Transnationals &  Money News -- 2
In his book The Cancer Stage of Capitalism, Professor John McMurtry says that our social immune system is being overwhelmed by growing out-of-control money market cancer. In this bold new look at the recent uncontrolled spread of global capitalism, John McMurtry, professor of philosophy at the University of Guelph, Canada, develops the metaphor of modern capitalism as a cancer. Its invasive growth, he argues, threatens to break down our society's immune system and -- if not soon restrained -- could reverse all the progress that has been made toward social equity and stability. This essay is a condensed version of an article Prof. McMurtry wrote for the American journal Social Justice in 1995. Another of his recent books is Unequal Freedoms: The Global Market as an Ethical System

THERE ARE ETHICAL CORPORATIONS: Not all TNCs (Transnational Corporations = Multinational Corporations) are predatory and solely driven by greed. Check these links (but e-mail us if you have facts suggesting they are not truly ethical):

CORRUPTION by certain TNCs exposed and discussed, with references, at Novartis Foundation's Webpage:

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DICTATORSHIP'S ARMY COMPANIES INVESTING OVERSEAS: Some of the Multinational Corporations or TNCs that have already made overseas investments, according to news media reports this week, are companies run by a dictatorship's army. The People's Liberation Army of Beijing China, following its road away from classical Marxism, has formed corporations which have invested overseas.
"Some of the firms are owned by individual units, others belong to one of China's seven military districts and still others are controlled directly by China's central military establishment -- such as the General Logistics Department or the army's General Political Department. Some firms owned by the army have a toehold in the United States and other foreign countries. During the 1990s, army-owned firms sold millions of assault weapons to American gun collectors and thousands of kilograms of whitefish to American fish-finger manufacturers.
"Companies controlled by the Chinese army own big chunks of property in Thailand and Hong Kong and, at one time, had property holdings around Atlanta and Dallas." -- The West Australian, July 24 1998, p 16

MOVING PRODUCTION TO LOW-WAGE COUNTRIES: "As proposed, the MAI would force countries to treat foreign investors as favourably as domestic companies; laws violating this principle would be prohibited. Under these conditions, transnational corporations would find it easier and more profitable to move investments, including production facilities, to low-wage countries." -- Social Justice webpage about MAI at:

WORLD DEVELOPMENT MOVEMENT'S EXPOSÉS: "... multinational companies ... have more power and influence over the lives of the world's population than most governments
* Of the world's 100 largest economic entities, 51 are multinational companies and 49 are nation states. * Shell, the world's most profitable company, has annual sales of £68 billion, two and a half times the income of Nigeria's 110 million people. * Multinationals account for two-thirds of world trade and an entire industry the world over can be dominated by a handful of companies. ...
"Many of the world's largest companies such as Shell, Nestlé and BP are the targets of international campaigns. WDM's campaigns on companies behaving badly in someone else's backyard include: * Rio Tinto for its refusal to recognise indigenous people's land rights in West Papua, Indonesia. * Poor working conditions in factories in Thailand and China which make toys like Barbie dolls for companies such as Mattel and Hasbro. * Victimisation of trade union members on plantations in Costa Rica which grow bananas for Del Monte, Chiquita and Dole.  (See Unholy banana wars.)
"WDM is campaigning to make multinational companies put people before profits. We want: * Companies to agree to voluntary codes of conduct on working conditions and to have their operations independently monitored. * Companies to accept free trade unions. * Government and international regulation which promotes the positive benefits of multinationals and limits their harmful impacts. * The withdrawal of the Multilateral Agreement on Investment [MAI], currently under negotiation, which would increase the power of multinationals but not their responsibilities."
For links to Armaments sold to dictatorships subsidised with taxpayers' money, Tied "Aid" to impoverished nations, International Debts, including the World Bank and the International Monetary Fund (IMF), the MAI (direct link given above), Banana Monopolies trampling human rights, Mining Corporations in Australia's near north stomping on indigenous people and the environment, Toy Businesses exploiting workers, and WDM's publications, click: World Development Movement of 25 Beehive Place, London, SW9 7QR, UK; Tel: 0800 328 2153, Fax: 0171 738 6098, at:

MONEY MARKET OVERWHELMING OUR SOCIAL IMMUNE SYSTEM: Book The Cancer Stage of Capitalism. "Our social immune system is being overwhelmed by growing out-of-control money market cancer. In this bold new look at the recent uncontrolled spread of global capitalism, John McMurtry, professor of philosophy at the University of Guelph [Canada], develops the metaphor of modern capitalism as a cancer. Its invasive growth, he argues, threatens to break down our society's immune system and -- if not soon restrained -- could reverse all the progress that has been made toward social equity and stability.This essay is a condensed version of an article Prof. McMurtry wrote for the American journal Social Justice [22(4): 1-25, 1995.]." Click: or for fuller details, including the title of another recent book Unequal Freedoms: The Global Market as an Ethical System, Toronto: Garamond, 1998, click the link given above at his name, which is:

"FREE MARKET" FALLACIES: John McMurtry also wrote "Free Market" Fallacies. "The corporations, in other words, are assumed not only to have the right to a free ride on costly services and infrastructures paid for by the citizens of free-trade countries, but the right to be held non-liable for any costs and damages they inflict within these countries." John McMurtry's work in social and political philosophy, political science and sociology has been widely published internationally in journals, textbooks and public forums. His latest book, The Invisible Prison: The Global Market as an Ethical System, will be published by Garamond Press this fall [1998 northern autumn]. The article at the above-linked Webpage was excerpted from a longer essay he wrote for the Journal of Business Ethics.

NEWS EMPIRE AVERAGES ABOUT 5.7% TAXATION: Kylie Morris: "Pulling together the global threads of Murdoch's business is an art practised by Washington Post journalist, Paul Farhi. His work culminated in an article in December, titled 'A Global Reach Keeps Taxman at Arm's Length'. In it, he described how little tax Murdoch pays. ...
Paul Farhi: "In the most recent fiscal year reported, Murdoch's company, News Corp, paid taxes at a rate of 7.8% on operating income. That compares with companies like Walt Disney which had a tax rate of about 28%, Viacom, which owns MTV and Paramount Pictures, paid 22%; Time-Warner, which is a US-based company that is about the same size as News Corp, paid at about a 17% rate. This was not an unusual year for News Corp in terms of its taxation, in fact if anything it was a high year. Throughout the 1990s the company averaged about 5.7% taxation on its operating income, and the other three companies that I just mentioned, averaged anywhere from about 27% to more than 32%. So he is clearly way, way under his peer group."
Kylie Morris: "Murdoch's success in minimising his worldwide tax bill means more ready cash to service debt, and more to grow new business. Ironically, investment-hungry governments sometimes encourage those new ventures by offering tax breaks. For example, the New South Wales Government is lightening Murdoch's tax load by $7-million to aid the Fox Studios developments at the Sydney Showground." And there's more, all revealed on the Australian Broadcasting Corporation's Background Briefing "Not Shaken, Not Stirred: Murdoch, Multinationals and Tax," of 22 March 1998, at:
And check the staff list of the Taxation Law and Policy Research Institute, at:

MOVING MONEY AROUND TO AVOID TAX: Rick Krever [Professor, Director, Taxation and Policy Research Institute, Deakin University]: "In the last decade there's just been an absolute explosion in types of derivatives, and derivatives based on derivatives, ... governments worldwide have been struggling to keep up [with] this explosion of new financial instruments, and nowhere have they done it successfully, the Canadians, the Americans, the New Zealanders have all brought in legislation to try to recognise some of these things for tax purposes. ... "
Kylie Morris: "Tim Edgar ... says there's no question cross-border companies ... use the new tricks of the finance markets ... to lower the tax bill in the country where they make their money. ..."
Tim Edgar [Associate Professor, University of Western Ontario]: "We have this silly convention internationally that multinational corporations operate as separate units within different countries. ... Financial instruments are just one particular way ... to stuff all the income in the low [tax] rate countries and keep all the expenses in the high tax rate countries."
Kylie Morris: "Tim Edgar says multinationals can stage-manage transactions to legitimise them, and at the same time, minimise tax. ... Despite two sophisticated reports that represent eight year[s] work by Treasury and the Tax Office, we haven't acted on their proposals."
Tim Edgar: "... Merton Miller, from the University of Chicago, a Nobel Prize winning economist, has written extensively in this area, says that tax avoidance is one of the driving forces underlying financial innovation." -- Extracts from another important part of the Australian Broadcasting Corporation's Background Briefing, of 22 March 1998, at:   and at:
Background on Rick Krever is on:
Publications of Merton Miller include: Financial Innovations And Market Volatility;   Macroeconomics; A Neoclassical Introduction Miller, Merton H./Upton, Charles W.;   Merton Miller On Derivatives;   Preliminary Study Of The Pueblo Of Taos New Mexico

DICTATORS GIVING DONATIONS TO U.S. LEADERS (2): In a recent article, Greg Poulgrain wrote about the aftermath of the 1998 Indonesian riots, rapes, burning, and looting, which concentrated on businesses and homes of certain wealthy Indonesians, including members of the Soeharto family and associates, and Chinese-Indonesians. Listing some of the premises destroyed, he wrote around mid-1998: "So too was Bank Lippo on Jalan Gajah Madah, owned by Riady who achieved notoriety by donating half a million dollars to assist in the re-election of President Clinton."  [SOURCE has been omitted; sorry.]
Dr Greg Poulgrain is a Lecturer in the Department of Asian Languages and Societies at the University of New England, Australia.

CENTRALISING AND RAISING PRICES IN THE 19TH CENTURY: Standard Oil, railroads, steel, etc: Reformers in the 19th century were opposing the monopolisers, centralisers, and consolidators in the railroad, steel, oil and other industries. See The Robber Barons, The Great American Capitalists, 1861-1901, by Matthew Josephson, New York, Harcourt Brace and Company, 1934 edition. The book was republished by Harvest/ Harcourt Brace & Co in 1995. ISBN 0-15-676790-2.
See part of the publisher's description: "Originally published in 1934. ... The book looks at this phenomenon through the eyes of the men that came out on top in the frenzied and unstructured rush for development, and it becomes in part the biographies of Rockefeller (oil), Carnegie (steel), Gould and Vanderbilt (railways) and Morgan (banking) among others. ... For example Rockefeller's switch from being the largest to the only oil refiner came in secret agreements with the Erie, Pennsylvania, and New York Central railroad "pools" whereby he and refiners invited to join the Standard Oil Trust (they received half the real value of their assets) had freight rates reduced by up to 50% whereas competing refiners had their rates increased by 100% with half of this being paid straight back to Standard Oil (drawback) by the railroads. Within three months his remaining 25 competitors surrendered to him and he fixed all U.S. oil sales at a new high price."

OIL MONOPOLIES, JOHN D. ROCKEFELLER, INCOME, POLITICAL DONATIONS AND THE TAX-FREE FOUNDATIONS: A book review in The Weekend Australian, August 8-9, 1998, "Review" section, p 14, includes a note that the author Ron Chernow is also the author of award-winning books on J.P.Morgan and the Warburgs. "By 1877, about 49 years before the car displaced more stately forms of transportation, John D. Rockefeller controlled 90 per cent of the refined oil in the US. ... By 1902, he had an untaxed income of $US58 million. ... Rockefeller created the organic unity known as the trust, which would be emulated by all the great industrial enterprises -- steel, copper, tobacco and rubber. ...
Rockefeller, and Standard, hated the government no less than the trust-busters hated them, and they treated it with supreme contempt -- by bribing it. There were big-time pay-offs to key senators and countless small-time corruptions. John D. gave campaign contributions to John Sherman and Teddy Roosevelt. But ... both took his money and turned on him. ... ... his great journalistic nemesis was Ida Tarbell, whose 19-part series from 1902-05 ... led the president to bring down the trust. ... all the break-up of Standard did was unlock the wealth in its components ... he was enriched many times over as a result.
Rockefeller's voice is still driving the tax agenda in the US. ...Although John D. is long gone, what is alive is his astounding array of philanthropic projects: the Rockefeller Institute of Medical Research, Rockefeller University, the Johns Hopkins Medical School, the University of Chicago and the Rockefeller Foundation." -- review by Bruce C. Wolpe of Titan, The Life of John D. Rockefeller, Sr, by Ron Chernow; Little, Brown; 774pp, $25.

In Nov-Dec 1999 Exxon and Mobil were amalgamating again.  The constant contributions to politicians' campaign funds was paying off at last!

NEWS EMPIRE'S LOW TAXES (2): "Murdoch's tax holiday. Tax investigators from Britain, the US, Canada and Australia have launched a secret joint inquiry to examine why Rupert Murdoch's global media empire pays hardly any tax. last year, while other international media groups, such as Walt Disney, paid up to 28 per cent of their income in tax, Murdoch's News Corporation reported paying only 7.9 per cent -- only $103 million from an operating profit of $1.3 billion. In 1989 an Australian investigation found that News Corporation had routed its profits through subsidiaries in low-tax countries such as the Cayman Islands. World Press Review, Vol 45 No 5, reprinted in New Internationalist, August 1998, p 6

BRIBERY OF POLITICIANS (again): "Quote. 'The White House is like a subway: You have to put in coins to open the gates.' Johnnie Chung, who pleaded guilty to making illegal donations to US President Bill Clinton's election campaign." -- New Internationalist, August 1998, p 6

MULTINATIONALS RELY ON GOVERNMENTS, PAY NO TAX: "But despite their brash free-enterprise ethos, TNCs [=Transnational Corporations = Multinational Corporations] rely very heavily indeed on the state.  When a TNC thinks of setting up a plant it holds an auction, commanding competitive bids from nation states with offerings of tax-breaks, grants, roads, power supplies, a compliant, 'flexible' labour force, a 'sympathetic' regime.  Huge public subsidies prop up TNCs everywhere.
"... finance houses and banks ... so much surplus cash now sloshes around that they're becoming richer and more powerful than TNCs. ...
Because these institutions have grown so bloated, and because globalization is all about paying no taxes, states are becoming virtually bankrupt. ...
... alternatives... the globalizers are opposed to every single one of them ... The simplest would be to impose a tax on the transactions of foreign-exchange markets, which could generate two-and-a-half trillion (thousand billion) dollars a year.
... the state bureaucracy ... has, by and large, aligned itself with globalization, set itself against the people and lost all political credibility." -- David Ransom, "Globalization -- an alternative view", in New Internationalist, November 1997, pp 7-10.

PREACHING "FREE MARKET" WHILE ARRANGING TAX-FUNDED AID AND BAIL-OUTS: Noam Chomsky, in "Free Market Fantasies" which can be heard online from or from, said that all of the top 100 transnational corporations in the world had benefitted from government assistance in their alleged "home" country, and 20 of them had been saved from collapse.  Yet these companies were strongly advocating "free market" theory, while receiving government subsidies or being baled out.  He covers the reasons for over-fishing through government subsidies while "free" trade was introduced.  Newt Gingrich was one of the most successful politicians in obtaining government help for his electorate's industries, while preaching the "market."
Chomsky wrote World Orders, Old and New: 1994: Pluto Press, London; 312pp, Paperback, ~$32.00.  For a little more on this book and other information try: GEA Links and Contacts. For a wide review of his writings and speeches up to recent times, including audio and video online, try:

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