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World of Resistance Report: IMF, World Bank, Giant Consultants Admit The Storm Is Coming

World of Resistance Report: IMF, World Bank, Giant Consultants Admit The Storm Is Coming

By: Andrew Gavin Marshall

21 July 2014

Originally posted at Occupy.com

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Following Parts 123 and 4 of the World of Resistance Report, in this fifth installment I examine the warnings of social unrest and revolution emanating from the world’s major international financial institutions like the IMF and World Bank, as well as the world’s major consulting firms that provide strategic and investment advice to corporations, banks and investors around the world.

These two groups – financial institutions and the consultants that advise them – play key roles in the spread of institutionalized corporate and financial power, and as such, warnings from these groups about the threat posed by “social unrest” carry particular weight as they are geared toward a particular audience: the global oligarchy itself.

Organizations like the International Monetary Fund (IMF) and World Bank were responsible for forcing neoliberal economic “restructuring” on much of the developing world from the 1980s onwards, as the IMF and E.U. are currently imposing on Greece and large parts of Europe. The results have been and continue to be devastating for populations, while corporations and banks accumulate unprecedented wealth and power.

As IMF austerity programs spread across the globe, poverty followed, and so too did protests and rebellion. Between 1976 and 1992, there were 146 protests against IMF-sponsored programs in 39 different countries around the world, often resulting in violent state repression of the domestic populations (cited explicitly by Firoze Manji and Carl O’Coill in “The Missionary Position: NGOs and Development in Africa,” International Affairs, Vol. 78, No. 3, 2002).

These same programs by the IMF and World Bank facilitated the massive growth of slums, as the policies demanded by the organizations forced countries to undertake massive layoffs, privatization, deregulation, austerity and the liberalization of markets – amounting, ultimately, to a new system of social genocide. The new poor and displaced rural communities flocked to cities in search of work and hope for a better future, only to be herded into massive urban shantytowns and slums. Today roughly one in seven people on Earth, or over 1 billion, live in slums. (An excellent source on this is Mike Davis’s “Planet of Slums”.)

How the Big Institutions Have Operated

Joseph Stiglitz, the Nobel Prize-winning former chief economist at the World Bank, blew the whistle on the World Bank’s and IMF’s policies in countries around the world – an act for which he was ultimately fired. In an interview with Greg Palast for the Guardian in 2001, Stiglitz explained that the same four steps of market liberalization are applied to every country.

The first includes privatization of state-owned industries and assets. The second step is capital market liberalization, which “allows investment capital to flow in and out,” though as he put it, “the money often simply flows out.” As Stiglitz explained, speculative cash flows into countries, and when there are signs of trouble it flows out dramatically in a matter of days, at which point the IMF demands the countries raise interest rates as high as 30% to 80%, further wrecking the economy.

At this point comes step three, called “market-based pricing,” in which prices get raised on food, water and cooking gas, leading to what Stiglitz calls “Step-Three-and-a-Half: the IMF riot.” When a nation is “down and out, [the IMF] squeezes the last drop of blood out of them. They turn up the heat until, finally, the whole cauldron blows up.” This process is always anticipated by the IMF and World Bank, which have even noted in various internal documents that their programs for countries could be expected to spark “social unrest.”

And finally comes step four, “free trade,” meaning that highly protectionist trade rules go into effect under supervision of the World Bank and World Trade Organization.

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Expecting Riots

The term “IMF riots” was applied to dozens of nations around the world that experienced waves of protests in response to the IMF/World Bank programs of the 1980s and 1990s, which plunged them into crisis through austerity measures, privatization and deregulation all enforced under so-called “structural adjustment programs.”

As the Guardian noted in September of 2012, “the European governments are out-IMF-ing the IMF in its austerity drive so much that now the fund itself frequently issues the warning that Europe is going too far, too fast.” Thus, we saw “IMF riots” – protests against austerity and structural adjustment measures – erupting over the past three years in Greece, Spain, Portugal and elsewhere in the E.U.

An academic study published in August of 2011 by Jacopo Ponticelli and Hans-Joachim Voth examined the link between austerity and social unrest, analyzing 28 European countries between 1919 and 2009, and 11 Latin American countries since 1937. The researchers measured levels of social unrest looking at five major indicators: riots, anti-government protests, general strikes, political assassinations and attempted revolutions.

The verdict: The researchers found there was “a clear and positive statistical association between expenditure cuts and the level of unrest.” In other words, the more that austerity was imposed, the more unrest resulted. Spending cuts, they wrote, “create the risk of major social and political instability.”

The Eurozone has been referred to by some as “an unemployment torture chamber” due to the structural reforms to the labor market – enforced through bailout conditions – which were purportedly designed to make it easier for employers to hire and fire but, instead, “firing has utterly dominated the employers’ agendas,” according to the Globe and Mail. This has created a “lost generation” in which unemployment in the E.U. for youths between 16 and 24 amounts to roughly 25% – while in Italy it’s roughly 40% and for Greece and Spain it’s as high as 60%. Tom Rogers, an adviser to Ernst & Young, noted, “Youth joblessness at these levels risks permanently entrenched unemployment, lowering the rate of sustainable growth in the future.”

The head of the IMF, Dominique Strauss-Kahn, warned in 2008 that “social unrest may happen in many places, including advanced economies.” The head of the World Bank, Robert Zoellick, warned in 2009 that “If we do not take measures, there is a risk of a serious human and social crisis with very serious political implications.”

Additionally, in November of 2009, the IMF chief warned the premier British corporate lobbying group, the Confederation of British Industry (CBI), that if a second major bailout of the banks were to occur, democracy itself would be jeopardized. The “man on the street” would not accept further bailouts, Strauss-Kahn said, and “the political reaction will be very strong, putting some democracies at risk.”

Consulting in the Midst of a Crisis

Global consulting firms play a peculiar role in the global economic order. The consulting, or “strategy,” firms became commonplace in the 1960s onward, and were frequently seen as “home to some great minds in the corporate world,” hired by corporate, financial and other institutional clients to advise management on strategy and investments. The Financial Times referred to the industry as “a global behemoth, employing an estimated 3 million people and generating revenues of $300 billion a year,” with the industry’s “product” being “the knowledge vested in its people.”

According to an Oxford team of researchers, in 2011 consulting firms advised on more than $13 trillion of U.S. institutional money. Worldwide, consultants advised roughly $25 trillion worth of assets. Consulting advice was seen to be “highly influential” in the United States; yet despite the enormous power wielded by consultancy firms, the Oxford study found that the funds recommended to investors by consultants did not in the end perform better than other funds.

Still, the influence of giant consulting firms remains, although their reputations have taken some hits along the way. The world’s largest consulting firms at the end of 2013 were McKinsey & Company, Bain & Company, Boston Consulting Group, Booz & Company, PricewaterhouseCoopers, Oliver Wyman, Deloitte Consulting, The Parthenon Group, A.T. Kearney and Accenture. With these large firms advising even larger clients on strategy and investments, it’s worth examining some of the advice and perspectives published by these agencies.

For example, McKinsey & Company, the world’s largest global management consulting firm, published a report in 2012 (Dominic Barton, “Capitalism for the Long Term,” Autumn 2012) noting that in the previous few years the world had been witnessing “a dramatic acceleration in the shifting balance of power between the developed West and the emerging East, a rise in populist politics and social stresses in a number of countries, and significant strains on global governance systems.”

For corporate executives, “the most consequential outcome of the [economic] crisis is the challenge to capitalism itself.” And while “trust in business hit historically low levels more than a decade ago,” McKinsey warned, “the crisis and the surge in public antagonism it unleashed have exacerbated the friction between business and society,” adding to anxiety over rising income inequality and other factors.

Having interviewed over 400 business and government leaders around the world, the McKinsey report noted that “despite a certain amount of frustration on each side, the two groups share the belief that capitalism has been and can continue to be the greatest engine of prosperity ever devised.” However, the report warned, “there is growing concern that if the fundamental issues revealed in the crisis remain unaddressed and the system fails again, the social contract between the capitalist system and the citizenry may truly rupture, with unpredictable but severely damaging results.” McKinsey & Company thus called for “nothing less than a shift from… quarterly capitalism to what might be referred to as long-term capitalism.”

In another instance, KPMG, one of the world’s leading accountancy firms and professional service providers, published a report in 2013 examining a list of “megatrends” in the world leading up to the year 2030 (“Future State 2030: The Global Megatrends Shaping Governments,” KPMG International, 2013). One of the major trends it referred to was “the rise of the individual,” in which technological and educational advancements “have helped empower individuals like never before, leading to increased demands for transparency and participation in government and public decision-making.”

This process is “ushering in a new era in human history,” KPMG went on. With major social issues left unresolved such as growing inequality and access to education, services, employment and healthcare, “growing individual empowerment will present numerous challenges to government structures and processes, but if harnessed, could unleash significant economic development and social advancement.”

The report further warned that there were other major consequences with the “rise of the individual,” including “rising expectations” and increased “income inequality within countries leading to potential for greater social unrest.” The fact that populations are “increasingly connected” and “faster dissemination of information through social media accelerates action” posed other concerns. John Herhalt, a former partner at KPMG, was quoted in the report as saying, “Citizens are not just demanding technologically advanced interactions with government, but also asking for a new voice.”

Further, a 2013 survey of 1,300 CEOs from 68 countries by PricewaterhouseCoopers, another of the world’s largest consulting firms, reported general views shared by CEOs around the world (“Dealing With Disruption: Adapting to Survive and Thrive,” 16th Annual Global CEO Survey). When asked about the ability of firms to deal with the potential impact of disruptive scenarios, the vast majority (75%) of CEOs responded that their companies “would be negatively affected, with major social unrest being cause for the greatest concern.” This was perceived as a greater threat than an economic slowdown in China.

CEOs, noted the report, “know they’ll have to repair the bridges of trust between business and society,” as the global financial crisis and its aftermath “have badly damaged faith in institutions of every kind.” Due to the revolution in social media, it concluded, many new “stakeholders… have an unprecedented amount of clout.”

After in-depth analyses of documents, speeches and reports from the world’s major economic institutions – from international organizations like the World Bank and IMF to global consultancy firms like McKinsey & Company and PricewaterhouseCoopers; and from big banks like HSBC, JPMorgan Chase and UBS to oligarchic platforms like the World Economic Forum – three issues are prevalent in terms of assessing the fears and threats facing the global elite: 1) growing inequality, 2) decline of public trust in institutions of all kinds, and 3) the resulting social unrest.

It should be clear by now that as global inequality continues to rise, trust in institutions will continue to fall, and social unrest will explode in new and more dramatic ways than we have witnessed thus far. We truly are entering a World of Resistance.

Andrew Gavin Marshall is a researcher and writer based in Montreal, Canada. He is project manager of The People’s Book Project, chair of the geopolitics division of The Hampton Institute, research director for Occupy.com’s Global Power Project and World of Resistance (WoR) Report, and hosts a weekly podcast show with BoilingFrogsPost.

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World of Resistance Report: Financial Institutions Fear Global Revolution

World of Resistance Report: Financial Institutions Fear Global Revolution

By: Andrew Gavin Marshall

11 July 2014

Originally posted at Occupy.com

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In Part 1 of the WoR Report, I examined Zbigniew Brzezinski’s warnings to elites around the world of the “global political awakening” of humanity. In Part 2, I looked at the relationship between inequality and social instability, and in Part 3 I examined the World Economic Forum’s warnings of growing inequality and the “lost generation” of youth who pose the greatest threat to oligarchic interests around the world. In this fourth installment in the series, we turn to reports from top banks and financial institutions warning about the growing threats to their interests posed by an increasingly disenfranchised and impoverished population – manifested in protests, strikes and social unrest.

In November of 2011, Bob Diamond, the CEO of one of the world’s largest banks, Barclays, stated in a speech: “We’ve seen violent protests in Greece, public sector strikes across Europe, [and] anti-capitalist demonstrations that started on Wall Street have spread to other places around the world.” Diamond added: “Young people have been especially hit hard by high levels of unemployment. The threat of further social unrest remains if we don’t work together to generate stronger economic growth and more jobs.”

A March 2013 report by senior economic adviser George Magnus of UBS Investment Research, entitled “Social Unrest and Economic Stress: Europe’s Angst, and China’s Fear,” noted that “the wave of social unrest that rumbled across Europe between 2008 and 2011 has become less intense… [and] has come as a cause for relief in financial markets.” Yet, he wrote, the occasional upsurge in large-scale national and European-wide anti-austerity protests and strikes “signifies the deep malaise in the complex and fragile trust relationship between European citizens and their governments and institutions.” Since 2010, approximately 13 out of 19 E.U. governments had been voted out of office or had collapsed, indicating that “public anger… is far from dormant, and its expression is mostly unpredictable.”

Social unrest, added the UBS report, “is a systemic phenomenon” that is “highly uncertain, complex and ambiguous,” and which can lead “to the toppling of governments, or even political systems.” Social unrest across the E.U. “has been notable more for the public expression of lack of trust in the institutions of government, including in Brussels,” the headquarters of the European Union.

This “lull” in social unrest, warned Magnus, “is most likely deceptive.” The present problem in Europe “is the same” as the main problems in Europe of the 1930s – when mass poverty, unemployment and social unrest led to the rise of fascism. The underlying problem in both eras was “the inadequacy of mainstream, political channels to address rising public concern about the loss of economic security, social stability and, yes, cultural identity.”

Citing an OECD study, the bank report noted that “austerity has gone hand-in-hand with a variety of forms of social and political instability, and politically-motivated violence.” There have been “heightened levels of social unrest and shocks to the political system in Greece, Spain, Portugal and Italy… sometimes requiring the force of the state to suppress it.” These are especially important matters for banks to pay attention to, since the European debt crisis was caused primarily by the big banks – and the austerity and “structural reform” policies (along with the bailouts that accompanied them) were designed for the benefit of those banks as well. Thus, resistance to austerity and “reform” is, in effect, resistance to the bailouts for the big banks.

In May of 2013, JPMorgan Chase released a report, “The Euro Area Adjustment: About Halfway There,” which assessed “progress” in the European Union on the issue of austerity and structural reform. The “adjustment” of European society, claimed the report, was “about halfway done on average,” noting that the process would continue for much of the rest of the decade although it faced major challenges, including the development of “new institutions” in the E.U. and what the bank called “national legacy problems.” This vague term referred to “the constitutions and political settlements in the southern periphery [of the E.U.], put in place in the aftermath of the fall of fascism, [which] have a number of features which appear to be unsuited to further integration in the region.”

Just what does this mean? The bank explained that “fiscal austerity” was likely to be a major feature in the E.U. “for a very extended period.” However, if the European Monetary Union is to survive the coming decade, “deep seated political problems in the periphery… need to change.” But what precisely are these “deep seated problems”? The bank elaborated that many of the southern periphery states’ constitutions “tend to show a strong socialist influence,” referring to the fact that many constitutions guaranteed various social rights for populations, including labor, healthcare and educational and civil rights.

Further, the bank reported that many of these nations suffer from the following features: “Weak executives; weak central states relative to regions; constitutional protection of labor rights; consensus building systems… and the right to protest if unwelcome changes are made to the political status quo.” The translation: democracy itself is the problem. As such, JPMorgan noted, “the process of political reform has barely begun.” In other words, out with democracy and in with financial and corporate oligarchy.

The bank’s report also noted that there were a number of potential threats as the process of “political reform” advanced, including “the collapse of several reform minded governments in the European south,” a “collapse in support for the Euro or the E.U.,” the possibility of “an outright electoral victory for radical anti-European parties,” or perhaps even “the effective ungovernability of some Member States once social costs (particularly unemployment) pass a particular level.” JPMorgan Chase warned that while there wasn’t a current situation of “ungovernability” in E.U. states, the longer-term prospects were “hard to predict, and a more pronounced backlash to the current approach to crisis management cannot be excluded.”

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AXA, one of the world’s largest financial institutions and insurance companies, published a report in July of 2013 written by Manolis Davradakis, entitled “Emerging Unrest: Looking for a Pattern,” which expressed particular concerns and perspectives on the issue of social unrest. The report noted that emerging market economies “are currently experiencing a surge in political risk due to social unrest that is being fueled by reasons that differ from those that resulted in the Arab Spring.”

The “main cause” of unrest in emerging market nations was “the rise of the middle class,” as this portion of the population “realize that they continue to experience the same everyday problems as poorer population strata, namely a high crime rate, poor public services, and corruption.” The report cited examples of social unrest in Turkey and Brazil, warning that these countries could see their credit ratings cut if the social upheaval is “lasting.”

The AXA report referred to the multiple episodes of unrest across emerging market nations in the summer of 2013 as “riots,” stating that they had several points in common, namely that “they were sparked by a government decision affecting daily life” and that the protesters were “not affiliated with political parties or movements” but instead were “well educated members of the middle class.” These factors were reminiscent of the massive unrest that took place in the advanced economies during the 19th century when emerging middle classes were struggling “for better living standards and more representation in political governance.”

Beyond a certain point, warned AXA, “repressing mass demands for a more open society becomes costly and economically ineffective.” A government’s inability or lack of will “to acknowledge the people’s right to freedom of expression and a voice in decision-making is a source of social unrest.”

AXA devised a Poor Governance Index (PGI), analyzing seven key indicators that could lead to social unrest, and concluded that the potential for instability in the BRIC nations – Brazil, Russia, India and China – was quite high. It also cited increased potential for unrest in Egypt, Ukraine, Indonesia, South Africa, Tunisia and Turkey, warning that such unrest “may have implications for emerging market [credit] ratings.” It noted that several credit ratings agencies had already warned about the effects that “prolonged social unrest” could have on the ratings for Turkey and Brazil.

Going further, in July of 2013, Stephen D. King, chief economist of HSBC bank, warned that growing wealth gaps and increasing divisions between generations could result in youth uprisings similar to the Peasants Revolt of the Middle Ages. King commented: “I am intrigued at the moment that the youth are quite peaceful, and I wonder whether that might change. It is very difficult to predict but youth movements might become more focused on their own rights rather than the economy.”

In October of 2013, King wrote an op-ed for the New York Times in which he warned that as bad as things already were, “they are going to get much worse, for the United States and other advanced economies, in the years ahead,” writing that both sides of the North Atlantic region had “already succumbed to a Japan-style ‘lost decade’” in which “promises can no longer be met, mistrust spreads and markets malfunction.” King wrote that “facing the pain will not be easy,” especially as policy makers continue to “opt for the illusion” and “pray for a strong recovery… because the reality is too bleak to bear.”

The “bleak” reality is that these and other big banks and financial institutions have repeatedly collapsed the global economy and profited along the way, punishing entire societies and populations into poverty through a process of plundering and exploitation as governments feared the wrath of “financial markets.” The banks that are now bigger, more dangerous and more powerful than ever fear the growing discontent, unrest and resistance of populations – especially the youth. The world’s major financial institutions fear that the global economic system which they helped to create, and over which they rule, will ultimately come back to haunt them in the form of mass social unrest, potentially undermining their power and the system as a whole.

Andrew Gavin Marshall is a researcher and writer based in Montreal, Canada. He is project manager of The People’s Book Project, chair of the geopolitics division of The Hampton Institute, research director for Occupy.com’s Global Power Project and World of Resistance Report, and hosts a weekly podcast show with BoilingFrogsPost.

World of Resistance Report: Davos Class Jittery Amid Growing Warnings of Global Unrest

 World of Resistance Report: Davos Class Jittery Amid Growing Warnings of Global Unrest

By: Andrew Gavin Marshall

Originally posted on 4 July 2014 at Occupy.com

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In Part 1 of the WoR Report, I examined the “global political awakening” as articulated by arch-imperial strategist Zbigniew Brzezinski. In Part 2 published last week I took a more detailed look at the ways global inequality and injustice relate to the coming era of instability and social unrest. Here, in Part 3, I explore the warnings on inequality and revolt now coming from one of the premier institutions of the global oligarchy: the World Economic Forum.

As an annual gathering of thousands of leading financial, corporate, political and social oligarchs in Davos, Switzerland, the World Economic Forum (WEF) has taken a keen interest in recent years discussing the potential for social upheaval as a result of mass inequality and poverty. A WEF report released in November of 2013 warned that a “lost generation” of unemployed youth in Europe could potentially pull the Eurozone apart. One of the report’s authors, the CEO of Infosys, commented that “unless we address chronic joblessness we will see an escalation in social unrest,” noting that youth especially “need to be productively employed, or we will witness rising crime rates, stagnating economies and the deterioration of our social fabric.” The report added: “A generation that starts its career in complete hopelessness will be more prone to populist politics and will lack the fundamental skills that one develops early on in their career.”

In short, if the global ruling class – known affectionately as the Davos Class – doesn’t quickly find ways to accommodate the continent’s increasingly unemployed and “lost” youth, those people will potentially turn to “populist politics” of resistance that directly challenge the global political and economic order. For the individuals and interests represented at the World Social Forum, this poses a monumental and, increasingly, an existential threat.

The World Economic Forum’s Global Competitiveness Report for 2013-2014, entitled “Assessing the Sustainable Competitiveness of Nations,” noted that the global financial crisis and its aftermath “brought social tensions to light” as economic growth was not translated into positive benefits for much or most of the planet’s population. Citing the Arab Spring, growing unemployment in Western economies and increasing income inequality, there was growing recognition that dangerous upheaval could be on the way. The report noted: “Diminishing economic prospects, sometimes combined with demand for more political participation, have also sparked protests in several countries including, for example, the recent events in Brazil and Turkey.”

The WEF report wrote that “if economic benefits are perceived to be unevenly redistributed within a society,” this could frequently result in “riots or social discontent” such as the Arab Spring revolts, protests in Brazil, the Occupy Wall Street movement, and other recent examples. The report concluded that numerous nations were at especially high risk of social unrest, including China, Indonesia, Turkey, South Africa, Brazil, India, Peru and Russia, among others.

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In early 2014, the World Economic Forum released the 9th edition of its Global Risks report, published to inform the debate, discussion and planning of attendees and guests at the annual WEF meeting in Davos. The report was produced with the active cooperation of major universities and financial corporations, including Marsh & McLennan Companies, Swiss Re, Zurich Insurance Group, National University of Singapore, University of Oxford, and the University of Pennsylvania’s Wharton Risk Management and Decision Processes Center. It included a large survey conducted in an effort to assess the major perceived risks to the global order atop which the Davos Class sits.

The report noted that the “most interconnected” risks were fiscal crises, structural unemployment and underemployment, all of which link to “rising income inequality and political and social instability.” The young generation now coming of age globally, noted the WEF, “faces high unemployment and precarious job situations, hampering their efforts to build a future and raising the risk of social unrest.” This “lost generation” faces not only high unemployment and underemployment, but also major educational challenges since “traditional higher education is ever more expensive and its payoff more doubtful.”

Perceiving the innovations and skills of today’s generation which are enabling the growing foment, the Forum noted:

“In general, the mentality of this generation is realistic, adaptive and versatile. Smart technology and social media provide new ways to quickly connect, build communities, voice opinion and exert political pressure… [youth are] full of ambition to make the world a better place, yet feel disconnected from traditional politics and government – a combination which presents both a challenge and an opportunity in addressing global risks.”

The Global Risks 2014 report cited a global opinion survey on the “awareness, priorities and values of global youth,” which the authors refer to as “generation lost.” This generation, noted the survey, “think independently of this basic fallback system of the older generation – governments providing a safety net,” which “points to a wider distrust of authorities and institutions.” The “mindset” of today’s youth has been additionally shaped by the repercussions and apparent failures to deal with the global financial crisis, as well as increasing revelations about U.S. intelligence agencies engaging in massive digital spying. For a generation largely mobilized through social media, online spying has held particular relevance, as “the digital revolution gave them unprecedented access to knowledge and information worldwide.”

Protests and anti-austerity movements were able to “give voice to an increasing distrust in current socio-economic and political systems,” with youth making up significant portions of “the general disappointment felt in many nations with regional and global governance bodies such as the EU and the International Monetary Fund.” The youth “place less importance on traditionally organized political parties and leadership,” which creates a major “challenge for those in positions of authority in existing institutions” as they try “to find ways to engage the young generation,” adds the report.

According to the World Bank, more than 25% of the world’s youth, or some 300 million people, “have no productive work.” On top of this, “an unprecedented demographic ‘youth bulge’ is bringing more than 120 million new young people on to the job market each year, mostly in the developing world.” This fact “threatens to halt economic progress, creating a vicious cycle of less economic activity and more unemployment,” which “raises the risk of social unrest by creating a disaffected ‘lost generation’ who are vulnerable to being sucked into criminal or extremist movements.”

Noting that more than 1 billion people currently live in slums – a number that has been steadily increasing as income inequality rises – the report stated that “this growing population of urban poor is vulnerable to rising food prices and economic crises, posing significant risks of chronic social instability.” Growing income inequality is now being termed a “systemic risk,” according to the WEF. And in a stark admission from that institution representing the world’s major profiteers of global capitalism, the report acknowledged that globalization “has been associated with rising inequality between and within countries” and that “these factors render poor people and poor countries vulnerable to systemic risks.”

The four major “emerging market” BRIC nations of Brazil, Russia, India and China “now rank among the 10 largest economies worldwide.” But slow political reforms within these countries, coupled with external economic shocks (like financial crises caused by Western nations and their corporate institutions) could aggravate the “existing undertones of social unrest.” Within the BRIC nations and other emerging market economies, “popular discontent with the status quo is already apparent among rising middle classes, digitally connected youths and marginalized groups,” the report went on. Collectively, these groups “want better services (such as healthcare), infrastructure, employment and working conditions,” as well as “greater accountability of public officials, better protected civil liberties and more equitable judicial systems.” Further, a “greater public awareness of widespread corruption have sharpened popular complaints.”

Both Brazil and Turkey have made universal healthcare systems a constitutional obligation, which was a stated ambition of other emerging market nations such as India, Indonesia and South Africa. The failure to create these healthcare systems “may arouse social unrest,” warned the WEF. The World Economic Forum’s chief economist, Jennifer Blanke, stated: “The message from the Arab Spring, and from countries such as Brazil and South Africa is that people are not going to stand for it any more.” David Cole, the group chief risk officer of Swiss Re (one of the contributing companies to the WEF report) commented: “The members of generation lost are not lost because they have tuned out. They are highly tuned in. They are lost because they are being left out or they are deciding to leave.” http://www.theguardian.com/business/2014/jan/16/income-gap-biggest-risk-global-community-world-economic-forum

The World Economic Forum’s Risk report for 2014 was primarily concerned with “the breakdown of social structures” and “the decline of trust in institutions.” It warned of risks of “ideological polarization, extremism – in particular those of a religious or political nature – and intra-state conflicts such as civil wars.” All of these issues relate directly “to the future of the youth.”

It’s an interesting paradox for an organization to see the greatest threat to its ideological and social power being “the future of the youth” when it has already written off the present generation as “lost.” However, this is a view shared not only by the World Economic Forum but, increasingly, by other powerful institutions creating something of an echo chamber through the mainstream media. The head of the IMF has warned that youth unemployment in poor nations was “a kind of time bomb,” and the head of the International Labor Organization (ILO) warned in 2011 that the “world economy” was unable “to secure a future for all youth,” thus undermining “families, social cohesion and the credibility of policies.” While there was “already revolution in the air in some countries,” as reported in the Globe and Mail, the dual crises of unemployment and poverty were “fuel for the fire.”

In April of 2014, the World Economic Forum on Latin America reported that the primary challenge for the region was “to reduce inequality,” noting that between 70 and 90 million people in Latin America had entered what were referred to as the “consuming classes,” or “middle classes,” over the previous decade. However, Marcelo Cortes Neri, Brazil’s Minister of Strategic Affairs, explained, “When we talk about middle class we think of the U.S. middle class, with two cars and two dogs and a swimming pool. That is not Latin American middle class or the world middle class.”

He added that the emerging so-called “middle class” in Latin America and elsewhere “could become a problem for governance,” commenting: “They are the ones that put pressure for better levels of education and healthcare; they are the ones that go to the streets to demand rights.” Neri then posed the question: “How prepared is Latin America to have a robust middle class?” In particular, youth between the ages of 15 and 29 raised specific concerns for Latin America’s elite, with Neri warning: “This is the group I am most worried about. They have very high expectations and so the probability they will get frustrated is enormous.”

When one of the world’s most influential organizations representing the collective interests of the global oligarchy openly acknowledges that globalization has increased inequality, and in turn, that inequality is fueling social unrest around the world manifesting the greatest potential threat to those oligarchic interests, we can safely say we’re entering a new era of global instability and resistance.

Andrew Gavin Marshall is a researcher and writer based in Montreal, Canada. He is project manager of The People’s Book Project, chair of the geopolitics division of The Hampton Institute, research director for Occupy.com’s Global Power Project and World of Resistance Report, and host of a weekly podcast show with BoilingFrogsPost.

World of Resistance Report: Inequality, Injustice and the Coming Unrest

World of Resistance Report: Inequality, Injustice and the Coming Unrest

By: Andrew Gavin Marshall

Originally posted at Occupy.com

26 June 2014

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In Part 1 of the World of Resistance (WoR) Report, I examined today’s global order – or disorder – through the eyes of Zbigniew Brzezinski, a former U.S. National Security Adviser and long-time influential figure in foreign policy circles. Brzezinski articulated what he refers to as humanity’s “global political awakening,” spurred by access to education, technology and communications among much of the world’s population.

Brzezinski has written and spoken extensively to elites at American and Western think tanks and journals, warning that this awakening poses the “central challenge” for the U.S. and other powerful countries, explaining that “most people know what is generally going on… in the world, and are consciously aware of global iniquities, inequalities, lack of respect, exploitation.” Mankind, Brzezinski said in a 2010 speech, “is now politically awakened and stirring.”

But Brzezinski is hardly the only figure warning elites and elite institutions about the characteristics and challenges of an awakened humanity. The subject of inequality – raised to the central stage by the Occupy movement – has become a fundamental feature in the global social, political and economic discussion, as people become increasingly aware of the facts underlying the stark division between the haves and have nots. While inequality is both a source and a result of the concentration of power in the hands of a few, it also represents the greatest threat to those very same power structures and interests.

As many if not most of us are by now aware, the global state-capitalist system is run by a relatively small handful of powerful institutions, groups and individuals who collectively control the vast majority of planetary wealth and resources. Banks, corporations, family dynasties and international financiers like the IMF and World Bank form a highly interconnected, interdependent network we now think of as the global oligarchy.

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Thomas Pogge explained in the Georgia Journal of International and Comparative Law that in the 20 years following the end of the Cold War, there were roughly 360 million preventable poverty-related deaths – more than all of the deaths in all of the wars of the 20th century combined. By 2004, over 1 billion people remained “chronically undernourished” and nearly a billion lacked access to clean drinking water and shelter. Roughly 1.6 billion lacked access to electricity while 218 million children were working as cheap labour.

Pogge noted that almost half of humanity – roughly 3.5 billion people – lived on less than $2.50 a day, and that all of these people could be lifted out of poverty with an expenditure $500 billion, which is roughly two-thirds of the annual U.S. Pentagon budget.

Preceding the statistics that would get popularized with the Occupy movement, Pogge asserted that the top 1% owned approximately 40% of global wealth while the bottom 60% of humanity owned less than 2%. “We are now at the point where the world is easily rich enough in aggregate to abolish all poverty,” Pogge wrote. “We are simply choosing to prioritize other ends instead.”

Still today, every year, approximately 18 million people – half of whom are children under the age of five – die from poverty-related causes, all of which are preventable. Seen through this lens, poverty, and by definition, inequality, has become the greatest purveyor of violence, death and injustice on Earth.

Meanwhile, the international charity Oxfam noted that the 100 richest people in the world made a combined 2012 fortune of $240 billion – enough to lift the world’s poorest out of poverty four times over. In the previous 20 years, the world’s richest 1% increased their income by 60%, perpetuating a system of extreme wealth which is, according to an Oxfam executive, “economically inefficient, politically corrosive, socially divisive and environmentally destructive.”

Not only that, a former chief economist for McKinsey & Company published data in 2012 for the Tax Justice Network that reported the world’s super rich had hidden between $21 and $32 trillion in offshore tax havens – a trend that has been increasing in the past three decades to reveal that inequality is “much, much worse than official statistics show.”.

In early 2014, Oxfam released a report revealing that the world’s 85 richest individuals had a combined wealth equal to the collective wealth of the world’s poorest 3.5 billion people – approximately $1.7 trillion. Meanwhile, the world’s top 1% own roughly half the world’s wealth, at $110 trillion. Oxfam noted: “This massive concentration of economic resources in the hands of fewer people presents a significant threat to inclusive political and economic systems… inevitably heightening social tensions and increasing the risk of societal breakdown.”

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What Does All the Inequality Mean in Terms of Instability?

Where there is great inequality, there is great injustice and where there is great injustice, there is the inevitability of instability. This relationship, between inequality and instability, has not gone unnoticed by the world’s oligarchs and plutocratic institutions. The potential for “social unrest” has gotten especially high since the onset of the global financial and economic crisis that began in 2007 and 2008.

The head of the OECD warned in 2009 that the world’s leading economies would have to take quick action to resolve the global crisis or face a “fully blown social crisis with scarring effects on the vulnerable workers and low-income households.”

The major credit ratings agency Moody’s warned back in 2009 that the growing debts among nations would “test social cohesiveness” as investors demanded countries impose still more painful austerity measures, leading to growing “political and social tension” and “social unrest.” In February of that same year, the Director-General of the World Trade Organization (WTO) warned that following the economic crisis, many nations were “going to be confronted by unrest and inter-religious and inter-ethnic conflicts.”

Brzezinski himself said:, “There’s going to be growing conflict between the classes and if people are unemployed and really hurting, hell, there could even be riots.” And meanwhile, the top-ranking U.S. military official and Chairman of the Joint Chiefs of Staff, Admiral Mike Mullen, commented that the global financial crisis was a greater security concern to the U.S. than either of the massive ground wars in Iraq or Afghanistan. “It’s a global crisis,” he said, and “as that impacts security issues, or feeds greater instability, I think it will impact our national security in ways that we quite haven’t figured out yet.”

Mullen’s point was reiterated by U.S. intelligence director Dennis Blair, who warned Congress that the global crisis was “the primary near-term security concern” for the U.S., adding that “the longer it takes for the recovery to begin, the greater the likelihood of serious damage to U.S. strategic interests.” Blair noted that as a result of the crisis, roughly 25% of the world’s nations had already experienced “low-level instability such as government changes.” If the crisis persisted beyond two years, Blair noted, there was a potential for “regime-threatening instability.” U.S. intelligence analysts were also fearful of a “backlash against U.S. efforts to promote free markets because the crisis was triggered by the United States.”

In November of 2008, the U.S. Army War College produced a document warning that the U.S. military must be prepared for the possibility of a “violent strategic dislocation inside the United States,” possibly caused by an “unforeseen economic collapse” and/or a “purposeful domestic resistance” and the “loss of functioning of political and legal order.” Under “extreme circumstances,” the document warned, “this might include the use of military force against hostile groups inside the United States.”

In 2009, the British spy agency MI5, along with the British Ministry of Defence, were preparing for the potential of civil unrest to explode in Britain’s streets as a result of the economic crisis, [noting](http://www.express.co.uk/posts/view/86981/MI5-alert-on-bank-riot> that there was a possibility the state would deploy British troops in major cities.

A December 2009 article in The Economist warned that increased unemployment and poverty along with “exaggerated income inequalities” following the global economic crisis made for a “brew that foments unrest.” In October of 2011, the International Labour Organizationwarned in a major report that the jobs crisis resulting from the global economic crisis “threatens a wave of widespread social unrest engulfing both rich and poor countries,” and pointed out that 45 of the 118 countries studied already saw rising risks of unrest, notably in the E.U., Arab world and Asia.

In June of 2013, the same ILO warned that the risks of social unrest including “strikes, work stoppages, street protests and demonstrations,” had increased in most countries around the world since the economic crisis began in 2008. The risk was “highest among the E.U.-27 countries,” it noted, with an increase from 34% in 2006-2007 to 46% in 2011-2012. The most vulnerable nations in the E.U. were listed as Cyprus, Czech Republic, Greece, Italy, Portugal, Slovenia and Spain, a fact “likely due to the policy responses to the ongoing sovereign debt crisis and their impact on people’s lives and perceptions of well-being.”

The E.U.’s “bleak economic scenario has created a fragile social environment as fewer people see opportunities for obtaining a good job and improving their standard of living,” warned the ILO, and advanced economies were “going to suffer a lost decade of jobs growth.”

An October 2013 report by the International Federation of Red Cross and Red Crescent Societies warned that the long-term consequences of austerity policies imposed by E.U. governments “will be felt for decades even if the economy turns for the better in the near future.” The report noted: “We see quiet desperation spreading among Europeans, resulting in depression, resignation and loss of hope… Many from the middle class have spiraled down to poverty.”

The study further reported “that the rate at which unemployment figures have risen in the past 24 months alone is an indication that the crisis is deepening, with severe personal costs as a consequence, and possible unrest and extremism as a risk. Combined with increasing living costs, this is a dangerous combination.”

In November 2013, The Economist reported: “From anti-austerity movements to middle-class revolts, in rich countries and in poor, social unrest has been on the rise around the world.” While there are various triggers – from economic distress (Greece and Spain) to revolts against dictatorships (the Arab Spring) to the growing aspirations of middle class populations (Turkey and Brazil), “they share some underlying features,” the magazine reported. The common feature, it noted, “is the 2008-09 financial crisis and its aftermath,” and an especially important factor sparking unrest in recent years was “an erosion of trust in governments and institutions: a crisis of democracy.”

A sister company of The Economist, the Economist Intelligence Unit (EIU), measured the risk of social unrest in 150 countries around the world, with an emphasis on countries with institutional and political weaknesses. The EIU noted that “recent developments have indeed revealed a deep sense of popular dissatisfaction with political elites and institutions in many emerging markets.” Indeed, the decline in trust has been accelerating across the developed world since the 1970s. The fall of Communist East European regimes in 1989 eroded that trust further, and the process sped up once again with the onset of the global financial crisis.

According to EIU estimates, roughly 43% (or 65) of the countries studied were considered to be at “high” or “very high” risk of social unrest in 2014. A further 54 countries were considered to be at “medium risk” and the remaining 31 were considered “low” or “very low.” Comparing the results to a similar study published five years previously, an additional 19 countries have been added to the “high risk” category.

Among the countries considered a “very high risk” for social unrest in 2014 were Argentina, Bahrain, Bangladesh, Bosnia, Egypt, Greece, Lebanon, Nigeria, Syria, Uzbekistan, Venezuela, Yemen and Zimbabwe. Among the countries in the “high risk” category were Algeria, Brazil, Cambodia, China, Cyprus, Ethiopia, Guatemala, Haiti, Honduras, Iran, Jordan, Laos, Mexico, Morocco, Nicaragua, Pakistan, Peru, the Philippines, Portugal, South Africa, Spain, Tunisia, Turkmenistan, Turkey and Ukraine.

It doesn’t take demonstrators filling the streets to tell us that inequality breeds instability. While many factors combine under different circumstances to lead to “social unrest,” inequality is almost always a common feature. Injustice, poor governance, corruption, poverty, exploitation, repression and corrosive power structures all support and are supported by underlying conditions of inequality. And as inequality is no longer a local, national or regional phenomenon but a global one, so too is the “threat” of instability that the world’s elite financial, media and think-tank institutions are now so busy warning about. So long as inequality increases, so will instability. Resistance, and even revolution, are the new global reality.

Andrew Gavin Marshall is a researcher and writer based in Montreal, Canada. He is project manager of The People’s Book Project, chair of the geopolitics division of The Hampton Institute, research director for Occupy.com’s Global Power Project and the World of Resistance (WoR) Report, and hosts a weekly podcast show with BoilingFrogsPost.

 

The West Marches East, Part 2: Georgia Starts a War, Russia Draws a Line

The West Marches East, Part 2: Georgia Starts a War, Russia Draws a Line

By: Andrew Gavin Marshall

Originally posted at The Hampton Institute

19 June 2014

U.S. Vice President Biden and Georgia's President Saakashvili review a honour guard during a welcoming ceremony in Tbilisi

In Part 1 of this series – ‘The West Marches East’ – I examined the circumstance that while Russia has received the majority of the blame for the more than six-month-crisis in Ukraine, these events did not take place in a vacuum, and, in fact, the Western powers and institutions – notably the United States, NATO and the European Union – have broke promises made at the end of the Cold War to expand NATO – a Western military alliance that was created in opposition to the Soviet Union – to Russia’s borders. Simultaneously, the European Union has expanded eastwards, bringing Eastern and Central European countries within its orbit and in adherence to its economic orthodoxy. Further, many NATO powers had worked together to promote ‘colour revolutions’ across much of Eastern Europe over the previous decade or so, helping to overthrow pro-Russian leaders and replace them with pro-Western leaders.

After nearly a quarter-century of Western expansion – militarily, politically, economically – to Russia’s borders, Russia has had enough. But Ukraine was not the first instance in which Russia has been provoked by the West into a response that the West subsequently declared as an act of imperial “aggression.” In 2008, the small Caucasus nation and former Soviet republic of Georgia started a war with Russia, leading to Russia’s invasion of the tiny country, effectively ending nearly two decades of NATO and Western expansion. This report examines the 2008 war in Georgia and the roles played by Russia and the NATO powers.
Setting the Stage

As documented in part 1, Georgia was – in 2003 – subjected to a NATO sponsored ‘Colour Revolution’ which removed the previous leader and replaced him with a pro-Western (and Western-educated) politician, Mikeil Saakashvili. In December of 2003, Georgian defense officials met with the U.S. Secretary of Defense Donald Rumsfeld to discuss enhancing military cooperation between the two countries. The US had sent roughly 60 military trainers to Georgia in 2002, but the Georgians had been lobbying for a US military base in their country.

Instead, the Pentagon decided to ” privatize its military presence in Georgia” through a security contractor, Cubic, which signed a three-year $15 million contract with the Pentagon to support the Georgian ministry of defense. The team from Cubic would engage in training and equipping the Georgian military, as well as protection for the oil pipeline that was to take oil from Baku, Azerbaijan, to Turkey through Georgia. Western diplomats suggested that the country could become a “forward operations area” for the US military, “similar to support structures in the Gulf.” In return for the program, Georgia agreed to send 500 soldiers to Iraq.

As the BBC reported in 2006, Georgia was discarding its ties with Moscow and instead, leading “westwards – towards NATO, and perhaps eventually the European Union.” US military instructors were in the country “to drive that change,” training Georgian soldiers to manage checkpoints in US-occupied Iraq. Georgia was largely uneasy with Russia due to the fact that Moscow provided – since the early 1990s – moral and material support to the country’s two breakaway regions of South Ossetia and Abkhazia. A Georgian corporal deployed in Iraq was quoted in the New York Times in 2007 saying, “As soldiers here [in Iraq], we help the American soldiers… Then America as a country will help our country.” This reflected the implicit thinking within Georgia up until the 2008 war.

In early April of 2008, U.S. President George W. Bush said he “strongly supported” Ukraine and Georgia’s bids to join NATO, despite the enormous objections from Russia, which would then see NATO powers located directly on its borders. Bush made the comments following a NATO meeting, where France, Germany, Italy, Hungary, Belgium, the Netherlands and Luxembourg all opposed the U.S. position of fast-tracking Georgian and Ukrainian membership into NATO, seeing it as ” an unnecessary offense to Russia.” Shortly after Bush made his announcement, a former Russian armed forces chief of staff said that Russia would ” take military and other steps along its borders if ex-Soviet Ukraine and Georgia join NATO,” claiming that “such a move would pose a direct threat to its security and endanger the fragile balance of forces in Europe.”

Within Georgia and its separatist regions, which were home to Russian soldiers, tensions were increasingly flaring over the summer months of 2008. With both sides undertaking provocative measures, there was a growing awareness that war could break out. In July of 2008, following her visit to the Czech Republic where she signed an agreement to base part of a new U.S. missile defense system in the country, U.S. Secretary of State Condoleezza Rice traveled to Georgia to meet with the country’s leadership. At that time, U.S. military forces in the region had begun joint exercises with soldiers from Georgia, Armenia, Ukraine and Azerbaijan. The exercises were taking place less than 100km from Russia’s border, with roughly 1,000 U.S. soldiers and an equal number of Georgian troops. As Rice arrived in Georgia, the Russian foreign ministry issued a statement accusing Georgia “of pushing the region towards war through actions openly supported by the United States.”

Then-Russian President Dmitri Medvedev later explained that as tensions escalated into July of 2008, he was in contact with his Georgian counterparts. However, following Secretary Rice’s July 2008 visit to Georgia, he claimed, “my Georgian colleague simply dropped all communication with us. He simply stopped talking to us, he stopped writing letters and making phone calls. It was apparent that he had new plans now. And those plans were implemented later.”

Indeed, as the New York Times noted, when Rice went to Georgia, she had two different goals, one private, and one public. Privately, she reportedly told the Georgians “not to get into a military conflict with Russia that Georgia could not win.” However, in public, standing alongside the Georgian president, Rice spoke defiantly against Russia and in support of Georgia and its “territorial integrity” in the regions of South Ossetia and Abkhazia. Standing next to the president, Rice declared that Russia “needs to be a part of resolving the problem… and not contributing to it.” The NYT claimed that these public statements of support for Georgia – and antagonism toward Russia – not to mention the fact that the US was engaging in large-scale military exercises with Georgians, expanding military installations all across Eastern Europe and providing Georgia with military advisers, had the combined effect of sending the small country “mixed messages ” about U.S. support for a war with Russia.

No doubt contributing to these ‘mixed messages’ was when – at the very same news conference with President Saakashvili – Rice was asked a question about a potential conflict with Iran, to which she replied that, “We will defend our interests and defend our allies… We take very, very strongly our obligations to defend our allies and no one should be confused of that.” Apparently, Georgia was a little confused.

When the Soviet Union collapsed and Georgia declared independence, the two regions of South Ossetia and Abkhazia gained de facto independence in the early 1990s following conflict between the breakaway regions and the central state. Following this brief period of fighting, tensions were largely reduced, though Russian ‘peacekeepers’ were on the ground monitoring the fragile balance. That balance was upset when Saakashvili became president in 2004, making one of his pledges “national unification.” By 2008, when tensions were reaching a breaking point, there were over 2,000 American civilians in Georgia, according to the Pentagon, with over 130 U.S. military trainers and 30 Defense Department civilians.

Another facet to the increased tensions was the fact that Georgia was an important conduit for a major pipeline, bringing oil from Baku in Azerbaijan through Georgia and to the Turkish port of Ceyhan on the Mediterranean. When the pipeline was completed in 2006, it was the second-longest pipeline in the world, and its construction and use was specifically designed to “bypass Russia, denying Moscow leverage over a key resource and a potential source of pressure.” As Jonathan Steele wrote in the Guardian, the resulting war was about more than pipeline politics, however, as it represented “an attempt, sponsored largely by the United States but eagerly subscribed to by several of its new ex-Soviet allies, to reduce every aspect of Russian influence throughout the region, whether it be economic, political, diplomatic or military.”

The Wall Street Journal reported that the Baku-Tbilisi-Ceyhan pipeline was built by a consortium of major Western energy corporations, and was “the first pipeline on former Soviet territory that bypasse[d] Russia,” which “was strongly backed by the US as a way of loosening Moscow’s grip on the Caspian’s oil wealth.”
When War Broke Out

On August 7, 2008, war broke out. Georgia claimed that it was responding to an attack on the country by separatists in South Ossetia and Russian aggressors. However, independent military observers from the Organization for Security and Cooperation in Europe (OSCE) who were deployed in the region refuted the Georgian government’s claim, and instead reported that, “Georgia’s inexperienced military attacked the isolated separatist [South Ossetian] capital of Tskhinvali on Aug. 7 with indiscriminate artillery and rocket fire, exposing civilians, Russian peacekeepers and unarmed monitors to harm.” While Georgian President Saakashvili presented the Georgian military actions as “defensive,” in response to separatist and Russian shelling of Georgian villages, the OSCE monitors were unable to confirm that such villages had been attacked, with no shelling heard in the villages prior to the Georgian bombardment of Tskhinvali. Two senior Western military officials who were stationed in Georgia, working with the Georgian military, told theNew York Times that, “whatever Russia’s behaviour or intentions for the enclave, once Georgia’s artillery or rockets struck Russian positions, conflict with Russia was all but inevitable.”

A year after the war, an EU-commissioned report which took nine months to compile concluded that despite much of the blame at the time of – and since – the war being directed at ‘Russian aggression,’ the conflict began “with a massive Georgian artillery attack.” The “damning indictment” of Georgia, however, blamed both Georgia and Russia for committing war crimes during the conflict, and noted that the conflict resulted from months and years of growing conflict. However, the report flatly stated: ” There was no ongoing armed attack by Russia before the start of the Georgian operation… Georgian claims of a large-scale presence of Russian armed forces in South Ossetia prior to the Georgian offensive could not be substantiated… It could also not be verified that Russia was on the verge of such a major attack.” However, Vladimir Putin stated in 2012 that Russia had drawn up plans to counter a Georgian attack as far back as 2006 and 2007, when he was president. Still, while the Russians were clearly aware – and preparing – for a war, it was ultimately Georgia that fired the first shots.

Months before the war broke out, according to documents and interviews obtained by the Financial Times, senior U.S. military officials and U.S. military contractors were inside Georgia training special forces commandos. The two contractors, MPRI and American Systems, both of which are based in Virginia, were responsible for training the Georgian special forces as part of a program run by the Pentagon. The Pentagon had previously hired MPRI to train the Croatian military in 1995, just prior to the Croatian military’s invasion of the ethnically-Serbian region of Krajina, “which led to the displacement of 200,000 refugees and was one of the worst incidents of ethnic cleansing in the Balkan wars.” MPRI, of course – in both cases – denied “any wrongdoing.” The first phase of the training in Georgia took place between January and April of 2008, and the second phase was due to begin on August 11, with the trainers arriving in Georgia on August 3, four days before the war broke out.

Just prior to the outbreak of war, as U.S. diplomatic cables showed, the U.S. Embassy in Georgia knew and reported about the fact that Georgian forces were concentrating their forces near South Ossetia, “either as part of a show of force or readiness, or both.” The U.S. ambassador reportedly told Georgian officials “to remain calm, not overreact, and to de-escalate the situation.” As the diplomatic cables from Georgia revealed, unlike in neighboring countries, U.S. diplomats in Georgia “relied heavily on the Saakashvili government’s accounts of its own behavior” and embraced the “Georgian versions of important and disputed events.” Whereas in other regional countries, U.S. diplomats would report to Washington on their “private misgivings” about their host countries’ claims, in Georgia, the Saakashvili government’s “versions of events were passed to Washington largely unchallenged.”

The five-day war between Russia and Georgia lasted from August 7 – 12, leading to a decisive Russian victory and a humiliating defeat for the US-puppet regime in Georgia. Months of ‘mixed messages’ and indecision and divisions within the Bush administration directly led to the conflict, inflaming internal confrontations within the Bush administration itself. A New York Times article tells this brief story based upon interviews with diplomats and senior officials in the US, EU, Russia and Georgia. Five months before Georgia started the war – in March of 2008 – President Saakashvili had gone to Washington to lobby for NATO membership at Congress, the State Department and the Pentagon. Bush promised the Georgian president ” to push hard for Georgia’s acceptance into NATO.”

In early April, President Bush flew to the Russian resort city of Sochi where he met with President Putin. Putin delivered Bush a message: “the push to offer Ukraine and Georgia NATO membership was crossing Russia’s ‘red lines’.” The United States, however, clearly underestimated Russia and Putin’s determination to adhere to those ‘red lines’. Meanwhile, Vice President Dick Cheney saw Georgia as a “model” for the administration’s “democracy promotion campaign,” and continued to push for selling Georgia more arms and military equipment “so that it could defend itself against possible Russian aggression.” Opposing Cheney were Secretary of State Rice, National Security Adviser Stephen J. Hadley and Undersecretary of State for Political Affairs William J. Burns, who were arguing that ” such a sale would provoke Russia, which would see it as arrogant meddling in its turf.”

While the official line of the Bush administration after the war broke out was to blame Russia, quietly and internally, top U.S. officials noted that Georgia was largely to blame, and that U.S. officials had contributed to that process by sending confused messages. Indeed, as some administration officials reported, the Georgian military had created a “concept of operations” plan for a military operation in South Ossetia which “called for its army units to sweep across the region and rapidly establish such firm control that a Russian response could be pre-empted.” As early as January of 2008, Georgia’s Ministry of Defense laid out plans in a “strategic defense review” which “set out goals for the Georgian armed forces and refers specifically to the threat of conflict in the separatist regions.” U.S. officials had reportedly warned the Georgians that, ” the plan had little chance of success.”

Indeed, as the war was under way, debates were raging within the Bush administration regarding the possible US response. In particular, tensions started to erupt between Bush and Cheney, as Cheney’s office felt that when Bush had previously met Putin in April, his silent response to Putin’s warning “inadvertently gave Russia the all-clear to attack.” There was discussion within the administration (from Cheney’s side of the debate) of launching air strikes to halt the Russian invasion. After four days of talks with the National Security Council (NSC), George Bush “cut off the discussion,” siding with his somewhat more rational advisers, as there was “a clear sense around the table that any military steps could lead to a confrontation with Moscow.”

Putin had also spoken with Georgian president Saakashvili in February of 2008, where he warned the Georgian president: “You think you can trust the Americans, and they will rush to assist you?” Putin then reportedly claimed that, ” Nobody can be trusted! Except me.” Interestingly, in this respect, Putin happened to be correct.

European governments were not big fans of Saakashvili, either, seeing him as “an American-backed hothead who spelled trouble.” During the five-day war, French President Nicolas Sarkozy shuttled between Russia and Georgia attempting to negotiate a ceasefire. Sarkozy reportedly told the Georgians: “Where is Bush? Where are the Americans?… They are not coming to save you. No Europeans are coming, either. You are alone. If you don’t sign [the ceasefire], the Russian tanks will be here soon.”

The day after the war began, the Russians called an emergency session at the United Nations to find a resolution to the conflict. The Russian’s proposed a short, three-paragraph draft resolution calling on all parties to “renounce the use of force.” This phrase ran into opposition from the United States, France and Britain, who claimed the phrase was “unbalanced” because it “would have undermined Georgia’s ability to defend itself.” The US, British and French opposition to “renounce the use of force” led to a collapse of diplomatic attempts at the UN to end the fighting, according to the New York Times. When the French President eventually negotiated a ceasefire on August 12, at least one senior U.S. official (presumably Cheney) was reportedly ” appalled” by the ceasefire text.

Erosi Kitsmarishvili, a former Georgian diplomat and ambassador to Moscow (and confidante of President Saakashvili) caused controversy within Georgia when he testified at a parliamentary hearing in Georgia in November of 2008 that Georgian officials were responsible for starting the war. He said that he was told by Georgian officials in April of 2008 that they had “planned to start a war in Abkhazia,” saying that they “had received a green light from the United States government to do so.” However, he added, the officials later decided to start the war in South Ossetia instead, believing that ” United States officials had given their approval.” He discussed the July 2008 meeting between Georgian officials and Secretary of State Rice, saying, “Some people who attended the meeting between Condoleezza Rice and Saakashvili were saying that Condoleezza Rice gave them the green light for military action,” though U.S. and Georgian officials “categorically denied this information.”

When the war broke out, the United States military airlifted Georgian troops from Iraq back to Georgia to participate in the fighting against Russia. In the Pentagon, a 28-year-old junior staffer, Mark Simakovsky, “almost overnight… became a key policy adviser” to Secretary of Defense Robert Gates and other top administration officials. Serving as the Pentagon’s country director for Georgia, he “used his expert knowledge and contacts throughout the government and in Georgia to quickly gather information about developments on the ground.” He was pivotal in shaping the Pentagon’s response to the crisis, including the coordination of airlifting 2,000 Georgian soldiers from Iraq back to Georgia.
Aftermath

Within a week of the Georgian war ending on August 12, Secretary of State Condoleezza Rice declared that the United States “would not push for Georgia to be allowed into NATO” during an upcoming emergency meeting of the NATO countries in Brussels, in what the New York Times reported as, “a tacit admission that America and its European allies lack the stomach for a military fight with Russia.”

However, NATO foreign ministers were expected to reaffirm that they would eventually like to see both Georgia and Ukraine join NATO, but not to fast-track the process through the Membership Action Plan (MAP), for which Georgia and the US had previously been lobbying. In November of 2008, Rice affirmed that the US was no longer attempting to fast-track Georgian and Ukrainian membership into NATO, largely due to opposition from France and Germany . In 2011, Russian President Dmitri Medvedev stated that if Russia hadn’t invaded Georgia in 2008, NATO would have expanded already to include Georgia as a member.

In late August, Russian commanders were reportedly “growing alarmed at the number of NATO warships sailing into the Black Sea.” The U.S. said it was delivering “humanitarian aid on military transport planes and ships,” though the Russians suspected that the Pentagon was shipping in weapons and military equipment “under the guise” of humanitarian assistance.

Weeks following Georgia’s defeat, officials at the White House, Pentagon and State Department were “examining what would be required to rebuild Georgia’s military.” The U.S. Chairman of the Joint Chiefs of Staff, Admiral Mike Mullen, stated during a news conference that Georgia was ” a very important country to us” and that the U.S. would continue to pursue a “military-to-military relationship.” Both Democrats and Republicans proclaimed their unyielding support for Georgia, as both the John McCain and Barack Obama presidential campaigns had “cultivated close ties” to President Saakashvili. John McCain’s wife and Senator Joe Biden (who would become Obama’s Vice President) had gone to visit Georgia in August of 2008, just following the end of the war.

In early September, President Bush promised $1 billion in ” humanitarian and economic assistance” to help rebuild the country following the war, making Georgia one of the largest recipients of U.S. foreign aid, after Israel, Egypt and Iraq. Comparatively, in the previous 17 years, the United States had provided a total of $1.8 billion in aid to the country. The European Union also pledged to contribute funds to Georgia, as did the International Monetary Fund (IMF), declaring its intention to provide the country with a $750 million loan.

In September of 2008, Vice President Dick Cheney flew to Georgia “to deliver a forceful American pledge to rebuild Georgia and its economy, to preserve its sovereignty and its territory and to bring it into the NATO alliance in defiance of Russia.” Cheney, who arrived in Georgia a day after the U.S. announced a $1 billion rescue package to help the country, then flew to Ukraine to deliver a similar message. Russia, meanwhile, was entrenching its control over the breakaway regions of South Ossetia and Abkhazia, recognizing their independence from Georgia and keeping military units stationed within them.

Cheney’s visit, which began in Azerbaijan, then to Georgia and Ukraine, was orchestrated to confirm that the U.S. had “a deep and abiding interest” in the region, and notably in terms of ensuring that these and neighboring countries remained “free from a new era of Russian domination.” Cheney was the highest-ranking U.S. official to visit Azerbaijan since it gained independence in 1991. Underscoring the importance of the BP-led pipeline transporting oil from Azerbaijan through Georgia to Turkey, Cheney’s first meetings in Azerbaijan were not with political officials, but with representatives from BP and Chevron.

In the last weeks of the Bush administration, Condoleezza Rice and the Georgian Minister of Foreign Affairs signed the U.S.-Georgian Charter on Strategic Partnership. This was followed up by the Obama administration, holding the first meeting of the Strategic Partnership Commission meeting in Washington on June 22, 2009, marking the launch of four bilateral working groups on “democracy, defense and security, economic, trade and energy issues, and people-to-people cultural exchanges.” The Strategic Partnership reflected U.S. commitment “to deepening Georgia’s integration into Euro-Atlantic institutions and enhancing security cooperation,” including eventual membership into NATO.

The Obama administration sent Vice President Joe Biden to Georgia in July of 2009, with Saakashvili lobbying for the U.S. to sell the country weapons, which Russia strongly opposed, considering the rearmament of Georgia to be ” more serious than whether Georgia enters NATO.”

In 2010, Georgia began a “serious push” to lobby the U.S. for “defensive weapons,” notably air defense and anti-tank systems. To help achieve this objective, Georgia spent roughly $1.5 million at four top Washington, D.C. lobbying firms over the course of the year. Meanwhile, Russia had been “intimidating” many of Georgia’s past arms suppliers, including Israel and other Eastern European nations, not to resume arms sales to the country.

In 2010, the United States also resumed its military training exercises in Georgia, which have continued in recent years, much to Russia’s displeasure. However, Saakashvili lost the 2012 elections and was replaced with a billionaire Bidzina Ivanishvili, who had made his fortune in Russia, leading to slightly improved relations with Putin. In 2013, Russia accused the U.S. of ” putting peace at risk” by holding joint military exercises in Georgia.

Bidzina Ivanishvili was the Georgian Prime Minister from 2012 to 2013, during which time Saakashvili was still president. As the Economist reported in October of 2013, weeks before the Georgian presidential elections to replace him, Saakashvili, who came to power through the U.S.-sponsored ‘Rose Revolution’ in 2003, had, in the following decade, “fought and lost a war with Russia, cracked down on the opposition, dominated the media, interfered with justice and monopolized power .” No wonder Cheney saw him as an ideal representation of America’s “democracy promotion” project.

The billionaire oligarch prime minister, Ivanishvili, Georgia’s richest man, had put his weight behind a presidential candidate, Giorgi Margvelashvili, who subsequently won the October 2013 elections. Under reforms implemented by Saakashvili, the role of president would become “largely ceremonial, with the bulk of power resting with the prime minister.” Ivanishvili proclaimed his intention to turn Georgia into a ” perfect European democracy.”

In May of 2014, months into the Ukrainian conflict, NATO announced its intentions to find ways of bringing Georgia ” even closer” to the military alliance. Just days earlier, both France and Germany “assured Georgia that a deal bringing it closer to the European Union would be sealed soon.”

Georgian officials were holding “extensive discussions” with US and German and other NATO members seeking ways to accelerate the country’s membership into NATO. Whereas previously, the US and NATO powers had decided to put Georgia’s NATO membership on the backburner, the conflict in Ukraine had changed the situation. Georgia’s Defense Minister stated: “Clearly, what’s happening in Ukraine impacts the thinking in Europe… Now it’s very different.” The Defense Minister went to Washington in May 2014 to visit with Vice President Biden and U.S. Secretary of Defense Chuck Hagel.

And so, in the more than ten years since Georgia’s U.S. and NATO-supported colour revolution, the West – particularly the United States – have increased Georgia’s military capabilities, armed and trained its forces, all the while aggravating Russia as NATO and Western military, political and economic influence spread ever-closer to its borders. This ultimately resulted in a war. Though, since then – and with the recent conflict in Ukraine – it is clear that rearming Georgia and further aggravating Russia is back on the agenda.

The hypocrisy and imperious expansionism of the West in Georgia is but a minor reflection of a similar process which has been taking place across much of Eastern Europe, and most especially in Ukraine. Thus, despite the never-ending proclamations of “Russian aggression,” it is once again the Western powers, NATO, the EU, the IMF and especially the United States that are the most to blame for the current conflict in Ukraine.

The 2008 war in Georgia had seemingly put an end – or a halt – on NATO’s eastward expansion. Russia had – after 18 years of NATO expansion – finally drawn a line in the sand over how much it was willing to put up with. It was clear, then, that a similar process with Ukraine, a much larger and more strategically significant country than Georgia, was sure to incur a military response from Russia. If anything, the only surprise is that Russia’s military response has been so minimal, comparatively speaking; at least, for the time being. But as this process continues in response to Ukraine’s crisis, and as NATO and the U.S. military, the EU and the IMF accelerate their advance eastward, future conflict is seemingly all but inevitable.

No doubt, when that conflict comes, we will once again hear the amnesic proclamations of “Russian aggression” and Western benevolence.

Andrew Gavin Marshall is a researcher and writer based in Montreal, Canada. He is Project Manager of The People’s Book Project, chair of the Geopolitics Division of The Hampton Institute, research director for Occupy.com’s Global Power Project and the World of Resistance (WoR) Report, and hosts a weekly podcast show with BoilingFrogsPost.

Voice of Access: The People’s Foundation

Voice of Access: The People’s Foundation

By: Andrew Gavin Marshall

Originally published in: The Spanda Journal, Vol. 5, No. 1, Innovation & Human Development, 2014, pages 69-80

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The Voice of Access: The People’s Foundation is a new initiative to establish a counter-hegemonic foundation – built upon an understanding of the hegemonic foundations that have been so pivotal in the construction and maintenance of the present social order – to effectively challenge and help to make obsolete the existing social order. Through the formation of new educational, research and media initiatives and organizations, the construction and dissemination of knowledge, connecting people and ideas from activists, intellectuals and groups around the world, The People’s Foundation hopes to aid in the multi-generational struggle of constructing a new – and fair – world order, to help lay the foundation for a future worth striving towards.

‘Voice of Access: The People’s Foundation’ is an initiative of myself and three other friends and associates, forming it as a non-governmental organization to act as a facilitator – and, when possible – a patron of organizations, activists, knowledge and social movements that seek to challenge and change the world order under which humanity now lives and struggles. From our backgrounds in research, writing, publishing, media, computer science and technology, and our experience with non-governmental organization and think tanks, we are seeking to channel our efforts into the operations of an organization dedicated to facilitating and supporting the efforts of others around the world. While we hold opposing views and philosophies to those that pervade the hegemonic foundations, our understanding of them and their successes in shaping the present global order helps us focus on methods with which we can challenge and seek to change that order.

In discussing the ways in which ‘The People’s Foundation’ would seek to operate and work toward achieving its objectives, it would first be useful to briefly outline some of the ways in which the major dominant foundations have operated in working toward their own objectives. As a case in point, I will focus on the Rockefeller Foundation, founded in 1913 by John D. Rockefeller “to promote the well-being of mankind,” as its original mission statement postulated.

The Rockefeller Foundation: Social Engineering for Social Control

In the late 19th and early 20th centuries, the United States – and much of the industrializing world – was in the midst of profound transformation and turmoil. Successive economic crises created growing uncertainty among an increasingly distrustful middle class, as the rich ‘Robber Baron’ industrialists (Rockefeller chief among them) grew ever more rich and powerful. Social unrest by the poor, workers, immigrants and others was threatening the prevailing social order. Those who sat atop the social hierarchy – notably, the ‘Robber Barons’ themselves – grew increasingly nervous at the prospect of the threat of revolution from below, as well as the growing restlessness of the middle classes. Actions and initiatives needed to be taken to safeguard powerful financial, economic, political and social interests.

It was a time not only of economic and social crises, of growing unrest, revolutionary fervor and industrial and financial consolidation into huge concentrations of economic power, but, simultaneously, was also a period of increasingly expansionist and imperialistic foreign policies. These were most notably on the part of the United States, which was extending its hegemony throughout the Caribbean and Central America, and reaching across the Pacific, with the most noteworthy example being in the Philippines, and with growing interests in China and Japan.

Changes in technology and communication were facilitating the spread of more information to more people than ever before, and the concept of ‘the public’ – and specifically, how to manipulate the public – moved to the forefront of elite intellectual discussion. It was an era that gave birth to the modern university, the advertising and public relations industries, the consumer society, and the modern philanthropic foundations.

The foundation functioned – and continues to function – as an institution dedicated to the process of social engineering with the objective of social control. In short, the foundation’s purpose was to identify major issues and areas of contention in the existing social order, and to subsequently find methods of promoting ‘reform’ and changes so as to manage the process of adaptation, undermine radical efforts at transformation and promote more moderate forces, integrating them within the existing social hierarchy and order. The goal, ultimately, was to maintain the social hierarchy itself.

Foundations would achieve these objectives by acting as major patrons of universities and the social sciences, to seek to find ‘scientific’ solutions to social problems, which were seen as technical – not structural; channeling intellectual efforts into finding ways to reform and adapt the social order instead of opposing or challenging it; sponsoring research organizations and think tanks, which bring together prominent individuals from academia, politics, finance, industry and the media in an effort to promote consensus between society’s dominant institutions and those who run them; and providing funding to social movements and initiatives so as to gain significant financial leverage over the direction of social movements, increasing support for reform-oriented and legalistic approaches to resolving social issues, and thus undermining and ostracizing more radical alternatives.

Foundations sought to manufacture ideology and consensus between elites, to institutionalize these ideologies within the existing and evolving dominant social structures, and to ‘engineer the consent’ of the governed. Over the course of the 20th century, major foundations – with the Rockefeller Foundation being perhaps the most prominent – exerted an immense, if not largely unknown, influence on the development and evolution of the United States. By virtue of the United States being an outwardly expansive and imperialistic society, that influence extended to much of the world.

Early on in their development, the U.S. Congress investigated the major foundations with a wariness of the intentions and functions they established under their extremely powerful and wealthy ‘Robber Baron’ patrons. In 1914, the Walsh Commission was formed, noting that the establishment of the Rockefeller Foundation – among others – “was the beginning of an effort to perpetuate the present position of predatory wealth through the corruption of sources of public information” and that if these foundations were left unchecked, they would “be used as instruments to change the form of government of the U.S. at a future date, and there is even a hint that there is a fear of monarchy,” noting that many of the foundations represented the interests of powerful industrial and financial dynasties. In the final report of the Walsh Commission in 1916, it was concluded that foundations represented so “grave a menace” to society that “it would be desirable to recommend their abolition.” Obviously, this did not take place.

As anthropologist David Nugent documented, the development of the modern social sciences by Rockefeller and Carnegie foundations (and later, with other foundations joining) was directly linked to the expanding global interests of the United States in becoming an imperial power and in managing domestic unrest at home. Foundation boards consisted not only of the dominant industrial and financial interests, but also of prominent intellectuals and foreign policy figures, all of whom together were well aware of the effects that industrialization and imperialism were having on people at home and abroad, and sought to find new ‘scientific’ ways of managing these changes without undermining their own social positions. This required a very careful, incremental and adaptive approach to social engineering. As a top Rockefeller philanthropy official, Wicliffe Rose, wrote in 1923, “All important fields of activity… from the breeding of bees to the administration of an empire, call for an understanding of the spirit and technique of modern science,” which “determined the mental attitude of a people, affects the entire system of education, and carried with it the shaping of civilization.”

The Rockefeller Foundation sought to establish “institutional centers of social research” in key nations around the world, facilitating exchange and collaboration between these various institutions which would ultimately “serve as a model for the development of the social sciences generally.” The initial focus was in the United States and Europe, aiming – in the 1920s – to establish roughly 12-15 major centers of social science research, one of the most important of which was the London School of Economics. Through fellowship programs sponsored by foundations, students from around the world would be taken to schools in the United States where the foundation influence over the development of the social sciences had already become significant.

Edmund Day, who ran the Rockefeller Foundation’s Social Sciences Division, wrote in 1930 that the social sciences were to engage in “human engineering” and that, “the validation of the findings of social science must be through effective social control.” Over the following years, the Foundation increasingly looked to establish within the social sciences a greater emphasis on ‘International Relations’ as well as – in the wake of the stock market crash and the start of the Great Depression – a greater emphasis on “the planning and control of economic structures and economic process.”

Max Mason, the president of the Rockefeller Foundation, wrote in 1933 that the policies of the Foundation “were directed to the general problem of human behavior, with the aim of control through understanding,” noting specifically that the “social sciences, for example, will concern themselves with the rationalization of social control,” whereas the natural and medical sciences would be concerned with “personal understanding and personal control.” Control, it seemed, was always the ultimate objective.

Concurrent with the development of the social sciences and major universities in the United States and Europe, Rockefeller and Carnegie philanthropies, among others, sought to construct an ‘educational’ system for black Americans in the South, which was deemed so successful that it was exported to several British colonies as a means of exerting colonial domination over subject populations. Beginning with a series of conferences between Wall Street bankers and northern industrialists in the late 19th century, an educational system for southern black Americans was sought in such a way as to ensure that the hierarchy which slavery had established between races would remain relatively unchanged. As one conference participant put it at the time, “the white people are to be the leaders, to take the initiative, to have direct control in all matters pertaining to civilization and the highest interest of our beloved land.” Conference participants agreed, on the other hand, that “the negro” was “best fitted to perform the heavy labor in the Southern states,” as, it was suggested, “he will willingly fill the more menial positions, and do the heavy work, at less wages.”

These conferences concluded with the establishment of what was known as the ‘Tuskegee educational philosophy,’ agreed upon in 1901, where attendees agreed on the need to “train a Negro leadership cadre” as “a strong professional class,” requiring a strengthening of certain ‘Negro colleges’, while the majority of education for black Americans was to remain “vocational and agricultural in focus… to be directed toward increasing the labor value of his race.” In time, the major foundations became involved in this endeavor, and the Phelps-Stokes Fund in particular took up this objective with a great deal of fervor, establishing schools dedicated to training black men in vocational and agricultural trades and black women in “home economics.”

In 1917, the Phelps-Stokes Fund published a two-volume survey on Southern Negro education, in which they maintained that academic and literary education was “dysfunctional for the black man” because it would create unrealistic expectations for black Americans in a segregated society. It claimed furthermore that would not provide the skills deemed necessary to become a “productive” worker, and, ultimately, it would undermine white dominance of society itself.

British colonialists took note of the success of the Tuskegee educational philosophy, and missionary educators from British colonies in Africa began cooperating with the American foundations and schools in replicating the Tuskegee educational system in several British colonies, including in Kenya and even South Africa, where it helped in the construction of the apartheid system. The education of black South Africans, in the words of a prominent Phelps-Stokes Fund official, was to keep the blacks as “junior partners in the firm.”

Not unrelated, in the early 20th century, the major American foundations – and the vast fortunes of ‘Robber Barons’ – contributed to the acceptance, institutionalization, and exportation of the eugenics movement (sometimes referred to as ‘scientific racism’). Eugenics was an extremely dangerous and destructive pseudo-science (or, rather, in truth, a religious orthodoxy in search of legitimacy) which was focused on the objective of refining the social engineering of the species, itself, to take ‘evolution’ into their own hands. This philosophy suggested that concepts such as poverty, crime, race, disabilities, mental suffering and lack of intelligence were products not of social conditions – or the social order and its devastating effects – but rather, they were inherent, genetic ‘defects’ experienced by the ‘unfit’. As a corollary, those who had risen to the top of the social hierarchy, the rich, white men of property and privilege, were considered to be the most intelligent, the racially superior, the “fit.” Thus, it was not avarice, crime, manipulation, expropriation, enslavement, theft and domination that made them their riches; it was their ‘genetic superiority’. This – conveniently – was an ideology which justified the enormous wealth and power held by a small minority, presenting it with scientific language that aimed to ground the social order as being one constructed through “natural selection” and evolution. As such, it was considered ideal for the “fit” to breed with each other (and thus, in theory, create a type of super-species), while the “unfit” were to be encouraged to stop breeding altogether.

When the eugenics movement reached the United States from Britain in the late 19th and early 20th centuries, it garnered the attention of elites in America. And very quickly, the vast fortunes of the Harrimans, Carnegies and Rockefellers – among many others – were mobilized to support the movement. As the foundations were established, eugenics became a major area of interest for their operations. The eugenics movement was arguably more successful in the United States than any other nation in the early 20th century, and in fact, it was from the United States that it was exported around much of the industrialized, western world. Eugenics affected the development and evolution of major institutions and ideologies of the era, such as the educational system, mental health, hygiene, medicine, psychology and psychiatry, migration, the criminal justice system, biology and the natural sciences. Between 1907 and 1927, twenty-three U.S. states enacted eugenic sterilization laws for the “genetically unfit,” ultimately leading to the forced sterilization of tens of thousands of people.

In fact, with the help of the Rockefeller Foundation, eugenics was exported to Weimar Germany, pouring hundreds of thousands of dollars into institutions dedicated to studying “race biology” and psychiatry. The German eugenics movement proved to be very successful, and when the Nazis came to power in 1933, eugenicists found a political movement espousing and embracing their ideas of racial inferiority and superiority. The Rockefeller Foundation continued its funding for Nazi ‘race science’ and psychiatry until the outbreak of World War II in 1939, by which time the impact had been profound. In fact, one of the most notorious Nazi war criminals, the “Angel of Death” – Dr. Josef Mengele, the infamous Auschwitz concentration camp doctor – had previously done research which was funded by the Rockefeller Foundation, whose money supported experimentation done at various concentration camps.

Of course, following World War II, the eugenics movement had been largely discredited after the world witnessed the repercussions of such institutionalized and ideological hatred and racism, as revealed by the extent of atrocities in the Holocaust – as well as those committed by the Japanese in the Pacific. Thereafter, the major proponents and patrons of the eugenics movement sought to rebrand themselves in various forms. In fact, a 1943 edition of Eugenical News – the most widely-read publication of the eugenics movement – published an article by one of the ‘fathers’ of the eugenics movement, Charles Davenport, who advocated a vision of “a new mankind of biological castes with master races in control and slave races serving them.” A 1946 edition of Eugenical News stated that following the War, “population, genetics, [and] psychology, are the three sciences to which the eugenicist must look for the factual material on which to build an acceptable philosophy of eugenics and to develop and defend practical eugenics proposals.”

One of the more prominent efforts at rebranding eugenics emerged as the ‘population control’ movement. Largely an initiative of the Rockefellers, John D. Rockefeller III established the Population Council in 1954, designed to “provide solid science to guide governments and individuals in addressing population questions.” Six of the ten founding members of the Population Council were well-known eugenicists. Matthew Connelly has written the most definitive account of the origins and evolution of the population control movement, based largely upon the internal records of the various international and private organizations involved in promoting population control, including the Rockefeller Foundation and Population Council. The primary fear of the elites behind the population control movement was the great mass of civilization that fell outside the western world: the largely non-white, poor populations of the world, seeking to toss off the chains of colonialism and chart their own way in the world.

The population control movement – with the Population Council as its “nexus” – relied on extensive funding from the Rockefeller and Ford Foundations, and became quickly institutionalized in United Nations organizations, as well as in the ideology of ‘development’ for the ‘Third World’. The result was measures designed to encourage population control becoming embedded within ‘aid’ agencies and development agencies. During the Eisenhower presidency, the issue of population had become “a national security issue” in the mind of the foreign policy establishment. The Population Council, Ford and Rockefeller Foundations, and UN agencies began working with USAID, the World Bank and other organizations in placing population control as a central element of U.S. and Western foreign policy concerns and actions, especially in countries like India, with large and largely poor populations.

As the population control movement was exported around the world, it resulted in a great deal of tragedy and repressive actions by governments, such as in India and China, where forced abortions and forced sterilizations had become rampant at various times. The movement had, however, garnered significant opposition from many countries and regions around the world, and its institutional and ideological structure experienced major setbacks going into the 1990s. However, it has never wandered far from the minds of the super-rich oligarchs and patrons of major foundations.

In 2009, a secret meeting was organized among some of the world’s richest billionaires, organized by David Rockefeller, Bill Gates and Warren Buffet. Invited guests included billionaires such as Ted Turner, George Soros, Michael Bloomberg, and even Oprah Winfrey. The meeting was designed to discuss the future of philanthropy, “what motivated their giving, the areas of focus, lessons learned and thoughts on how they might increase giving going forward.” Each guest was given 15 minutes to discuss and promote their personal favourite ‘cause,’ but after a great deal of discussion, they sought to establish an “umbrella cause” which could “harness their interests.” Apparently with Bill Gates leading the call, the billionaires agreed that “overpopulation was a priority… in which population growth would be tackled as a potentially disastrous environmental, social and industrial threat.”

Out of this meeting, a new effort was begun – largely driven by Bill Gates and Warren Buffet – to encourage billionaires and the super-rich around the world to join in giving their enormous ill-gotten wealth to ‘philanthropy’, in what is referred to as ‘The Giving Pledge’, to try to get the rich to pledge 50% of their net worth to charity during their lifetimes or after death.

At the end of World War II, the United States emerged as the dominant global power, and its institutions became oriented toward finding ways to use, maintain and extend that power. Foundations played a key role in the development of think tanks and the educational system, with a focus on creating consensus among elites on the need for empire and in training future managers of the imperial system.

The Rockefeller Foundation played a key role in transforming the United States into a global empire. One of the most influential think tanks in the United States is the Council on Foreign Relations (CFR), founded in 1921. Early on, the CFR relied upon Rockefeller Foundation funding for a great deal of its operations. Between 1927 and 1945, the Rockefeller Foundation provided the Council on Foreign Relations with more than $443,000 in funding for “study group” research, which would subsequently be implemented in official policy of the U.S. government. The Council has extensive ties to the foreign policy establishment of the United States, most notably with the U.S. State Department. In fact, during the early years of World War II, the CFR established a “strictly confidential” project in cooperation with the U.S. State Department to plan for U.S. entry into the war as well as to outline a post-war blueprint for a U.S.-dominated world. The project was entirely funded by the Rockefeller Foundation.

The results of the project outlined the areas of the world which the United States would need to control in order to maintain and expand its global power, referred to as the ‘Grand Areas’, which included, “Latin America, Europe, the colonies of the British Empire, and all of Southeast Asia.” The world was divided into four main blocs: the U.S.-dominated Western hemisphere, the British Empire and its colonies, a German-dominated continental Europe, and a Japanese-dominated East and Southeast Asia. As the war went on, slowly the ‘Grand Area’ plans changed to the point where U.S. planners decided that America ultimately had to dominate all of these regions, noting that, “as a minimum, American ‘national interests’ involved free access to markets and raw materials in the British Empire, the Far East, and the entire Western hemisphere.”

The Rockefeller Foundation took it upon itself to develop educational systems at elite universities which would be dedicated to the study of ‘International Relations’ and ‘Area Studies’ programs. Along with the Carnegie Corporation and the Ford Foundation, the Rockefeller Foundation helped to establish Soviet Studies and Area Studies programs at multiple universities around the country, focusing on providing an education which could inform the application of policy. The Ford Foundation – with considerable financial resources – moved to the forefront of this endeavor. In 1967, a survey by the U.S. State Department noted that out of 191 university centers of foreign affairs research in the United States, 107 depended primarily upon funding from the Ford Foundation. Between 1950 and 1973, the Ford Foundation contributed roughly $278 million to the development of ‘area studies’ programs at major American universities. While ‘International Relations’ was designed to focus on the study of a “realistic” approach and understanding of power (and how to apply it), ‘area studies’ programs focused on the study of the non-Western world.

The large foundations also provided financing and networking connections to aid in the establishment of other large international think tanks, such as the Bilderberg Group – which was founded in 1954 as a forum for Western European and North American elites to meet privately on an annual basis – as well as the Trilateral Commission in 1973, to bring the Japanese elite into the fold of the Western European and North American hegemonic class.

So while the major foundations were shaping the education of elites, socializing them in think tanks where they sought to establish consensus with domestic and international elites in other powerful nations and to manufacture and institutionalize dominant, imperial ideologies, they also worked to try to manage the ‘unwashed masses’ of the world. Just as these foundations had constructed an education to keep black Americans and Africans as “junior partners in the firm” in the early 20th century, in the latter half of the 20th century they sought to export the Western-style educational system – and notably the foundation-influenced social sciences – to other regions and nations around the world in order to help develop domestic elites within those societies that would ultimately serve the interests of Western hegemony and empire.

Foundation officials were extremely concerned about changes taking place across the developing world, where revolutionary and radical movements were attempting to rid their societies of European colonial domination. Foundation officials worked with members of the business and financial elite, alongside the foreign policy establishment, to attempt to manage the process and objectives of change in the ‘third world’. While acknowledging that the era of formal colonialism was at an end, these individuals were not eager to see people and nations chart their own individual paths to independence and freedom. Instead, formal colonial structures needed to be replaced with informal imperial structures. A consensus was formed between the foreign policy-makers, business class and foundation-academic officials that changes in places like Africa “must be evolutionary rather than revolutionary.” As a top Carnegie Corporation official noted: “American industry could ill-afford the loss of cheap sources of raw materials which could only be secured in the nations of Africa, Asia, and Latin America.”

With this in mind, the Rockefeller, Carnegie and Ford Foundations undertook ambitious programs in Africa, Asia and Latin America which sought to create prominent universities and programs of social science research “in areas considered of geo-strategic and/or economic importance to the United States.” These would include the training of public administrators, teachers, the development of curriculums, and exchange programs that would have young academics in these nations come to the United States to receive training and education at prominent U.S. schools like Harvard or Yale. The objective was to channel the intellectual talents of these nations away from support for radical ideologies and revolutionary movements, and push them instead into the social sciences and the construction of domestic, technocratic elites that would see social problems as ‘technical’ issues requiring reforms and slow, evolutionary change. As noted in the book Philanthropy and Cultural Imperialism:

The power of the foundation is not that of dictating what will be studied. Its power consists in defining professional and intellectual parameters, in determining who will receive support to study what subjects in what settings. And the foundation’s power resides in suggesting certain types of activities it favors and is willing to support. As [political theorist and economist Harold] Laski noted, “the foundations do not control, simply because, in the direct and simple sense of the word, there is no need for them to do so. They have only to indicate the immediate direction of their minds for the whole university world to discover that it always meant to gravitate to that angle of the intellectual compass.”

As political scientist Joan Roelofs wrote, foundations exert their influence in multiple ways:

[By] creating ideology and the common wisdom; providing positions and status for intellectuals; controlling access to resources for universities, social services, and arts organizations; compensating for market failures; steering protest movements into safe channels; and supporting those institutions by which policies are initiated and implemented… [F]oundations like Carnegie, Rockefeller, and Ford have a corrosive influence on a democratic society; they represent relatively unregulated and unaccountable concentrations of power and wealth which buy talent, promote causes, and, in effect, establish an agenda of what merits society’s attention.

Further, foundations play a role in providing extensive funding for social movements and non-governmental organizations (NGOs). Their funding for such social movement organizations typically follows years of organic and slow development of social movements from the ground up. Foundations typically move in to provide funding when a social movement is seen as a potential threat to the prevailing social order. Their funding subsequently focuses on supporting the more reform-oriented, legalistic and ‘evolutionary’ (as opposed to revolutionary) organizations, with an objective of helping them to become the dominant organizations in the movement and steer social movements in directions safe for those who own and operate the foundations themselves (representing the political, industrial and financial elites).

With this in mind, it is noteworthy that the Ford, Rockefeller and Carnegie foundations all provided extensive funding to many civil rights organizations in the 1960s and 1970s, “as a response to the threat posed by the generation of a mass-based social movement.” These foundations channeled their funding into support of “moderate civil rights organizations.” Foundation funding for civil rights groups did not become common until the early 1960s, some five years after the Birmingham bus boycott, and the peak of foundation support was in the early 1970s, roughly five years following the assassination of Martin Luther King, Jr. As more militant movements emerged in the later 1960s, such as the Black Power movement and the Black Panther Party, among many others, the foundations increased their support for more moderate organizations like the NAACP and the National Urban League.

This strategy of co-optation also explains the heavy funding and support by major foundations for the environmental and conservation movements, which originally – and still in their more radical arms – represent very direct, fundamental threats to the existing social order. Thus, today the environmental movement is dominated by large institutions like the World Wildlife Fund, Conservation International, Resources for the Future, World Resources Institute, the International Union for Conservation of Nature and Natural Resources (IUCN), and the Nature Conservancy, among others. Most of these institutions at some point depended upon financial support from major foundations, and today their boards are largely dominated by representatives from the corporate and financial world. Most of their funding comes from corporations, with whom they engage in “strategic relationships.”

Such has also been the relationship between major foundations and the so-called ‘anti-globalization’ movement. As globalization became the dominant force of the world from the 1990s onward, new movements began to spring up all around the world, opposing various policies, programs, institutions and ideologies embedded within the process of globalization. Major targets for anti-globalization activists and organizations had been the World Trade Organization, the G7/G8 meetings, the World Bank and IMF, among others. Major protests at the annual gathering of these institutions – notably at the 1999 World Trade Organization meeting in Seattle – began to strike fear into the minds of the global elite. As The Economist noted in 2000, despite the differing views and backgrounds of activists and protesters in Seattle, what they “have in common is a loathing of the established economic order, and of the institutions – the IMF, the World Bank and the WTO – which they regard as either running it or serving it.” This ‘new kind’ of protest, noted the magazine, “is more than a nuisance: it is getting in the way.”

A reaction to this development was seen in the formation of the World Social Forum, an annual meeting of NGOs and various civil society organizations acting as an alternative to more radical, protest-oriented and revolutionary movements and advocacy, and instead promoting the discussion of “reforms” to globalization. Funding for the World Social Forum has been provided by many governments and political parties, and, notably, the Ford Foundation. As Lisa Jordan of the Ford Foundation explained: “Government, business and civil society cannot solve problems separately. There must be dialogue between and amongst these three groupings. The WSF is an attempt to support a vast and complex array of public space for an integrating world.” Again, the objective is to ‘integrate’ the opposition to the existing social order within the social order, to give the ‘rebels’ a seat at the table, and thus, undermine the rebellion itself.

While reforms and evolutionary change can produce good and real results, they do not keep pace with the ever-expanding militarism, war, environmental degradation, economic and financial destruction, corporate colonization, manipulation and devastation of biodiversity, impoverishment and exploitation of the world’s masses, and the ever-growing concentration of wealth and power in the hands of very few institutions and individuals at the global level. The human species – and the planet itself – do not have the time to await the slow changes begrudgingly afforded by the institutions of empire, exploitation and domination. Reform has its place, but radical – transformative – change is of the utmost necessity in order to not only challenge the existing order, but to create alternatives to it – and to help make the existing order obsolete, so that humanity may chart a path that does not lead to eventual extinction, as our current trajectory indicates.

This is where ‘Voice of Access: The People’s Foundation’ – and organizations like it – can play a much-needed role.

A ‘Voice’ for the People, a ‘Foundation’ for Change

The establishment of ‘Voice of Access: The People’s Foundation’ represents an attempt to create a counter-hegemonic foundation, to follow familiar patterns of facilitation, patronage, exchange and interaction, the formation of new organizations, the construction of knowledge, support for social movements, connecting intellectuals, activists and communities. The objective and methods of these efforts will counter those of the dominant hegemonic foundations, however, in a few pivotal ways.

First, the People’s Foundation does not have a substantial financial base upon which to leverage projects and steer the focus of other organizations. In fact – at present – the financial standing of the People’s Foundation is non-existent. Currently, it is still in the starting stages of constructing a legal entity, and those of us who are working to create the foundation are attempting to look into various methods of financing, including approaching the traditional grant procedures, as well as exploring alternatives for specific project financing via crowd-funding measures through social media, and also encouraging donations from supporters around the world. Financial considerations – at present – aside, The People’s Foundation does not expect to ever match the financial resources of the large foundations created and operated by the world’s financial oligarchs. As such, our focus is to be more on facilitation as opposed to funding, though we do hope to increase the amounts of money we can put into projects over time.

What is the role of a facilitator foundation?

To describe the role envisioned for the foundation, it would be best to give some examples of projects that are being planned over the coming years. One key project with which there is a great interest and necessity is in building connections around the world between activists and organizations seeking to promote transformative changes in the social order, whether domestically or internationally. An example of this type of engagement is a project to work with the Mpambo Afrikan Multiversity based out of Uganda.

The founding president of Mpambo Afrikan Multiversity is Paulo Wangoola, an indigenous scholar and intellectual in East Africa. As Wangoola wrote, “The Multiversity is a post-colonial concept of higher learning of the oppressed, by the oppressed and for the oppressed, in pursuit of their community cognitive autonomy and security,” further noting that, “when Europeans colonized the world, they also colonized other people’s knowledge,” which continues under the concept of the modern university (which, I might add, was exported to Uganda and East Africa through efforts by the Rockefeller and Ford Foundations). In contrast, the ‘university’ has extended from the West into Africa “as a colonial/neocolonial design” which has advanced Western hierarchical knowledge structures at the expense of “the total eclipse of Afrikan indigenous thought, scientific knowledge, philosophy, spirituality, wisdom and epistemology; that is, the knowledge base developed over millennia, by the Afrikan Black Nation, as a self-determined people.”

The concept of the ‘Multiversity’ – on the other hand – “is based on the proposition that the people of the world and their knowledges, cultures, language and epistemologies are horizontally ordered, such that each of the knowledges is valid in itself.” This understanding of people and knowledge “is derived from Afrikan spirituality, worldview, scientific thought and ontology; by which all being and phenomena, spiritual and material, natural and supernatural, manifests itself complementally in sets of twos, female and male… balance, harmony and reciprocity.” Thus, wrote Wangoola, “each one of the world’s knowledges deserves some ample and adequate space, and resources to be advanced to its farthest frontiers, as well as to be enriched by, as it itself enriches, other knowledges, through cross-fertilization.” The Multiversity is focused on “creating some democratic intellectual space and elbow room for oppressed peoples to make and demonstrate a case for a MULTIplicity of epistemologies, thought and knowledge to blossom, as a necessity to vitalize each of the world’s knowledges, as well as the totality of human knowledge as a whole.”

Mpambo Afrikan Multiversity, more specifically, “is a community-based institution of mother tongue higher learning, centered around persons who are considered by their peers and community to be compelling experts: wise men and wise women, philosophers, sages, scientists, scholars, innovators and the highly talented. They may be primarily indigenously trained or primarily Western-trained, but both are embedded in their community, have emerged out of their people’s struggles to be free… organic intellectuals, scholars and scientists.” The word Mpambo – in the Lusoga dialect spoken by the Basoga people at the Source of the Nile in Uganda – means ‘the best seed, the most potent seed selected at the time of harvest for safe custody, for propagation in subsequent good seasons’. Mpambo Afrikan Multiversity aims “to help raise and nurture a critical mass of a world class of itself of intellectuals and scholars to three principal goals: to create capacity for a people’s socially necessary knowledge to be created close to that people and amidst themselves; to help render people to be both creators and consumers of knowledge; and to build effective capacity for Afrikan peoples to learn from themselves, and on that basis to learn intellectually, philosophically, scientifically and technically from and with the other world’s spiritual, philosophical, scientific and academic traditions and practices.”

I was fortunate enough to have spent a little time in Uganda with Mpambo Afrikan Multiversity roughly seven years ago, when I was given the responsibility by Paulo Wangoola of recruiting some young Westerners to return to Uganda in order to study and work with Mpambo, and to build up connections between the young, emergent leadership of Mpambo, so that these connections may last for generations to come. This is where there is great potential for The People’s Foundation to engage in facilitation and the construction of new knowledge networks, to provide a forum and means of exchange. Our initial project is to go to Uganda and spend roughly two months learning from the organization, documenting and discussing the activities, objectives, and establishing a means for advancing future cooperation and interaction between Mpambo and The People’s Foundation.

Unlike hegemonic foundations, which approach social movement organizations and centers of knowledge with an objective to steer such organizations in a specific direction, to act as patron and paterfamilias, the People’s Foundation approaches Mpambo Afrikan Multiversity with an objective to learn, to receive guidance, to listen, and to mutually discuss and agree upon methods and purposes of future cooperation and support. This represents a horizontal approach to facilitation and support, as opposed to the vertical (and hierarchical) approach undertaken by hegemonic foundations. We will of course be approaching Mpambo with ideas of potential cooperation – including the possibility of facilitating exchanges between African and Western intellectuals and other Indigenous peoples and communities from around the world. Ultimately, this is the type of role as facilitator that the Foundation envisions for itself among many different organizations and communities.

Hegemonic foundations have achieved immense success in providing forums for the establishment of consensus between elites, both nationally and globally, so as to effect a more precise, permanent and stable system of domination and control. The counter-hegemonic People’s Foundation aims – in the long-term – to help facilitate interaction, communication, cooperation and coordination between groups of activists, intellectuals and other counter-hegemonic groups around the world.

The world is in the midst of powerful transformations and changes. Power is globalizing like never before, with more wealth than ever previously existed being concentrated in fewer hands than ever before, with structures and ideologies of dominance and governance being institutionalized not only at national, but also regional and global levels. A corollary of this process is that of the ‘globalization of resistance and revolt.’ From Tunisia to Egypt, Israel to Turkey, Greece to Spain, Indonesia to China, South Africa to Brazil, Chile and the Canadian province of Quebec, to the Indigenous movements across North and South America, Africa and Asia, to peasant and labour resistance and militancy, the world is in the early stages of forming a truly global resistance to the processes, institutions and ideologies of domination (which have, in no small part, been constructed and institutionalized through the efforts of hegemonic foundations).

While these protests, movements and methods of resistance around the world appear disparate and often disconnected, there is enormous potential for mutual understanding, cooperation, coordination and support. The People’s Foundation hopes to play a role in attempting to connect and facilitate interactions, exchanges, conferences, and creating supporting organizations to help turn the concept of ‘solidarity’ into a solid practice. For example, imagine the possibilities of holding an international conference of activists, intellectuals and organizations involved in resistance movements to meet, discuss their respective struggles and objectives, and to find meaningful possibilities of collaboration and coordination, to establish new organizations – think tanks, media centers, educational organizations, etc. – which would represent the combined interests and activities of these seemingly-disparate groups.

The other major aspect of the People’s Foundation – the Voice of Access – reflects a priority in making information readily available to the broadest possible audience, through collaboration and publication of texts in multiple languages, offering reduced rates to schools, community groups, low-income organizations and researchers and finding ways of distributing the information – particularly through digital formats – as well as in print. The ‘Voice of Access’ moniker and meaning reflects a focus on expanding and facilitating access to information, communication and interaction. This will necessitate an increasing focus on access to and utilization of technology itself. While we take for granted our information and communications technology in the West, much of the world continues to lack access to these materials. Voice of Access would seek to find ways of helping to improve and facilitate increased access to such forms of technology, let alone the information and communication they help facilitate.

Student activism and militancy has been on the rise across much of the world, including notable examples in recent years from Greece to the United Kingdom, Chile and Quebec. In each case, students have been mobilized in opposition to the ever-expanding process of the neoliberal restructuring of the educational system: increased privatization, corporatization, leading to increased tuition and debt for prospective students, which has the dual effect of making education harder to attain, and for those who do pursue education, the effect is to shackle them through debt servitude to the social order itself; focusing their energies – upon graduation – to getting jobs so that they can pay off their debt, instead of channeling their intellectual capacities and energies into finding alternatives to the existing system.

One long-term objective of The People’s Foundation would be to help facilitate the development of connections and coordination between student movements and struggles around the world. A good starting place would be to invite not simply leadership but also participants and supporters of various student movements to participate in a conference where they could discuss their respective experiences, successes and failures, prospects and potential. Through such interaction and the development of interpersonal relationships, new ground could be broken on building support between student movements around the world, new organizations could be established to promote the sharing and development of knowledge between students and youth movements, with cooperative thinks tanks, media centers and similar organizations with a focus on advancing understanding, public awareness, and coordination about and between youth/student movements.

The People’s Foundation would have an equal interest in promoting, supporting and encouraging similar processes for activists and movements around the world. Our objective is not to be at the center of these processes, nor to become a ‘hegemonic’ institution in its own right, but rather, to attempt these initiatives and projects – and to learn from their various successes and failures – in the hope that others may build upon this and attempt similar, parallel and mutually-supportive projects. In short, it would be far more effective and beneficial to all if there were a multiplicity of similar organizations to the Voice of Access pursuing similar and parallel objectives, as opposed to simply one. These are ultimately long-term objectives, and the reality of current non-existent funds means that our initial steps will have to be small and slow. Thus, our primary aims in this area will be toward establishing channels of communication and informal relationships with activists, intellectuals and social movements locally, nationally, regionally and globally, slowly and steadily.

The People’s Foundation will look to the world with a focus on attempting to understand and share knowledge regarding the true nature and structure of our global socio-political and economic order: the institutions and ideologies of power and domination, as well as the methods and movements of resistance. We will look to this situation with a focus on examining what appears to be missing, what appears to be needed, and to try to provide what we can to address these concerns. As such, the educational and media endeavours of the People’s Foundation are essential.

In this regard, there are two organizations that the People’s Foundation has an interest in helping to establish. One – tentatively named the General Research Association for the Study of Power (or GRASP) – would be focused on bringing together young scholars and intellectuals into a cooperative organization functioning like a think tank, which would be dedicated to the study of institutions and ideologies of power and domination: the State, corporations, banks, investment facilities, international organizations/bodies, hegemonic think tanks and foundations, universities/schools, the media, military, public relations/advertising industry, etc. GRASP would aim to undertake extensive and rigorous research and study of these and other institutions and the ideologies that pervade them, historically, presently, and with a focus on trends and transformations in their future development. We are, ultimately, a society dominated not by a single institution but by many, each with their own hierarchies, structures, histories, evolution and ideologies. Yet the institutions which dominate society as whole do so on a largely cooperative basis.

For example, the educational system supports the development of intellectuals who are channeled into think tanks and foundations, where they engage in the construction of knowledge, development of strategies, social engineering, and the formation of foreign policy; from there they are channeled into the state apparatus to enact policies. Corporations and financial institutions, in turn, dominate the governance structures of universities, think tanks and foundations, and participate in the development of strategies, policies and ideology. Thus, while theoretically these are separate institutions, functionally they are interconnected and interdependent. The purpose of GRASP and its research would be to study the historical evolution of these various institutions, and their interconnections and interdependencies with other institutions, including by mapping out their shared leadership with other institutions. The objective is to establish a think tank which may ultimately provide a source of knowledge-generation promoting a more comprehensive and coordinated understanding of our present global order.

The People’s Foundation would simultaneously seek to support the dissemination of knowledge produced by GRASP, through building connections with alternative media sources, as well as pushing the knowledge into the mainstream, or, if necessary, helping to establish new media organizations or groups dedicated to the dissemination of this knowledge. GRASP would be an incredibly useful resource for scholars, researchers, journalists and interested individuals and groups around the world. Its focus would primarily be on studying and understanding the principal Western institutions of domination, and thus provide a valuable source of knowledge for others to consult.

A parallel organization to this would be a similar think tank/research organization, which would be dedicated to the study and discussion of social movements and methods of resistance around the world, historically and presently. The aim, once again, would be to connect young scholars and intellectuals in a cooperative organization, which would initially establish a regional focus-approach to the study of social movements. For example, it would be the job of one (or a few) of the scholars to focus exclusively on analyzing the present social movements, rebellions, revolutions, riots and methods of resistance across sub-Saharan Africa; others would be focused on North Africa and the Middle East, Continental Europe, East and Southeast Asia, North and South America, etc. Monthly reports could be prepared by the young scholars, examining the current state of a ‘world of unrest.’ Such an organization could become an immensely useful resource for researchers, intellectuals, journalists and interested individuals, seeking to provide a single source whose primary focus is on studying the various social/resistance movements around the world.

This is a needed resource in the world today. There are several media and research groups that focus exclusively on studying social/resistance movements, but the focus is often inconsistent, and the sheer scope of global unrest and resistance is monumental. However, an organization with a focus on studying not simply what protests are ‘popular’ and in the press more frequently than others, but rather, on examining the multiplicity of resistance movements around the world, is a needed resource to both expand understanding of the current state of global unrest, as well as supporting those social and resistance movements. How can the people of the world – especially those actively engaged in resistance – support each other if they don’t even know about each other’s respective struggles? This organization would be dedicated to the construction and dissemination of knowledge regarding the methods and movements of resistance taking place around the world, presently and historically. Here, the Voice of Access could play a part in helping to provide a voice for those who frequently go unheard in the Western world.

Such an organization would greatly help our understanding of resistance and revolution itself. With such a large focus and source of knowledge, we would be able to see larger patterns and processes, gain a better understanding of the conditions and ‘sparks’ that lead to differing social movements; to better understand the successes and failures of resistance movements; and through the raising of public awareness – to encourage active and future support for resistance movements.

For both GRASP and the as-yet unnamed research organization focused on studying global resistance, the objective for the People’s Foundation would be to bring different scholars, activists and related organizations together, in a cooperative and horizontal (i.e. non-hierarchical) structure, with a focus on undertaking extensive and rigorous research (held to academic standards), to produce research reports, articles for dissemination, books, host meetings/conferences, media consultations, educational seminars and gatherings, providing a source of important and needed knowledge to be shared as widely as possible, to undertake the dual task of advancing human understanding of the social order which dominates our world, and of the people around the world who are resisting that order’s various manifestations.

For ‘Voice of Access: The People’s Foundation’, the methods would be geared towards reaching out to young scholars and interested individuals and organizations, to begin a process of communication and consultation on the formation of these two organizations, to connect these individuals and organizations and hopefully – if possible – to provide the initial funding needed to establish the organizations.

Problems and Prospects

There are, of course, many present barriers to all the current objectives – short and long-term – of Voice of Access: The People’s Foundation. The most obvious is the financial impediment. While the People’s Foundation ultimately seeks to function as a counter-hegemonic presence with an aim towards building alternatives to the existing global social order (making present power structures obsolete), the Foundation must still operate within the existing social order. That means that, internally and legally, it must establish itself as a non-governmental organization (NGO), with its own internal hierarchy and legal structure, and, more problematic, it must seek to accumulate funds to support projects, as well as to build up a financial base capable of supporting the Foundation’s staff itself, so that we may dedicate our time and resources to the activities of the Foundation. These are obstacles which we have yet to overcome in any meaningful sense, but, through the articulation of some of our short and long-term goals and objectives, we hope to encourage support – both material/financial and otherwise – to helping Voice of Access: The People’s Foundation establish itself and begin its important work in the world.

The major hegemonic foundations have been essential and effective institutions in the process of shaping education, constructing knowledge, disseminating information, creating institutions, establishing consensus between elites – nationally and globally – and institutionalizing ideology for the benefit of the hegemonic financial and corporate interests of the world. They have operated through long-term social engineering projects to try to establish social control: to connect elites, to co-opt and deflect resistance, to promote reform and slow adaptation, so as to ultimately secure the stability of the existing social order, and the hierarchies of inequality and oppression which dominate it.

The counter-hegemonic People’s Foundation hopes to become an effective organization for the purpose of finding new means and processes of education, the construction and dissemination of new forms of much-needed knowledge, to connect people and communities – activists, intellectuals, individuals and groups – not elites, to support the growth and interconnections (and radicalization) of social movements – not to co-opt, but to cooperate – with the ultimate objectives of challenging the prevailing social order, and sowing the seeds for future generations to construct a new order, making the existing one obsolete. These are large objectives, but as with any goal, it all begins with small and slow steps in the right direction.

With an understanding of the role that has been played by hegemonic foundations in the preservation and propagation of the existing social order, it seems that there is a needed place for counter-hegemonic foundations seeking to challenge and make obsolete that same social order, until such a point where the Foundation itself may be made obsolete. Revolution is a process, not an event, and it requires one to operate within an existing social system while simultaneously challenging that social system. This is a multi-generational process, and we must begin thinking and acting with a focus on the short- and long-term.

Voice of Access: The People’s Foundation hopes to take such a short and long-term focus on encouraging and supporting social transformation for the benefit of humanity and the world as a whole, not simply the powerful few who rule over it. This requires building connections and facilitating support with groups and people around the world, to advance access to technology, communication and interaction, to be a ‘voice’ for those who go unheard, a foundation for people, a foundation for change.

To read the full report with citations and footnotes, please download the original from the Spanda Journal here.

Andrew Gavin Marshall is an independent researcher and writer based out of Montreal, Canada. He is Project Manager of The People’s Book Project, Chair of the Geopolitics Division of the Hampton Institute, Research Director of Occupy.com’s Global Power Project and the World of Resistance Report, hosts a weekly podcast at BoilingFrogsPost.com, and is a co-founder and Vice President of Voice of Access: The People’s Foundation.

When Fat Cats Meet In Munich: Welcoming the International Monetary Conference

When Fat Cats Meet In Munich: Welcoming the International Monetary Conference

By: Andrew Gavin Marshall

Originally posted at Occupy.com

2 June 2014

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In Part 1 of this series, I examined the history and early evolution of the annual meeting that takes place among world bankers and financial and monetary officials at the International Monetary Conference. Part 2 looked at the role of the IMC in the lead-up to the 1980s debt crisis.Part 3 examined the influence of the IMC throughout that decade’s debt crisis. This last installment – published just as the IMC prepares for its June 1-3 meeting at Hotel Bayerischer Hof in Munich, Germany – looks at what the IMC has done since the 1990s to maintain its status among the world’s most highly influential bodies in economic, financial and monetary affairs. Included is a rundown of bankers who run the IMC along with leaked documents from the 2013 meeting in Shanghai.

At the 1992 International Monetary Conference in Toronto, there was a general consensus among private bankers and public officials that, as a result of enormous over-lending to Latin America and developing countries throughout the previous debt-crisis decade, the task of financing “the transformation of the former Soviet Union to a market economy” could not be left to bank loans alone. Hilmar Kopper, the CEO of Deutsche Bank, told the conference attendees that commercial banks would only engage in large-scale financing if there were “government-guaranteed credits” and “an agreement on the old debt,” implying that the banks would essentially need the guarantee of a government bailout scheme if things got bad. Japan’s former vice minister of finance, Toyoo Gyohten, told the attendees that “public-sector agencies must cooperate with private banks, with the willingness to share the unavoidable risk.”

Canada’s finance minister, Don Mazankowski, told the bankers that “we are prepared to help” the former Soviet bloc countries so long as “they help themselves and get on the path to economic growth and prosperity.” His words implied that the Soviet countries must undertake similar austerity and structural adjustment packages imposed upon other countries through the 1980s debt crisis. The bankers stressed the same point, noting that “it would be difficult for governments to be generous with Russia until it established an economic recovery program approved by the International Monetary Fund.”

Throughout the 1990s, the IMC continued to be a significant forum for discussion among bankers and finance officials. Remarks made by Federal Reserve chairman Alan Greenspan and Hans Tietmeyer, the president of Germany’s Bundesbank (the Central Bank of Germany), at the 1995 meeting of the IMC led to a strengthening of the U.S. dollar and a weakening of the German mark in international currency markets.

IMC Influence in More Recent Years

In the early 21st century, the International Monetary Conference has remained relevant, as admitted during a 2001 press conference with the president of the European Central Bank, Willem F. Duisenberg. Duisenberg had been criticized by European media for not attending a recent Eurogroup meeting of finance ministers and central bankers from euro-currency countries, which had gathered in Brussels.

Duisenberg commented:

“I would like to point out that it has been a tradition since 1954 that the highlight of the annual International Monetary Conference, which is held in a different place every year, is the so-called Central Bankers’ Panel in which the central banks, or central bankers, of the three main currencies in the world participate. And I did so. It would have drawn more attention had I not been there, than had I been in Brussels… I can tell you that the next meeting of the International Monetary Conference will be … in Montreal [in 2002], and the year after it will be … in Berlin. On both occasions you can be sure, if it happens to coincide with the meeting of the Eurogroup, that the ECB will be represented in the Eurogroup by the Vice-President.

Indeed, as recently as the IMC’s 2013 meeting in Shanghai, we can see that the importance and relevance of the annual meeting has not diminished. Though the IMC has no publicly-accessible website, I managed to compile a rough list of leading officials and board members of the International Monetary Conference, drawing information from references on their official CVs and publicly-available biographies, as well as from leaked documents including a program overview of the 2013 conference.

Names to Know

The president and chairman of the International Monetary Conference is Baudouin Prot. Formerly CEO of BNP Paribas, one of France’s largest global banks, Prot is currently chairman of that bank as well as a current board member of Kering, Veolia Environment, Lafarge, Erbé SA and Pargesa Holding SA. He is a member of the International Advisory panel to the Monetary Authority of Singapore, the International Business Leaders’ Advisory Council to the Major of Shanghai, the European Financial Services Round Table, and is chairman of the European Banking Group.

The executive vice president of the IMC is Frank Keating, President and CEO of the American Bankers Association and former president and CEO of the American Council of Life Insurers (2003-2011). Keating is also the former governor of Oklahoma (1995-2003), a former official in the U.S. Department of Housing and Urban Development, and a former Assistant Secretary of the Treasury. Additionally he is a member of the board of directors of the National Archives Foundation, the Bipartisan Policy Center, the Jamestown Foundation, and he was a member of the Bipartisan Policy Center’s Debt Reduction Task Force in 2010.

Confirmed board members of the International Monetary Conference include: Gordon Nixon, President and CEO of Royal Bank of Canada; William Downe, CEO of BMO Financial Group; Axel Weber, Chairman of UBS; Francisco Gonzalez, Chairman and CEO of BBVA; Robert E. Setubal, President and CEO of Itau Unibanco Banco SA; Richard Waugh, President and CEO of Scotiabank; Chanda Kochhar, Managing Director and CEO of ICICI Bank; Jacko Maree, senior banker at Standard Chartered; Andreas Triechl, Chairman and CEO of Erste Group Bank; and Walter B. Kielholz, the Chairman of Swiss Re.

Interestingly, there are no major American banks or bankers listed as current board members of the IMC, which is dominated by European and Canadian bankers. Further, there were three bankers whose CVs listed them as “members” of the IMC, but when I attempted to contact the IMC and the American Bankers Association to confirm whether they were board members – the IMC has roughly 15 board members, and I had only confirmed 12 of them – neither the ABA nor IMC replied to my multiple inquiries. The three bankers who were listed as “members” – and possible, though unconfirmed, board members – are Federico Ghizzoni, the CEO of UniCredit; Douglas Flint, the Chairman of HSBC (also chairman of the Institute of International Finance), and Ibrahim S. Dabdoub, the CEO of the National Bank of Kuwait.

Compiling the CVs of the 12 confirmed board members of the International Monetary Conference, we can see what other institutions are most represented among the membership:

Four members of the IMC board are also members of the Institute of International Finance, the leading global banking lobby group; four IMC board members are also members of the International Business Council of the World Economic Forum and the European Financial Services Round Table (EFR), a group of leading European bankers. And three IMC board members are also represented in the European Banking Group, created to advise the European Union on financial market “regulations,” as well as the Canadian Council of Chief Executives (CCCE), the leading corporate interest group in Canada.

Other organizations sharing leadership with two members of the IMC board are the International Advisory Panel of the Monetary Authority of Singapore, the International Business Leaders’ Advisory Council to the Major of Shanghai, and the International Advisory Committee of the Federal Reserve Bank of New York.

If we include the three bankers whose CVs listed them as “members” of the IMC, the cross-over representation of leadership in these institutions increases: the European Financial Services Round Table increases representation from four to six members of the IMC board, the European Banking Group from three to five members, the Institute of International Finance from four to five, and the International Business Leaders’ Advisory Council to the Mayor of Shanghai increases from two to three.

Leaked Details from Shanghai

Leaked documents from the 2013 IMC meeting in Shanghai show the planned program for the four-day conference held at the Four Seasons Hotel Shanghai in early June of 2013. Welcoming remarks were presented by the President and CEO of the American Bankers Association, Frank Keating, followed by opening remarks from the BNP Paribas chairman and president of the IMC, Baudouin Prot.

On Monday, June 3, speakers at the IMC included Han Zheng, a member of the Political Bureau of the CPC (Communist Party of China) Central Committee; Mario Draghi, President of the European Central Bank; Douglas Flint, Chairman of HSBC and Chairman of the Institute of International Finance (unconfirmed board member of the IMC); Jaime Caruana, General Manager of the Bank for International Settlements (BIS); Lord Adair Turner, former chairman of the Financial Services Authority in the UK and a Senior Fellow of the Institute for New Economic Thinking; and Janet Yellen, Vice Chair and Governor (now current Chair) of the Federal Reserve Board.

Other speakers at the 2013 International Monetary Conference included Axel A. Weber, Chairman of UBS; Niall Ferguson, the Lawrence A. Tisch Professor of History at Harvard University; Jacob A. Frenkel, Chairman of JPMorgan Chase International and Chairman of the Board of Trustees of the Group of Thirty (G30); Tharman Shanmugaratnam, Deputy Prime Minister and Minister for Finance in the Government of Singapore; Zhou Xiaochuan, Governor of the People’s Bank of China (China’s Central Bank); Jamie Dimon, Chairman and CEO of JPMorgan Chase; Jurgen Fitschen, co-Chairman of Deutsche Bank; John G. Strumpf, Chairman, President and CEO of Wells Fargo; Francisco Gonzalez, Chairman and CEO of BBVA; Sir Martin Sorrell, CEO of WPP; and Victor Yuan, Chairman and President of Horizon Research Consultancy Group.

Additional speakers at the conference included Jiang Jianqing, Chairman of the Industrial and Commercial Bank of China (ICBC); Stephen Bird, CEO for Asia Pacific at Citibank in Hong Kong; Michael Pettis, Professor of International Finance at the Guanghua School of Management at Peking University in Beijing; Peter Sands, Chief Executive of Standard Chartered; Shang Fulin, Chairman of the China Banking Regulatory Commission; Tian Guoli, Chairman of the Bank of China; and Andrew Sheng, President of the Fung Global Institute in Hong Kong.

The fact alone that this group of global financiers met with China’s leading bankers and top government officials within China points to the continuing relevance of the International Monetary Conference. What’s more, Janet Yellen, then a contender for the position of Chair of the Federal Reserve Board, attended the IMC meeting while sitting as Vice Chair of the Federal Reserve, and outlined her views on “what more should be done” to “make the global financial system more resilient.”

One of the key issues Yellen discussed in her speech to hundreds of global bankers assembled at the 2013 IMC was the concept of “too-big-to-fail” banks, what the regulatory agencies (and, notably, central banks) refer to as “systemically-important financial institutions,” or SIFIs. Yellen noted that there have been proposals for a “sweeping restructuring of the banking system,” including the possibility of the “resurrection of Glass-Steagall-style separation of commercial banking from investment banking and imposition of bank size limits.” However, Yellen reassured the financiers, “I am not persuaded that such blunt approaches would be the most efficient ways to address the too-big-to-fail problem.”

Indeed, systemic problems of the global monetary, financial and economic system will likely remain unresolved so long as forums like the International Monetary Conference are permitted to take place outside public scrutiny. Such meetings, where central bankers, regulators and leading financial policy makers meet in private with the world’s most influential bankers, only encourage consensus, closer cooperation and, ultimately, collusion between our so-called public officials and the bankers who profited off the financial and economic destruction which they themselves caused.

Andrew Gavin Marshall is a researcher and writer based in Montreal, Canada. He is project manager of The People’s Book Project, chair of the geopolitics division of The Hampton Institute, research director for Occupy.com’s Global Power Project and the World of Resistance (WoR) Report, and hosts a weekly podcast show with BoilingFrogsPost.

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