The Golden Rule
By Gary W. Harding
If the global economy is so good for us, why are so many people seeing their incomes go down; why are so many being downsized and outsourced? For the last two decades, there has been a pervasive feeling that something has gone terribly wrong. The rich are getting richer while the poor are getting poorer. The middle class is slowly sinking into poverty. There is a growing sense of cultural and societal decay. Degradation of the environment continues at an accelerating pace.
What is happening and why?
Is it that there are too many people?
Is it because people have become selfish and lazy?
Is it because government no longer represents the people?
Has the march toward one-world government left most of us on the outside? Or, is it because a small group of wealthy and powerful people have gained control of the world’s economies in order to pursue their agenda?
To answer these questions, an outline of what is going on and how the world presently operates is presented here. It provides surprising answers to the questions posed above. All of these answers revolve around a single principle. When it comes to the affairs of mankind, the world operates by the “Golden Rule”. That is, “He who has the gold, makes the rules”. This, of course, is no surprise. Everyone understands that money makes the world go round and it has for a long time. However, the surprise is the overwhelming degree to which the Golden Rule now applies and where the concentration of wealth and power lies.
It takes some doing to find out what has been going on and why. The pieces begin to fall into place when one follows a suggestion from the anonymous informant who was a key figure during the Watergate investigation: “If you want to find out what is really going on, follow the money”.
Respected television commentator Bill Moyers, after spending a 2-week around-the-world trip with David Rockefeller, said: “Just about a dozen or 15 individuals made day-to-day decisions that regulated the flow of capital and goods throughout the entire world”. Moyers went on to say: “David Rockefeller is the most conspicuous representative today of the ruling class, a multinational fraternity of men who shape the global economy and manage the flow of its capital. … But what some critics see as a vast international conspiracy, he considers a circumstance of life and just another day’s work. … In the world of David Rockefeller, it’s hard to tell where business ends and politics begins” (Whitley, 1996).
If you object to the concept of a one-world government, it is already too late; one-world government is already here. This governing body is not the United Nations (UN). It resides in the boardrooms and executive offices of the world’s giant corporations and owners of capital. With the General Agreement on Tariffs and Trade (GATT) and its successor, the World Trade Organization (WTO), big money is now in complete control. If you do not believe this, you will soon find out otherwise. The WTO being in place, for the vast majority of the world’s people, the “race to the bottom” is in full swing.
Unfortunately, we the people appear to be willing partners in this race. In the rich countries, with 20% of the world’s population, today’s opulent life is pursued with little regard for tomorrow, let alone what this does to the other 80% of the world’s people and the environment. Almost everyone wants to be rich and the quicker the better. This seems to be a universal human trait. Although repeated over and over again through the past 4,000 years, we have failed to learn the lessons from the “Tragedy of the Commons” (Garrett Hardin, SCIENCE, 162:1243-1248, 1968). If too many of us take too much, too fast, the commons we all depend upon will collapse.
It used to be that most of the goods and services that people needed for a reasonable standard of living were produced and consumed locally. Now, the economies of most countries have been transformed so that they are primarily based upon exports. The needs of people are, in turn, now dependant upon imports. With the WTO in place, laws and regulations in any country (e.g., rules against unfair consumer practices, health detriments, environmental degradation, child or prison labor) can be declared illegal because they are “non-tariff restrictions of free trade”. Any member country’s government (at the urging of any corporation doing business there) can, for a particular export product, file a complaint against the import restrictions of another member country. If the WTO rules in favor of the exporting country, that excluded product must be allowed into the restricting country. Dominated by the corporate ruling class, the WTO considers only the economic issues involved. There is no appeal.
In developed countries, this means that any local business is subject to the prevailing costs and rules within that country’s borders. However, that business must compete with imports which are not subject to these costs and rules. One result is declining sales, lower wages, layoffs and all too often, bankruptcy. A second result is, to stay in business, that business must move to a country where it can compete, leaving its jobs behind. Another result is that laws and rules which impact business costs must be rescinded so that the country, as a whole, can stay competitive.
In developing countries, saddled with massive foreign debt, their resources must be dedicated to export products to gain foreign exchange to pay the interest on the debt. One result is that these resources are not available for the needs of the local people. Their needs must be met with imports. Another result is that the people are forced into dismal living and working conditions. Thus, in both developed and developing countries, the net balance of trade is tipped heavily in the direction of imports. As a consequence of this import/export, global shell game, a huge quantity of wealth accumulates in the accounts of giant corporations and capital owners.
These accounts fill up because their owners externalize their costs. The strategy here is to rig the rules of the game so that profits are maximized while the costs are born by the taxpayers and/or society. For example, to avoid the costs associated with a living wage and labor and environmental regulations, capital moves and corporations subcontract with or move their production facilities to countries without these restrictions. The costs for the resulting unemployment in their former home is the obligation of the taxpayers. In their new home, unsafe working conditions, unfair wages and environmental degradation are imposed upon the local population.
One wonders how the corporate elite can live such schizophrenic lives. They live and work in the society and environment that they create, although wealth can insulate them in guarded conclaves. At home, their concerns are much like those of anyone else. But, when they enter the palatial surroundings of corporate headquarters, their mind-set changes to that of the bottom line. Millions of people are employed by the giant corporations. Most of them are working longer hours for less pay; fearful that they will be the next to be laid off. So, they toe the company line even if privately, they disagree with the corporate agenda.
There are about 3.2 million small businesses (less than $500,000 annual receipts) in the US employing about 10.5 million people. These businesses are, for the most part, delivering needed, safe, and effective products and services to the local population. (Typical examples are a neighborhood restaurant or a dentist.) Many small businesses are relatively unaffected by the export/import economy. They are the ones serving the local population or the ones dealing in unmoveable assets like land and infrastructure. Others must compete with the large discount stores selling primarily imported products. In small towns all over the US, the businesses on main street dry up when a big discount store is built close by.
There are about 1.4 million large businesses in the US, including giant corporations, which employ about 77.5 million people. Large businesses which are not giant corporations are the ones feeling the pressure from the export/import shell game. (Examples are a clothing or shoe manufacturer.) These companies are being put out of business by cheap imports while being priced out of export markets. Giant corporations, on the other hand, are doing just fine thank you. They are the ones who benefit from the global economy while externalizing their costs and downsizing and outsourcing their employees.
There is nothing wrong with fair competition among small and large companies to deliver the safe and effective products and services that people need and at a fair price. There is nothing wrong with those companies earning a fair profit in the process. There is nothing wrong with importing needed goods which are not available any other way. There is nothing wrong with investing in the productive economy for a fair return. There is a problem with importing goods produced with unfair wages and unsafe working conditions, goods which could be produced locally and sold at a fair price and with a fair profit.
There is a problem with arbitraging for profits [ in the stock market ] without producing anything of real value.
Another problem now is that for every dollar that flows in the productive economy, $20 flows in the extractive economy. The extractive economy is based entirely upon the manipulation of money.
arbitraging temporary price differences for the same commodity or financial instrument in two markets;
speculating on price changes in commodities,
currency exchange rates, interest rates and financial instruments such as stocks, bonds and derivatives; and
insuring others against the risks of future price changes (Korten, 1995)
How did this state of affairs come to be? Well, it all began in the depression years of the 1930’s with the formation of the Council On Foreign Relations (COFR; an acronym with prophetic implications). Its members include a collection of the powerful US corporate and foreign policy establishment. In 1939, just after the outbreak of WWII, they outlined a long-range plan on problems posed by the war and the organization of subsequent peace. This plan focused upon the need for the US to economically and militarily dominate materials for its industries with the “fewest possible stresses” (Korten, 1995). Shortly after the war, this group was instrumental in establishing, through the fledgling UN, the International Monetary Fund (IMF) and the Bank for Reconstruction and Development (World Bank). Although ostensibly part of the UN, these agencies quickly became completely autonomous. The role of the IMF and World Bank (sometimes referred to as the Bretton Woods institutions) has been neocolonialism of poor and developing countries. Including, and in addition to, the dozen or so men that Moyers was referring
Including, and in addition to, the dozen or so men that Moyers was referring to, there are a collection of several hundred wealthy and powerful men called the Bilderberg (after the Bilderberg hotel in Oosterbeek, Holland where they first met in 1954; Korten, 1995). The Bilderberg holds a conference every year (or two); the last one outside of Toronto in June 1996. At these conferences, the participants break up into small groups for discussions. However, what they discuss is kept very secret. Officially, the Bilderberg says that their conferences “reach no conclusions and recommend no policies” (Whitley, 1996).
In 1973, David Rockefeller formed the Trilateral Commission (TLC; another acronym with ironic overtones). The TLC is an economic alliance among the US, Western Europe, and Japan. Its members include about 325 “distinguished citizens”, mostly the heads of giant corporations and powerful government officials (Korten, 1995). The COFR, Bilderberg and TLC were instrumental in forming GATT and the WTO. Aligned with these groups is the Business Roundtable, composed of about 200 CEO’s from the largest Fortune 500 US corporations. These CEO’s gather periodically to reach a consensus on issues of social and economic policy for America (Korten, 1995). Through their political-campaign financing, mis/disinformation enterprises and lobbying of congress, they were influential in the US passage of the North American Free Trade Agreement (NAFTA), GATT and our entry into the WTO.
The WTO’s global health and safety standards relating to food are set by a group known as the Codex Alimentarius Commission (Codex). This organization was established in 1963 and is run by the UN’s Food and Agriculture Organization (FAO) and World Health Organization (WHO). Codex is heavily influenced by industry and has tended to harmonize standards downward (Korten, 1995).
During the 1960s, the COFR and Bilderberg became alarmed at the rise of Japanese economic power and the implications of a new generation that rejected consumerism. They responded with integrated strategies to challenge these threats to the status quo and to turn the political consensus hard to the right. These strategies continue today. They began by forming front organizations (often with deceiving names) which were designed to advance the corporate agenda. It took a decade, but they succeeded in 1980 with the election of Ronald Reagan and a Republican controlled Senate.
These front organizations are well financed (e.g.,
Proctor & Gamble,
AT&T, Arco, etc.).
Some (e.g., The Heritage Foundation) serve to funnel money from giant corporations to other front organizations. The role of many (e.g., think-tanks like the Cato Institute) is to produce misinformation and self-serving analysis that is designed to convince the public, media, and government officials to follow the corporate agenda.
The purpose of some (e.g., Pacific Legal Foundation) is to attack offending legislation and regulations in court; particularly property-rights, consumer-protection, labor, and environmental rules (Helvarg, 1994; Korten, 1995). Another purpose of these legal foundations is to silence dissenting voices through the filing of Strategic Lawsuits Against Public Participation (SLAPP suits). Many poor people seeking their rights have been financially devastated by the legal expenses required to fight these specious lawsuits (Helvarg, 1994).
Another strategy is to buy political influence through campaign financing (and outright bribery when they can get away with it) and to conduct intense lobbying of government officials (Kessler, 1997). We are all aware of the countless episodes of influence pedaling that pervades the legislative and executive branches of government at the federal, state and local levels. A third strategy is to wage all out war on liberals, environmentalists and the poor (Helvarg, 1994). The trick here is a simple one (e.g., Rush Limbaugh): redefine these groups as being socialists or better yet, communists.
The next strategy is to gain control of the media, particularly television. Here, advertising dollars determine the fare that appears and dictates the agenda presented. In addition, radio and television shows which pitch “The Way Things Ought To Be” or pacify the public with mind-numbing programming, have become very popular. Yet another strategy has been to facilitate the placement of judges sympathetic to the interests of corporations in our civil courts.
A more recent strategy is to inject the corporate agenda into our education system through “free”, corporate sponsored educational materials in our public schools (Korten, 1995). Embedded in all of these strategies is the often successful and time tested “big lie”. If a preposterous lie is told often enough, people will eventually come to believe it.
According to Korten (1995): “The [COFR], Bilderberg, and [TLC] bring together heads of competing corporations and leaders of competing national political parties for closed-door discussions and consensus-building processes that the public never sees. Although the participants may believe that they represent a broad spectrum of intersectional and even international perspectives, in truth, it is a closed and exclusive process limited to [the] elite. … Participants are predominantly male, wealthy, from Northern industrial countries, and except for the Japanese on the [TLC], Caucasian. Other voices are excluded.” Some of these men are members of two or all three of these organizations.
One can easily imagine a Bilderberg discussion that starts out something like this; the discussion leader opening with the following statement to set the agenda: ‘As you all know, we have collected excellent profits over the past few decades from population and per capita consumption growth in the developed countries. However, these ingrates have responded by significantly lowering their population growth rates and by developing environmentalist tendencies. Thus, future profits from the developed countries will likely be limited. Developing countries, on the other hand, represent a vast market for which there is likely to be continued population growth and considerable growth in per capita consumption. Through the WTO and the foundations we have laid down with the IMF, World Bank, and GATT we are positioned to take advantage of these markets for the next several decades. The question is, what must we all do to accomplish this goal?’
To consolidate their wealth and power, giant corporations and owners of capital are engaging in merger mania, one swallowing up another almost every day. The richest 1% of households have acquired 36% of the total wealth in the country. Politicians are being openly bought. The public is being encouraged to participate in the extractive economy. The stock market is soaring. But, we know who will lose when little fish swim in the same pool with sharks. For those of you not old enough to remember or who have not paid attention to history, this is exactly the situation that existed in the decade of the 1920s, just before the “Great Depression” (Beckman, 1988).
It is clear that a few hundred very rich and powerful men completely control the choices that are available to the rest of us. These choices, to indicate just a few, include:
what kind of job and standard of living we will have,
what kind of transportation system we will have;
whether we will have clean air to breath and clean water to drink;
whether the energy we use comes from renewable or nonrenewable sources;
whether our economic system is based upon recycled resources or most of them eventually end up in a land fill.
Most of the goods and services available to us are not what we need or what is sustainable into the future, but what the corporate ruling class has determined will be the most profitable to sell (Korten, 1995).
The consequences of the decisions made by the corporate ruling class are far reaching and pervasive. A detailed and comprehensive account of exactly what they are doing and how the global economy operates can be found in William Greider’s new book (1997), ONE WORLD, READY OR NOT. [If you read nothing else listed in the referenses at the end of this article, READ THIS BOOK!!] The danger is that if they are too greedy, the whole economic/political system could collapse. More disturbing, this system is unsustainable, both in terms of resources availability and ecosystem viability (Korten, 1995; Athanasiou, 1996).
The population of the world survives, and part of it prospers, by borrowing heavily from the future. The ultimate price exacted by the corporate ruling class will soon have to be paid. There are a number of recent trends and trend reversals (Brown, 1996) which indicate that there are hard times ahead, very hard times:
At the end of 1994, the world’s population was estimated to be 5,642 million people. By the end of 1995, it had grown to 5,733 million. Thus, 91 million people were added in 1995 alone. That is 250,000 people a day; enough to fill the Rose Bowl 2 and 1/2 times over. If all these new people were to have a standard of living like that in the US, this is equivalent to having to completely duplicate the entire St. Louis metropolitan area (2.5 million people) every 10 days. However, most of the added people will not have a standard of living like ours. The vast majority live in poor and developing countries where population growth rates are the highest. A better analogy would be that the population of Mexico (91 million people) more closely resembles the distribution of wealth in the world (more about that later). This means that every year, the entire infrastructure and economic support base of Mexico must be replicated somewhere in the world just to accommodate the annual population growth (Data from Famighetti, 1995 & 1996).
The world population growth rate for 1995 was 1.6% [(5,733 – 5,642) x 100 / 5642]; down 0.5% from the absolute maximum of 2.1% that occurred in 1969. Thus, population growth rate has averaged a 0.02% per year decline over the past 25 years. However, despite this drop in growth rate, at least 90 million people could be added to the population every year for the next 20 years. If population growth is declining, how can this be, you ask? A simple projection calculation demonstrates why. First, population growth is NOT declining; the rate of growth is. Second, to keep things simple, assume that population growth rate continues to decline at the same average rate that it has over the last 25 years, until it reaches zero. Now for each year, starting in 1995, calculate the number of people added; then add this to the population at the beginning of that year to determine the population at the beginning of the next year [pop(yr+1) = pop(yr) + (pop(yr) x gr(yr) / 100)]. The results from this calculation are shown in Table 1 for the years indicated:
TABLE 1. Growth in World Population, Economic Base, and Resource Demand
Year | World Growth Added to 2% Economic Resource|
Population* Rate (%) Population* Growth** Demand**
1995 | 5,733.4 1.60 91.7 1.0 1.1
1996 | 5,825.1 1.58 92.0 1.1 1.1
1997 | 5,917.2 1.56 92.3 1.1 1.1
1998 | 6,009.5 1.54 92.5 1.1 1.2
1999 | 6,102.0 1.52 92.8 1.1 1.2
2000 | 6,194.8 1.50 92.9 1.1 1.3
2005 | 6,660.4 1.40 93.2 1.3 1.5
2010 | 7,125.8 1.30 92.6 1.4 1.8
2015 | 7,586.2 1.20 91.0 1.5 2.1
2025 | 8,471.5 1.00 84.7 1.9 2.8
2050 | 10,236.6 0.50 51.2 3.1 5.6
2075 | 10,922.9 0.00 0.0 5.1 9.8
*Population in millions at end of year; **At the end of the year, relative to thebeginning of 1995
Under this declining growth-rate assumption, the first thing to notice is that, although population growth rate declines, the number of people added each year actually grows for the next 10 years. Why? Because the population base is so large. The second thing to notice is that the population would reach nearly 11 billion people in 2075 (double that in 1995) even though population growth rate gradually drops to zero. The third thing to notice is that 85 million or more people would be added each year until 2025.
If we further assume a modest 2.0% annual growth in the world’s average standard of living (Table 1), we can calculate, relative to beginning of 1995, the change in the amount of resources that would be required with simultaneous population and economic growth [Table 1; pop(yr) x econ(yr) / pop(1994)]. By 2025, the economic base would double and the resource demand would triple. When population finally stabilizes, the economic base would increase five-fold and the required resource demand would grow by a factor of 10.
Of course, the assumptions in the above calculations are overly simplistic. The results are shown to demonstrate the dynamics of what happens with compound exponential growth. The actual size of the population and the magnitude of resource demand will depend upon what actually happens over the next few decades. Some argue that population growth rate will decline faster as developing countries achieve higher standards of living and the population of developed countries stabilizes. Further, the impact of resource demand could be less with the applications of more efficient and/or new technologies. Others argue that official population growth-rate projections in the past have always turned out to be lower than reality. Further, the lead-time required to bring more efficient and/or new technologies on-line is already being overwhelmed by population growth. There are a number of related trends which indicate that the latter view may be the right one.
Distribution of Wealth
In 1991, the richest 20% of the world’s population collected 84.7% of the world’s total annual income. The poorest 20% collected just 1.4% of that income (See Cohen, 1995). This left the other 60% of the population with just 13.8%. In 1970, these figures were 73.9%, 2.3% and 23.8%, respectively. As with our simple future-growth calculations for population and resource demand above, assume that the growth rate of income for the wealthiest 20% and the declining rate of income for the poorest 20% will continue to change at the average rates that they have from 1970 to 1991. Then, by the year 2010, the richest 20% would be collecting 94.7% of the world’s annual income, the poorest 20% would collect 1.1% and the other 60% would collect just 4.2%. In only 15 years, this would leave 80% of the world’s population with an income level like the poorest 20% had in 1991 (See also, Korten, 1995).
The richest 20% of the world’s population lives in the developed countries. This population consumes 80% of the world’s annual harvest of resources (Athanasiou, 1996). The US alone, with 5% of the world’s population, consumes 25% of these resources. The population growth rate in the developed world was about 0.8% per year in 1995, half the world’s average. It would have been much lower if it were not for the US with a growth rate of 1.2%. The population of the US grew by 3.1 million people in 1995. This means that, if this growth rate continues, the entirety of metropolitan St. Louis must be duplicated somewhere within the US every year.
Over the last few decades, the world has produced enough food to feed everyone an adequate and healthy diet despite rapid population growth. That is, if food was equitably distributed and 1/3 of it was not lost to pests and spoilage. However, recent reports indicate that the “green revolution” has reached the point of diminishing returns. Yields are no longer increasing, even with increasing applications of fertilizer, pesticides and irrigation. The amount of land used for agriculture has been declining recently. Some say that this is because increasing yields have reduced the need for land. Others point out that agricultural land is being abandoned because it is no longer productive. New agricultural land is being added, but all of it is marginal at best. Overgrazing, erosion, salinization, and water-logging are producing massive losses annually (Brown, 1996).
Food production has become more and more concentrated in huge monocultures; the same plant being cultivated over large areas. This leads to an increased vulnerability to pests. With the heavy application of pesticides, many pests have become resistant. In addition, global warming will increase pest problems.
All around the world, fish populations are being decimated by over-fishing and pollution. The annual tonnage harvested has fallen in recent years (Brown, 1996). Aquaculture enterprises are springing up, but their productivity cannot even come close to what has been lost.
Genetic engineering is being touted as the solution to future food supplies. More ominous than possible catastrophes from “messing with Mother Nature” is the extension through GATT and the WTO of international patent rights on genetic materials, including seeds and natural medicinals. This is a blatant effort by a few corporations to establish monopoly control over the common biological heritage of the planet (Korten, 1995).
In many places, the demand for fresh water now exceeds the supply. So much water is removed from some rivers for irrigation that at times (including our own Colorado River), not a drop reaches the sea (Brown, 1996). Deep aquifers are being mined at an unsustainable rate (particularly in the US) for agriculture and domestic supply (Brown, 1996). The oscillations between flood and drought are so severe in many places that rain fed supplies cannot be captured for use. Some have speculated that global warming has something to do with this. There is increasing resistance to building more dams because of the damage that they do to aquatic ecosystems and because of downstream water-rights disputes.
In 1992, the world’s consumption of primary energy was 343 quadrillion BTUs (not including wood and dung burning; data from Famigehtte, 1995). A year later, it had grown to 349 quadrillion BTUs (data from Famigehtte, 1996), a growth rate of 1.75% per year. Thus, energy consumption was growing faster than population. The sources of primary energy include fossil fuels (oil, natural gas, and coal), hydroelectric, nuclear, and a small amount of wind, geothermal and biomass. By far, the most dominant is, of course, fossil fuels. Like the distribution of wealth (see above), there is an enormous disparity in the consumption of primary energy (See Table 2).
The US and Canada consumes 27% of the world total and the growth rate in their consumption is twice that of their population. Western Europe has a declining growth rate due to more efficiency and conservation measures. Japan has both a stable demand and a stable population. Russia and Eastern Europe have a substantial decline in demand due to the collapse of their economies. However, in poor and developing countries like China and India, the growth rate of primary energy demand is rising at triple their population growth rates.
TABLE 2. Primary Energy: Countries With Largest Consumption And Greenhouse Gas Emissions
Country | 1992^ 1993^ % Change % Greenhouse Gas % Carbon Dioxide(Rich)
| (%) (%) 1992-1993 Emissions 1991@ Emissions 1800-1988$
US | 24.0 24.0 2.1 19.1 29.6
Canada | 3.2 3.3 3.8 1.6 3.6
Germany | 4.1 4.0 -1.4 3.8 26.1&
France | 2.8 2.7 -3.0 1.6 *
UK | 2.8 2.7 -4.0 2.4 *
Italy | 2.0 * — 1.7 *
Japan | 5.5 5.5 0.2 5.1 3.7
Australia | 1.5 * — 1.1 1.1
Russia | 9.5 9.0 -3.2 13.6+ 14.1+
Ukraine | 2.6 2.2 -11.9 * 5.5#