Corporate crime wave: Australia's epidemic of corporate criminality

“As crimes pile up they become invisible”

Bertolt Brecht

“Corporate crime poses a significant threat to the welfare of the community. Given the pervasive presence of corporations in a wide range of activities in our society, and the impact of their actions on a much wider group of people than are affected by individual action, the potential for both economic and physical harm caused by a corporation is great.”

Law Reform Commission of New South Wales

In two recent submissions, I argue that Australia is in the wake of a global and national epidemic of corporate and business malfeasance, lawlessness and criminality, and has become a haven for corporate and white collar crime.

Crimes committed by those at the top of the corporate (and political) hierarchy are routinely ignored or brushed under the carpet and Australia governments and the various regulatory authorities have failed to take action against increasingly egregious and escalating levels of unlawful and criminal conduct by corporations and business.

One submission was to an Australian Senate Inquiry into Penalties for White Collar Crime (which has since lapsed because of the government's dissolution of both houses.) My submission is available here as Submission No 18 under the banner of the Nemesis Project which I coordinate.

The second submission was to the Federal Attorney's General's public consultation on Deferred Prosecution Agreements for corporate and business crime (submission is not yet publicly available but will be here).

In the submission to the Senate Inquiry into Penalties for White Collar Crime, I argue that:

• Over recent decades legal and regulatory systems have been dismantled or loosened to remove constraints against corporate and investor profit-making and profit-taking.
• Corporate and white-collar crime is traceable to a gross failure of the law. Legal constraints have been cast aside or not applied to their fullest. Corporations and business groups have worked to limit the effectiveness of efforts to stamp out corporate crime. They make it more difficult to prosecute crimes.
• Corporations and business have actively subverted the law, as well as government regulation and ethical standards, in order to maximize their profits and ensure that resources flow to them. There has been a pervasive legal and political failure to control unlawful conduct by corporations and business.
• For decades, the regulatory authorities have failed to investigate and take action against corporate and white collar crimes.  Governments, corporate regulators and law enforcement authorities and politicians have been unwilling to take serious action against corporate criminals who knowingly swindle and harm ordinary Australians.
• The dominant response to corporate and business offending has been regulation rooted in co-operation. These strategies work predominantly to the advantage of powerful corporate and business interests.

These views were supported by numerous other submissions to the Senate Inquiry, as well as a recent report by the Australia Institute.

A submission to the Senate Inquiry by the the Economic Consultancy LF Economics provides a damming indictment of corporate criminality and control fraud within the FIRE sector (finance, insurance and real estate).

They contend that systemic criminal activity exists in the FIRE sector, with the full knowledge of all the regulatory authorities and State and Federal governments, and  places consumers at grave risk of having their finances and livelihoods destroyed.

LF Economics calls for much greater enforcement and prosecution of corporate and financial criminality:

Australians have been betrayed by the regulatory agencies’ neglect and continual siding with lenders and corporate management, despite their full knowledge of the catastrophic pain endured by many who have lost their homes, assets and life savings. ….. A strict focus on rules, regulations, standards, codes and penalties will have a negligible effect on control frauds because these crimes are simply ignored in reality. Two decades of fruitless inquiries and tweaking of innumerable rules and regulations has merely contributed to the losses endured by typical ‘mum and dad’ investors, now into many tens (perhaps hundreds) of billions of dollars. The nation already has an abundance of appropriate laws and regulations to contain and dismantle these control frauds, yet regulators are averse to enforcement, rendering these powers null and void.

The Australia Institute report Corporate Malfeasance in Australia shows that corporate malfeasance is endemic and widespread in Australia. Its findings include:

• Budget cuts enacted by the current government have compromised the ability to investigate corporate wrongdoing.
• There are hundreds of cases against corporations and business being pursued by Australian regulators each year, however progress is seriously impaired by the lack of staffing and resources.
•  There are fewer regulators ‘patrolling the corporate beat’ in Australia with government agencies responsible for monitoring corporate wrongdoing and malfeasance having their staffing cut between 14-16% since the 2013-14 Budget.

Despite this corporate crime wave, the Abbott/Turnbull Government is considering introducing a Deferred Prosecution Agreements (DPA) Scheme to give corporations accused of wrongdoing and criminality the opportunity to defer prosecution in exchange for a monetary payment and compliance with a range of conditions. DPAs involve a shift from prosecution to compliance.

A DPA is a contractual agreement between government and a corporate entity that allows government to impose sanctions and set up and monitor institutional changes, in exchange for an agreement that government forego further investigation and corporate criminal indictment.

Governments and regulatory authorities (particularly in the USA and UK) have relied primarily on deferred prosecution agreements, however corporations and business continue to engage in unlawful and criminal conduct. Indeed, the criminality has intensified and become more brazen.

In the US, despite an epidemic of criminality, the authorities have been unwilling to charge and prosecute corporate criminals and one consequence of the adoption of DPA’s, is that Federal prosecutions of corporate and white collar crime is at a 20 year low.

In my submission, I argue that Deferred Prosecution Agreements are no solution to the epidemic of serious corporate malfeasance and criminality that has made Australia a haven for corporate crime.

There is no evidence that DPAs deter corporate and white collar crime and they may, in fact, encourage crime by reducing the threats of prosecution and incarceration. As the number of DPAs rise, the number of prosecutions decline.

My submission opposed the adoption of a DPA scheme in Australia.

Songs of Renown: Billy Bragg interprets Woody Guthrie's 'I Aint Got No Home'

"I mined in your mines and I gathered in your corn
I been working, mister, since the day I was born
Now I worry all the time like I never did before
'Cause I ain't got no home in this world anymore

Now as I look around, it's mighty plain to see
This world is such a great and a funny place to be;
Oh, the gamblin' man is rich an' the workin' man is poor,
And I ain't got no home in this world anymore."

 Woody Guthrie

No one does Woody Guthrie's songs of capitalist plundering and immiseration better than Billy Bragg.

On his most recent album, Tooth and Nail, Billy Bragg does a magnificent cover version of Woody Guthrie's Great Depression era song 'I Aint Got No Home', one of the great political folk songs.

Woody Guthrie composed 'I Ain't Got No Home'  in 1940 and recorded the song in the same year. It first appeared on Woody Guthrie Dust Bowl Ballads Volume 2.

The tune is based on a  traditional hymn titled 'I Can't Feel Home in this World Anymore' that was made famous by the Carter Family.

The song could have been written in the last 8 years. It is all there- people losing their homes to the bankers, people dying for lack of proper health care, the rich making millions by gambling on the stock market while ordinary people's wages go backwards.

The song has a contemporary resonance with its musings about "Now I worry all the time like I never did before/ Cause I ain't got no home in this world anymore", how the “rich man took my home and drove me from my door” and mention of “the banker’s store”.

Earlier versions of Guthrie's song concluded by stating that the hardship expressed in the song is happening to "a hundred thousand others and a hundred thousand more," all of whom were victimized by the more fortunate elite.  Once again, a reflection of what has happened since the 2008 economic crash.

Bragg, like Woody Guthrie, is a singer songwriter who made his name with socio-political songs and his involvement in social movements and political campaigns. Bragg is known as a combative British socialist who doggedly opposed the British Conservative Party and its leader Margaret Thatcher throughout the ’80s and ’90s.

This version of Woody Guthrie's song appears on Billy Blagg's 2013 album Tooth and Nail, which was produced by American singer songwriter Joe Henry whose work has appeared on this blog before.

Woody Guthrie's version of the song is here

The song has also been covered by Bob Dylan and Bruce Springsteen. Springsteen's version (with slightly different lyrics) is here.

I Aint Got No Home

By Woody Guthrie

I ain't got no home, I'm just a-roamin' 'round,
Just a wandrin' worker, I go from town to town.
And the police make it hard wherever I may go
And I ain't got no home in this world anymore.

My brothers and my sisters are stranded on this road,
A hot and dusty road that a million feet have trod;
Rich man took my home and drove me from my door
And I ain't got no home in this world anymore.

Was a-farmin' on the shares, and always I was poor;
My crops I lay into the banker's store.
My wife took down and died upon the cabin floor,
And I ain't got no home in this world anymore.

I mined in your mines and I gathered in your corn
I been working, mister, since the day I was born
Now I worry all the time like I never did before
'Cause I ain't got no home in this world anymore

Now as I look around, it's mighty plain to see
This world is such a great and a funny place to be;
Oh, the gamblin' man is rich an' the workin' man is poor,
And I ain't got no home in this world anymore.

© Copyright 1961  and 1963  by Woody Guthrie Publications, Inc.; TRO-Ludlow Music, Inc.

Thomas Frank on why many Americans support Donald Trump

Thomas Frank has written some smart books on the links between the American political and corporate elite and the concerns and aspirations of everyday Americans, the rise of the political right, the failure of the Democratic liberal elite and why ordinary Americans often support politicians and policies that are counter to their own interests.

In a recent article in the Guardian [1] Frank drills down beneath all the rhetoric and outrage about Donald Trump to explore why large numbers of ordinary Americans support him.

Frank dismisses the simplistic moralizing and manufactured outrage of the media and political commentators who dismiss Trump’s working class supporters as ignorant and ill-informed bigots and racists.

As Frank notes, while Trump appears to be a racist himself, racism is not necessarily what motivates many of his followers. Instead Frank writes:

“A map of his support may coordinate with racist Google searches, but it coordinates even better with deindustrialization and despair, with the zones of economic misery that 30 years of Washington’s free-market consensus have brought the rest of America… ……when people talk to white, working-class Trump supporters, instead of simply imagining what they might say, they find that what most concerns these people is the economy and their place in it”

 

Franks suggests that part of Trump's appeal is that he is telling a tale as much about economic outrage, as it is about racism:

 

"Many of Trump’s followers are bigots, no doubt, but many more are probably excited by the prospect of a president who seems to mean it when he denounces our trade agreements and promises to bring the hammer down on the CEO that fired you and wrecked your town, unlike Barack Obama  and Hillary Clinton".

In a similar vein, Jeff Gupo [2] of the Washington Post argues that it is economic distress among older white people in many parts of the country that is driving many voters toward Donald Trump.

Gupo, who has delved into the connection between white mortality, economic anxiety and support for Trump writes:

"[I]t is nonetheless striking that Trump’s promise to "Make America Great Again" has been most enthusiastically embraced by those who have seen their own life's prospects diminish the most — not [only] in terms of material wealth, but in terms of literal chances of survival."

In his Guardian article, Thomas Frank refers to the findings of a recent study by Working America, an organization associated with US Unions, which interviewed some 1,600 white working-class voters in the suburbs of Cleveland and Pittsburgh in December and January. 

The group found that support for Trump is strong, even among self-identified Democrats and not because people are racist or want a racist in the White House, but because Trump speaks about their number one concern- “good jobs and the economy”.

Of that study Frank writes:

“People are much more frightened than they are bigoted,” is how the findings were described to me by Karen Nussbaum, the executive director of Working America. The survey “confirmed what we heard all the time: people are fed up, people are hurting, they are very distressed about the fact that their kids don’t have a future” and that “there still hasn’t been a recovery from the recession, that every family still suffers from it in one way or another.”
 

Frank cites Tom Lewandowski, the president of the Northeast Indiana Central Labor Council:

“These people aren’t racist, not any more than anybody else is,” he says of Trump supporters he knows. “When Trump talks about trade, we think about the Clinton administration, first with Nafta and then with [Permanent Normal Trade Relations] China, and here in Northeast Indiana, we hemorrhaged jobs.”

“They look at that, and here’s Trump talking about trade, in a ham-handed way, but at least he’s representing emotionally. We’ve had all the political establishment standing behind every trade deal, and we endorsed some of these people, and then we’ve had to fight them to get them to represent us.”

Frank concludes:

"Left parties the world over were founded to advance the fortunes of working people. But our left party in America – one of our two monopoly parties – chose long ago to turn its back on these people’s concerns, making itself instead into the tribune of the enlightened professional class, a “creative class” that makes innovative things like derivative securities and smartphone apps. The working people that the party used to care about, Democrats figured had nowhere else to go, in the famous Clinton-era expression. The party just didn’t need to listen to them any longer.

Yet still we cannot bring ourselves to look the thing in the eyes. We cannot admit that we liberals bear some of the blame for its emergence, for the frustration of the working-class millions, for their blighted cities and their downward spiraling lives. So much easier to scold them for their twisted racist souls, to close our eyes to the obvious reality of which Trumpism is just a crude and ugly expression: that neoliberalism has well and truly failed."[1] Thomas Frank 2016) Millions of ordinary Americans support Trump: here’s, the Guardian, March 7 2016

 http://www.theguardian.com/commentisfree/2016/mar/07/donald-trump-why-americans-support

 [2] Jeff Gupo https://www.washingtonpost.com/news/wonk/wp/2016/03/04/death-predicts-whether-people-vote-for-donald-trump/

 

Learning from the pioneering work of Elinor Ostrom (1933-2012)

 

Three years after her death in 2012 the work of  Elinor Ostrom remains more relevant than ever for those of us campaigning for alternatives to the contemporary orthodoxy of market fundamentalism and neoliberalism.

 

 Ostrom who was a Professor at Indiana University was the first woman to be awarded the Nobel Prize for Economic Sciences in 2009.

Ostrom's work challenged and rebutted fundamental economic beliefs, particularly free market and neo-classical economic paradigms. Ostrom was particularly concerned with  relational aspects of economic activity — the ways in which people interact and negotiate with each other to forge rules and informal social understandings.

Ostrom's early work focused on what she called co-production.

 

Ostrom argued that many public services depend heavily on the contribution of time and effort by the persons who consume these services, i.e. the clients and citizens.

 

Ostrom believed that services rely as much upon the unacknowledged knowledge, assets and efforts of service ‘users’ as the expertise of professional providers. It was the informal understanding of local communities and the on the ground relationships that make services more effective.

Co-production describes the relationship that exist between ‘regular producers’, like health workers, police, and schoolteachers and their ‘clients’ who may be transformed by the services into safer, better educated and/or healthier persons.

Ostrom defined co-production as

 “…the mix of activities that both public service agents and citizens contribute to the provision of public services. The former are involved as professionals, or ‘regular producers’, while ‘citizen production’ is based on voluntary efforts by individuals and groups to enhance the quality and/or quantity of the services they use”

One implication is that privatization of public services and the turning over of services to the market fundamentally transforms the relationship between provider and service user, hampering the development of co-production and democratic governance.

Her later work examined how people and communities collaborate and organize themselves to manage collective shared resources like forests, fisheries and natural and social resources. The research overturned the conventional wisdom about government regulation  and challenged the idea that private ownership of public resources is better and more effective than the public and collective sphere.

Ostrom's work provides clear evidence  that the commons-based traditions of cooperation and communal management of resources is not a violation of basic economic common sense.

Her work undermines political conservatives and mainstream economists who denigrate collectively managed property and government and who argue that only private property and the "free market" can responsibly manage resources.  Her work also directly challenges current ideas that privatization and private ownership and expert management of resources is a more effective strategy than collective and public management

Ostrom advocated a “polycentric” approach to managing shared or common resources involving oversight “at multiple levels with autonomy at each level. She argued that shared management of resources helps to establish rules that “tend to encourage the growth of trust and reciprocity” among people who use and care for a particular commons.

Ostrim argued that key management decisions should be made as close to the scene of events and the people and groups involved as possible. Her work showed that the people most affected by or with a stake in shared or common resources are the ones best able to collaborate to use and manage those shared resources effectively and sustainably.

Her work demonstrates that ordinary people are able to create rules, institutions and systems that ensure the equitable and sustainable management of shared and common resources, what is often called our 'common wealth'.

She demonstrated the importance of shared (collective) rather than expert or private management of resources and knowledge and emphasises the importance of active citizen participation. She cited a comprehensive study of 100 forests in 14 countries that detailed how the involvement of local people in decision making is more important to successfully sustaining healthy forests than who is actually in charge of the forests.

 David Bollier writes of the significance of Ostrom's work:

In the 1970s, economics was quickly veering into a kind of religious fundamentalism. It was a discipline obsessed with “rational individualism,” private property rights and markets even though the universe of meaningful human activity is much broader and complex. Lin Ostrom pioneered a different, more humanistic way of thinking about “the economy” and resource management. She originally focused on property rights and “common-pool resources,” collective resources over which no one has private property rights or exclusive control, such as fishers, grazing lands and groundwater. This work later evolved into a broader study of the commons as a rich, cross-cultural socio-ecological paradigm. Working within the social sciences, Ostrom proceeded to build a new school of thought within the standard economic narrative while extending it in vital ways.

 Ostrom's work also has direct relevance to the current economic and environment crises. She wrote:

"We cannot rely on singular global policies to solve the problem of managing our common resources: the oceans, atmosphere, forests, waterways, and rich diversity of life that combine to create the right conditions for life, including seven billion humans, to thrive.....Success will hinge on developing many overlapping policies to achieve the goals,.......We have a decade to act before the economic cost of current viable solutions becomes too high. Without action, we risk catastrophic and perhaps irreversible changes to our life-support system.”

Articles written in memory of her work are here, here, here and here.

A reading list of her work is here.

The last article she wrote before she died is here

Her last book, published just before her death was titled Working Together: Collective Action, the Commons, and Multiple Methods in Practice, and describes the advantages of using several different research methods to study a problem.

Swiss people take action to cap executive pay and address growing income inequality

The Swiss people are showing that citizens can organize and take action to address growing income inequality by placing restrictions and caps on executive salaries. 

Since the 2008 global financial crises Swiss citizens have set their sights on excessive corporate pay and rising income inequality.

Already public activism by the Swiss people on executive pay has forced two referendums and efforts are underway to force a third referendum. Under Swiss law citizens are able to organize popular initiatives whereby the Swiss Parliament must hold a referendum on any initiative that has gathered more than 100,000 signatures. 

In March 2013 the Swiss voted overwhelmingly to pass some of the strictest controls on executive pay, requiring that public company shareholders vote on compensation for executives.

In November 2013 the Swiss people will get a vote on another proposal to to cap and limit executive pay. The 1:12 initiative will limit executive pay to no more than 12 times the salary of the lowest paid worker. Compare that to the USA which has among the highest levels of income inequality in the world with a CEO to worker pay ratio of 185:1 and here in Australia where the CEO to worker pay ratio is 100:1

Unsurprisingly, corporations and business groups oppose the Swiss  1: 12 initiative claiming that it will abolish prosperity  and is an attack on freedom. Global multinational corporations like GlencoreXstrata  threaten to move their headquarters out of Switzerland if the proposal is passed.

Now Swiss citizens are trying to establish a guaranteed basic income for all citizens. 

On Friday Swiss citizen activists submitted over 130,000 signatures to the Swiss Parliament- enough to call a vote over whether or not to approve the proposal-  to create a law guaranteeing all Swiss nationals a guaranteed basic income of around $2800 per month.  In a public display of support, advocates of the measure tipped over a truck full of 8 million 5-cent coins (one for each citizen of the country.)

Should corporate and business advocates lead NGOs who fight for social justice ?

The  appointment of  Jennifer Westacott, CEO of the Business Council of Australia  as Chair of the Mental Health Council of Australia is further evidence of the trend towards  the "corporate and business takeover" of the not- for- profit sector in Australia.

This "takeover" occurs in many ways and brings the not-for-profit sector closer to the value, agendas and practices of corporate Australia and the business sectors.

One of the many ways this occurs is through the "revolving door" of business and corporate leaders appointed to senior management positions and the Boards of not- for- profit agencies.

The intent of the "takeover" is to harness the not-for-profit and civil society sector (the non- market sectors) so it adopts and serves (and does not challenge) the interests, visions and hegemony of corporate Australia and business interests.

Jennifer Westacott may be eminently qualified and deeply concerned about the mental health of her fellow Australians.

But the Business Council of Australia, the organization she leads, is actively and forcefully pursuing agendas to slash public spending on social security and social spending and promote privatization of public services.

It is hard to see how the CEO of  the Business Council of Australia, a powerful business and corporate lobby group, who argues, advocates and lobbies for policies that are antithetical and hostile to the social justice agenda of the mental health sector could seriously advocate and fight for the interests of the people and stakeholders the Mental Health Council represents and acts on behalf of.

Who can forget the Business Council's campaign to reduce public spending on income support for people with mental health problems struggling to survive on the Disability Support Pension.

As CEO of the Business Council since 2011 Westacott has been an active player in advocating and lobbying to protect and advance the interests of corporate Australia. She is a forceful advocate for what she calls "unleashing the wealth creating parts of the economy"to allow them to pursue endless economic growth.  This requires that social policy become a fundamental plank of, and subservient to economic policy that is  pro-growth, in other words pro-corporate and pro business. 

In the BCA view of the world social policy and the needs of vulnerable and marginalized people are secondary to the interests of  unleashed and unrestrained corporations and business who they claim are the real drivers of economic growth and social prosperity. The BCA and Westacott view is that business and corporations are the ones that really create prosperity and wealth.

Westacott regularly argues the BCA line that it is only by unleashing economic and business growth that social prosperity and the vision of a good society can be achieved. Westacott argues that the Australian mindset and cultural values has to change to support this unleashing of the power of economic growth.

In 2011 Westacott gave the Sambell Oration for the Brotherhood of St Laurence where she laid out her views about social policy. While she was reflecting the views of the Business Council of Australia,  the speech shows how profoundly her world view and vision is shaped by corporate and business ideas that are antithetical and hostile to a not- for- profit sector committed to social justice.

In the Sambell Oration Westacott called for a new partnership between the NGO sector, Government and business and urged the sector to engage in difficult conversations. The real purpose of those conversations was primarily for the NGO sector to adopt and advocate pro- business and pro- corporate policies of the Business Council of Australia that she argued were necessary to ensure wealth creation and economic growth, and ultimately social prosperity.

Westacott called on the NGO sector to support a new social contract, part of which was built upon accepting the BCA  agenda of :

• the need for eonomic growth to be unleashed
• lower corporate and personal taxes
• removal of any "regulation" that restricts profit making
• more flexible labour market
• reducing the size of Government and cutting Government spending

As Bernard Keane argued in Crikey Westacott's interventions in public policy have almost always driven by the self interest of the business community and corporate Australia.

The decades long neglect of the needs and well being of people with mental illness and their family members, carers and people affected has partly been the result of the dominance in public policy circles of the sort of "market fundamentalist" (neo-liberal) policy ideas that Jennifer Westacott and the Business Council of Australia advocate.

What on earth leads NGOs to think that corporate and business advocates and lobbyists who advocate for market fundamentalist policies are the best people to fight for and speak on behalf of some of the most vulnerable and disadvantaged people?

Arundhati Roy : Imagining a World Beyond Capitalism and Communism

"The dilemma for the writer, I think, is how to spend your life honing your individual voice and then, at times like this, to declare it from the heart of a crowd. That tension, that balance, is something I think about quite often"
Arundhati Roy

Arundhati Roy is one of India's most articulate and high profile radical intellectuals and political dissidents.

She is a profound thinker, a writer of immense power and a political activist with great courage.

She challenges not just the Indian state’s political, economic and military policy, but also religious and right wing groups, mining and financial corporations and the other  barons of corporate capitalism and big business.

In her recent writings  Arundhati Roy reminds us of India's long, complicated and strong legacy of political and intellectual left-wing activity and the need for spaces, places and communities free from capitalist exploitation and destruction.

"The day capitalism is forced to tolerate non-capitalist societies in its midst and to acknowledge limits in its quest for domination, the day it is forced to recognize that its supply of raw material will not be endless, is the day when change will come.

If there is any hope for the world at all, it does not live in climate-change conference rooms or in cities with tall buildings. It lives low down on the ground, with its arms around the people who go to battle every day to protect their forests, their mountains and their rivers because they know that the forests, the mountains and the rivers protect them

The first step toward re-imagining a world gone terribly wrong would be to stop the annihilation of those who have a different imagination – an imagination that is outside of capitalism as well as communism. An imagination which has an altogether different understanding of what constitutes happiness and fulfillment.

To gain this philosophical space, it is necessary to concede some physical space for the survival of those who may look like the keepers of our past but who may really be the guides to our future. To do this, we have to ask our rulers: Can you leave the waters in the rivers, the trees in the forest? Can you leave the bauxite in the mountain? If they say they cannot, then perhaps they should stop preaching morality to the victims of their wars"

Environmental activist Tim DeChrisopher faces 10 years in jail for civil disobedience

An individual who breaks a law that conscience tells him is unjust, and who willingly accepts the penalty of imprisonment in order to arouse the conscience of the community over its injustice, is in reality expressing the highest respect for the law.

Martin Luther King, Jr.

I think the opportunity that's here is to build a real resistance movement -- not just a lobby movement, but a resistance movement, that says this path that we're on is absolutely unacceptable, and we're going to use our power as citizens and as a movement to shut this system. I think that's where we need to be right now, recognizing that this is not a matter of lobbying for trivial reforms, but we're at a point where we need to make the path we're on absolutely impossible to continue. Hopefully that's the lesson that people are taking out of this.
Tim DeChristopher

Student and activist Tim DeChristopher found a way to resist corporate power and fight against the damage caused by US oil and gas corporations. But it may cost him a long prison term.

On June 23 the environmental activist and campaigner  will find out whether he will spend the next ten years in a US Federal Prison for an act of civil disobedience against the oil and gas industry.

His case is being seen as yet another example of the serious assault on public protest and dissent that is occurring around the world, whereby governments and corporations are increasingly using whatever means possible, such as anti- terrorist legislation, increased police powers, direct restrictions on public protest, SLAPP suits and arbitrary detention, to prevent and limit the right to protest.

In December 2008 DeChristopher participated in an oil and gas auction of 150,000 acres of public land in Southern Utah. Sale of the land had been fast tracked in the last days of the Bush administration to benefit the fossil fuel industry. It was a last minute land grab authorized in the last days of the Bush administration.

DeChristopher was outraged by the illegality of the land grab and the fact that leases were being handed out in an irregular way. He was also outraged about the ways that the oil and gas companies privatized all their profits and externalized all their costs. His argument was that the oil and gas companies had no intention to pay the full costs of their operations which are offloaded to the public :

"Well, I saw this auction as, first off, a fraud against the American people, that the government wasn’t following their own rules and was locking the public out of the decision-making process for public property. I also saw it as a real threat to my future, because of the impact on climate change that this kind of “drill now, think later” mentality was having, and an attack on our public lands, on our natural heritage, in pretty pristine and irreplaceable areas in southern Utah".

DeChristopher successfully bought (without any money or intention to pay) 22,000 acres of the land in order to save it from fossil fuel extraction. De Christopher had originally attended the auction to protest without any intention of bidding for the land. However, upon entry to the auction he was asked if he intended to be a bidder to which he replied "yes" and he became Bidder No 70. DeChristopher then proceeded to bid and successfully secured 13 leases, thereby disrupting the sale.

De Christopher actually raised the money to buy the land but he was still charged with fraud because at the time of the auction he had no intention to pay. However, that fact and many other issues were not allowed to be introduced into the trial.

In March 2011 he was convicted of fraud and faces a 10 year jail term and $750,000 fine imposed by the Obama administration.

As Tim De Christopher points out his case was prosecuted to scare off others who might consider civil disobedience.

"I was born the year that Ronald Reagan took office. The reality throughout my lifetime has been, corporations and governments are powerful, and people are weak, and there is nothing you can do to change that. Now that paradigm is starting to shift, and all of a sudden, the world is starting to believe in people power again"

Various web sites have been set up to publicize DeChristopher's case (Bidder 70) and  The Trial of Tim DeChristopher and a Facebook site allows you to follow the case. Interviews and stories about DeChristopher can be read here, here, here, here, here and here.

The failure of market led approaches in Australian water policy

"Australian water is now effectively commoditised: allocated to whoever is willing to pay the going price"
Ian Douglas

Excellent article by Ian Douglas of Fair Water Use Australia on the failure of market approaches in national water reform.:

"This blind commitment to growth, which also suffuses the policy platforms of the major parties, is being used to justify public-private partnerships and the construction of ill-conceived and untenably costly water infrastructure, most notoriously desalination plants. Our governments appear quite comfortable entering into public-private partnerships with multinationals whose track record in terms of corporate responsibility on the global stage is, at best, in-glorious."

Douglas argues that the reliance on market based approaches and the privatization of water is incompatible with the idea of access to water as a public good and poses a serious threat to Australia's water future.

Douglas argues that despite the fact that polling indicates that at least 70% of Australians are opposed to water privatization it continues to be imposed on the nation, under the guise of water reform:

"Australian water reform was conceived in 1994 by the Council of Australian Governments; nurtured by the prevailing mantra that free-market exposure was the ultimate panacea for undercapitalised and inefficient public utilities. COAG went one giant leap further, in deciding to establish a national water market; arguing that this would direct water to its most productive use.

In the years since these sweeping changes were announced, the wisdom of applying free market principles to the management of an essential natural resource has been largely discredited by events overseas: In the water-supply sector, major corporate players have been accused and, in more than a few instances, convicted of price-gouging, anti-competitive behaviour, corrupt practice and fraud. On all continents there are moves to wrest control from private corporations. Globally, more than 90 per cent of water services are now publicly owned.

In Australia there are valid concerns that water reform is leaving crucial decisions, with respect to the “where”, “when” and “how” of water distribution, in the hands of entities whose priority is profit rather than socially and environmentally responsible water use. Questions are being raised as to why our governments have been prepared to implement these radical policies without seeking and obtaining prior electoral mandate and in the absence of adequate constitutional protection of water.

Carl Safina on the catastrophic consequences of the Deepwater Horizon disaster

 A Sea in Flames: The Deepwater Horizon Oil Blowout  by Carl Safina

Twelve months after the disaster in the Gulf of Mexico which resulted from the explosion at the BP's Deepwater Horizon more books are appearing that chronicle the catastrophe and its terrible legacy. Carl Safina is a renowned marine ecologist and expert on the world's oceans.

The extract below is from Douglas Brinkley's* review of Carl Safina's new book on the Deepwater Horizon catastrophe  and the terrible legacy for the planet:

In “A Sea in Flames,” his newest installment, Safina investigates the impact of the BP Deepwater Horizon blowout......

His kinship is with two tribes of people: gulf fishermen and marine biologists. “Crucial mistakes, disastrous consequences, the weakness of power, unpreparedness and overreaction, the quiet dignity of everyday heroes,” he writes. “The 2010 Gulf of Mexico blowout brought more than oil to the surface.”.................

Back in 2008 around 300 exploratory wells were dug in the deep water of the Gulf of Mexico. Very few Americans questioned the environmental damage inherent in such activity. “Our everyday use of fossil fuels is changing the atmosphere,” Safina warns, “ruining the world’s oceans.” He garners credibility by being evenhanded. Doing some complicated math, he argues that the mixing of millions of gallons of BP oil with the Gulf’s 660 quadrillion gallons of water allowed the oil to easily dilute. But the carbon dioxide we’re emitting into the atmosphere, he scolds, isn’t being diluted. It’s building up in an extremely toxic way.

Safina suggests that the oceans are Earth’s lungs and they’re smoking two packs of cigarettes a day. Sea water is getting more acidic due to carbon dioxide. This spells dire consequences for oceans, which are losing habitats ranging from glaciers to tropical reefs at an astonishing rate. “Because we’ve bet the house on burning oil, coal, and gas,” he writes, “our atmosphere’s concentration of carbon dioxide is a third higher now than at the start of the Industrial Revolution.” 

At the end of “A Sea in Flames,” Safina is desperate to close the deal against fossil fuels. His previously steady and nuanced prose turns polemical. He reminds us that oil is making undemocratic countries like Russia, Iran and Saudi Arabia powerful. Petro dictators, he charges, are stoking anti-Americanism all over the world. If we don’t get behind a Marshall Plan-like program for renewable energy, it seems, China will surpass America as the world’s superpower.

Carbon dioxide, the killer of Earth, can be slain only by consumers who are aware of how hideous oil, coal and gas truly are to the atmosphere and oceans, Safina argues. The smartest way to respond to the Gulf disaster shouldn’t have been cleaning birds or picking up turtles or spraying 1.84 million gallons of Corexit 9500. Instead, an infuriated citizenry should have pulled the subsidies out from under Big Petroleum. Tax the oil conglomerates out of business. It’s still not too late. Better to be, as Safina puts it, “shocked at the pump” than dead in the water. 

* Douglas Brinkley is a professor of history at Rice University. His most recent book is “The Quiet World: Saving Alaska’s Wilderness Kingdom 1879-1960.”

Economists who document the failure of market driven reform in Australia

John Quiggin is one of a growing number of Australian economists who continue to make the case that the market-based reforms imposed by Federal and State Governments over the last two decades have not delivered the anticipated benefits for consumers and ordinary citizens, and in many cases have been unmitigated failures.

Market led reform assumes that market-based solutions are always best, regardless of the problem.

Other important contrarian economic voices about market driven neoliberal reform championed by mainstream economists and Australian governments of all persuasions can be found on the pages of Dissent, the excellent journal edited by the Age and Sydney Morning Herald economics writer Kenneth Davidson and in the Journal of Australian Political Economy produced out of the University of Sydney. Bloggers such as Billy Blog (Bill Mitchell) also provide important critiques of mainstream economics, as do academic economists and public commentators such as Con and Betty Walker.

In today's Australian Financial Review John Quiggin argues that:

The failure of reform is most dramatically evident in the infrastructure sector, and particularly for utilities such as electricity, telecommunications and water.

Quiggin argues that the benefits of market led reform that were promised by its proponents have not resulted. Whilst there were some benefits in the short term, in the longer term the proposed benefits for consumers and society have not been sustained. Prices have not lowered but increased. Supposedly, allowing the market to rip would bring more choice and better quality of service. Neither have happened.

As Quiggin points out, the privatization of telecommunications and electricity have been unmitigated failures for consumers and society. Electricity price inflation has reached double digit levels and the break up of electricity utilities into separate generation, distribution and retail sectors has created massive new problems.

Quiggin argues that it is time for policy makers, politicians and commentators to accept that the mantra of market led reform has been a complete failure in the infrastructure sector. He writes that:

Faith in reform has proved utterly impervious to contrary evidence. The only answer to the failure of reforms has been to conclude that more reform in needed.

But as John Quiggin notes the lure of market led reform is still all powerful:

Despite this and other failures, the incantation of ‘reform’ retains its magical power. The politically and economically disastrous privatisation program in NSW was justified entirely on the basis that it was needed in order that reform could continue.

It is, perhaps, too much to ask that such an appealing word should be abandoned. But can’t we at least admit that the 1980s reform program has had its day, and look for some reforms more appropriate to the 21st century?

The failure of market driven neoliberal reform in the infrastructure sector (water, telecommunications, utilities, and public infrastructure) and in many other areas of Australian social and economic life, including health, housing, social welfare, retirement incomes, aged care, education, child care, human and community services and the environment and climate change, are core themes in Australian journals such as Dissent and  the Journal of Australian Political Economy, which in each edition document the harm that has been done by market driven neoliberal reform in this country.

More Australians need to support and read the important work done by economists such as John Quiggin, Bill Mitchell, Con and Betty Walker and all those associated with journals such as Dissent and The Australian Journal of Political Economy.

Queensland floods: Australia's "Katrina moment?"

 "Since the 1980s, Australia has become the model of a social democracy where the cult of the “market” has diminished public services and infrastructure budgets and divided by wealth a society that once boasted the most equitable spread of personal income in the world".
John Pilger

As always, John Pilger, Australia's finest journalist offers a contrarian view on the Queensland floods in in this recent piece (here).

Pilger describes the floods as "Australia Katrina moment", in recognition that the devastation and destruction that resulted was compounded by policy decisions (and inaction) by successive Federal, State and local governments and Australia's corporate elite.

Pilger describes a political culture and political system subservient to business and corporate interests which stood by and allowed excessive land clearing on flood prone areas and environmental degradation, failed to invest in public infrastructure to protect flood prone communities and benefited from property speculation and property development which sold property and houses on flood prone land.

Pilger also describes how  pro-market and pro-business regulatory institutions allowed insurance companies to avoid an agreed definition of what constituted a flood, thereby allowing them to more easily refuse to honor claims of flood damage.

The greedy ghost of market madness

Fantastic speech here by British author Phillip Pulman on what he calls "the greedy ghost of market madness" and the social, cultural, and democratic dislocation that it causes. 

In this speech Pulman attacks the British Government for its austerity cuts which are resulting in the closure of hundreds of libraries throughout the UK and are hitting the most marginalized and disadvantaged the hardest, whilst delivering tax cuts and more public funds to the wealthy, the corporate elite and business and corporate interests.

Pulman argues that libraries are too precious a resource to destroy. They are he believes, essential not just for the value of reading, but also because of the democratic and civic space enshrined in public libraries and other public services, public assets and public infrastructure.

"there are things above profit, things that profit knows nothing about.. things that stand for civic decency and public respect for imagination and knowledge and the value of simple delight"

Pulman points the finger directly at all those who place the unfettered freedom of the market at the centre of public policy and social and economic life, as well as those who measure the success of an endeavor or a public service by the metrics of profit.

"...........And it always results in victory for one side and defeat for the other. It’s set up to do that. It’s imported the worst excesses of market fundamentalism into the one arena that used to be safe from them, the one part of our public and social life that used to be free of the commercial pressure to win or to lose, to survive or to die, which is the very essence of the religion of the market. Like all fundamentalists who get their clammy hands on the levers of political power, the market fanatics are going to kill off every humane, life-enhancing, generous, imaginative and decent corner of our public life. I think that little by little we’re waking up to the truth about the market fanatics and their creed. We’re coming to see that old Karl Marx had his finger on the heart of the matter when he pointed out that the market in the end will destroy everything we know, everything we thought was safe and solid. It is the most powerful solvent known to history. “Everything solid melts into air,” he said. “All that is holy is profaned.”

Market fundamentalism, this madness that’s infected the human race, is like a greedy ghost that haunts the boardrooms and council chambers and committee rooms from which the world is run these days.

So decisions are made for the wrong reasons. The human joy and pleasure goes out of it; books are published not because they’re good books but because they’re just like the books that are in the bestseller lists now, because the only measure is profit.

The greedy ghost is everywhere. That office block isn’t making enough money: tear it down and put up a block of flats. The flats aren’t making enough money: rip them apart and put up a hotel. The hotel isn’t making enough money: smash it to the ground and put up a multiplex cinema. The cinema isn’t making enough money: demolish it and put up a shopping mall.

"...............The greedy ghost understands profit all right. But that’s all he understands. What he doesn’t understand is enterprises that don’t make a profit, because they’re not set up to do that but to do something different. He doesn’t understand libraries at all, for instance. That branch – how much money did it make last year? Why aren’t you charging higher fines? Why don’t you charge for library cards? Why don’t you charge for every catalogue search? Reserving books – you should charge a lot more for that. Those bookshelves over there – what’s on them? Philosophy? And how many people looked at them last week? Three? Empty those shelves and fill them up with celebrity memoirs.

That’s all the greedy ghost thinks libraries are for.

Now of course I’m not blaming Oxfordshire County Council for the entire collapse of social decency throughout the western world. Its powers are large, its authority is awe-inspiring, but not that awe-inspiring. The blame for our current situation goes further back and higher up even than the majestic office currently held by Mr Keith Mitchell. It even goes higher up and further back than the substantial, not to say monumental, figure of Eric Pickles. To find the true origin you’d have to go on a long journey back in time, and you might do worse than to make your first stop in Chicago, the home of the famous Chicago School of Economics, which argued for the unfettered freedom of the market and as little government as possible.