It’s been a great few decades for the world’s largest corporations:
• Out of the top 100 economic units on the planet, 51 are corporations. The other 49 are countries.1
• Trade between subsidiaries within the same parent corporation now accounts for roughly a third of world trade.2
• While the top 200 corporations account for over a quarter of economic activity on the planet, they employ less than 1% of its workforce.1
• In 1970 there were approximately 7,000 corporations operating internationally. Today there are approximately 60,000 transnationals with over half a million foreign affiliates.3
• The top 200 corporations’ sales levels are 18 times the combined annual income of the 1.2 billion poorest people.1
Follow the money
• The global economy is dominated by international financial capital. It’s not so much McDonald’s or Nike that rule the world, but the international giants of the banking world like JP Morgan Chase and Citigroup.
• Before 1970, an estimated 90% of all international transactions were accounted for by trade, and only 10% by capital flows. Today, despite a vast increase in global trade, 90% of transactions are accounted for by financial flows not directly related to trade in goods and services.5
• $1.5 trillion change hands every day through currency trading; 97% of all currency trades are for speculative purposes, rather than to fund the exchange of ‘real’ goods and services.5
Forget the free market – merge!
• Of the 100 largest announcements of mergers in history, 84 occurred during the years 1996-2000.4
• A third of the US Fortune 500 companies listed 20 years ago were bought out by 1990 and another 40% were merged by 1995. In the past five years the pace of corporate extinctions has surpassed the loss of livestock breeds.6
• Mergers and a proliferation of strategic partnerships among corporations are giving a few producers an undue amount of influence on the market. Market power often also translates into political influence. The current cascade of mergers is bolstered by the broad trend toward privatization of state-owned companies and public infrastructure, deregulation and the liberalization of trade, investments and capital markets.2
Join the government – revolving doors & advisory groups
• Former corporate executives commonly head regulatory agencies. When bureaucrats quit government service they are often hired by corporations – many go on to lobby their former colleagues on behalf of their new employers. Corporate executives serve in cabinets and ministries.4
• In the US, more than three-quarters of the 205 Cabinet secretaries appointed between 1897 and 1972 were directors of corporations or came from corporate law firms.4
• Advisory committees appointed by many governments are dominated by corporations and industry associations, linking private interests to public authorities.4
• Oxfam estimates that developing countries lose tax revenues of at least $50 billion a year due to tax competition and the use of tax havens.
• In 1994, 26% of assets and 31% of US transnationals’ profits were located in tax havens.8
• 44 of the US corporations on the world’s top 200 list did not pay the full 35% corporate tax rate during the period 1996-98.1
• Seven of the firms actually paid less than zero in federal income taxes in 1998 because they received rebates that exceeded the amount of taxes they paid. These include: Texaco, Chevron, PepsiCo, Enron, Worldcom, McKesson and General Motors.1
• Direct government grants and tax breaks from the US federal budget add up to subsidies to corporations of around $100 billion every year. A more complete measure of subsidies includes externalities, eg health-care costs of smoking and automobile use; the cost of repairing buildings damaged by air pollution; costs to consumers of price-fixing conspiracies; military contract fraud. These are benefits to industry at the expense of some other sector of society or the environment.4
• All US corporate profits total about $500 billion per year, yet a conservative estimate of the externalized costs of industry runs to about $2.5 trillion per year. Thus corporate profits are dwarfed by externalized costs by a factor of 1 to 5.9
World corporations spare no expense to get their voices heard in the places that matter.
- Top 200, Institute of Policy Studies 2000.
- Vital Signs 2000, Worldwatch Institute.
- UNCTAD Reports 1998, 1999.
- Draffan, George, Report on Corporations.
- Jubilee Plus.
- ‘Politics and Persuasion’, The Janus Programm
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