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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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The Global Banking ‘Super-Entity’ Drug Cartel: The “Free Market” of Finance Capital

The Global Banking ‘Super-Entity’ Drug Cartel: The “Free Market” of Finance Capital

By: Andrew Gavin Marshall

HSBC bankers testifying before U.S. Senate on laundering billions in drug money (photo courtesy of The Economist, 21 July 2012)

 

This essay is the product of research undertaken for the first volume of The People’s Book Project. Please donate to help the first volume come to completion: a study of the institutions, ideas, and individuals of power and resistance in a snap-shot of the world today, looking at the global economic crisis, war and empire, repression and the global spread of anti-austerity and resistance movements.

I would like to introduce you, the reader, to some realities of our global banking system, resting on the rhetoric of free markets, but functioning, in actuality, as a global cartel, a “super-entity” in which the world’s major banks all own each other and own the controlling shares in the world’s largest multinational corporations, influence governments and policy with politicians in their back pockets, routinely engaging in fraud and bribery, and launder hundreds of billions of dollars in drug money, not to mention arms dealing and terrorist financing. These are the “too big to fail” and “too big to jail” banks, the centre of our global economy, what we call a “free market,” implying that the global banks – and corporations – have “free reign” to do anything they please, engage in blatantly criminal activities, steal trillions in wealth which is hidden offshore, and never get more than a slap on the wrist. This is the real “free market,” a highly profitable global banking cartel, functioning as a worldwide financial Mafia.

Scientific Research Proves the Existence of a Global Financial “Super-Entity”

In October of 2011, New Scientist reported that a scientific study on the global financial system was undertaken by three complex systems theorists at the Swiss Federal Institute of Technology in Zurich, Switzerland. The conclusion of the study revealed what many theorists and observers have noted for years, decades, and indeed, even centuries: “An analysis of the relationships between 43,000 transnational corporations has identified a relatively small group of companies, mainly banks, with disproportionate power over the global economy.” As one of the researchers stated, “Reality is so complex, we must move away from dogma, whether it’s conspiracy theories or free-market… Our analysis is reality-based.” Using a database which listed 37 million companies and investors worldwide, the researchers studied all 43,060 trans-national corporations (TNCs), including the share ownerships linking them.[1]

The mapping of ‘power’ was through the construction of a model showing which companies controlled which other companies through shareholdings. The web of ownership revealed a core of 1,318 companies with ties to two or more other companies. This ‘core’ was found to own roughly 80% of global revenues for the entire set of 43,000 TNCs. And then came what the researchers referred to as the “super-entity” of 147 tightly-knit companies, which all own each other, and collectively own 40% of the total wealth in the entire network. One of the researchers noted, “In effect, less than 1 per cent of the companies were able to control 40 per cent of the entire network.” This network poses a huge risk to the global economy, as, “If one [company] suffers distress… this propagates.” The study was undertaken with a data set established prior to the economic crisis, thus, as the financial crisis forced some banks to die (Lehman Bros.) and others to merge, the “super-entity” would now be even more connected, concentrated, and problematic for the economy.[2]

The top 50 companies on the list of the “super-entity” included (as of 2007): Barclays Plc (1), Capital Group Companies Inc (2), FMR Corporation (3), AXA (4), State Street Corporation (5), JP Morgan Chase & Co. (6), UBS AG (9), Merrill Lynch & Co Inc (10), Deutsche Bank (12), Credit Suisse Group (14), Bank of New York Mellon Corp (16), Goldman Sachs Group (18), Morgan Stanley (21), Société Générale (24), Bank of America Corporation (25), Lloyds TSB Group (26), Lehman Brothers Holdings (34), Sun Life Financial (35), ING Groep (41), BNP Paribas (46), and several others.[3]

In the United States, five banks control half the economy: JP Morgan Chase, Bank of America, Citigroup, Wells Fargo, and Goldman Sachs Group collectively held $8.5 trillion in assets at the end of 2011, which equals roughly 56% of the U.S. economy. This data was according to central bankers at the Federal Reserve. In 2007, the assets of the largest banks amounted to 43% of the U.S. economy. Thus, the crisis has made the banks bigger and more powerful than ever. Because the government invoked “too big to fail,” meaning that the big banks will be saved because they are very important, the big banks have incentive to make continued and bigger risks, because they will be bailed out in the end. Essentially, it’s an insurance policy for criminal risk-taking behaviour. The former president of the Federal Reserve Bank of Minneapolis stated, “Market participants believe that nothing has changed, that too-big-to-fail is fully intact.” Remember, “market” means the banking cartel (or “super-entity” if you prefer). Thus, they build new bubbles and buy government bonds (sovereign debt), making the global financial system increasingly insecure and at risk of a larger collapse than took place in 2008.[4]

When politicians, economists, and other refer to “financial markets,” they are in actuality referring to the “super-entity” of corporate-financial institutions which dominate, collectively, the global economy. For example, the role of financial markets in the debt crisis ravaging Europe over the past two years is often referred to as “market discipline,” with financial markets speculating against the ability of nations to repay their debt or interest, of credit ratings agencies downgrading the credit-worthiness of nations, of higher yields on sovereign bonds (higher interest on government debt), and plunging the country deeper into crisis, thus forcing its political class to impose austerity and structural adjustment measures in order to restore “market confidence.” This process is called “market discipline,” but is more accurately, “financial terrorism” or “market warfare,” with the term “market” referring specifically to the “super-entity.” Whatever you call it, market discipline is ultimately a euphemism for class war.[5]

The Global Supra-Government and the “Free Market”

In December of 2011, Roger Altman, the former Deputy Secretary of the Treasury under the Clinton administration wrote an article for the Financial Times in which he explained that financial markets were “acting like a global supra-government,” noting:

They oust entrenched regimes where normal political processes could not do so. They force austerity, banking bail-outs and other major policy changes. Their influence dwarfs multilateral institutions such as the International Monetary Fund. Indeed, leaving aside unusable nuclear weapons, they have become the most powerful force on earth.[6]

Altman continued, explaining that when the power of this “global supra-government” is flexed, “the immediate impact on society can be painful – wider unemployment, for example, frequently results and governments fail.” But of course, being a former top Treasury Department official, he went on to endorse the global supra-government, writing, “the longer-term effects can be often transformative and positive.” Ominously, Altman concluded: “Whether this power is healthy or not is beside the point. It is permanent,” and “there is no stopping the new policing role of the financial markets.”[7] In other words, the ‘super-entity’ global ‘supra-government’ of financial markets carries out financial extortion, overthrows governments and impoverishes populations, but this is ultimately “positive” and “permanent,” at least from the view of a former Treasury Department official. From the point of view of those who are being impoverished, the actual populations, “positive” is not necessarily the word that comes to mind.

In the age of globalization, money – or capital – flows easily across borders, with banks, hedge funds and other financial institutions acting as the vanguards of a new international order of global governance. Where finance goes, corporations follow; where corporations venture, powerful states stand guard of their interests. Our global system is one of state-capitalism, where the state and corporate interests are interdependent and mutually beneficial, at least for those in power. Today, financial institutions – with banks at the helm – have reached unprecedented power and influence in state capitalist societies. The banks are bigger than ever before in history, guarded by an insurance policy that we call “too big to fail,” which means that despite their criminal and reckless behaviour, the government will step in to bail them out, as it always has. Financial markets also include credit ratings agencies, which determine the supposed “credit-worthiness” of other banks, corporations, and entire nations. The lower the credit rating, the riskier the investment, and thus, the higher the interest is for that entity to borrow money. Countries that do not follow the dictates of the “financial market” are punished with lower credit ratings, higher interest, speculative attacks, and in the cases of Greece and Italy in November of 2011, their democratically-elected governments are simply removed and replaced with technocratic administrations made up of bankers and economists who then push through austerity and adjustment policies that impoverish and exploit their populations. In the age of the “super-entity” global “supra-government,” there is no time to rattle around with the pesky process of formal liberal democracy; they mean business, and if your elected governments do not succumb to “market discipline,” they will be removed and replaced in what – under any other circumstances – is referred to as a ‘coup.’

Banks and financial institutions provide the liquidity – or funds – for what we call “free markets.” Free markets in principle would allow for free competition between companies and countries, each producing their own comparative advantage – producing what they are best at – and trading with others in the international market, so that all parties rise in living standards and wealth together. The “free market” is, of course, pure mythology. In practice, what we call “free markets” are actually highly protectionist, regimented, regulated, and designed to undermine competition and enforce monopolization. The “free markets” serve this purpose for the benefit of large multinational corporations and banks.

When we use the term “free markets” we are generally referring to the “real” economy, legitimate and legal. When it comes to illegitimate markets, for example, the global drug trade, we do not tend to refer to them as “free markets” but rather, “illegal” and run by “cartels.” Cartels, like corporations, are hierarchically organized totalitarian institutions, where decisions and power and exercised from the top-down, with essentially no input going from the bottom-up. Large multinational corporations, like large international cartels, seek to control their particular market throughout entire nations, regions, and beyond. Often, co-operation between corporations allow them to function in an oligopolistic manner, where the collectively dominate the entire market, carving it up between them. Major oil companies, agro-industrial firms, telecommunications, pharmaceutical, military contractors and water management corporations are well-known for these types of activities.

Cartels have often been known to engage in a similar practice, though typically they are more competitive with each other. When interests are threatened – which is defined as when a corporation or cartel is at risk of losing its total dominance of its market in a particular region – conflict arises, and often violently so, with the potential for coups, assassinations, terror campaigns, and war. This is when the state intervenes to protect the market for the cartel or corporate interests. Thus, a market like the global drug trade functions relatively similar to those of the “legitimate” economy, pharmaceuticals, energy, technology, etc. The illicit trade in drugs is as much a “free market” as is the trade in automobiles or oil. And of course, the money ends up in the same place: the global supra-government of “financial markets.”

Banking Cartel or Drug Cartel… or What’s the Difference?

In 2009, the United Nations Office on Drugs and Crime reported that billions of dollars in drug money saved the major banks during the financial crisis, providing much-needed liquidity. Antonio Maria Costa, the head of the UN Office on Drugs and Crime stated that drug money was “the only liquid investment capital” available to banks on the brink of collapse, with roughly $325 billion in drug money absorbed by the financial system. Without identifying specific countries or banks, Costa stated that, “Inter-bank loans were funded by money that originated from the drugs trade and other illegal activities… There were signs that some banks were rescued that way.”[8]

In 2010, Wachovia Bank (now owned by Wells Fargo) settled the largest action ever under the U.S. bank secrecy act, paying a fine of $50 million plus forfeiting $110 million of drug money, of which the bank laundered roughly $378.4 billion out of Mexico. The federal prosecutor in the case stated, “Wachovia’s blatant disregard for our banking laws gave international cocaine cartels a virtual carte blanche to finance their operations.” The fine that the bank paid for laundering hundreds of billions of dollars in drug money was less than 2% of the bank’s 2009 profit, and on the same week of the settlement, Wells Fargo’s stock actually went up. The bank admitted in a statement of settlement that, “As early as 2004, Wachovia understood the risk” of holding such an account, but “despite these warnings, Wachovia remained in the business.” The leading investigator into the money laundering operations, Martin Woods, based out of London, had discovered that Wachovia had received roughly six or seven thousand subpoenas for information about its Mexican operation from the federal government, of which Woods commented: “An absurd number. So at what point does someone at the highest level not get the feeling that something is very, very wrong?” Woods had been hired by Wachovia’s London branch as a senior anti-money laundering officer in 2005, and when in 2007 an official investigation was opened into Wachovia’s Mexican operations, Woods was informed by the bank that he failed “to perform at an acceptable standard.” In other words, he was actually doing his job. In regards to the settlement, Woods stated:

The regulatory authorities do not have to spend any more time on it, and they don’t have to push it as far as a criminal trial. They just issue criminal proceedings, and settle. The law enforcement people do what they are supposed to do, but what’s the point? All those people dealing with all that money from drug-trafficking and murder, and no one goes to jail?[9]

As the former UN Office of Drugs and Crime czar Antonio Maria Costa said, “The connection between organized crime and financial institutions started in the late 1970s, early 1980s… when the mafia became globalized,” just like other major markets. Martin Woods added that, “These are the proceeds of murder and misery in Mexico, and of drugs sold around the world,” yet no one went to jail, asking, “What does the settlement do to fight the cartels? Nothing – it doesn’t make the job of law enforcement easier and it encourages the cartels and anyone who wants to make money by laundering their blood dollars. Where’s the risk? There is none.” He added: “Is it in the interest of the American people to encourage both the drug cartels and the banks in this way? Is it in the interest of the Mexican people? It’s simple: if you don’t see the correlation between the money laundering by banks and the 30,000 people killed in Mexico, you’re missing the point.” Woods, who now runs his own consultancy, told the Observer in 2011 that, “New York and London… have become the world’s two biggest laundries of criminal and drug money, and offshore tax havens. Not the Cayman Islands, not the Isle of Man or Jersey. The big laundering is right through the City of London and Wall Street.”[10]

Just as the “too big to fail” program acts as an insurance policy for the big banks to engage in constant criminal activity, taking ever-larger financial risks with the guarantee that they will be bailed out, the settlements and lack of criminal prosecutions for banks laundering drug money provides the incentive to continue laundering hundreds of billions in drug money, because so long as the fine is smaller than the profit accrued from such a practice, it comes down to a simple cost-benefit analysis: if the cost of laundering drug money is less than the benefit, continue with the policy. The same cost-benefit analysis goes for all forms of criminal activity by banks and corporations, whether bribery, fraud, or violating environmental, labour and other regulations. So long as the penalty is less than the profit, the problem continues.

An article in the Observer from July of 2012 referred to global banks as “the financial services wing of the drug cartels,” noting that HSBC, Britain’s biggest bank, had been called before the U.S. Senate to testify about laundering drug money from Mexican cartels, holding one “suspicious account” for four years on behalf of the largest drug cartel in the world, the Sinaloa cartel in Mexico.[11] In fact, a multi-year investigation into HSBC revealed that the bank was not only a major international drug money-laundering conduit, but also laundered money for clients with ties to terrorism. In July of 2012, as the Senate was publicly investigating HSBC, Antonio Maria Costa stated, “Today I cannot think of one bank in the world that has not been penetrated by mafia money.” The global drug trade is estimated to be worth roughly $380 billion annually, with most of the money made in the consumer markets of North America and Europe. Using the example of the $35 billion per year cocaine market in the United States, only about 1.5% of these profits make their way to the coca-leaf producers (mostly poor peasants) in South America (who became the target of our bombing and chemical warfare campaigns in the “war on drugs”), while the international traffickers get roughly 13% of the profits, with the remaining 85% earned by the distributors in the U.S. HSBC was accused of laundering the profits of the distributors.[12]

The U.S. Senate report concluded that HSBC had exposed the U.S. financial system to “a wide array of money laundering, drug trafficking, and terrorist financing,” including billions in “proceeds from illegal drug sales in the United States.” HSBC acknowledged, in an official statement, that, “in the past, we have sometimes failed to meet the standards that regulators and customers expect.” Among those “standards” that HSBC “sometimes failed to meet,” according to the Senate investigation, were financing provided to banks in Saudi Arabia and Bangladesh which were tied to terrorist organizations, while the bank’s regulator failed to take a single enforcement action against HSBC.[13] Among the terrorist organizations which potentially received financial assistance from HSBC through Saudi banks was al-Qaeda. HSBC put aside $700 million to cover any potential fines for such activities, which is not uncommon for banks to do. Banks like ABN Amro, Barclays, Credit Suisse, Lloyds and ING had all reached major settlements for admitting to facilitating transactions and engaging in money laundering for clients in Cuba, Iran, Libya, Myanmar and Sudan.[14]

As executives from HSBC appeared in the U.S. Senate, the bank’s head of compliance since 2002, David Bagley, resigned as he testified before the committee, commenting, “Despite the best efforts and intentions of many dedicated professionals, HSBC has fallen short of our own expectations and the expectations of our regulators.”[15] As Ed Vulliamy reported in the Observer, in May of 2012, a poor black man named Edward Dorsey Sr. was convicted of peddling 5.5 grams of crack cocaine in Washington D.C. and was given 10 years in jail. Meanwhile, just across the river from where Dorsey had committed his crime, executives from HSBC admitted before the U.S. Senate that they laundered billions in drug money, just as Wachovia had admitted to the previous year, with no one going to prison.[16] The lesson from this is clear: if you are poor, black, and are caught with a couple grams of crack-cocaine, you can expect to go to prison for several years (or in this case, a decade); but if you are rich, white, own a bank, and are caught laundering billions of dollars (or hundreds of billions of dollars) in drug money, you will be fined (but not enough to make such practices unprofitable), and may have to resign. Too big to fail is simply another way of saying “too big to jail.”

Of course, it’s not fair to put all the blame for international drug money-laundering on the shoulders of HSBC and Wachovia, as Bloomberg reported, Mexican drug cartels also funneled money through the Bank of America and even the banking branch of American Express, Banco Santander, and Citigroup.[17] Even the FBI has accused Bank of America of laundering Mexican drug cartel funds.[18] But it’s not just drug money that banks launder; all sorts of illicit funds are laundered through major banks, many of which have been fined or are now being investigated for their criminal activities, including JPMorgan, Standard Chartered, Credit Suisse, Lloyds, Barclays, ING, and the Royal Bank of Scotland, among others.[19] Another major Swiss bank, UBS, has been very consistent in committing fraud and engaging in various conspiracies, a great deal of which was committed against Americans, though the bank was given “conditional immunity” from the U.S. Department of Justice.[20]

Financial Fraud and the ‘Get Out of Jail Free Card’

The major banks of the world have been caught in conspiracies of ripping off small towns and cities across the United States, which allowed banks like JPMorgan Chase, GE Capital, UBS, Bank of America, Lehman Brothers, Wachovia, Bear Stearns, and others, to steal billions of dollars from schools, hospitals, libraries, and nursing homes from “virtually every state, district and territory in the United States,” according to a court settlement on the issue. The theft was done through the manipulation of the public bidding process, something that the Mafia has become experts in with regards to garbage and construction industry contracts. In short, the banking system actually functions like a Mafia cartel system, not to mention, taking money from the Mafia and cartels themselves.[21] Banks like JP Morgan Chase and Goldman Sachs engaged in bribery, fraud, and conspiracies which resulted in the bankruptcy of counties all across the United States.[22] Still, they continue to be ‘respected’ by the political class which refuses to punish them for their criminal activity, and instead, rewards them with bailouts and follows their instructions for policy.

Over the summer of 2012, another major banking scandal hit the headlines, regarding the manipulation of the London inter-bank lending rate known as the Libor. The Libor rate, explained the Economist, “determines the prices that people and corporations around the world pay for loans or receive for their savings,” as it is used as a benchmark for establishing payments on an $800 trillion derivatives market, covering everything from interest rate derivatives to mortgages. Essentially, the Libor is the interest rate at which banks lend to each other on the short term, and is established through an “honour system” of where 18 major banks report their daily rates, from which an average is calculated. That average becomes the Libor rate, and reverberates throughout the entire global economy, setting a benchmark for a massive amount of transactions in the global derivatives market. Whereas the derivatives market is a massive casino of unregulated speculation, the Libor scandal revealed the cartel that owns the casino.

The scandal began with Barclays, a 300-year old bank in Britain, revealing that several employees had been involved in rigging the Libor to suit their own needs. More banks quickly became implemented, and countries all over the world began opening investigations into this scandal and the role their own banks may have played in it. By early July, as many as 20 major banks were named in various investigations or lawsuits related to the rigging of the Libor.[23]

Among the major global banks which are being investigated by U.S. prosecutors are Barclays, Deutsche Bank, Citigroup, JPMorgan Chase, Royal Bank of Scotland, HSBC, UBS, Bank of America, Bank of Tokyo Mitsubishi, Credit Suisse, Lloyds Banking Group, Rabobank, Royal Bank of Canada, Société Générale, and others. Prosecutors in the U.S., U.K., Canada and Japan were investigating collusion between the major banks on the manipulation of the Libor. In June of 2012, Barclays paid a fine to US and UK authorities, admitting its culpability in the rigging with a $450 million settlement.[24] With information and documents pouring out, implicating further banks and institutions in the scandal, a general consensus was emerging that the Libor had been manipulated since at least 2005, though, as one former Morgan Stanley trader wrote in the Financial Times, the rigging had began as early as 1991, if not before. The British Banker’s Association was responsible for setting the Libor rate by polling roughly 18 major banks on their highest and lowest rates daily. Thus, rigging by one bank would require the co-operating of at least nine other banks in purposely manipulating their rates in order to have any effect upon the Libor. Douglas Keenan, the former Morgan Stanley trader, wrote that, “it seems the misreporting of Libor rates may have been common practice since at least 1991.”[25]

Rolf Majcen, the head of a hedge fund called FTC Capital told Der Spiegel that, “the Libor manipulation is presumably the biggest financial scandal ever.” As regulators were using words like “organized fraud” and “banksters” to describe the growing scandal, it was becoming common to refer to the major banks as functioning like a “cartel” or “mafia.”[26] The CEO of Barclays, Bob Diamond, resigned in disgrace, as did Marcus Agius, the Chairman of Barclays (who also serves as a director on the board of BBC, and is married into the Rothschild banking dynasty). The “cartel” manipulated the Libor for a great number of reasons, among them, to appear to be in better health by rigging their credit ratings upwards.[27] The Business Insider referred to the Libor rigging as a “criminal conspiracy” from the start, essentially designed to promote manipulation as the Libor was determined by an “honor system” for banks to properly report their rates.[28] Imagine giving a pile of credit cards to a group of credit card fraud convicts and establishing an “honour system.” Could one truly be surprised if it didn’t work out? Well, the Libor scandal is effectively based upon the same logic, except that the repercussions are global in scope.

Traders at the Royal Bank of Scotland referenced, in internal emails, to their participation in operating a “cartel” that made “amazing” amounts of money through the manipulation of interest rates, with a former senior trader at RBS writing that managers at the bank had “condoned collusion.” The same trader, who was later hung out to dry by RBS as a scapegoat, wrote in an email to a trader at Deutsche Bank that, “It is a cartel now in London,” where the Libor is established.[29]

The cartel, however, did not simply include the major banks, but also required the cooperation or at least negligence of regulators and central banks. Documents released by the Federal Reserve Bank of New York and the Bank of England show correspondence between then-President of the NY Fed Timothy Geithner (who is now Obama’s Treasury Secretary) and Bank of England Governor Mervyn King discussing how Barclays was manipulating the Libor rates during the 2008 financial crisis. While the NY Fed corresponded with both the Bank of England and Barclays itself on the acknowledgment of interest rate manipulation, it never told the bank to stop the rigging practice. An official at Barclays even informed the NYFed in 2008 that the bank was under-reporting the rate at which it could borrow from other banks so that Barclays could “avoid the stigma” of appearing to be weaker than its peers, adding that “other participating banks were also under-reporting their Libor submissions.”[30]

A Barclays employee told the New York Fed in an April 2008 phone call that, “We know that we’re not posting um, an honest Libor… and yet we are doing it, because, um, if we didn’t do it, it draws, um, unwanted attention on ourselves.” The New York Fed official replied: “You have to accept it… I understand. Despite it’s against what you would like to do. I understand completely.” Several months later, a Barclays employee told a New York Fed official that the Libor rates were still “absolute rubbish.”[31]

While the New York Fed expressed sympathy for the poor and helpless global banks need to engage in fraud and interest rate manipulation in order to lie and appear to be healthier than it was, the Bank of England went a step further, when Paul Tucker, the head of markets at the BoE wrote a note to Barclays CEO Bob Diamond in 2008 suggesting that Barclays lower its Libor rate, thus encouraging the rigging itself, instead of just expressing sympathy for the “need” to commit fraud.[32]

The main British banking lobby group, the British Banker’s Association (BBA), which was responsible for overseeing the Libor rate process (no conflict of interest there, right?), was, in late September of 2012, stripped of its right to oversee the Libor, to be replaced with a formal regulator. The BBA’s “oversight” of Libor dates back to 1984, when the City of London (Britain’s Wall Street) had begun an experiment to establish a new way of setting interest rates, asking the banking lobby group to set the rate in 1986 when the Libor began.[33] The BBA’s Foreign Exchange and Money Markets Committee is responsible for setting the Libor, and they meet every two months to review the process in secret without any minutes being published, and even the membership of the Committee is kept a secret. Spokespersons at Credit Suisse, Royal Bank of Scotland, and UBS refused to comment on whether they had any representatives on the committee, while Barclays, Deutsche Bank, HSBC, Bank of America and Citigroup didn’t even respond to emailed inquiries about their involvement with the committee, as Bloomberg reported. A British regulator, in the understatement of the century, stated, “There is an apparent lack of transparency,” adding that the BBA’s committee “doesn’t appear to be sufficiently open and transparent to provide the necessary degree of accountability to firms and markets with a direct interest in being assured of the integrity of Libor.”[34] When the fox guards the henhouse, it takes a great deal of stupidity to be “surprised” when some hens go missing.

In an April 2008 meeting with officials at the Bank of England, Angela Knight, the head of the British Banker’s Association, suggested that the BBA perhaps should no longer be responsible for oversight of “the world’s most important number,” which had become too big for the BBA to manage. No one at the meeting cared enough to do anything about it, however, and so nothing changed.[35] Where was the incentive to change the system, after all? Yes, massive fraud was taking place, and this was well understood by the banks committing it, as well as the regulators and central banks overseeing it. But on the plus side, everyone was getting away with it. So indeed, there was no incentive to change the system. From the point of view of those managing it, the Libor was functioning as it should. A cartel was established because a cartel was desired. The fact that it was all highly illegal, fraudulent, and immoral was – and is – beside the point. Mexican drug cartels do not worry about the legality of their operations because they are, by definition, illegal. They worry simply about getting away with their illegal operations. The same can be said for the global banking cartel. So long as they get away with criminal cartel operations, there is no incentive to change the system, and instead, there is only an incentive to expand and further entrench the cartel’s operations.

Canada’s antitrust regulator began an investigation into the “international cartel” of banks rigging the Libor, focusing on the role played by banks such as JP Morgan Chase, Royal bank of Scotland, Deutsche Bank, HSBC, and Citigroup, among others. A law professor at the University of Toronto who was hired by the regulator to study the case commented that, “international cartels are of a significant concern for the Canadian economy.”[36] We have truly reached an impressive circumstance when the actual regulators of the banks refer to the banking system as an “international cartel.”

A lawsuit was being filed by several homeowners in the U.S. who were attempting to sue some of the world’s largest banks for fraud, as the Libor manipulation sparked increases on their mortgages, resulting in illegal profits for banks. The class action lawsuit filed in New York in October of 2012 accused banks such as Bank of America, Citigroup, Barclays, UBS, JPMorgan Chase, Deutsche Bank and others of fraud over a period of ten years.[37] For U.S. states and municipalities that bought interest-rate swaps before the financial crisis, the Libor rigging was poised to more than double their losses. Banks had sold roughly $500 billion of interest-rate swaps (in the derivatives market) to municipalities before the financial crisis, with roughly $200 billion of those swaps tied to the Libor. As one legal expert who studies derivatives told Bloomberg, “Almost all interest-rate swaps begin with Libor.” This prompted several states in the U.S. to begin their own investigations into how the Libor-rigging may have negatively affected them.[38]

Punishing the World’s Population into Poverty: Life Under the Global Cartel

While the global cartel of criminal banks rig rates, launder drug money, fund terrorists, engage in bribery, fraud and demand multi-trillion dollar bailouts from our governments (effectively selling their bad debts to the public), and then give themselves massive bonuses, they are also demanding – through what is called “market discipline” – that our governments deal with our debts by undertaking policies of “austerity” and “structural reform,” which are euphemisms for impoverishment and exploitation. Thus, after the cartel helped create a massive financial crisis, and after our governments rewarded them for their criminal activity, the cartel now demands that our governments punish their populations into poverty and open their economies, resources and labour up for cheap and easy exploitation by banks and multinational corporations. This is referred to as the “solution” for getting out of the ‘Great Recession,’ and which is sure to great a Great Depression. Greece is now two and a half years into its “austerity” and “adjustment” reforms, with its debt growing as a result, poverty exploding, misery spreading, health, education, welfare rapidly declining, suicide rates and hunger increasing, as the Greek people are subjected to a program of “social genocide.” Market discipline demands austerity and adjustment, or in other words, class warfare creates poverty and exploitation.[39]

Countries that refuse to implement programs of austerity and adjustment are subjected to financial terrorism by the “international cartel,” as financial markets engage in “market discipline” by using the derivatives market to speculate against that particular country’s ability to pay its interest or debt, thus making its credit ratings decrease and borrowing rates increase, plunging the country into a deeper crisis. In any other scenario, this is called terrorism or in the very least, extortion: do what I say or I will punish you and destroy you. This is what former U.S. Treasury official Roger Altman referred to in the Financial Times as the new “global supra-government” who can “force austerity, banking bail-outs and other major policy changes,” and thus, “have become the most powerful force on earth.”[40] Countries, regional, and international organizations all bow down to the dictates of the “international cartel” of the “global supra-government,” and so countries like Greece, Spain, Ireland, Italy, and Portugal, organizations like the European Union, European Central Bank, powerful states like Germany, France, Britain, and the U.S., and other international organizations like the IMF, Bank for International Settlements, and the OECD all demand and implement austerity measures and structural “reforms.” Either they follow the orders of the “cartel” – which we commonly refer to as the “invisible hand” of the “free market – or they directly challenge “the most powerful force on earth.” In the global economy, a small country like Greece standing up to the “global supra-government” is much like a small Greek restaurant trying to stand up to the city Mafia.

In the U.S., states that were defrauded in the billions of dollars by the cartel, and took on major debts as a result, are now the harbingers of austerity in America. Beginning in 2010, roughly 20 states across the U.S. began implementing austerity measures, and have been doing much worse economically as a result (the predicted effect of austerity). Even the institutions which are the most militant in demanding austerity measures, such as the European Union and the IMF, have acknowledged in recent reports that countries which pursue austerity to supposedly reduce their debts end up getting much larger debts as a result, and that such measures are actually extremely damaging to economies. This is not news, of course, since there is a rather large sample of data from the past 30 years of forced austerity and adjustment measures across Africa, Asia, and Latin America (at the behest of the IMF, World Bank, western governments, and of course, the “cartel”), which show quite clearly the effect that austerity and adjustment have in rapidly expanding poverty and facilitating exploitation. As austerity is hitting several U.S. states, jobs are lost and poverty increases with debt, standards of living decline and the recession deepens into a depression. The population is essentially punished for the crimes of the global cartel, while public employees, pensioners, welfare recipients, teachers and workers get the blame.[41]

In late October of 2012, the CEOs of 80 major corporations and banks in the United States banded together (as any well functioning cartel does) in order to pressure Congress, regardless of who the next President is, to pursue an agenda of harsh austerity measures and structural reforms. In a statement to Congress signed by the 80 CEOs, the American branch of the global cartel (its most significant branch), demanded that policies be enacted immediately, though implemented gradually, “to give Americans time to prepare for the changes in the federal budget.” Among the demands are to reform Medicare and Medicaid, healthcare, Social Security, increase taxes, and generally reduce spending. All of this amounts to a large federal program of austerity, to cut social spending and increase taxes on the population, thus impoverishing the population. This, in the words of the letter to Congress, “must be bipartisan and reforms to all areas of the budget should be included.”[42] Among the signatories to the letter were the CEOs of AT&T, Bank of America, BlackRock, Boeing, Caterpillar, Dow Chemical Company, General Electric, Goldman Sachs, JPMorgan Chase, Merck, Microsoft, Motorola, Time Warner, and Verizon, among many others.[43]

This followed roughly one week after a group of 15 major global bank CEOs sent a letter to President Obama and the U.S. Congress lecturing the U.S. political class on “moral authority,” giving their formal orders to the U.S. political establishment, that regardless of Democratic or Republican administrations, they are losing patience with the democratic apparatus of the state, and warned: “The solvency, productive capacity, and stability of the United States, as well as its moral authority as a global leader, require that its fiscal challenges be credibly met.” Among the signatories to the letter were the CEOs of Bank of America, Citigroup, Goldman Sachs, JPMorgan Chase, Morgan Stanley and Wells Fargo. The Wall Street Journal, reporting on this letter, commented that even for “a dying democracy, it’s embarrassing enough to see bankers telling our government what to do,” but in this letter, “we even see foreign bankers telling our government what to do,” as other CEOs of the global cartel signed the letter, from banks such as UBS, Credit Suisse, and Deutsche Bank. The “consequences of inaction” on the U.S. debt, read the letter, “would be very grave.” In other words, the U.S. political class has received a threat from the global cartel that it is now time to implement austerity and adjustment measures, or to face the consequences of financial terrorism.[44]

Hiding the Loot: The Offshore Economy in the Age of the Global Plutonomy

While people are being forced into poverty to pay off the bad debts of the “super-entity” global banking cartel of drug-money laundering banks which make up the “global supra-government,” the richest people in the world have been hiding their wealth in offshore tax havens, and of course, with the help of those same banks. James Henry, a former chief economist at McKinsey, a major global consultancy, published a major report on tax havens in July of 2012 for the Tax Justice Network, compiling data from the Bank for International Settlements (BIS), the IMF and other private sector entities which revealed that the world’s superrich have hidden between $21 and $32 trillion offshore to avoid taxation. Henry stated: “This offshore economy is large enough to have a major impact on estimates of inequality of wealth and income; on estimates of national income and debt ratios; and – most importantly – to have very significant negative impacts on the domestic tax bases of ‘source’ countries.” John Christensen of the Tax Justice Network commented that, “Inequality is much, much worse than official statistics show, but politicians are still relying on trickle-down to transfer wealth to poorer people… This new data shows the exact opposite has happened: for three decades extraordinary wealth has been cascading into the offshore accounts of a tiny number of super-rich.” Roughly 92,000 of the super-rich, globally, hold at least $10 trillion in offshore wealth. In many cases, the worth of these offshore assets far exceeds the debts of the countries that they flow from, the same debts that are used to keep these countries and their populations in poverty and a constant state of exploitation.[45]

The estimated total of hidden offshore wealth amounts to more than the combined GDP of the United States and Japan, hidden in secretive financial jurisdictions like Switzerland and the Cayman Islands. The process of hiding this wealth is largely facilitated by the major global banks, which compete with one another to attract the assets of the world’s super-rich. James Henry explained that the wealth of the world’s super-rich is “protected by a highly paid, industrious bevy of professional enablers in the private banking, legal, accounting and investment industries taking advantage of the increasingly borderless, frictionless global economy;” more of that “free market” magic. The top ten banks in the world, which include UBS and Credit Suisse (based in Switzerland) as well as Goldman Sachs in the United States, collectively managed roughly $6.4 trillion in offshore accounts for 2010 alone. As the report revealed, “for many developing countries the cumulative value of the capital that has flowed out of their economies since the 1970s would be more than enough to pay off their debts to the rest of the world,” debts which are largely illegitimate as it stands. This trend is exacerbated in the oil-rich states of the world such as Nigeria, Russia, and Saudi Arabia. The report stated: “The problem here is that the assets of these countries are held by a small number of wealthy individuals while the debts are shouldered by the ordinary people of these countries through their governments.” With roughly half of the world’s offshore wealth belonging to the top 92,000 richest individuals, they represent the top 0.001%, a far more extreme global disparity than that which is invoked by the Occupy movement’s 1% paradigm. Henry commented: “The very existence of the global offshore industry, and the tax-free status of the enormous sums invested by their wealthy clients, is predicated on secrecy.”[46] Remember, “free market” means that those who own the market (the global cartel), and free to do anything they please.

A 2005 report from Citigroup coined the term “plutonomy,” to describe countries “where economic growth is powered by and largely consumed by the wealthy few,” and specifically identified the U.K., Canada, Australia, and the United States as four plutonomies. Keeping in mind that the report was published three years before the onset of the financial crisis in 2008, the Citigroup report stated: “Asset booms, a rising profit share and favourable treatment by market-friendly governments have allowed the rich to prosper and become a greater share of the economy in the plutonomy countries,” and that, “the rich are in great shape, financially.”[47] It’s only everyone else that is suffering, which by definition, is a “well functioning” economy. As the Federal Reserve reported, “the nation’s top 1% of households own more than half the nation’s stocks,” and “they also control more than $16 trillion in wealth — more than the bottom 90%.” The term ‘Plutonomy’ is specifically used to “describe a country that is defined by massive income and wealth inequality,” and that they have three basic characteristics, according to the Citigroup report:

1. They are all created by “disruptive technology-driven productivity gains, creative financial innovation, capitalist friendly cooperative governments, immigrants…the rule of law and patenting inventions. Often these wealth waves involve great complexity exploited best by the rich and educated of the time.”

2. There is no “average” consumer in Plutonomies. There is only the rich “and everyone else.” The rich account for a disproportionate chunk of the economy, while the non-rich account for “surprisingly small bites of the national pie.” [Citigroup strategist Ajay] Kapur estimates that in 2005, the richest 20% may have been responsible for 60% of total spending.

3. Plutonomies are likely to grow in the future, fed by capitalist-friendly governments, more technology-driven productivity and globalization.[48]

Kapur, who authored the Citigroup report, stated that there were also risks to the Plutonomy, “including war, inflation, financial crises, the end of the technological revolution and populist political pressure,” yet, “the rich are likely to keep getting even richer, and enjoy an even greater share of the wealth pie over the coming years.”[49]

In February of 2011, Ajay Kapur, the author of the Citigroup report who is now with Deutsche Bank, gave an interview in which he explained that, “the world economy is even more dependent on the spending and consumption of the rich,” and that, “Plutonomist consumption is almost 10 times as volatile that of the average consumer.” He further explained that increased debt levels are a sign of plutonomies:

We have an economy today where a large fraction of the population doesn’t pay federal income taxes and, because of demand for entitlements, we have a system of massive representation without taxation. On the other hand, you have plutonomists who protect their turf and the taxation amounts are not enough to pay for everyone’s demand. So I’ve come to the conclusion that budget deficits are biased toward getting bigger and bigger. Budget deficits are going to become a manifestation of a plutonomy.[50]

The plutonomy is largely characterized by a lack of a consuming and vibrant middle class. This is a trend that has been accelerating for several decades, particularly in North America and Britain, where the middle class population is heavily indebted. The middle class has existed as a consumer class, keeping the lower class submissive, and keeping the upper class secure and wealthy by consuming their products, produced with the labour of the lower class.

The most advanced plutonomies in the world are the most advanced industrial and technological nations, where the major corporations and banks are highly subsidized and protected by the state, as is typical for a state-capitalist society. While the industrial and rich northern state-capitalist societies were able to industrialize and grow rich through highly protectionist measures, the poor south of the world (Africa, Asia, Latin America) were subjected to “free market” policies which opened up their economies to be exploited and plundered by the rich northern nations. No country has ever become an industrial power by implementing free market policies, but rather, by doing the exact opposite: heavy subsidies and state protection for key industries, technologies, and corporate entities.

While the ‘Third World’ was forced to implement “free market” policies in order to get loans, the predictable result took place: mass impoverishment and exploitation. The ‘Third World’ states were run by tiny elites who dominated the countries politically and economically, and who hid their stolen wealth in foreign banks and offshore tax havens. Now, in the midst of the global economic crisis which has been ravaging the world for the past four years, the rich northern countries are themselves implementing the same “free market” policies, though designed to subject their populations to “market discipline” while maintaining – and in fact increasing – the protectionist and subsidized policies for the multinational corporations and banks. It is important to note that “market discipline” and actual “free market” policies are exclusively designed for the general population, not the elite. Workers, students, the elderly, the poor and the many are to be subjected to “market discipline” while the banks and multinational corporations continue to be heavily subsidized (as the largest national welfare recipients) and protected by the state. Thus, just as our banks and corporations have plundered the Third World with rapacious delight over the past three decades, now they will be able to do the same to the populations of the rich nations themselves. The state will transform, as it did in the ‘Third World’, into a typically totalitarian institution which is responsible for protecting the super-rich and controlling, oppressing, or, in extreme cases of resistance, eliminating the ‘problem populations’ (i.e., the people).

Welcome to the global plutonomy in the age of austerity, the result of living under – and tolerating – a global “super-entity” corporate-financial cartel. Truly, one must pause and, if only for a moment, appreciate the ability of this global cartel to function so effectively in spite of its blatant criminal activities, and face almost absolutely no repercussions. Something truly is wrong with a society when a poor black man caught with 5 grams of crack-cocaine goes to prison for ten years, while rich white bank executives admit to laundering billions of dollars in drug money and receive only a fine and a slap on the wrist (maybe).

The lesson is clear: if you are a thief, steal by the billions or trillions, and then no one can do anything about it. If you are in the drug trade: handle only billions (or hundreds of billions) in drug money, and then you will get away with it. If you don’t want to pay taxes, be a member of the top o.oo1% of the world’s super-rich and hide your billions in offshore tax-free accounts. If you want more, create a global economic crisis, demand to be saved by the state to the tune of tens of trillions of dollars, and then, tell the state to punish their populations into poverty in order to pay for your mistakes.

In other words, if you want to indulge your criminal fantasies, lie and steal, profit from death and drugs, dominate and demand, be king and command, become the highly-functioning socially-acceptable sociopath you always knew you could be… think big. Think BANK. Serial killers, bank robbers and drug dealers go to jail; bankers get bailouts and get an unlimited insurance policy called “too big to fail.”

Andrew Gavin Marshall is an independent researcher and writer based in Montreal, Canada, writing on a number of social, political, economic, and historical issues. He is also Project Manager of The People’s Book Project. He also hosts a weekly podcast show, “Empire, Power, and People,” on BoilingFrogsPost.com.

 

Notes

[1]       Andy Coghlan and Debora MacKenzie, “Revealed – the capitalist network that runs the world,” New Scientist, 24 October 2011:

http://www.newscientist.com/article/mg21228354.500-revealed–the-capitalist-network-that-runs-the-world.html

[2]       Ibid.

[3]       Ibid.

[4]       David J. Lynch, “Banks Seen Dangerous Defying Obama’s Too-Big-to-Fail Move,” Bloomberg, 16 April 2012:

http://www.bloomberg.com/news/2012-04-16/obama-bid-to-end-too-big-to-fail-undercut-as-banks-grow.html

[5]       Dean Baker, “The eurozone crisis is not about market discipline,” Al-Jazeera, 18 December 2011:

http://www.aljazeera.com/indepth/opinion/2011/12/2011121874651469307.html

[6]       Roger Altman, “We need not fret over omnipotent markets,” The Financial Times, 1 December 2011:

http://www.ft.com/intl/cms/s/0/890161ac-1b69-11e1-85f8-00144feabdc0.html#axzz1fnNHC8YP

[7]       Roger Altman, “We need not fret over omnipotent markets,” The Financial Times, 1 December 2011:

http://www.ft.com/intl/cms/s/0/890161ac-1b69-11e1-85f8-00144feabdc0.html#axzz1fnNHC8YP

[8]       Rajeev Syal, “Drug money saved banks in global crisis, claims UN advisor,” The Observer, 13 December 2009:

http://www.guardian.co.uk/global/2009/dec/13/drug-money-banks-saved-un-cfief-claims

[9]       Ed Vulliamy, “How a big US bank laundered billions from Mexico’s murderous drug gangs,” The Observer, 3 April 2011:

http://www.guardian.co.uk/world/2011/apr/03/us-bank-mexico-drug-gangs

[10]     Ibid.

[11]     Ed Vulliamy, “Global banks are the financial services wing of the drug cartels,” The Observer, 21 July 2012:

http://www.guardian.co.uk/world/2012/jul/21/drug-cartels-banks-hsbc-money-laundering

[12]     John Paul Rathbone, “Money laundering: Taken to the cleaners,” 20 July 2012:

http://www.ft.com/intl/cms/s/0/702a64a6-d25e-11e1-ac21-00144feabdc0.html#axzz2ALt54B7K

[13]     Agustino Fontevecchia, “HSBC Helped Terrorists, Iran, Mexican Drug Cartels Launder Money, Senate Report Says,” Forbes, 16 July 2012:

http://www.forbes.com/sites/afontevecchia/2012/07/16/hsbc-helped-terrorists-iran-mexican-drug-cartels-launder-money-senate-report-says/

[14]     Roberto Saviano, “Where the Mob Keeps its Money,” The New York Times, 25 August 2012:

http://www.nytimes.com/2012/08/26/opinion/sunday/where-the-mob-keeps-its-money.html?pagewanted=all&_r=0

[15]     Dominic Rushe, “HSBC ‘sorry’ for aiding Mexican drugs lords, rogue states and terrorists,” The Guardian, 17 July 2012:

http://www.guardian.co.uk/business/2012/jul/17/hsbc-executive-resigns-senate

[16]     Ed Vulliamy, “Global banks are the financial services wing of the drug cartels,” The Observer, 21 July 2012:

http://www.guardian.co.uk/world/2012/jul/21/drug-cartels-banks-hsbc-money-laundering

[17]     Michael Smith, “Banks Financing Mexico Gangs Admitted in Wells Fargo Deal,” Bloomberg, 29 June 2010:

http://www.bloomberg.com/news/2010-06-29/banks-financing-mexico-s-drug-cartels-admitted-in-wells-fargo-s-u-s-deal.html

[18]     Alexander Eichler, “Mexican Drug Cartel Laundered Money Through BofA, FBI Alleges,” The Huffington Post, 9 June 2012:

http://www.huffingtonpost.com/2012/07/09/los-zetas-laundered-money-bank-america_n_1658943.html

[19]     Jessica Silver-Greenberg and Edward Wyatt, “In Laundering Case, a Lax Banking Law Obscured Money Flow,” The New York Times, 8 August 2012:

http://www.nytimes.com/2012/08/09/business/how-a-lax-banking-law-obscured-money-flow.html?pagewanted=all;

Jessica Silver-Greenberg and Ben Protess, “

Money-Laundering Inquiry Is Said to Aim at U.S. Banks,” The New York Times, 14 September 2012:

http://www.nytimes.com/2012/09/15/business/money-laundering-inquiry-said-to-target-us-banks.html?pagewanted=all&_r=0

[20]     James B. Stewart, “For UBS, a Record of Averting Prosecution,” The New York Times, 20 July 2012:

http://www.nytimes.com/2012/07/21/business/ubss-track-record-of-averting-prosecution-common-sense.html?pagewanted=all

[21]     Matt Taibbi, “The Scam Wall Street Learned From the Mafia,” Rolling Stone, 21 June 2012:

http://www.rollingstone.com/politics/news/the-scam-wall-street-learned-from-the-mafia-20120620

[22]     William D. Cohan, “How Wall Street Scams Counties Into Bankruptcy,” Bloomberg, 1 July 2012:

http://www.bloomberg.com/news/2012-07-01/how-wall-street-scams-counties-into-bankruptcy.html

[23]     “The Libor Scandal: The Rotten Heart of Finance,” The Economist, 7 July 2012:

http://www.economist.com/node/21558281

[24]     Shahien Nasiripour, “Nine more banks added to Libor probe,” The Financial Times, 26 October 2012:

http://www.ft.com/intl/cms/s/0/6f4e7960-1f1a-11e2-be82-00144feabdc0.html#axzz2ARAog5NE

[25]     Douglas Keenan, “My thwarted attempt to tell of Libor shenanigans,” The Financial Times, 26 July 2012:

http://www.ft.com/intl/cms/s/0/dc5f49c2-d67b-11e1-ba60-00144feabdc0.html#axzz2ARAog5NE

[26]     “The Cartel: Behind the Scenes in the Libor Interest Rate Scandal,” Der Spiegel, 1 August 2012:

http://www.spiegel.de/international/business/the-libor-scandal-could-cost-leading-global-banks-billions-a-847453.html

[27]     Matt Taibbi, “Why is Nobody Freaking Out About the LIBOR Banking Scandal?” Rolling Stone, 3 July 2012:

http://www.rollingstone.com/politics/blogs/taibblog/why-is-nobody-freaking-out-about-the-libor-banking-scandal-20120703

[28]     Raúl Ilargi Meijer, “LIBOR Was A Criminal Conspiracy From The Start,” The Business Insider, 11 July 2012:

http://www.businessinsider.com/libor-was-a-criminal-conspiracy-from-the-start-2012-7

[29]     Steven Swinford and Harry Wilson, “RBS traders boasted of Libor ‘cartel’,” The Telegraph, 26 September 2012:

http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/9568087/RBS-traders-boasted-of-Libor-cartel.html

[30]     Jill Treanor and Dominic Rushe, “Timothy Geithner and Mervyn King discussed Libor worries in 2008,” The Guardian, 13 July 2012:

http://www.guardian.co.uk/business/2012/jul/13/tim-geithner-mervyn-king-libor

[31]     Mark Gongloff, “New York Fed’s Libor Documents Reveal Cozy Relationship Between Regulators, Banks,” The Huffington Post, 13 July 2012:

http://www.huffingtonpost.com/2012/07/13/new-york-fed-libor-documents_n_1671524.html

[32]     Chris Giles, “Libor scandal puts BoE in line of fire,” The Financial Times, 17 July 2012:

http://www.ft.com/intl/cms/s/0/68605a86-d02a-11e1-bcaa-00144feabdc0.html#axzz2ARAog5NE

[33]     Jill Treanor, “British Bankers’ Association to be stripped of Libor rate-setting role,” The Guardian, 25 September 2012:

http://www.guardian.co.uk/business/2012/sep/25/bba-libor-setting-role-stripped-banks

[34]     Liam Vaughan, “Secret Libor Committee Clings to Anonymity Following Scandal,” Bloomberg, 21 August 2012:

http://www.bloomberg.com/news/2012-08-20/secret-libor-committee-clings-to-anonymity-after-rigging-scandal.html

[35]     David Enrich and Max Colchester, “Before Scandal, Clash Over Control of Libor,” The Wall Street Journal, 11 September 2012:

http://online.wsj.com/article/SB10000872396390443847404577631404235329424.html

[36]     Andrew Mayeda, “Canada Regulator Says Has Power to Probe Libor ‘Cartel’,” Bloomberg, 22 June 2012:

http://www.bloomberg.com/news/2012-06-22/canada-regulator-says-has-power-to-probe-libor-cartel-.html

[37]     Halah Touryalai, “Banks Rigged Libor To Inflate Adjustable-Rate Mortgages: Lawsuit,” Forbes, 15 October 2012:

http://www.forbes.com/sites/halahtouryalai/2012/10/15/banks-rigged-libor-to-inflate-adjustable-rate-mortgages-lawsuit/

[38]     Darrell Preston, “Rigged Libor Hits States-Localities With $6 Billion: Muni Credit,” Bloomberg, 9 October 2012:

http://www.bloomberg.com/news/2012-10-09/rigged-libor-hits-states-localities-with-6-billion-muni-credit.html

[39]     Andrew Gavin Marshall, “Austerity, Adjustment, and Social Genocide: Political Language and the European Debt Crisis,” Andrewgavinmarshall.com, 24 July 2012:

https://andrewgavinmarshall.com/2012/07/24/austerity-adjustment-and-social-genocide-political-language-and-the-european-debt-crisis/

[40]     Roger Altman, “We need not fret over omnipotent markets,” The Financial Times, 1 December 2011:

http://www.ft.com/intl/cms/s/0/890161ac-1b69-11e1-85f8-00144feabdc0.html#axzz1fnNHC8YP

[41]     Ben Polak and Peter K. Schott, America’s Hidden Austerity Program,” The New York Times, 11 June 2012:

http://economix.blogs.nytimes.com/2012/06/11/americas-hidden-austerity-program/;

Jason Cherkis, “A Thousand Cuts: Austerity Measures Devastate Communities Around The World,” The Huffington Post, 17 July 2012:

http://www.huffingtonpost.com/2012/07/12/austerity-measures-a-thousand-cuts_n_1666309.html;

Editorial, “The Austerity Trap,” The New York Times, 23 October 2012:

http://www.nytimes.com/2012/10/24/opinion/the-austerity-trap.html?_r=0;

Derek Thompson, “American Austerity: Why the States Cutting Spending Are Doing Worse,” The Atlantic, 21 June 2012:

http://www.theatlantic.com/business/archive/2012/06/american-austerity-why-the-states-cutting-spending-are-doing-worse/258825/

[42]     “CEOs Deficit Manifesto,” The Wall Street Journal, 25 October 2012:

http://online.wsj.com/article/SB10001424052970203937004578076254182569318.html?mod=googlenews_wsj

[43]     “Executives Who Signed the Fix the Debt Declaration,” The Wall Street Journal, 25 October 2012:

http://online.wsj.com/article/SB10001424052970203897404578077251928040508.html

[44]     Al Lewis, “Bankers Face the Abyss,” The Wall Street Journal, 21 October 2012:

http://online.wsj.com/article/SB10000872396390444734804578064840879262594.html?mod=googlenews_wsj

[45]     Heather Stewart, “Wealth doesn’t trickle down – it just floods offshore, research reveals,” The Observer, 21 July 2012:

http://www.guardian.co.uk/business/2012/jul/21/offshore-wealth-global-economy-tax-havens

[46]     Heather Stewart, “£13tn hoard hidden from taxman by global elite,” The Observer, 21 July 2012:

http://www.guardian.co.uk/business/2012/jul/21/global-elite-tax-offshore-economy

[47]     We’re living in a plutonomy, The Telegraph, 2 April 2006:

http://www.telegraph.co.uk/finance/2935809/Were-living-in-a-plutonomy.html

[48]     Robert Frank, Plutonomics, The Wall Street Journal, 8 January 2007:

http://blogs.wsj.com/wealth/2007/01/08/plutonomics/

[49]     Ibid.

[50]     Gus Lubin, Deutsche Bank Says The ‘Global Plutonomy’ Is Stronger Than Ever, And That Means 10X More Volatility, Business Insider, 17 February 2011:

http://www.businessinsider.com/ajay-kapur-plutonomy-2011-2

 

On June 11, the Global Elite Gather in Montreal: Will the Maple Spring Say Hello?

On June 11, the Global Elite Gather in Montreal: Will the Maple Spring Say Hello?

By: Andrew Gavin Marshall

Paul Desmarais Jr., leaving a Power Corporation shareholders meeting as students protest on May 15, 2012

 

From June 11-14, Montreal will be hosting the International Economic Forum of the Americas at the 2012 Conference of Montreal, which will bring roughly 150 speakers from the global elite to speak to an audience of other elites and sympathetic media spokespersons. This year’s conference will include as the keynote speaker, Alan Greenspan, former Chairman of the Federal Reserve System (the U.S. central bank), who was once considered for nearly 20 years to be “the most powerful banker in the world,” and as such, was largely responsible for causing the global financial crisis, along with the heads of the central banks of Portugal, Spain, France, Brazil, Mexico and Canada. There will be delegates from 24 countries around the world gathering at the Hilton Bonaventure Montreal Hotel to discuss the theme of “A Global Economy in Transition: New Strategies, New Partnerships” in front of roughly 3,000 participants. Along with formal discussions, “the Conference of Montreal will also enable the world’s various economic and political players present on this occasion to strengthen their relationships and develop new business opportunities.”

Here is the website in English: The Conference of Montreal

Here is the website in French: Conférence de Montréal

Here is a Facebook Event for a protest/manifestation at the Forum.

This conference will include key policy-makers and power-holders in Canada, North America, and around the world. It provides a forum through which the global elite may meet, talk, debate, shape consensus, and discuss policy-objectives of their respective nations and institutions. The ideology of those present is relentlessly pro-globalization, pro-Capitalist, and pro-power. The speakers are often advocates of neoliberalism, globalization, fiscal austerity, privatization, corporatization, imperialism and social control. This conference takes place in the midst of Quebec students standing up against educational austerity and protesting against policies which benefit the rich at the expense of the many. Will the ‘Maple Spring’ say hello to the global elite as they gather in Montréal?

The event, which is hosted by Power Corporation, owned by the billionaire Desmarais family, and a host of other corporate sponsors, receives 25% of its funding from public sources, including the Government of Canada and the Province of Québec, which alone contributes nearly $200,000 to a Conference hosted by billionaires. But remember, while public subsidies are available for billionaires to discuss how to make billions more, there is no money for education, social services, health care, or your future.

What is the Conference of Montreal / International Economic Forum of the Americas?

The stated “Mission” of the IEFA/Conference de Montréal is “to heighten knowledge and awareness of the major issues concerning economic globalization, with a particular emphasis on the relations between the Americas and other continents.” The Conference “strives to foster exchanges of information, to promote free discussion on major current economic issues and facilitate meetings between world leaders to encourage international discourse by bringing together Heads of State, the private sector, international organizations and civil society.” Among the stated “Objectives” are:

* To give its participants access to privileged information while fostering free and extensive discussions on various aspects of economy, with contributors and experts from among the best qualified;

* To promote relations between governments, international organizations, business people, members of the civil society, workers associations and universities;

* To allow its participants from various areas in the world to have business meetings during which they can develop their company or organization internationally

The International Economic Forum of the Americas/Conference of Montreal began in 1994 “at a time when the globalization of the economies was beginning to emerge at an increased rate” with the founding of the World Trade Organization (WTO), the end of the Cold War, development of NAFTA and other free-trade agreements, and thus, there was “the idea that Montreal could be the host city for an international yearly economic conference concerned with this phenomenon of the globalization of economies.” The first Conference took place in 1995.

The 18th annual conference of the International Economic Forum of the Americas will include “some of the most important international decision makers have already confirmed their attendance.” The focus of this year’s Forum will include: “the financial crisis and its impact on the world economy”; “International trade, and in particular the new Americas-European Union economic space, including the Canada-European Union trade agreement: this important trade agreement, which should be finalized in 2012” and will include “a number of executives from Canadian and European companies [who] will take the opportunity to meet at the 2012 Conference of Montreal to form new business ties for this new and important economic space”; and of course, “developing and extracting natural resources.” The full program can be reviewed here: Program 2012.

This year’s speakers list includes representatives and leaders from: the C.D. Howe Institute, the World Economic Forum, Bombardier Inc., Citibank, the European Commission, McKinsey & Company, Rio Tinto Alcan, the Canadian Chamber of Commerce, the U.S. Department of Homeland Security, the Rector of the University of Montreal, the President of the Canadian Bankers Association, the Governor of the Bank of Canada (a former Goldman Sachs executive), J.P. Morgan Chase, BNP Paribas, Governor of the Bank of Portugal, former Canadian Ambassador to Egypt, Power Corporation of Canada, Canadian Ambassador to the United States, President and CEO of the U.S. Chamber of Commerce, Royal Bank of Canada, Federal Reserve Bank of New York, the Conference Board of Canada, the World Bank, Scotiabank, PepsiCo, McGill University, Canadian Council of Chief Executives, Deutsche Bank, the Chairman of the Bank for International Settlements (the central bank to the world’s central banks and the most powerful financial institution in the world), the Brookings Institution, the Wall Street Journal, CNN, the World Policy Institute and the World Bank, among many others.

At the 2007 Conference of Montreal, Premier Jean Charest stated that, “Quebec is deeply committed to the process of globalization,” and that, “Quebec has built an economy open to the world which has allowed us to reach a very high standard of living because globalization has worked for us.” By “us” he means his friends and informal advisers at Power Corporation and the Forum. In his speech to the Conference, Charest stated that, “We believe very much in equality of opportunity.” Apparently, this is not the case for students.

The Founding Chairman of the International Economic Forum of the Americas is Gil Rémillard, Counsel for the law firm Fraser Milner Casgrain LLP, and between 1985 and 1994 he held several different positions in the Quebec government, including Minister of International Relations, Minister of Public Security, Minister of Justice, Attorney General, and the Minister of Intergovernmental Affairs.

The Chairman of the Board of Governors of the Forum is Paul Desmarais Jr., Co-CEO of Power Corporation of Canada alongside his brother André Desmarais, both sons of one of Canada’s richest billionaires, Paul Desmarais Sr, collectively making up Canada’s most powerful family. Paul Desmarais Jr. sits on a number of corporate boards, including: Power Corporation of Canada, Power Financial Corporation, Investors Group Inc., The Great-West Life Assurance Company, Great-West Lifeco Inc., London Insurance Group Inc. and London Life Insurance Company; in the United States: Great-West Life & Annuity Insurance Company; in Europe: Pargesa Holding S.A. (Switzerland) and Groupe Bruxelles Lambert S.A. (Belgium). He is a member of the Board of Directors of Gesca Ltd, Les Journaux Trans-Canada Inc. and La Presse Ltd in Canada; Suez and TotalFinaElf in France, among others.

Another member of the Board of Governors of the Forum is the wife of Paul Desmarais Jr., Hélène Desmarais, Chair of the Board of Directors of HEC Montréal (Canada’s leading business school), Chairman and Chief Executive Officer of the Montreal Enterprises and Innovation Centre (CEIM), Vice-President of the Board of Directors and member of the Executive Committee of the Board of Trade of Metropolitan Montreal (which praised the passing of Bill 78), and is a member of the Board of directors of The Montreal Economic Institute, a right-wing think tank which has been promoting more neoliberalism in Québec and blaming the student strike for the “financial cost” it has made to Québec; and she is a board member of the C.D. Howe Institute, one of Canada’s most influential think tanks.

Another member of the board of governors of the Forum is Heather Munroe-Blum, Principal and Vice Chancellor of McGill University, who is also a member of the Trilateral Commission and is on the board of directors of the Royal Bank of Canada (RBC). Other members include the presidents of the Chamber of Commerce of Canada and the Canadian Council of Chief Executives (CCCE), the CEO of Rio Tinto Alcan, a major mining company; the CEO of GDF Suez, a French electricity and gas company; the CEO of Hydro-Quebec; and the executives of the African Development Bank, the Asian Development Bank, UNESCO, the OECD, the World Trade Organization (WTO), the European Bank for Reconstruction and Development (EBRD), the Organization of American States (OAS), the Inter-American Development Bank (IDB), the International Energy Agency (IEA), as well as Louis Lévesque, Canada’s Deputy Minister of International Trade.

The Forum’s official ‘Partners’ include first and foremost, the Desmarais-owned Power Corporation of Canada, followed by the Royal Bank of Canada, Rio Tinto Alcan, Cisco, Total, GDF Suez, McKinsey & Company, SNC Lavalin, Hydro-Quebec, BNP Paribas, Bell, Citibank, Desjardins Group, the Government of Canada and the Government of Quebec, with media partners including the Financial Post and La Presse (owned by the Desmarais family).

The ‘Power’ Behind the Conference of Montreal

The Desmarais family is unquestionably Canada’s most powerful family. The Desmarais family, wrote Christa d’Souza for the London Telegraph, are “Canada’s equivalent of the Rockefellers or Vanderbilts.” Founded in 1925, Power Corporation of Canada is an investment company involved in communications, business, and especially finance. In the 1960s, the company began to invest in energy, finance, industry, and real estate. In 1968, financier Paul Desmarais took over the leadership of Power Corporation, and rapidly expanded the assets held by the company, including by the 1970s: Canada Steamship Lines (transportation); Consolidated Bathurst (pulp and paper); Investors Group, Great-West Life, Montreal Trust (financial services); and Gesca (communications). Power Corporation expanded across Canada, Europe, and into China. Paul Desmarais stepped aside as Chairman and CEO in 1996, though remaining as the controlling shareholder, and had his two sons, Paul Jr. and André, become Chairman and President and Co-CEOs. Power Corporation owns Gesca, a communications company which in turn owns La Presse as well as six other daily newspapers in Quebec.

Paul Desmarais Sr. is one of Canada’s richest individuals, which is, of course, no surprise, and as Konrad Yakabuski wrote for the Globe and Mail, “Desmarais has been personally consulted by prime ministers on every major federal economic and constitutional initiative since the 1970s. Most of the time, they’ve taken his advice.” Power Corporation has taken large stakes in major European companies such as Bertelsmann, Total and Suez. In the mid-1960s, a protégé of Desmarais was a young Montreal lawyer named Brian Mulroney, who would later become Canada’s Prime Minister. Paul Sr. groomed his sons, and especially André, who is now perhaps the most well-known Canadian businessman in China. André also married the daughter of another Canadian Prime Minister, Jean Chrétien. Desmarais Sr. also got involved in French banking through Paribas, and later, Pargesa, which handled investments in a wide range of European corporations, and shot Desmarais into the accepted ranks of French nobility and the old-monied European elite. Paul Desmarais Jr. is close friends with the recent French President Nicolas Sarkozy, and socializes with Spanish royalty, the Rothschilds, and other European oligarchs. The Desmarais family have strong connections to Canada’s four major political parties: the Liberals, Conservatives, Bloc Quebecois, and the NDP. This has included close ties to Lucien Bouchard, former leader of the Parti Québecois and Premier of Quebec; Jean Chrétien, former Canadian Prime Minister; Brian Mulroney, former Canadian Prime Minister who worked for Power Corporation; Bob Rae, an NDP leader; and Paul Martin, another Liberal Prime Minister who worked for Power Corporation. In the 1990s, the international advisory board of Power Corporation included former Prime Ministers Brian Mulroney and Pierre Trudeau. Brian Mulroney was sure to create friendly ties between the Desmarais family and soon-to-be Canadian Prime Minister Stephen Harper, who put two Desmarais-connected politicians in his cabinet, Peter Mackay and Maxime Bernier.

Quebec author Robin Philpot wrote a scathing critique of the power of the Desmarais family several years ago, suggesting that, “Over the last several years, [Paul Desmarais Sr.] has spun his web to such an extent that it now enables him to call the shots,” especially in promoting his right-wing economic vision, with “a disproportionate influence on politics and the economy in Quebec and Canada.” Of course, it’s not only Canadian politicians with whom Desmarais is close, but French and American politicians as well, including Sarkozy, George H.W. Bush, and Bill Clinton. Desmarais owns seven of the ten French-language newspapers in Quebec, and has been close to nearly every Quebec premier, apart from Parti Québécois leaders Jacques Parizeau and Bernard Landry. Philpot alleged that Desmarais “has a lot of influence on Premier Jean Charest,” who is the current premier imposing tuition increases. When Desmarais received the French Légion d’honneur (Legion of Honour) from Nicolas Sarkozy, Jean Charest was in attendance, of which Philpot stated, “He took him along like a poodle.” Philpot added, “It’s a very unhealthy situation for a government to be indebted to a businessman that has his own interest at heart. They get their hands tied.”

Paul Desmarais Sr (left), Nicolas Sarkozy (middle), Québec Premier Jean Charest (right)

 

In rural Quebec, the Desmarais family has an estate the size of Manhattan, with a private golf course and pheasant shooting range, as well as a music pavilion where opera is performed. This is the home of Paul Desmarais Sr. Guests, such as former U.S. Presidents George H.W. Bush and Bill Clinton, come play golf on this vast estate, and are flown in on helicopters belonging either to Power Corporation or Desmarais personally. The Desmarais family has even had the internationally renowned Cirque du Soleil perform on their massive 15,000-acre estate. King Juan Carlos of Spain has even been a guest from time to time. André Desmarais is himself a member of the Trilateral Commission, founded by David Rockefeller, and is also on the International Advisory Board of David Rockefeller’s former bank, JP Morgan Chase, alongside other notables such as former British Prime Minister Tony Blair. Both brothers have regularly attended meetings of the Bilderberg Group, of which David Rockefeller is a top official (founded in 1954 as an elite think tank linking Western Europe and North America). A son of Paul Desmarais Jr., Paul Desmarais III, is a banker with Goldman Sachs. At times, the influence of the family is shyly acknowledged. As French President Sarkozy stated upon awarding Paul Desmarais Sr. with the French Legion of Honour, “If I am the president of France today, it is thanks in part to the advice, the friendship and the loyalty of Paul Desmarais.”

Here is a video documenting a party thrown for the wife of Paul Desmarais, Sr., including notable guests Quebec Premier Jean Charest and former U.S. President George H.W. Bush

 

Protesting Power: Students Protest Outside Shareholder Meeting of Power Corporation

On May 15, 2012, as Power Corporation (with total revenue of $7.2 billion) held its shareholder meeting announcing its first quarter earnings of $264 million, and its main subsidiary company, Power Financial, announced quarterly profits of $455 million, demonstrators met outside to ensure that Power was met with protest. The National Post reported that, “one of Canada’s wealthiest and most politically connected families has come under attack as the force and rhetoric of Quebec’s student protests move from the streets into corporate shareholder meetings.”

Student protesters met by riot police outside of Power Corporation’s shareholders meeting on May 15, 2012

 

Riot police guarded the hotel’s main entrance as protesters chanted (in French): “We must fight the thieves in ties,” and “Your wealth is our poverty.” A student group had called for the demonstration, but Quebec Finance Minister Raymond Bachand commented, “There are radical groups that systematically want to destabilize the Montreal economy… They are anti-capitalists, Marxists.” As Paul Desmarais Jr. was announcing the company’s profits and stating, “we have a solid risk management strategy,” police on horseback outside were pushing the protestors back: “risk management.” A reporter asked Desmarais about “the protests that have shaken Quebec’s political class and caused millions worth of dollars in lost productivity,” to which he replied, “How could you not be concerned right now in terms of what’s going on?” He added:

Like all citizens, we are concerned. But we want this issue to be resolved hopefully in a respectful fashion. Let’s start with respect. With a democratic way. Within the rule of law. And that we come to an agreement that makes sense and where everybody invests in the future of our students. But everybody’s got to participate in that.

The two brothers, Paul Jr. and André, told reporters that, “they were being unfairly criticized as the company’s annual meeting became the latest target in the ongoing protests in Quebec.” Paul commented: “We’re a very caring company and I think a very caring family and we care about the society around us and we’ve always demonstrated that.” Police outside used pepper spray on protesters, one of whom commented, “I think Power Corp. is a very good example of the one per cent and it shows how private companies can be more powerful than some countries.” Desmarais would not directly answer when questioned about whether or not he supported Charest’s tuition hike, instead saying, “Frankly I’m not elected. Why should I meddle in things of people who are elected to resolve these problems. Our job is to manage our company.” The two brothers explained that, “they were reluctant to publicly comment on public issues except when they’re asked to by governments on financial issues.” That is to say, they will not publicly comment on the private advice they give to our politicians.

So the name is Power, and it fits. The Desmarais family spend their leisure time with King Juan Carlos of Spain (who recently had to apologize for going on an elephant hunting trip in Africa while 50% of youth in Spain are unemployed), they have had Cirque du Soleil perform on their family estate (larger than the island of Manhattan) with guests that include presidents and prime ministers, and have close business and even family ties to every Canadian Prime Minister since Pierre Trudeau, and almost every Quebec premier, especially the current “poodle” Jean Charest. They are billionaires who sit on the boards of the major Canadian and international think tanks which set policy for our nations. The International Economic Forum of the Americas / Conference of Montreal is simply another venue through which elites gather to form consensus and debate, discuss, and promote policies which benefit the few at the expense of the many. Their rhetoric is replete with talk of “democracy” and “fairness,” but their actions speak louder than their words, their bank accounts weigh more heavily than their hearts, and their ideas more easily become policy. The elite do not go and protest in the streets, demanding justice and equality, because they call up their friends, our politicians, who they have cocktails with in social gatherings, play golf with, travel with, intermarry with, and who grant their favoured politicians financially bountiful positions on corporate boards when they leave political life. They do not have to agitate in the streets to have their voices heard because they are the patrons of our politicians and policy-makers, they are the real constituents of our constitutional “democracies,” they are the captains of corporations, barons of business, and Kings of Capital.

So this year, let the real masters of our political, economic, and social world hear the voices of the real people. Let students and others peacefully assemble and protest outside the Hilton Bonaventure Hotel from June 11-14, and have the elites inside hear the people say that we know who they are, those who rule our nations and undermine our democratic ideals.

They are the bankers and corporate executives, the heads of our universities and owners of our media, our politicians and their advisers, the patrons and “intellectuals” of the think tanks that lobby governments and set policies, the heads of foundations and civil society monopolists. Most especially it is the bankers who sit atop a vast network of social, political, and economic institutions. The bankers are the modern monarchs of our globalized state-Capitalist society. In Canada, our country is dominated by the ‘big five’ banks: Royal Bank of Canada (RBC Group), Canadian Imperial Bank of Commerce (CIBC), Toronto-Dominion Bank (TD), the Bank of Montreal (BMO), and the Bank of Nova Scotia (Scotiabank).

Peter Kruyt is Chairman of the Board of Governors of Concordia University in Montreal, and is also Vice-President of Power Corporation. The Chancellor of Concordia University is L. Jacques Ménard, the President of BMO Financial Group, as well as being on the boards of a number of other corporations and schools. The rest of the board of governors of Concordia is dominated by bankers and business executives. The Principal and Vice-Chancellor of McGill University is Heather Munroe-Blum, who sits on the board of directors of the Royal Bank of Canada as well as the board of governors of the International Economic Forum of the Americas, as well as sitting on a number of other boards. The Chairman of McGill University is Stuart Cobbett, who also sits on the board of Citibank Canada. Another member of the board of governors of McGill University is Kathy Fazel, who is also an executive with the Royal Bank of Canada. Another member of McGill’s board is Daniel Gagnier, former Chief of Staff to Quebec Premier Jean Charest. Another board member is Samuel Minzberg, who sits on the board of HSBC Bank Canada. Clearly, bankers and business executives run our schools.

In 2008 and 2009, Canada’s banks received a “secret bailout” from the Bank of Canada (run by a former executive at Goldman Sachs) and the Federal Reserve of the United States (owned by JP Morgan Chase and all the other big U.S. banks). Canada’s banks are always said to be the “best in the world,” and a model to follow, since they magically weathered the financial crisis untouched. As it turns out, that was BS. Canada’s banks were bailed out to the tune of $114 BILLION. That amounts to $3,400 for every single Canadian man, woman, and child, or 7% of Canada’s 2009 GDP. So Quebec students want to maintain tuition costs at less than $2,500, and we are called “entitled brats.” But Canada’s big banks, which are making record-high profits, and getting record-low tax cuts, sitting on hundreds of billions of dollars in cash reserves, while their increased profits come from the increased debt of the Canadian population, and yet, they get the equivalent of $3,400 from each and every Canadian, which we then have to pay for through increased taxes and increased costs (such as tuition). But it’s the students who are “entitled.”

TD Bank told the Government of Quebec in 2007 to increase university tuition. In 2008, TD Bank got $26 billion in support from the Bank of Canada (meaning Canadians citizens have to pay for that through taxes… just to pay the interest on that debt!), and $8 billion from the U.S. Federal Reserve (which U.S. taxpayers have to pay for). In March of 2012, TD Bank and Royal Bank (Canada’s two biggest banks) announced record profits. That same month, it was announced that the average Canadian household debt was $103,000, making income security for Canadians an “elusive dream.” More than half of the jobs created since 2008 have gone to people aged 55 and over. Increases in hourly wages did not keep pace with inflation last year, and thus, income inequality is growing. Nearly two million Canadians have student loans totaling $20 billion, with the average student debt in Canada at $27,000 upon graduation. We are told that 70% of new jobs will require a university education. A four-year degree for a student in Canada costs an average of $55,000, expected to rise to $102,000 by 2030. This was reported by TD Bank, which then stated, “we argue that students have to recognize an investment in higher education is really a long-term one.” Things are much harder for students and youth today than for previous generations. Increasing tuition in Quebec could inflate an already over-inflated student debt bubble which could do for youth what the mortgage crisis did for housing, and would end of costing the government more in the end; thus, “there is no need for additional funding for Quebec universities.” Meanwhile, all the banks have inflated a massive housing bubble in Canada which itself could pop in the near-term future, recreating here what took place in the US in 2008.

So, who is really “entitled” here? Is it the students and youth, who are simply demanding a chance to have a future, to not be disciplined and chained down with debt before we even leave our home, get a degree, or have our first job? Or is it the banks, that control the economy, inflate bubbles that create crises, get bailed out by our governments (which we have to pay for), that tell our governments to increase tuition, that get tax cuts from our governments and sit on hundreds of billions of dollars in cash reserves, and who make record profits? These banks support and sponsor the International Economic Forum of the Americas, as does the Government of Quebec and the Government of Canada. So our governments have money to support a conference held by billionaires, bankers, and financiers… so that they can all get together once a year and talk about how “ineffectual” government support is, so that they can praise the “free market” while their “invisible hand” reaches into our pockets, as our politicians sit comfortably in theirs. They spew and steam about “handouts” to poor people, and then take $114 billion from the Canadian people, who are already deep in debt. These reverse-Robin Hoods take money from the poor and give it to themselves… and then charge us interest.

This system is simply too insane to consent to. Canada’s elites, like most elites, represent a class of parasites, living off and at the expense of the people, while their local and global connections to and profits from organized crime enshrine them as a type of ‘Mafiocracy’ ruling class.

Perhaps the Maficocracy should hear the voices of the Maple Spring.

From June 11-14, 2012, the International Economic Forum of the Americas gathers in Montreal, Quebec.

On June 11, at 8:30 a.m., the Maple Spring will say hello!

 

Let your voice be heard peacefully:

June 11-14

Hilton Bonaventure Hotel

900, de la Gauchetière W.

Montreal, Quebec

 

Peace and Solidarity!

 

For more information on the ‘Maple Spring’, see:

The Québec Student Strike: From ‘Maple Spring’ to Summer Rebellion?

What Really Happened at the Montréal May Day Protest? From Peaceful Protest to Police Brutality

Ten Points Everyone Should Know About the Quebec Student Movement

From the Chilean Winter to the Maple Spring: Solidarity and the Student Movements in Chile and Quebec

Quebec Steps Closer to Martial Law to Repress Students: Bill 78 is a “Declaration of War on the Student Movement”

Writing About the Student Movement in Québec: You’re Damn Right I’m “Biased”! … Confessions of a Non-Neutral Observer

The Maple Spring and the Mafiocracy: Struggling Students versus “Entitled Elites”

Andrew Gavin Marshall is an independent researcher and writer based in Montreal, Canada, writing on a number of social, political, economic, and historical issues. He is also Project Manager of The People’s Book Project. He also hosts a weekly podcast show, “Empire, Power, and People,” on BoilingFrogsPost.com.

Ten Points Everyone Should Know About the Quebec Student Movement

Ten Points Everyone Should Know About the Quebec Student Movement

By: Andrew Gavin Marshall

The student strikes in Quebec, which began in February and have lasted for three months, involving roughly 175,000 students in the mostly French-speaking Canadian province, have been subjected to a massive provincial and national media propaganda campaign to demonize and dismiss the students and their struggle. The following is a list of ten points that everyone should know about the student movement in Quebec to help place their struggle in its proper global context.

1)            The issue is debt, not tuition

2)            Striking students in Quebec are setting an example for youth across the continent

3)            The student strike was organized through democratic means and with democratic aims

4)            This is not an exclusively Quebecois phenomenon

5)            Government officials and the media have been openly calling for violence and “fascist” tactics to be used against the students

6)            Excessive state violence has been used against the students

7)            The government supports organized crime and opposes organized students

8)            Canada’s elites punish the people and oppose the students

9)            The student strike is being subjected to a massive and highly successful propaganda campaign to discredit, dismiss, and demonize the students

10)            The student movement is part of a much larger emerging global movement of resistance against austerity, neoliberalism, and corrupt power

1)            The issue is debt, not tuition: In dismissing the students, who are striking against a 75% increase in the cost of tuition over the next five years, the most common argument used is in pointing out that Quebec students pay the lowest tuition in North America, and therefore, they should not be complaining. Even with the 75% increase, they will still be paying substantially lower than most other provinces. Quebec students pay on average $2,500 per year in tuition, while the rest of Canada’s students pay on average $5,000 per year. With the tuition increase of $1,625 spread out over five years, the total tuition cost for Quebec students would be roughly $4,000. The premise here is that since the rest of Canada has it worse, Quebec students should shut up, sit down, and accept “reality.” THIS IS FALSE. In playing the “numbers game,” commentators and their parroting public repeat the tuition costs but fail to add in the numbers which represent the core issue: DEBT. So, Quebec students pay half the average national tuition. True. But they also graduate with half the average national student debt. With the average tuition at $5,000/year, the average student debt for an undergraduate in Canada is $27,000, while the average debt for an undergraduate in Quebec is $13,000. With interest rates expected to increase, in the midst of a hopeless job situation for Canadian youth, Canada’s youth face a future of debt that “is bankrupting a generation of students.” The notion, therefore, that Quebec students should not struggle against a bankrupt future is a bankrupted argument.

2)            Striking students in Quebec are setting an example for youth across the continent: Nearly 60% of Canadian students graduate with debt, on average at $27,000 for an undergraduate degree. Total student debt now stands at about $20 billion in Canada ($15 billion from Federal Government loans programs, and the rest from provincial and commercial bank loans). In Quebec, the average student debt is $15,000, whereas Nova Scotia and Newfoundland have an average student debt of $35,000, British Columbia at nearly $30,000 and Ontario at nearly $27,000. Roughly 70% of new jobs in Canada require a post-secondary education. Half of students in their 20s live at home with their parents, including 73 per cent of those aged 20 to 24 and nearly a third of 25- to 29-year-olds. On average, a four-year degree for a student living at home in Canada costs $55,000, and those costs are expected to increase in coming years at a rate faster than inflation. It has been estimated that in 18 years, a four-year degree for Canadian students will cost $102,000. Defaults on government student loans are at roughly 14%. The Chairman of the Canadian Federation of Students warned in June of 2011 that, “We are on the verge of bankrupting a generation before they even enter the workplace.” This immense student debt affects every decision made in the lives of young graduates. With few jobs, enormous housing costs, the cutting of future benefits and social security, students are entering an economy which holds very little for them in opportunities. Women, minorities, and other marginalized groups are in an even more disadvantaged position. Canadian students are increasingly moving back home and relying more and more upon their parents for support. An informal Globe and Mail poll in early May of 2012 (surveying 2,200 students), “shows that students across Canada share a similar anxiety over rising tuition fees” as that felt in Quebec. Roughly 62% of post-secondary students said they would join a similar strike in their own province, while 32% said they would not, and 5.9% were undecided. In Ontario, where tuition is the highest in Canada, 69% said they would support a strike against increasing tuition. A Quebec research institution released a report in late March of 2012 indicating that increasing the cost of tuition for students is creating a “student debt bubble” akin to the housing bubble in the United States, and with interest rates set to increase, “today’s students may well find themselves in the same situation of not being able to pay off their student loans.” The authors of the report from the Institut de recherche et d’informations socio-economique explained that, “Since governments underwrite those loans, if students default it could be catastrophic for public finances,” and that, “If the bubble explodes, it could be just like the mortgage crisis.” In the United States, the situation is even worse. In March of 2012, the Federal Reserve reported that 27 percent of student borrowers whose loans have gone into repayment are now delinquent on their debt.” Student debt in the United States has reached $1 trillion, “passing total credit card debt along the way.” It has become a threat to the entire existence of the middle class in America. Bankruptcy lawyers in the US are “seeing the telltale signs of a student loan debt bubble.” A recent survey from the National Association of Consumer Bankruptcy Attorneys (NACBA) indicated, “more than 80 percent of bankruptcy lawyers have seen a substantial increase in the number of clients seeking relief from student loans in recent years.” The head of the NACBA stated, “This could very well be the next debt bomb for the U.S. economy.” In 1993, 45% of students who earn a bachelor’s degree had to go into debt; today, it is 94%. The average student debt in the United States in 2011 was $23,300, with 10% owning more than $54,000 and 3% owing more than $100,000. President Obama has addressed the situation by simply providing more loans to students. A recent survey of graduates revealed that 40% of them “had delayed making a major purchase, like a home or car, because of college debt, while slightly more than a quarter had put off continuing their education or had moved in with relatives to save money,” and 50% of those surveyed had full-time jobs. Between 2001 and 2011, “state and local financing per student declined by 24 percent nationally.” In the same period of time, “tuition and fees at state schools increased 72 percent.” It would appear that whether in the United States, Canada, or even beyond, the decisions made by schools, banks, and the government, are geared toward increasing the financial burden on students and families, and increasing profits for themselves. The effect will be to plunge the student and youth population into poverty over the coming years. Thus, the student movement in Quebec, instead of being portrayed as “entitled brats” elsewhere, are actually setting an example for students and youth across the continent and beyond. Since Quebec tuition is the lowest on the continent, it gives all the more reason that other students should follow Quebec’s example, instead of Quebec students being told to follow the rest of the country (and continent) into debt bondage.

3)            The student strike was organized through democratic means and with democratic aims: The decision to strike was made through student associations and organizations that uniquely operate through direct-democracy. While most student associations at schools across Canada hold elections where students choose the members of the associations, the democratic accountability ends there (just like with government). Among the Francophone schools in Quebec, the leaders are not only elected by the students, but decisions are made through general assemblies, debate and discussion, and through the votes of the actual constituents, the members of the student associations, not just the leaders. This means that the student associations that voted to strike are more democratically accountable and participatory than most other student associations, and certainly the government. It represents a more profound and meaningful working definition of democracy that is lacking across the rest of the country. The Anglophone student associations that went on strike – from Concordia and McGill – did so because, for the first time ever, they began to operate through direct-democracy. This of course, has resulted in insults and derision from the media. The national media in Canada – most especially the National Post – complain that the student “tactics are anything but democratic,” and that the students aren’t acting in a democratic way, but that “it’s really mob rule.” Obviously, it is naïve to assume that the National Post has any sort of understanding of democracy.

4)            This is not an exclusively Quebecois phenomenon: I am an Anglophone, I don’t even speak French, I have only lived in Montreal for under two years, but the strikers are struggling as much for me as for any other student, Francophone or Anglophone. Typically, when others across Canada see what is taking place here, they frame it along the lines of, “Oh those Quebecois, always yelling about something.” But I’m yelling too… in English. Many people here are yelling… in English. It is true that the majority of the students protesting are Francophone, and the majority of the schools on strike are Francophone, but it is not exclusionary. In fact, the participation in the strike from the Anglophone schools (while a minority within the schools) is unprecedented in Quebec history. This was undertaken because students began mobilizing at the grassroots and emulating the French student groups in how they make decisions (i.e., through direct-democracy). The participation of Anglophone students in the open-ended strike is unprecedented in Quebec history.

5)            Government officials and the media have been openly calling for violence and “fascist” tactics to be used against the students: With all the focus on student violence at protests, breaking bank windows, throwing rocks at riot police, and other acts of vandalism, student leaders have never called for violence against the government or vandalism against property, and have, in fact, denounced it and spoken out for calm, stating: “The student movement wants to fight alongside the populace and not against it.” On the other hand, it has been government officials and the national media which have been openly calling for violence to be used against students. On May 11, Michael Den Tandt, writing for the National Post, stated that, “It’s time for tough treatment of Quebec student strikers,” and recommended to Quebec Premier Jean Charest that, “He must bring down the hammer.” Tandt claimed that there was “a better way” to deal with student protesters: “Dispersal with massive use of tear gas; then arrest, public humiliation, and some pain.” He even went on to suggest that, “caning is more merciful than incarceration,” or perhaps even re-imagining the medieval punishment in which “miscreants and ne’er-do-wells were placed in the stockade, in the public square, and pelted with rotten cabbages. That might not be a bad idea, either.” This, Tandt claimed, would be the only way to preserve “peace, order, and good government.” Kelly McParland, writing the for National Post on May 11, suggested that it was now time for Charest to “empower the police to use the full extent of the law against those who condone or pursue further disruption,” and that the government must make a “show of strength” against the students. If this was not bad enough, get ready for this: A member of the Quebec Liberal Party, head of the tax office in the Municipal Affairs Department, Bernard Guay, wrote an article for a French-language newspaper in Quebec in mid-April advocating a strategy to “end the student strikes.” In the article, the government official recommended using the fascist movements of the 1920s and 1930s as an example in how to deal with “leftists” in giving them “their own medicine.” He suggested organizing a political “cabal” to handle the “wasteful and anti-social” situation, which would mobilize students to not only cross picket lines, but to confront and assault students who wear the little red square (the symbol of the student strike). This, Guay suggested, would help society “overcome the tyranny of Leftist agitators,” no doubt by emulating fascist tyranny. The article was eventually pulled and an apology was issued, while a government superior supposedly reprimanded Guay, though the government refused to elaborate on what that consisted of. Just contemplate this for a moment: A Quebec Liberal government official recommended using “inspiration” from fascist movements to attack the striking students. Imagine if one of the student associations had openly called for violence, let alone for the emulation of fascism. It would be national news, and likely lead to arrests and charges. But since it was a government official, barely a peep was heard.

6)            Excessive state violence has been used against the students: Throughout the three months of protests from students in Quebec, the violence has almost exclusively been blamed on the students. Images of protesters throwing rocks and breaking bank windows inundate the media and ‘inform’ the discourse, demonizing the students as violent, vandals, and destructive. Meanwhile, the reality of state violence being used against the students far exceeds any of the violent reactions from protesters, but receives far less coverage. Riot police meet students with pepper spray, tear gas, concussion grenades, smoke bombs, beating them with batons, shoot them with rubber bullets, and have even been driving police cars and trucks into groups of students. On May 4, on the 42nd anniversary of the Kent State massacre in which the U.S. National Guard murdered four protesting students, Quebec almost experienced its own Kent State, when several students were critically injured by police, shot with rubber bullets in the face. One student lost an eye, and another remains in the hospital with serious head injuries, including a skull fracture and brain contusion. The Quebec provincial police – the SQ – have not only been involved in violent repression of student protests in Quebec, but have also (along with the RCMP) been involved in training foreign police forces how to violently repress their own populations, such as in Haiti. Roughly 12,000 people in Quebec have signed a petition against the police reaction to student protests, stipulating that the police actions have been far too violent.  In late April, even before the Quebec police almost killed a couple students, Amnesty International “asked the government to call for a toning down of police measures that… are unduly aggressive and might potentially smother students’ right to free expression.” The Quebec government, of course, defends police violence against students and youths. The Canadian Security Intelligence Service (CSIS) – Canada’s spy agency – has recently announced its interest in “gathering intelligence” on Quebec student protesters and related groups as “possible threats to national security.” Coincidentally, Prime Minister Stephen Harper dismantled the government agency responsible for oversight of CSIS, making the agency essentially unaccountable. In reaction to student protests, the City of Montreal is considering banning masks being worn at protests in a new bylaw which is being voted on without public consultation. Thus, apparently it is fine for police to wear gas masks as they shoot chemical agents at Quebec’s youth, but students cannot attempt to even meagerly protect themselves by covering their faces. The federal Conservative government of Stephen Harper is attempting to pass a law that bans masks at protests, which includes a ten-year sentence for “rioters who wear masks.” Quebec has even established a secretive police unit called the GAMMA squad to monitor political groups in the province, which has already targeted and arrested members of the leading student organization behind the strike. The police unit is designed to monitor “anarchists” and “marginal political groups.” Some political groups have acknowledged this as “a declaration of war” by the government against such groups. Spokesperson for the largest student group, Gabriel Nadeau-Dubois, stated that, “This squad is really a new kind of political police to fight against social movements.” The situation of police repression has become so prevalent that even the U.S. State Department has warned Americans to stay away from student protests in the city, “as bystanders can quickly be caught up in unforeseen violence and in some cases, detained by the local police.”

7)            The government supports organized crime and opposes organized students: The government claims that it must increase the cost of tuition in order to balance the budget and to increase the “competitiveness” of schools. The government has ignored, belittled, undermined, attempted to divide, and outright oppress the student movement. The Liberal Government of Quebec, in short, has declared organized students to be enemies of the state. Meanwhile, that same government has no problem of working with and supporting organized crime, namely, the Montreal Mafia. In 2010, Quebec, under Premier Jean Charest, was declared to be “the most corrupt province” in Canada. A former opposition leader in the Montreal city hall reported that, “the Italian mafia controls about 80 per cent of city hall.” The mafia is a “big player” in the Quebec economy, and “is deeply entrenched in city affairs” of Montreal, as “more than 600 businesses pay Mafia protection money in Montreal alone, handing organized crime leaders an unprecedented degree of control of Quebec’s economy.” The construction industry, especially, is heavily linked to the mafia. The Montreal Mafia is as influential as their Sicilian counterparts, where “all of the major infrastructure work in Sicily is under Mafia control.” In 2009, a government official stated that, “It’s Montreal’s Italian Mafia that controls what is going on in road construction. They control, from what we can tell, 80 per cent of the contracts.” In the fall of 2011, an internal report written by the former Montreal police chief for the government was leaked, stating, “We have discovered a firmly rooted, clandestine universe on an unexpected scale, harmful to our society on the level of safety and economics and of justice and democracy.” The report added, “Suspicions are persistent that an evil empire is taking form in the highway construction domain,” and that, “If there were to be an intensification of influence-peddling in the political sphere, we would no longer simply be talking about marginal, or even parallel criminal activities: we could suspect an infiltration or even a takeover of certain functions of the state.” Quebec Premier Jean Charest, for several years, rejected calls for a public inquiry into corruption in the construction industry, even as the head of Quebec’s anti-collusion squad called for such an inquiry. An opposition party in Quebec stated that Jean Charest “is protecting the (Quebec) Liberal party – and in protecting the Liberal party, Mr. Charest is protecting the Mafia, organized crime.” After the leaked report revealed “cost overruns totaling hundreds of millions of dollars, kickbacks and illegal donations to political parties,” Charest had to – after two years of refusing – open a public inquiry into corruption. The Quebec mafia have not only “run gambling and prostitution and imported stupefying amounts of illegal drugs into Canada, but they have extended their influence to elected civic and provincial governments, and to Liberal and Conservative federal governments through bribery and other ‘illustrious relations’.” The Federal Conservative Party of Canada, with Prime Minister Stephen Harper as its leader, received dozens of donations from Mafia-connected construction and engineering firm employees. The Mafia-industry has also donated to the Federal Liberal Party, but less so than the Conservatives, who hold power. In Quebec, government officials have helped the Mafia charge far more for public-works contracts than they were worth. These Mafia companies would then use a lot of that extra money to fund political parties, most notably, the Liberals, who have been in power for nine years. A former Montreal police officer who worked in the intelligence unit with access to the police’s confidential list of informants was suspected of selling information to the mafia. In January of 2012, he was found dead, reportedly of a suicide. In April of 2012, fifteen arrests were made in Montreal by the police in relation to corruption charges linked to the Mafia. Among them were one of the biggest names in the construction industry, with 14 individual facing conspiracy charges “involving municipal contracts associated with the Mascouche water-treatment plants [that] are connected to big construction, engineering and law firms that have been involved in municipal contracts and politics across the Montreal region for decades. And the individuals have been around the municipal world for years.” One Quebec mayor has even been charged. The Montreal police force has “not been very interested, and it should be,” in helping the anti-corruption investigation. Two of those who were arrested included Quebec Liberal Party fundraisers, one of whom Charest personally delivered an award to in 2010 for his “years of service as an organizer.” All three of Quebec’s main political parties were connected to individuals arrested in the raids. Canada’s federal police force, the RCMP, have refused to cooperate with the Mafia-corruption inquiry in handing over their massive amounts of information to the judge leading the inquiry. Quebec Education Minister Line Beauchamp, who has been leading the government assault against the students, attended a political fundraiser for herself which was attended by a notorious Mafia figure who personally “donated generously to the minister’s Liberal riding association.” As these revelations emerged, Beauchamp stated, “I don’t know the individual in question and even today I wouldn’t be able to recognize him.” At the time, Beauchamp was the Environment Minister, and was responsible for granting the Mafia figure’s company a favourable certificate to expand its business. Beauchamp claimed she did not know about the deal, but as head of the Ministry which handled it, either she is utterly incompetent or a liar. Either way, she is clearly not fit for “public service” if it amounts to nothing more than “service to the Mafia.” The fact that she is now responsible for increasing tuition and leading the attack on students speaks volumes.  Line Beauchamp, when questioned about taking political contributions from the Mafia, stated, “Now that the information is public and the links well established, I would not put myself in that position again.” Well isn’t that reassuring? Now that it’s public, she wouldn’t do it again. That’s sort of like saying, “I wouldn’t have committed the crime if I knew I was going to be caught.” The notion that Beauchamp didn’t know whom this Mafia figure was who was giving her money is absurd. It’s even more absurd when you note that one of Beauchamp’s political attaches was a 30-year veteran of the Montreal police force. As one Quebec political figure commented about the Liberal Government’s Mafia links: “They refuse to sit down with a student leader but they have breakfast with a mafioso … where is the logic in that?” Indeed. It’s clear that the Quebec government has no problem working with, handing out contracts to, and taking money from the Mafia and organized crime. In fact, they are so integrated that the government itself is a form of organized crime. But for that government, and for the media boot-lickers who follow the government line, organized students are the true threat to Quebec. National newspapers declare Quebec students following “mob rule” when it’s actually the government that is closely connected to “mob rule.” The students are challenging and being repressed by a Mafioso-government alliance of industrialists, politicians, financiers and police… yet it is the students who are blamed for everything. The government gives the Mafia public contracts double or triple their actual value, wasting hundreds of millions of dollars (if not more), while students are being asked to pay nearly double their current tuition. There’s money for the mob, but scraps for the students.

8)            Canada’s elites punish the people and oppose the students: It’s not simply the government of Quebec which has set itself against the students, sought to increase their tuition and repress their resistance, often with violent means, but a wide sector of elite society in Quebec and Canada propose tuition increases and blind faith to the state in managing its repression of a growing social movement. As such, the student movement should recognize that not simply are Jean Charest and his Liberal-Mafia government the antagonists of social justice, but the whole elite society itself. As early as 2007, TD Bank, one of Canada’s big five banks, outlined a “plan for prosperity” for the province of Quebec, and directly recommended Quebec to raise tuition costs for students. Naturally, the Quebec government is more likely to listen to a bank than the youth of the province. Banks of course, have an interest in increasing tuition costs for students, as they provide student loans and lines of credit which they charge interest on and make profits. The Royal Bank of Canada acknowledged that student lines of credit are “very popular products.” Elites of all sorts support the tuition increases. In February of 2010, a group of “prominent” (i.e., elitist) Quebecers signed a letter proposing to increase Quebec’s tuition costs. Among the signatories were the former Premier of Quebec for the Parti Quebecois, Lucien Bouchard.  In early May, a letter was published in the Montreal Gazette which stated that students need to pay more for their education in Quebec, signed by the same elitists who proposed the tuition increase back in February of 2010. Initially, this group of elitists had proposed an increase of $1,000 every year for three years. The letter then calls for the application of state power to be employed against the student movement: “It is time that we react. We must reinstate order; the students have to return to class… This is a situation when, regardless of political allegiances, the population must support the state, which is ultimately responsible for public order, the safety of individuals and the integrity of our institutions.” The “integrity” of institutions which cooperate with the Mafia, I might add. What incredible integrity! The letter was signed by Lucien Bouchard, former Premier of Quebec; Michel Audet, an economist and former Finance Minister in the first Charest government in Quebec; Françoise Bertrand, the President and chief executive officer of the Fédération des chambres de commerce du Québec (The Quebec Federation of Chambers of Commerce), where she sits alongside the presidents and executives of major Canadian corporations, banks, and business interests. She also sits on the board of directors of Quebecor Inc., a major media conglomerate, with former Prime Minister Brian Mulroney on its board. Another signatory was Yves-Thomas Dorval, President of the Quebec Employers’ Council, who formerly worked for British American Tobacco Group, former Vice President at Edelman Canada, an international public relations firm, was a director at a pharmaceutical corporation, head of strategic planning at an insurance company, and previously worked for the Government of Quebec and Hydro-Quebec. Joseph Facal, another signatory to the letter demanding higher tuition and state repression of students, is former president of the Quebec Treasury Board, and was a cabinet minister in the Quebec government of Lucien Bouchard. Other signatories include Pierre Fortin, a professor emeritus at the Université du Québec à Montréal; Michel Gervais, the former rector of Université Laval; Monique Jérôme-Forget, former finance minister of Quebec and former president of the Quebec Treasury Board, member of the Quebec Liberal Party between 1998 and 2009, was responsible for introducing public-private partnerships in Quebec’s infrastructure development (which saw enormous cooperation with the Mafia), and is on the board of directors of Astral Media. Robert Lacroix, another co-signer, was former rector of the Université de Montréal is also a fellow at CIRANO, a Montreal-based think tank which is governed by a collection of university heads, business executives, and bankers, including representatives from Power Corporation (owned by the Desmarais family). Another signatory is Michel Leblanc, president and CEO of the Board of Trade of Metropolitan Montreal, a prominent business organization in Montreal, of which the board of directors includes a number of corporate executives, mining company representatives, university board members, bankers and Hélène Desmarais, who married into the Desmarais family. Another signatory is Claude Montmarquette, professor emeritus at the Université de Montréal, who is also a member of the elitist CIRANO think tank, which as a “research institution” (for elites) has recommended increasing Quebec’s tuition costs for several years. Another signatory was Marcel Boyer, a Bell Canada Professor of industrial economics at the Université de Montréal, Vice-president and chief economist at the Montreal Economic Institute, is the C.D. Howe Scholar in Economic Policy at the C.D. Howe Institute, Member of the Board of the Agency for Public-Private Partnerships of Québec, and Visiting Senior Research Advisor for industrial economics at Industry Canada. At the Montreal Economic Institute, Boyer sits alongside notable elitists, bankers, and corporate executives, including Hélène Desmarais, who married into the Desmarais family (the most powerful family in Canada). At the C.D. Howe Institute, Boyer works for even more elitists, as the board of directors is made up of some of Canada’s top bankers, corporate executives, and again includes Hélène Desmarais. The Desmarais family, who own Power Corporation and its many subsidiaries, as well as a number of foreign corporations in Europe and China, are Canada’s most powerful family. The patriarch, Paul Desmarais Sr., has had extremely close business and even family ties to every Canadian Prime Minister since Pierre Trudeau, and all Quebec premiers (save two) in the past several decades. The Desmarais’ have strong links to the Parti Quebecois, the Liberals, Conservatives, and even the NDP, and socialize with presidents and prime ministers around the world, as well as the Rothschilds, Rockefellers, and even Spanish royalty. Paul Desmarais Sr. has “a disproportionate influence on politics and the economy in Quebec and Canada,” and he especially “has a lot of influence on Premier Jean Charest.” When former French President Nicolas Sarkozy gave Desmarais the French Legion of Honour, Desmarais brought Jean Charest with him. Quebec author Robin Philpot commented that Desmarais “took him along like a poodle,” referring to Charest. The Desmarais family has extensive ties to Canadian and especially Quebec politicians, have extensive interests in Canadian and international corporations and banks, are closely tied to major national and international think tanks (including the Council on Foreign Relations, the Trilateral Commission, and the Bilderberg Group), and even host an annual international think tank conference in Montreal, the Conference of Montreal. The Desmarais family have had very close ties to Prime Ministers Pierre Trudeau, Brian Mulroney, Jean Chretien, Paul Martin, and even Stephen Harper, and to Quebec premiers, including Lucien Bouchard, who co-authored the article in the Gazette advocating increased tuition. The Desmarais empire also includes ownership of seven of the ten French newspapers in Quebec, including La Presse. The Desmarais family stand atop a parasitic Canadian oligarchy, which has bankers and corporate executives controlling the entire economy, political parties, the media, think tanks which set policy, and even our educational institutions, with the chancellors of both Concordia and McGill universities serving on the boards of the Bank of Montreal and the Royal Bank of Canada, respectively, as well as both schools having extensive leadership ties to Power Corporation and the Desmarais family. It is this very oligarchy which demands the people pay more, go further into debt, suffer and descend into poverty, while they make record profits. In March of 2012, Power Corporation reported fourth quarter profits of $314 million, with yearly earnings at over $1.1 billion. Canada’s banks last year made record profits, and then decided to increase bank fees. At the end of April, it was reported that Canada’s banks had received a “secret bailout” back in 2008/09, from both the Bank of Canada and the U.S. Federal Reserve, amounting to roughly $114 billion, or $3,400 for every Canadian man, woman, and child (more than the cost of yearly tuition in Quebec). And yet Quebec youth are told we suffer from “entitlement.” And now banks are expected to be making even more profits, as reported in early May. As banks make more record profits, Canadians are going deeper into debt. The big Canadian banks, along with the federal government, have colluded to create a massive housing bubble in Canada, most especially in Toronto and Vancouver, and with average Canadian household debt at $103,000, most of which is held in mortgages, and with the Bank of Canada announcing its intent to raise interest rates, Canada is set for a housing crisis like that seen in the United States in 2008, forcing the people to suffer while the banks make a profit. The head of the Bank of Canada (a former Goldman Sachs executive) said that Canadian household debt is the biggest threat to the Canadian economy, but don’t worry, Canada’s Finance Minister said he is working in close cooperation with the big banks to intervene in the housing market if necessary, which would likely mean another bailout for the big banks, and of course, hand the check to you! So, Canada has its priorities: every single Canadian man, woman, and child owes $3,400 for a secret bank bailout to banks that are now making record profits and increasing their fees, while simultaneously explaining that there is no money for education, so we will have to pay more for that, too, which is something those same banks demand our governments do to us. When the students stand up, they are said to be “brats” and whining about “entitlements.” But then, what does that make the banks? This is why I argue that Canada’s elites are parasitic in their very nature, slowly draining the host (that’s us!) of its life until there is nothing left the extract.

9)            The student strike is being subjected to a massive and highly successful propaganda campaign to discredit, dismiss, and demonize the students: In the vast majority of coverage on the student strike and protests in Quebec, the media and its many talking heads have undertaken a major propaganda campaign against the students. The students have been consistently ignored, dismissed, derided, insulted and attacked. One Canadian newspaper said it was “hard to feel sorry” for Quebec students, who were “whining and crying” and “kicking up a fuss,” treating Canada’s young generation like ungrateful children throwing a collective tantrum. In almost every article about the student strike, the main point brought up to dismiss the students is that Quebec has the lowest tuition costs in North America. The National Post published a column written by a third-year political science student at McGill University in Montreal stating that, “Quebec students must pay their share,” and advised people to “ignore the overheated rhetoric from student strikers,” and that, “Jean Charest must go full steam ahead.” The student author, Brendan Steven, is co-founder of McGill’s Moderate Political Action Committee (ModPAC), which is an organizing mobilizing McGill students in opposition to the strike. Steven’s organization attacked striking student associations as “illegitimate, unconstitutional shams” and attacked the democratic functioning of other student associations holding general assemblies. Steven complained that the democratic general assemblies “are being invented on a whim.” Brendan Steven not only gets to write columns for the National Post, but gets interviewed on CBC. Steven’s anti-strike group sent a letter to the McGill administration complaining about pro-strike students on the campus, writing, “This group violates our democratic right to access an education without fear of harm,” and added: “We are demanding the McGill administration take action against this minority group before the current conflicts escalate into disasters. They have proven they will not remain peaceful.” As a lap-dog boot-licking power worshipper, Brendan Steven has a future for himself in politics, that’s for sure! Back in January, Steven wrote an article for the Huffington Post in which he explained that the reason why CEOs get paid so much is because “they’re worth it.” He referred to Milton Friedman – the father of neoliberalism – as a “great economic thinker.” Back in November of 2011, Steven wrote an article for the McGill Daily entitled, “Do not demonize authorities,” and then went on to justify police violence against protesting students engaged in an occupation of a school building, which he characterized as “an inherently hostile act.” Steven later got an opportunity to appear on CBC’s The Current. Margaret Wente, writing for the Globe and Mail, wrote that, “It’s a little hard for the rest of us to muster sympathy for Quebec’s downtrodden students, who pay the lowest tuition fees in all of North America.” She then referred to the striking students as “the baristas of tomorrow and they don’t even know it.” Wente then attempted to explain the Quebec students by writing: “Now I get it: The kids are on another planet.” Interesting how she used the word “kids” to just add a little extra condescension. But it seems clear that Wente “gets” very little. In an August 2011 column, Wente tried to explain why poor black communities in Britain and America were experiencing riots and gang activity, placing blame on “single-mothers” and “family breakdown,” and explained that, “Rootless, unmoored young men with no stake in society are a major threat to social order.” Explaining this demographic in economic terms, Wente wrote: “They are, quite simply, surplus to requirements.” In another column, Wente argued that helping deliver much-needed humanitarian supplies to Gaza would “enable terrorists.” Wente also wrote an article entitled, “The poor are doing better than you think,” suggesting that it’s not so bad for poor people because they have air conditioning, DVD players, and cable TV. Wente has been consistently critical of the Occupy movement, and suggested in another article that, “the biggest economic challenge we face today is not income inequality, greedy corporations, Wall Street corruption or the concentration of wealth among the top 1 per cent. It’s the increasing failure of young men with high-school degrees or less to latch on to the world of work.” Of course, in Wente’s world, the inability of young men to get a job has nothing to do with income inequality, greedy corporations, Wall Street corruption or the concentration of wealth. In another article criticizing the Occupy movement, Wente managed to argue that it was not Wall Street and bankers that have destroyed the economy and left people without jobs, but rather what she refers to as the “virtueocracy,” blaming unions, single mothers who gets masters degrees in social sciences, and people who want to work at NGOs and non-profits, doing “transformational, world-saving work.” So it’s Wente’s “insightful” voice which is “informing” Canadians about the student movement in Quebec. Other Canadian publications writing about the Quebec student strike have headlines like, “Reality check for the entitled,” repeating the idiotic argument that because Quebec students pay less than the rest of Canada, they shouldn’t be “complaining” about the hikes. Andrew Coyne wrote a syndicated column in which he claimed that, “Quebec students know violence works,” framing the protest at which police almost killed two students as an action “of general rage the students had promised.” With no mention of the student who lost an eye, or the other student who ended up in the hospital with critical head injuries, Coyne talked about a cop who “was beaten savagely” and “lay helpless on the ground.” No mention, of course, of the police truck that drove into a group of students moments later, or the fact that the cop who was “beaten savagely” got away with minor injuries, unlike the students who were shot in the face with rubber bullets. By simply omitting police brutality and violence, Coyne presented the student movement as itself inherently violent, instead of at times erupting in violent reactions to state violence, which is far more extreme in every case. The Toronto Sun even had an article which claimed that the students have employed tactics of “thuggery” and “violent criminal behaviour.” Publications regularly ask their readers if Quebec students have “legitimate” grievances, if they are fighting for “social justice,” or if they are just “spoiled brats.” A syndicated column from the Vancouver Sun by Licia Corbella was titled, “How rioting students help make me grateful.” She discussed her latest visit to church where the pastor advised: “Parents, do not provoke your children to anger by the way you treat them,” and mentioned how parents anger their children by “belittling them, underestimating them and not treating them as individuals.” Corbella then took particular note of how parents provoke and enrage children “when we give them a sense of entitlement.” With the word “entitlement,” Corbella naturally then began thinking about Quebec students, as according to Corbella’s pastor, “entitlement leads to rage.” Corbella wrote that rioting “is, in essence, what a spoiled two-year-old would do if they had the ability.” She further wrote: “In Quebec, these entitled youth, who believe the rest of society MUST provide them with an almost free education or else, have blocked other students from accessing the educations they paid for, burned vehicles, smashed shop windows, looted property and severely beaten up a police officer who got separated from the rest of his colleagues.” Again, no mention of the two students who were almost killed by police at the same event. Corbella quoted someone interviewed on TV, endorsing the claim that the student protests are “starting to resemble terrorism,” though she took issue with the word “starting.” This is the result of creating, according to Corbell, “an entitlement society.” Apparently, the pastor’s lesson about not “belittling” the young did not sink in with Corbella. An article in the Chronicle Herald asked, “What planet are these kids on?” The author then wrote that, “the irony is that these students now want the system to accommodate their desires and for someone else to pay the bill,” and that, “students should stop making foolish demands.” Other articles claim that students “need a lesson in economics.” After all, the fact that the majority of economists, fully armed with “lessons in economics,” were unable to predict the massive global economic crisis in 2008, should obviously not lead to any questioning of the ideology of modern economic theory. No, it would be better for students to learn about the ocean from those who couldn’t see a tsunami as it approached the beach. Another article, written by a former speechwriter to the Prime Minister of Canada, wrote that the student arguments were vacuous and that the youth were in a “state of complete denial.” Rex Murphy, a commentator with the National Post and CBC, referred to the student strike as “short-sighted” and that student actions were “crude attempts at precipitating a crisis.” Student actions, he claimed, were the “actions of a mob” and were “simply wrong,” and thus, should be “condemned.” The CBC has been particularly terrible in their coverage of the student movement. With few exceptions, the Canadian media have established a consensus in opposition to the student protests, and use techniques of omission, distortion, or outright condemnation in order to promote a distinctly anti-student stance.

10)            The student movement is part of a much larger emerging global movement of resistance against austerity, neoliberalism, and corrupt power: In the coverage and discourse about the student movement, very little context is given in placing this student movement in a wider global context. The British newspaper, The Guardian, acknowledged this context, commenting on the red squares worn by striking students (a symbol of going squarely into the red, into debt), explaining that they have “become a symbol of the most powerful challenge to neoliberalism on the continent.” The article also adopted the term promoted by the student movement itself to describe the wider social context of the protests, calling it the “Maple Spring.” The author placed the fight against tuition increases in the context of a struggle against austerity measures worldwide, writing: “Forcing students to pay more for education is part of a transfer of wealth from the poor and middle-class to the rich – as with privatization and the state’s withdrawal from service-provision, tax breaks for corporations and deep cuts to social programs.” The article noted how the student movement has linked up with civic groups against a Quebec government plan to subsidize mining companies in exploiting the natural resources of Northern Quebec (Plan Nord), taking land from indigenous peoples to give to multibillion dollar corporations. As one of the student leaders stated, the protest was about more than tuition and was aimed at the elite class itself, “Those people are a single elite, a greedy elite, a corrupt elite, a vulgar elite, an elite that only sees education as an investment in human capital, that only sees a tree as a piece of paper and only sees a child as a future employee.” The student strike has thus become a social movement. The protests aim at economic disruption through civil disobedience, and have garnered the support of thousands of protesters, and 200,000 protesters on March 22, and close to 300,000 on April 22. Protests have blocked entrances to banks, disrupted a conference for the Plan Nord exploitation, linking the movement with indigenous and environmental groups. It was only when the movement began to align with other social movements and issues that the government even accepted the possibility of speaking to students. Unions have also increasingly been supporting the student strike, including with large financial contributions. Though, the large union support for the student movement was also involved in attempted co-optation and undermining of the students. At the negotiations between the government and the students, the union leaders convinced the student leaders to accept the deal, which met none of the student demands and kept the tuition increases intact. There was a risk that the major unions were essentially aiming to undermine the student movement. But the student groups, which had to submit the agreement to democratic votes, rejected the horrible government offer. Thus the Maple Spring continues. Quebec is not the only location with student protests taking place. In Chile, a massive student movement has emerged and developed over the past year, changing the politics of the country and challenging the elites and the society they have built for their own benefit. One of the leaders of the Chilean student movement is a 23-year old young woman, Camila Vallejo, who has attained celebrity status. In Quebec’s student movement, the most visible and vocal leader is 21-year old Gabriel Nadeau-Dubois, who has also achieved something of celebrity status within the province. Just as in Quebec, student protests in Chile are met with state violence, though in the Latin American country, the apparatus of state violence is the remnants of a U.S.-supported military dictatorship. Still, this does not stop tens of thousands of students going out into the streets in Santiago, as recently as late April. Protests by students have also been emerging elsewhere, often in cooperation and solidarity with the Occupy movement and other anti-austerity protests. Silent protests are emerging at American universities where students are protesting their massive debts. California students have been increasingly protesting increased tuition costs. Student protests at UC Berkeley ended with 12 citations for trespassing. Some students in California have even begun a hunger strike against tuition increases. In Brooklyn, New York, students protesting against tuition increases, many of them wearing the Quebec “red square” symbol, were assaulted by police officers. Even high school students in New York have been protesting. Israeli social activists are back on the streets protesting against austerity measures. An Occupy group has resumed protests in London. The Spanish indignado movement, which began in May of 2011, saw a resurgence on the one year anniversary, with another round of anti-austerity protests in Spain, bringing tens of thousands of protesters, mostly youths, out into the streets of Madrid, and more than 100,000 across the country. Their protest was met with police repression. Increasingly, students, the Occupy movement, and other social groups are uniting in protests against the costs of higher education and the debts of students. This is indeed the context in which the ‘Maple Spring’ – the Quebec student movement – should be placed, as part of a much broader global anti-austerity movement.

So march on, students. Show Quebec, Canada, and the world what it takes to oppose parasitic elites, mafia-connected politicians, billionaire bankers, and seek to change a social, political, and economic system that benefits the few at the expense of the many.

Solidarity, brothers and sisters!

For a comprehensive analysis of the Quebec student strike, see: “The Québec Student Strike: From ‘Maple Spring’ to Summer Rebellion?”

For up to date news and information of student movements around the world, join this Facebook page: We Are the Youth Revolution.

Andrew Gavin Marshall is an independent researcher and writer based in Montreal, Canada, writing on a number of social, political, economic, and historical issues. He is also Project Manager of The People’s Book Project. He also hosts a weekly podcast show, “Empire, Power, and People,” on BoilingFrogsPost.com.

Meet Canada’s Ruling Oligarchy: Parasites-a-Plenty!

Meet Canada’s Ruling Oligarchy: Parasites-a-Plenty!

Class War and the College Crisis, Part 7

By: Andrew Gavin Marshall

Paul Desmarais Sr. (left), Nicolas Sarkozy (centre), and Quebec Premier Jean Charest (right)

Part 1: The “Crisis of Democracy” and the Attack on Education

Part 2: The Purpose of Education: Social Uplift or Social Control?

Part 3: Of Prophets, Power, and the Purpose of Intellectuals

Part 4: Student Strikes, Debt Domination, and Class War in Canada

Part 5: Canada’s Economic Collapse and Social Crisis

Part 6: The Québec Student Strike: From ‘Maple Spring’ to Summer Rebellion?

As hundreds of thousands of students in the province of Québec continue to strike into their 13th week against tuition increases, as the provincial government continues to employ legal repression and state violence against the youth, as Canadian families are over $100,000 in debt, as a looming housing crisis begins to rear its ugly head, as youth unemployment increases, student debt explodes, jobs vanish, poverty deepens, and oppression increases, it’s time to meet those responsible, those who are doing better than ever, those who are making record profits, sitting comfortably in their estates which are larger than the entire island of Manhattan, who travel by helicopter and private jet, who co-mingle with the Rockefellers, Rothschilds, Spanish royalty, presidents and prime ministers at home and abroad: meet Canada’s ruling oligarchy.

As this series, “Class War and the College Crisis,” is more focused on the issue of education, I will focus here on the composition of the oligarchy in terms of how they control our educational system. This part in the series will be part article and part research annex. First, I will introduce the reader to Canada’s most powerful family, our version of the Rockefeller’s south of the border, or the Rothschilds in Europe, and of course, all these families are close in both business and social circles. Such is the nature of being an elite in a globalized world. The Desmarais family, located in the province of Québec, are without question the most influential and powerful family in the country, and it’s no wonder, considering their power is vested in an investment company known as Power Corporation.

Why is Power Corporation important?

The name says it all: it has Power. Founded in 1925, Power Corporation of Canada is an investment company involved in communications, business, and especially finance. Power Corporation was founded by A.J. Nesbitt and P.A. Thomson, two partners in the Montreal investment firm, Nesbitt, Thomson and Company, who wanted to consolidate Canada’s power sector, and established Power Corporation as a ‘holding company,’ meaning, it owns other corporations. In the 1960s, the company began to invest in energy, finance, industry, and real estate. In 1968, financier Paul Desmarais took over the leadership of Power Corporation, and rapidly expanded the assets held by the company, including by the 1970s: Canada Steamship Lines (transportation); Consolidated Bathurst (pulp and paper); Investors Group, Great-West Life, Montreal Trust (financial services); and Gesca (communications). Power Corporation expanded across Canada, Europe, and into China. Paul Desmarais stepped aside as Chairman and CEO in 1996, though remaining as the controlling shareholder, and had his two sons, Paul Jr. and André, become Chairman and President and Co-CEOs. Power Corporation owns Gesca, a communications company which in turn owns La Presse as well as six other daily newspapers in Quebec.

The Desmarais family, wrote Christa d’Souza for the London Telegraph, are “Canada’s equivalent of the Rockefellers or Vanderbilts.”[1] Indeed, it would appear that the Desmarais are very much akin to the Rockefellers, the most powerful family in the United States, and one of the most powerful families in the world (perhaps only challenged by the older European-based Rothschild banking family). The Rockefeller family developed the Standard Oil empire, which branched off into several different oil companies, including Exxon and Chevron; founded the Rockefeller Foundation as an engine of social engineering, founded the University of Chicago, became a dominant force in global banking (through Citibank and JP Morgan Chase), highly influential in politics (Vice President Nelson Rockefeller and Senator Jay Rockefeller), and of course, remain a dominant influence in think tanks, such as the Council on Foreign Relations, the Bilderberg Group, and the Trilateral Commission, which ultimately play a major role in shaping policies of industrial nations.

The Desmarais family, while not as powerful in a global sense as the Rockefellers, have nevertheless made themselves a powerful name in the global oligarchy, and most certainly the most powerful family in Canada. Paul Desmarais Sr. is one of Canada’s richest individuals, which is, of course, no surprise, and as Konrad Yakabuski wrote for the Globe and Mail, “Desmarais has been personally consulted by prime ministers on every major federal economic and constitutional initiative since the 1970s. Most of the time, they’ve taken his advice.” Power Corporation has taken large stakes in major European companies such as Bertelsmann, Total and Suez. Peter Munk, a friend of Paul Desmarais and the CEO of Barrick Gold Corporation (a major mining company profiting off of genocide in the Congo), said that, “Paul built that business with an enormous capability for networking that no one in Canadian history has ever matched. And the boys got introduced to his contacts. They were educated well, they married well. And they’ve behaved.” In the mid-1960s, a protégé of Desmarais was a young Montreal lawyer named Brian Mulroney, who would later become Canada’s Prime Minister. Paul Sr. groomed his sons, and especially André, who is now perhaps the most well-known Canadian businessman in China. André also married the daughter of another Canadian Prime Minister, Jean Chrétien. Desmarais Sr. also got involved in French banking through Paribas, and later, Pargesa, which handled investments in a wide range of European corporations, and shot Desmarais into the accepted ranks of French nobility and the old-monied European elite. Paul Desmarais Jr. is close friends with the recent French President Nicolas Sarkozy, and socializes with Spanish royalty, the Rothschilds, and other European oligarchs.[2]

The Desmarais family have strong connections to Canada’s four major political parties: the Liberals, Conservatives, Bloc Quebecois, and the NDP. This has included close ties to Lucien Bouchard, former leader of the Parti Québecois and Premier of Quebec, Jean Chrétien, former Canadian Prime Minister; Brian Mulroney, former Canadian Prime Minister who worked for Power Corporation; Bob Rae, an NDP leader, and Paul Martin, another Liberal Prime Minister who worked for Power Corporation. When André Pratte, the chief editorialist of the Desmerais-owned paper La Presse, wrote in 1994 that, “Power Corp. controls everything, everyone knows that. Chrétien, [then Quebec premier Daniel] Johnson, it’s Power Corp,” Paul Desmarais Sr. intervened directly with the paper to ensure that Pratte was demoted. Claude Masson, the deputy publisher of La Presse at the time, stated that, “When you bite the hand that feeds you, there are consequences.”[3] Indeed, the hand bites back.

The Desmarais’ also have close connections with James Wolfensohn, the former President of the World Bank, who has extensive ties to the Rockefeller family. Paul Jr. married Hélene Blouin, the “founder and CEO of le Centre d’entreprises et d’innovation de Montréal, an incubator for tech businesses; a director of the Montreal Board of Trade; chairman of HEC Montréal; and a co-founder of the Montreal Economic Institute, a think tank that has become Quebec’s leading policy advocate on the non-partisan right.” André married France Chrétien, daughter of Jean Chrétien, and he even served as a press secretary to Jean Chrétien while he was Minister of Justice in the Pierre Trudeau government. In the 1990s, the international advisory board of Power Corporation included former Prime Ministers Brian Mulroney and Pierre Trudeau. Brian Mulroney was sure to create friendly ties between the Desmarais family and soon-to-be Canadian Prime Minister Stephen Harper, who put two Desmarais-connected politicians in his cabinet, Peter Mackay and Maxime Bernier.[4]

Quebec author Robin Philpot wrote a scathing critique of the power of the Desmarais family several years ago, suggesting that, “Over the last several years, [Paul Desmarais Sr.] has spun his web to such an extent that it now enables him to call the shots,” especially in promoting his right-wing economic vision, with “a disproportionate influence on politics and the economy in Quebec and Canada.” Of course, it’s not only Canadian politicians with whom Desmarais is close, but French and American politicians as well, including Sarkozy, George H.W. Bush, and Bill Clinton. Desmarais owns seven of the ten French-language newspapers in Quebec, and has been close to nearly every Quebec premier, apart from Parti Québécois leaders Jacques Parizeau and Bernard Landry. Philpot alleged that Desmarais “has a lot of influence on Premier Jean Charest,” who is the current premier imposing tuition increases. When Desmarais received the French Légion d’honneur (Legion of Honour) from Nicolas Sarkozy, Jean Charest was in attendance, of which Philpot stated, “He took him along like a poodle.” Philpot added, “It’s a very unhealthy situation for a government to be indebted to a businessman that has his own interest at heart. They get their hands tied.”[5]

Jean-François Lisée, the director of the Center for International Studies and Research at the University of Montreal stated that, “They are in a class all by themselves… There’s the Desmaraises, then there’s everyone else.” However, as one man close to the family said, in regards to their influence in politics, “We live in a village in Canada, and there are a lot of circumstances which come together which make it appear as if there’s some great manipulation… These are the coincidences of life. It might be more notorious than substantial.”[6] Indeed, the elite live in “a village,” and that’s the whole point, which is, I might add, “substantial.”

In rural Quebec, the Desmarais family has an estate the size of Manhattan, with a private golf course and pheasant shooting range, as well as a music pavilion where opera is performed. This is the home of Paul Desmarais Sr. Guests, such as former U.S. Presidents George H.W. Bush and Bill Clinton, come play golf on this vast estate, and are flown in on helicopters belonging either to Power Corporation or Desmarais personally. As one of Canada’s richest billionaires, this is a simple matter. Power Corporation, which owns a controlling share in Power Financial Corporation, an insurance giant, has established ties with one of Belgium’s richest men, Albert Frere, with whom they have been in business for decades, and together hold significant shares of Total SA (the third largest oil company in Europe), Lafarge SA (the world’s largest cement maker), and GDF Suez SA (the world’s second largest utility company).[7]

The Desmarais family has even had the internationally renowned Cirque du Soleil perform on their massive 15,000-acre estate. King Juan Carlos of Spain has even been a guest from time to time. André Desmarais is himself a member of the Trilateral Commission, founded by David Rockefeller, and is also on the International Advisory Board of David Rockefeller’s former bank, JP Morgan Chase, alongside other notables such as former British Prime Minister Tony Blair. Both brothers have regularly attended meetings of the Bilderberg Group, of which David Rockefeller is a top official (founded in 1954 as an elite think tank linking Western Europe and North America). The Desmarais also hold a major international meeting of elites in Montreal every year, the Conference de Montreal, drawing in thousands of top policy-makers, industrialists, bankers, strategists, and international elites from the major nations of the world. A son of Paul Desmarais Jr., Paul Desmarais III, is a banker with Goldman Sachs. At times, the influence of the family is shyly acknowledged. As French President Sarkozy stated upon awarding Paul Desmarais Sr. with the French Legion of Honour, “If I am the president of France today, it is thanks in part to the advice, the friendship and the loyalty of Paul Desmarais.”[8]

So while Quebec students are being asked to pay double their current tuition to reduce public spending, the Desmarais family is hob-nobbing around with a top public-sector individual responsible for investing $150 billion in Quebecers’ public-sector pension and insurance plans, Michael Sabia. Though apparently a weekend stay at the Desmarais estate by Sabia did not involve business discussions, it was merely “friendly.” No doubt. Meanwhile, Power Financial profits rose 37% in March of 2012, earning the company $533 million, while Power Corporation itself earned $314 million in the same amount of time, with its profits also increasing by 37%.[9]

The Canadian Oligarchy Assaults Democracy

In the 1970s, just as the United States elite were organizing for their assault on the democratic advances brought about by the activism and popular mobilizations of the 1960s, so too was Canada. With the Powell Memo and the Trilateral Commission’s “Crisis of Democracy” report in the early and mid 1970s, we saw the emergence of a vast array of right-wing pro-business think tanks which sought to – and successfully did – promote neoliberalism and thus, created enormous repercussions for universities and education. Canada was not to be left behind in the elitist assault on democracy.

As William Carroll and Murray Shaw wrote in the journal Canadian Public Policy: “Integral to the rise and consolidation of neoliberal hegemony were the emergence of new centres of class-wide business activism and the retooling of established policy institutes along neoliberal lines.” A few major think tanks and policy institutes were integral to this approach for Canada. The Conference Board of Canada was founded in 1954 when the New York Conference Board opened an office in Montreal, later moved to Ottawa, and now one of the largest think tanks in Canada, linking academia, government and corporate elites. The Private Planning Association of Canada (PPAC) was founded in 1958 by members of the Canadian American Committee (CAC), “a group of business and labour leaders from Canada and the US” who were seeking closer and deeper ties between Canada and the United States, specifically in relation to trade. When the PPAC merged with the C.D. Howe Memorial Foundation in 1973, the C.D. Howe Institute was formed. The C.D. Howe Institute became a major force pushing for free trade agreements such as NAFTA, and by the mid-1990s, was portraying social programs as a major source of Canada’s economic problems.[10]

The Business Council on National Issues (BCNI) – now known as the Canadian Council of Chief Executives (CCCE) – was founded to create consensus on policy issues among Canada’s top 150 CEOs, making it less of a think tank, and more of a “shadow government.” Founded in 1976 in order to bring together the corporate elite of Canada into forming a more long-term strategic position with the government, directly lobbying the state. The mandate of the Council is “to ensure that Canadian chief executives play an influential role in the international financial, trade, investment, environmental and foreign affairs domains.” Since the era of the Trudeau Liberals, politicians have come and gone from power, but the Council, “the voice and organizational embodiment of corporate rule, is a permanent presence.” Another major player is the Fraser Institute (FI), dedicated to mythical “free market” policies and neoliberalism, founded in 1973 with money from fifteen different mining executives, and is essentially a replica of the American Enterprise Institute in the United States. The Fraser Institute is perhaps the most quoted institution in the Canadian media, ensuring that its neoliberal ideology is firmly entrenched in popular ‘information’ (i.e., propaganda). One study from 1998 showed that over the course of a year, the left-wing think tank, the Canadian Centre for Policy Alternatives was quoted in business news stories 16 times, while the Fraser Institute was quoted in over 140 stories.[11]

Today, Hélène Desmarais, wife of Paul Desmarais Jr., is on the board of the C.D. Howe Institute, alongside top officials from GE Canada, Manulife Canada, HSBC Canada, Enbridge, Barrick Gold, BMO Financial Group, and a number of other top financial and industrial corporations. Power Corporation is listed among the C.D. Howe Institute’s supporters, alongside other notable entities such as: Astral Media (a major media conglomerate), Bank of America Merrill Lynch, Barrick Gold Corporation, BMO Financial Group, Bombardier, Canadian Bankers Association, Canadian Chamber of Commerce, CIBC, Canadian Pacific Railway, Canadian Oil Sands Limited, Cargill Limited, CN, Deloitte & Touche LLP, Desjardins Group, Deutsche Bank, Enbridge, Encana, Ford Motor Company, HSBC, Google, Imperial Tobacco, JP Morgan, National Bank of Canada, Pfizer, Procter & Gamble, RBC Financial Group, Rio Tinto Alcan, Scotiabank, Shell Canada, SNC Lavalin, Standard Life Financial, Swiss Bankers Association, TD Bank Group, and many others. The C.D. Howe Institute also gets a good deal of financial support from several Canadian universities, including Carelton, HEC Montréal, Laval, McMaster, Queen’s, Ryerson, Calgary, Lethbridge, Western Ontario, Université de Sherbrooke, U. of Alberta, UBC, Ottawa, Saskatchewan, U of T, and Wilfred Laurier University.[12]

Looking at Power

The board of directors of Power Corporation includes: Pierre Beaudoin, President and CEO of Bombardier; Marcel R. Coutu, President and CEO of Canadian Oil Sands Limited and Chairman of Syncrude Canada, director of Great-West Lifeco (owned by Power Corporation), and is a member of the Canadian Council of Chief Executives; Laurent Dassault, Vice President of Groupe Industriel Marcel Dassault (a Paris-based investment and financing company), and a director of a number of European companies, including SITA, Generali France, Kudelski, and the Banque Privée Edmond de Rothschild Europe (a major banking house owned by the Rothschild family); Guy Fortin, Vice Chairman of Sanpalo Investments, former senior partner at Ogilvy Renault, Chairman of the Canadian Tax Foundation; Anthony R. Graham, President of Wittington Investments, formerly with National Bank Financial Inc., Chairman of President’s Choice Bank, on the board of Power Financial, Loblaw Companies, George Weston Limited, Brown Thomas Group Ltd, Holt Renfrew & Co., the Canadian Institute for Advanced Research, Council for Business and the Arts in Canada, and is a member of the Canadian Council of Chief Executives; Robert Gratton, former Chairman and CEO of Montreal Trust, director of Power Financial, member of the Harvard Business School Canadian Advisory Board, the Conference Board of Canada, the C.D. Howe Institute, and the Trilateral Commission; Isabelle Marcoux, Vice Chair of the board of Transcontinental Inc., on the boards of George Weston Ltd., Rogers Communications, the Board of Trade of Metropolitan Montreal; Donald Mazankowski, director of Power Financial, former member of the Canadian House of Commons and member of Parliament for 25 years, former Canadian Minister of Transport, Deputy Prime Minister, President of the Queen’s Privy Council, and Government House Leader, and is a former member of the board of governors of the University of Alberta.

Other board members include: Raymond L. McFeetors, Vice Chairman of Power Financial and Chairman of Great-West Lifeco, a director of London Life, Canada Life Financial, Canada Life, Crown Life, IGM Financial, Investors Group, Mackenzie Financial, Putnam Investments; Jerry E. A. Nickerson, Chairman of Nickerson & Sons Ltd., director of several Power Corporation companies, honorary director of the Bank of Montreal; James R. Nininger, on the Board of Management of the Canada Revenue Agency (responsible for administering the tax laws of Canada and most of the provinces), on the board of Canadian Pacific Railway, former President and CEO of The Conference Board of Canada (a major research institute/think tank); R. Jeffrey Orr, President and CEO of Power Financial, a board member of several Power group subsidiaries, former Chairman and CEO of BMO Nesbitt Burns and Vice Chairman of the Bank of Montreal’s Investment Banking Group, and is a member of the Canadian Council of Chief Executives; Robert Parizeau, Chairman of Aon Parizeau, Inc., director of National Bank Life Insurance Company, former Chairman of Gaz Métro, former director of Van Houtte, and director of the National Bank of Canada for over 20 years, and is a director of the Institute of Corporate Directors; Michel Plessis-Bélair, Vice Chairman of Power Corporation, director of several Power group subsidiaries, and a director of Lallemand Inc., Université de Montréal, Hydro-Québec, and is a member of the International Advisory Board of École des hautes etudes commerciales (HEC) of Montréal (Business School of Montreal); John A. Rae, director of a number of Power subsidiaries, a director of Fednav Ltd, BNP Paribas (Canada), McGill University Health Centre Foundation, former Executive Assistant to Jean Chrétien, National Campaign Chairman for Jean Chrétien’s 1984 and 1990 leadership campaigns, and Coordinator of the National Campaign of the Liberal Party of Canada for the 1993, 1997, and 2000 elections, and is also Chair Emeritus of the Board of Trustees of Queen’s University; Henri-Paul Rousseau, a director of several Power group subsidiaries, board member of the Global Financial Markets Association, former President and CEO of the Caisse de depot et placement du Québec (which manages public pensions for the province of Quebec), former President and CEO of the Laurentian Bank of Canada, former CEO of Boréal Assurances Inc., and former Senior VP of the National Bank of Canada; T. Timothy Ryan, Jr., President and CEO of the Securities Industry and Financial Markets Association (SIFMA), the leading trade association representing global financial market participants, CEO of the Global Financial Markets Association (GFMA), a director of a number of Power subsidiaries, as well as a director of Lloyds Banking Group, Lloyds TSB Bank, HBOS, the Bank of Scotland, and the United States-Japan Foundation, formerly a top official with J.P. Morgan, is a private sector member of the Global Markets Advisory Committee for the U.S. National Intelligence Council (NIC), the Council which oversees all sixteen U.S. intelligence agencies; and Emoke J.E. Szathmary, President Emeritus of the University of Manitoba, former President and Vice Chancellor of the University of Manitoba, Provost and Vice President of McMaster University, and former Dean of the Faculty of Social Science of the University of Western Ontario, is currently a director of a number of Power subsidiaries, and is a director of the International Institute for Sustainable Development, the Pierre Elliott Trudeau Foundation, the Canadian Foundation for Innovation, and the Board of Governors of McMaster University.

And of course, we have the Desmarais family themselves, including Paul Desmarais Sr., Paul Desmarais Jr., who is not only a director of several Power subsidiaries, but is Vice Chairman of the Board and Executive Director of Pargesa, a director of Group Bruxelles Lambert, GDF Suez, Total, Lafarge, and is a member of the European Institute of Business Administration, Chairman of the Board of Governors of the International Economic Forum of the Americas, a trustee and Co-Chair of the International Advisory Council of the Brookings Institute, founder and member of the International Advisory Board of the McGill University Faculty of Management in Montreal, and the founder and member of the International Advisory Committee of HEC (business school) in Montreal. André Desmarais is not only on several Power subsidiaries, former Special Assistant to the Minister of Justice of Canada, a director of Pargesa in Europe, CITIC Pacific Ltd. in China, is a member of the Chairman’s International Advisory Council of the Americas Society (founded by David Rockefeller), and is Honorary Chairman of the Canada China Business Council.

As for Power Financial, while there is a great deal of overlap between the two boards, there are some unique names on the board of Power Financial. Among these are J. Brian Aune, President of Aldervest Inc., former Chairman of St. James Financial Corporation, is Governor Emeritus of Concordia University; V. Peter Harder, President of the Canada China Business Council, former Canadian Deputy Minister of Foreign Affairs, former Deputy Minister of the Treasury Board, Solicitor General, Citizenship and Immigration, and Industry Canada, and is a director of IGM Financial, TimberWest, Telesat Canada, Energizer Resources, Northland Power, Pinetree Capital Ltd, and is an independent advisor to the Auditor General of Canada.

The Oligarchy of Education

Canada’s universities, like all universities, are governed by bankers and corporate executives, foundation officials, and think tank presidents, media moguls and millionaires. Given the current situation in Quebec, where hundreds of thousands of students have been taking to the streets in a strike against tuition increases, with over 200 protests in Montreal over the past three months alone, I will focus here on the two major English-speaking universities in the province: Concordia and McGill. This is important to focus on, simply because throughout this crisis, the university administrations have been claiming to be “neutral,” though they have actively set themselves against the students, filing legal injunctions against picketing, hiring private security firms to patrol the schools, and even calling in riot police to disperse striking youth. The schools have claimed to be neutral on the issue of tuition increases, though they have not – in any way – applied pressure or lobbying efforts on the government to reverse its position. In fact, it has been the exact opposite. When we look at who actually sits on the boards of the school administrations, it becomes clear that these are the very same elite who, in their various other social positions, lobby the government to increase the tuition, who sit on the boards of the banks that hand out student loans and charge exorbitant interest rates, who profit off the debt and poverty of the masses.

So let’s start with my own school: Concordia University.

The Chancellor of Concordia is L. Jacques Ménard, the President of BMO Financial Group, one of Canada’s largest banks, a director of Claridge Inc., and a director of the Institute for Research on Public Policy (a think tank promoting elite interests). The Chairman of the Board of Governors of Concordia is Peter Kruyt, President and CEO of Victoria Square Ventures, a director of La Presse (the largest French-language newspaper in Quebec), a director of Picchio Pharma Inc., a director of CITIC Pacific Ltd., Chairman of the Canada China Business Council, and a Vice President of Power Corporation, a company he has been working for since 1980 when he was Executive Assistant to the CEO, Paul Desmarais.

Norman Hébert, Jr.: CEO of Group Park Avenue Inc., former board member of Hyrdo-Québec, Chairman of the Board of Société des Alcools du Québec (SAQ, a provincial crown corporation which sells liquor).

Hélène F. Fortin: a director of Larose Fortin CA Inc., member of the Institute of Corporate Directors, former Assistant to the Vice President of Quebecor Inc. (a major media conglomerate), and a former director of CBC and Hydro-Québec.

Brian Edwards: founder of BCE Emergis, one of North America’s largest electronic commerce companies, Chairman of the Board of Miranda Technologies and Biotonix 2010 Inc., and is on the boards of Camoplast Inc. and Impath Networks Canada Corporation, and Transat AT.

Jean Pierre Desrosiers: on the boards of KPGM, Aéroports de Montréal and D-BOX Technologies Inc.

Rita Lc de Santis: a partner at Davies, Ward, Phillips & Vineberg, former member of The Italian Chamber of Commerce in Canada, Board of Trade of Metropolitan Montréal, Business Development Bank of Canada and Hydro-Québec.

James Cherry: President and CEO of Aéroports de Montréal, former executive with Bombardier, Oerlikon Aerospace Inc., CAE Inc. and ALSTOM Canada Inc.

Baljit Singh Chadha: Director of the Canada-India Business Council, Pesident and founder of Balcorp Ltd.

Charles Cavell: former President and CEO of Quebecor World Inc., former Chairman of the Board of Sun Media Corp, a director of Adaltis Inc., Novelis Inc.

Tim Brodhead: former President and CEO of the J.W. McConnell Family Foundation, former Executive Director of the Canadian Council for International Co-operation (CCIC), past chair of Philanthropic Foundations Canada.

Joelle Berdugo Adler: founder of ONEXEONE, and CEO of Diesel Canada.

Jonathan Wener: President and CEO of Canderal (a major real estate investment company), a trustee of the Fraser Institute, member of the board of the Laurentian bank of Canada, Silanis Technologies, and former president of the Urban Development Institute of Canada.

Annie Tobias: former official at Deloitte & Touche

Michael Novak: Executive Vice President of SNC-Lavalin Group, a global engineering and defense contractor.

Marie-José Nadeau: Executive Vice President of Hydro-Québec, Executive Vice President of Corporate Affairs and General Secretary at Cascades Fine Papers Group Inc, and is a director of Metro.

Andrew T. Molson: Chairman of the Board of Molson Coors Brewing Company, is a partner and chairman of RES PUBLICA Consulting Group, a Montreal-based holding and management company, is Chairman of the Board of Trade of Metropolitan Montreal and a director of The Montreal Canadiens, DundeeWealth Inc., Groupe Deschênes Inc. and Montréal International, and is president of the Molson Foundation.

Tony Meti: President of G.D.N.P. Consulting Services, Inc., a former Senior Vice President at National Bank Financial Group, a director of ADF Group, Saputo Inc.

Jacques Lyrette: Executive at Innovative Materials Technologies, former CEO of ADGA Inc., an engineering consulting company.

Arvind K. Joshi: CEO at St. Mary’s Hospital Center, member of the advisory board of the John Molson School of Business at Concordia University.

Suzanne Gouin: President and Chief Executive Officer, TV5 Québec Canada, former director of Hydro-Québec.

McGill University:

H. Arnold Steinberg: Chancellor of McGill University, formerly worked for Dominion Securities (now RBC – Royal Bank of Canada – Dominion Securities), has been a member of the boards of Bell Canada, Teleglobe, Provigo, National Bank of Canada.

Heather Munroe-Blum: Principal and Vice Chancellor of McGill, is on the board of the Internationalization Committee, and the Membership Committee of the Association of American Universities, a member of the Science, Technology and Innovation Council (STIC) of Canada, the U.S. National Research Council’s Committee on Research Universities, the Canada Foundation for Innovation, the Trilateral Commission, and is co-chair of the Private Sector Advisory Committee of the Ontario-Quebec Trade and Co-operation Agreement, on the boards of the Trudeau Foundation, Canada Pension Plan Investment Board (CPPIB), Conférence de Montréal, and the Royal Bank of Canada. She has served on the boards of the Conference Board of Canada, Montreal Chamber of Commerce, Four Seasons Hotel, and Hydro One.

Stuart Cobbett: Managing Partner and Chief Operating Officer of Stikeman Elliott LLP, and is a Director of Citibank Canada.

Lili de Grandpré: founder of an organization strategy consulting firm, CenCEO Consulting, formerly with the Mercer Consulting Group and Bank of Montreal.

Michael Boychuk: President and CEO of Bimcor Inc., and is a member of the advisory board of Centennial Ventures, a U.S. private equity firm, former Senior Vice President and Treasurer of BCE Inc. and Bell Canada.

Gerald Butts: President and CEO of WWF-Canada.

Daniel Gagnier: former Chief of Staff to Quebec Premier Jean Charest, former VP at Alcan, former Chairman of the Canadian Manufacturers and Exporters, current chairman of the International Institute for Sustainable Development, and a board member of the Asia-Pacific Foundation.

Banking on Power

In Canada, there are five major banks which dominate the national banking sector (and together wield enormous influence over Canada’s monetary system through the Bank of Canada). These banks are the Canadian Imperial Bank of Commerce (CIBC), the Bank of Montreal (BMO), Toronto-Dominion Bank (TD), the Bank of Nova Scotia (Scotiabank), and the Royal Bank of Canada (RBC). To understand how these banks wield influence over Canada as a whole, it would be useful to examine the boards of directors of the banks, drawing the overlap of leadership between the ‘Big Five’ and Canada’s major corporations, think tanks, foundations, media and educational institutions. For the purpose of this report, I will simply take a look at the board of directors of the biggest bank: Royal Bank of Canada (RBC), and show how it overlaps with the other institutions which dominate our society.

W. Geoffrey Beattie: on the board of directors of General Electric (GE), President of the Woodbridge Company, a privately held investment holding company (the majority shareholder of Thomson Reuters, a major media conglomerate of which he is Deputy Chairman), and he is also a board member of Maple Leaf Foods Inc. and Chairman of CTV Globemedia, a major Canadian media conglomerate.

Richard L. George: President and CEO of Suncor Energy, on the board of the Canadian Pacific Railway, former Chairman and current board member of the Canadian Council of Chief Executives (CCCE), was a member of the North American Competitiveness Council (NACC), which was formed in 2006 to advise North American governments on the process of ‘North American integration’.

Paule Gautier: the first woman president of the Canadian Bar Association, on the boards of Metro Inc., TransCanada Corporation, and Transcanada Pipelines, an associate member of the American Bar Association, and is on the board of CARE, a supposed “humanitarian” organization, and she was a former director of the Institut Québecois des Hautes Études Internationales at Laval University.

Timothy J. Hearn: former CEO of Imperial Oil Limited, former chairman of the C.D. Howe Institute (a major pro-business think tank) where he remains as a board member, former member of the Canadian Council of Chief Executives (CCCE), is co-chair of a fundraising campaign for the University of Alberta and is chair of the fundraising campaign for Tyndale University, and is on the Advisory Board of the Public Policy School at the University of Calgary, a director of Viterra Inc., and is Chair of the board of directors of the Calgary Homeless Foundation.

Alice D. Laberge: former CEO of Fincentric, a current Commissioner of the Financial Institutions Commission, on the board of the Minerva Foundation, and a member of the Financial Executives Institute, and a former director of BC Hydro and Power Authority, and is on the board of directors of the University of British Columbia (UBC).

Jacques Lamarre: former President and CEO of SNC-Lavalin, a major global engineering, construction, and military contractor; is on the board of Suncor Energy, the founding member and former Chair of the Commonwealth Business Council, former Chairman of the board of directors of the Conference Board of Canada, a leader at the World Economic Forum, a former director of Canadian Pacific Railway, a member of the C.D. Howe Institute’s British North American Committee.

Brandt C. Louie: Chairman and CEO of H.Y. Louie Co. Limited, a food retail distribution company, Chairman of London Drugs Limited, Vice Chairman of IGA Canada Ltd., former Chancellor of Simon Fraser University (SFU), Governor of the Vancouver Board of Trade, Governor of the British Columbia Business Council, a member of the Canadian Council of Chief Executives (CCCE), and is a member of the Dean’s Council of the John F. Kennedy School of Government at Harvard University, and is a current director of the Gairdner Foundation. He is also a board member of the World Economic Forum, Grosvenor (a property company), and the Fraser Institute, a major right-wing pro-business think tank.

Michael H. McCain: President and CEO of Maple Leaf Foods Inc., Chairman of the Canada Bread Company, board member at the American Meat Institute, the Richard Ivey School of Business Advisory Board, a member of the Canadian Council of Chief Executives (CCCE), and a former director of Bombardier Inc.

Heather Munroe-Blum: the Principal and Vice Chancellor of McGill University, board member of the Canadian Pension Plan Investment Board, a member of the Trilateral Commission, has attended meetings of the Bilderberg Group, is co-chair of the Private Sector Advisory Committee of the Ontario-Quebec Trade and Co-operation Agreement, on the board of the Trudeau Foundation, and is on the board of the Conférence de Montréal (the International Economic Forum of the Americas), which is chaired by Paul Desmarais Jr.; and she has also been on the boards of the Conference Board of Canada, Montreal Chamber of Commerce, Four Seasons Hotel, and Hydro One.

Gordon Nixon: President and CEO of the Royal Bank of Canada, a director and past Chairman of the Canadian Council of Chief Executives (CCCE), on the board of directors of the International Monetary Conference, and has been on the boards of Daimler/Chrysler, Catalyst, EnCana Corporation, and Queen’s University School of Business; is a director of the Institute of International Finance and has attended Bilderberg Group meetings.

David P. O’Brien: Chairman of the Board of the Royal Bank of Canada, Chairman of EnCana Corporation, a director of Enerplus Corporation, Molson Coors Brewing Company, and TransCanada Corporation; he is also the Chancellor of Concordia University, and is on the board of the C.D. Howe Institute. He was the former Chairman and CEO of Canadian Pacific Limited.

J. Pedro Reinhard: a director of the Colgate-Palmolive Company, a director of Sigma-Aldrich Corporation, a chemical company; former Executive Vice President and Dow Chemical Company, is a former board member of the Coca-Cola Company, and is President of Reinhard & Associates, a financial advisory practice.

Edward Sonshine: was President, CEO and a director of RioCan Real Estate Investment Trust, Chairman and a director of Chesswood Income Fund, and is Vice Chairman and a director of Mount Sinai Hospital.

Kathleen P. Taylor: President of Four Seasons Hotels and Resorts, is a director of The Hospital for Sick Children Foundation, a cabinet member of the United Way of Greater Toronto and a member of the Industry Real Estate Financing Advisory Council of the American Hotel and Motel Association and the International Advisory Council of the Schulich School of Business of York University.

Bridget A. van Kralingen: Senior Vice President of IBM, and was Managing Partner of Deloitte Consulting, and is a member of the board of advisors at Catalyst Inc.

Victor L. Young: a director of Imperial Oil Ltd., former Chairman and CEO of Fishery Products International Limited, and is a current board member of McCain Foods, former Chairman and CEO of Newfoundland and Labrador Hydro, and was a director at BCE Inc. (Bell Canada).

Our Parasitic Elite

Canada’s elite, like all elites, are parasitic to the social good and wellbeing of the people. They own the banks and financial institutions, own our central bank which sets the interest rates, gives loans and collect on debt, pushing people deeper into servitude and slavery; poverty as punishment. They control our media, which shapes our views and ‘opinions,’ they sit on the boards of our universities, putting future generations into debt before they have a chance at life, and control the ‘knowledge economy’ for which they have defined the purpose of education. They influence and control our governments and political leaders, sit on the boards of the think tanks that write policy and promote political agendas, they run the foundations and claim themselves to be benevolent philanthropists, when philanthropy is at best, moral masturbation for the wealthy, a way to feel good about their vast disparity of wealth, and at its more organized levels, is simply a means through which to engage in social engineering and social control: to give a little in order to continue taking so much. The profit off of the foreign wars our country wages and supports, blood plunderers of the Congo, Afghanistan, and Libya. The Canadian elite rule the country as a proxy for the American Empire, acting as a resource suction-cup for the behemoth below us, providing the United States with most of its oil, water, electricity, and timber. These rapacious parasites claim they hold the answers to the crises they cause and profit from; a super-class which can only be understood as a sprawling, venomous, and vacuous social succubus.

With a massive student movement in Quebec nearing its fourth month of strikes against tuition increases, the media has set against them in a massive propaganda campaign, the legal system has set against them in declaring injunctions against picketing students, the provincial state has dismissed, derided, and engaged in fallacious negotiations designed only to win public sympathy for the government, while the police have been incredibly oppressive against the youth: employing pepper spray, tear gas, smoke bombs, concussion grenades, beatings with batons, mass arrests, shooting students in the face with rubber bullets, and a disturbing trend of driving police cars and trucks into crowds of students. These are images you expect from a military dictatorship like Egypt, but not from a supposed “democracy” like Canada. In the midst of this social upheaval and state repression, the propaganda campaign against the students has been so successful that the majority of public opinion stands with the government and against the youth. Through every institution, and with every means made available, the elite have set themselves against the student movement. It is time the students and Canada at large recognize our elite for what they are: parasites!

While this rhetoric is perhaps a little inflammatory, it remains apt. A parasite is much smaller than its host, and it benefits at the expense of the host, changing its behaviour and health. The word “parasite” comes from the Latin word parasitus which is itself derived from the Greek word, parasitos, meaning, “one who eats at the table of another.” The elite have been eating at our table for far too long. They have long over-stayed their welcome. It’s time to make it known that we have no patience or place for them at our table any longer. This will not be easy, this will not be simple; this will take a long time and a great deal of effort. But if we don’t start now, if we don’t begin to take and create a society of, by, and for the people (what was once referred to as ‘democracy’), then elite parasitism will continue to sap the strength, health, environment, wealth, and the very hope and lives of future generations. They will continue to spread like a social cancer until the host is dead.

The youth are always told that the future is ours, but that remains up to us to make it so. The past and the present belong to the parasites, so if we do not stand up and struggle now and forever, we have no future to inherit, no world in which to grow and no hope in which to gaze. We have only debt bondage, state violence, table scraps, impoverishment, punishment, and oppression. The youth in Quebec are trying to just begin to stand up, to say ‘No More!’ and demand for themselves and others a chance at a future. The success of the strike is secondary to the newly-discovered strength of the students. They have been dismissed and derided, insulted and oppressed, from the left and the right, from so-called Progressives and self-congratulating Libertarians. Because the students do not articulate the same philosophy as those of other critics, they are presented as naïve and ‘entitled.’ Those who insult and deride without empathy or understanding only expose their own naivety.

The fundamental and historical importance of the present situation in Québec is not the cost of tuition, it’s the mass mobilization of youth: it is an expression of a popular and growing dissatisfaction with the way things are and an articulation and drive to create something different, to chart a course for the way things can be. Those who fail to see and recognize that, fail to see the development of progress through history, not immediate, but evolving, not instant, but incremental and persistent. If nothing else, this generation can look back and say, “At least we tried. At least we started.”

What will you look back and say?

Andrew Gavin Marshall is an independent researcher and writer based in Montreal, Canada, writing on a number of social, political, economic, and historical issues. He is also Project Manager of The People’s Book Project. He also hosts a weekly podcast show, “Empire, Power, and People,” on BoilingFrogsPost.com.

Notes

[1]            Christa d’Souza, The art of being Louise MacBain, The Telegraph, 26 June 2004:

http://www.telegraph.co.uk/culture/3619575/The-art-of-being-Louise-MacBain.html

[2]            Konrad Yakabuski, Like Father, like sons?, The Globe and Mail, 26 March 2006:

http://www.theglobeandmail.com/report-on-business/rob-magazine/like-father-like-sons/article170466/singlepage/#articlecontent

[3]            Ibid.

[4]            Ibid.

[5]            Marianne White, “Author delivers high-voltage critique of Paul Desmarais Sr. — the man behind Power Corp,” Ottawa Citizen, 21 October 2008:

http://www2.canada.com/ottawacitizen/news/story.html?id=2e3cff7f-05a2-44fc-afc1-616c5c40f64f

[6]            Ian Austen, “The Name Is ‘Power’ and It Fits,” The New York Times, 26 January 2007:

http://www.nytimes.com/2007/01/26/business/26fund.html?_r=1

[7]            Lisa Kassenaar, “Desmarais family keeps a low profile,” Edmonton Journal, 1 August 2009:

http://www2.canada.com/edmontonjournal/news/business/story.html?id=b40b4563-fe56-4612-920d-a66e9e7da838

[8]            Lisa Kassenaar, “Buffett Loses to Desmarais as Power Exceeds Return,” Bloomberg, 30 July 2009:

http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aEl4wizkuSTQ

[9]            Christinne Muschi, “Great-West Lifeco helps boost profit at Power Financial,” Reuters, 14 March 2012:

http://www.theglobeandmail.com/globe-investor/great-west-lifeco-helps-boost-profit-at-power-financial/article2368991/print/

Kevin Dougherty, “Sabia-Desmarais meeting was “friendly”, not lobbying, Caisse de dépôt says,” Montreal Gazette, 7 February 2012:

http://www.montrealgazette.com/news/Sabia+Desmarais+meeting+friendly+lobbying+Caisse+d%C3%A9p%C3%B4t+says/6116318/story.html

[10]            William K. Carroll and Murray Shaw, “Consolidating a Neoliberal Policy Bloc in Canada, 1976 to 1996,” Canadian Public Policy (Vol. 27, No. 2, June 2001), pages 196-200.

[11]            William K. Carroll and Murray Shaw, “Consolidating a Neoliberal Policy Bloc in Canada, 1976 to 1996,” Canadian Public Policy (Vol. 27, No. 2, June 2001), pages 200-202.

[12]            C.D. Howe Institute, Members and Supporters: http://www.cdhowe.org/members-and-supporters