also employees, customers, society and even nature.(?) But ‘stakeholders’, are typically and purposely ill-defined. This effectively gives companies ‘moral cover’ to be ruthless, free and unregulated to pursue their own interests at the expense of the public good while not worrying about society’s larger interests. (J. Sundaram)
10. Some die-hard capitalists even argue that corporate social responsibility (CSR) is based on the ‘socialist’ view that political, not market mechanisms are better for allocating scarce resources to alternative uses. They overlook the fact that CSR has also been invoked to justify wage curbs against trade union demands, ostensibly for some ‘higher’ public purpose. CSR has also been used for advancing public relations and marketing, e.g., by ‘greenwashing’ products and services. Capitalism may well be the only ‘show in town’ for some time to come. But popular demands for more thoroughgoing reforms, for better checks and balances and for HR are likely to grow as the devious realities of capitalism and of CSR become increasingly apparent. (J. Sundaram)
Claudio Schuftan, Ho Chi Minh City
Your comments are welcome at schuftan@gmail.com
All Readers are available at www.claudioschuftan.com
Postscript/Marginalia
I found the following aphorisms to be fitting here:
-Alan Greenspan dixit: “To fix the catastrophe of capitalism what is required is to add a bit more of capitalism”.
-A virus is a microscopic, a-cellular infective agent that can only replicate inside the cells of another organism –exactly the way capitalism does it… (Louis Casado)
–Corona is the virus. Capitalism is the pandemic. (graffiti in Santiago, Chile)
–Assorted intentional deceptive blabber used by the guardians of the paradigm:
- If they do not want to say capitalism, they will say market economy.
- If they do not want to say countries rendered poor, they will say developing countries.
- If they do not want to say people rendered poor, they will say people of limited resources.
- If they do not want to say firing without compensation, they will say flexibilization of the labor market.
- If they do not want to say recession, they will say negative growth.
- If they do not want to say blue collar employees, they say ‘service providers’. [This is the way labor laws can be bypassed: no maximum working hours, no labor unions, no social security, nothing; just a mere wage (Ahh!, but you can do with your wage whatever you want…Ain’t that nice?)]. (L. Casado)
- Shit jobs, they will call mini-jobs.
- Mass firings they will call employment regulation.
- Forced migration due to poverty or strife, they will call external mobility.
- Rescue of the banking system, they will call loans with very favorable terms with no costs to taxpayers.
- Salary cuts, they will call salary moderation. (Fabián Barrio)
- Torture they will call illegitimate emergency procedures. (L. Casado)
- Forceful evictions they will call population resettling (or rectification of borders).
- Jailing without trial or summary executions they call elimination of suspected elements.