The short answer is: a great deal of influence, directly and indirectly. We have already touched on this in section B.2.3 ("How does the ruling class maintain control of the state?") Here we will expand on those remarks.
State policy in a capitalist democracy is usually well-insulated from popular influence but very open to elite influence and money interests. Let's consider the possibility of direct influence first. It's obvious that elections cost money and that only the rich and corporations can realistically afford to take part in a major way. Even union donations to political parties cannot effectively compete with those from the business classes. For example, in the 1972 US presidential elections, of the $500 million spent, only about $13 million came from trade unions. The vast majority of the rest undoubtedly came from Big Business and wealthy individuals. For the 1956 elections, the last year for which direct union-business comparisons are possible, the contributions of 742 businessmen matched those of unions representing 17 million workers. And this was at a time when unions had large memberships and before the decline of organised labour.
Therefore, logically, politics will be dominated by the rich and powerful -- in fact if not in theory -- since only the rich can afford to run and only parties supported by the wealthy will gain enough funds and favourable press coverage to have a chance (see section D.3, "How does wealth influence the mass media?"). Even in countries with strong union movements which support labour-based parties, the political agenda is dominated by the media. As the media are owned by and dependent upon advertising from business, it is hardly surprising that independent labour-based political agendas are difficult to follow or be taken seriously. Moreover, the funds available for labour parties are always less than those of capitalist supported parties, meaning that the ability of the former to compete in "fair" elections is hindered. And this is ignoring the fact that the state structure is designed to ensure that real power lies not in the hands of elected representatives but rather in the hands of the state bureaucracy (see section J.2.2) which ensures that any pro-labour political agenda will be watered down and made harmless to the interests of the ruling class.
To this it must be added that wealth has a massive indirect influence over politics (and so over society and the law). We have noted above that wealth controls the media and their content. However, beyond this there is what can be called "Investor Confidence," which is another important source of influence. If a government starts to pass laws or act in ways that conflict with the desires of business, capital may become reluctant to invest (and may even disinvest and move elsewhere). The economic downturn that results will cause political instability, giving the government no choice but to regard the interests of business as privileged. "What is good for business" really is good for the country, because if business suffers, so will everyone else.
David Noble provides a good summary of the effects of such indirect pressures when he writes firms "have the ability to transfer production from one country to another, to close a plant in one and reopen it elsewhere, to direct and redirect investment wherever the 'climate' is most favourable [to business]. . . . [I]t has enabled the corporation to play one workforce off against another in the pursuit of the cheapest and most compliant labour (which gives the misleading appearance of greater efficiency). . . [I]t has compelled regions and nations to compete with one another to try and attract investment by offering tax incentives, labour discipline, relaxed environmental and other regulations and publicly subsidised infrastructure. . . Thus has emerged the great paradox of our age, according to which those nations that prosper most (attract corporate investment) by most readily lowering their standard of living (wages, benefits, quality of life, political freedom). The net result of this system of extortion is a universal lowering of conditions and expectations in the name of competitiveness and prosperity." [Progress Without People, pp. 91-92]
And, we must note, even when a country does lower its standard of living to attract investment or encourage its own business class to invest (as the USA and UK did by means of recession to discipline the workforce by high unemployment), it is no guarantee that capital will stay. US workers have seen their companies' profits rise while their wages have stagnated and (in reward) hundreds of thousands have been "down-sized" or seen their jobs moved to Mexico or South East Asia sweatshops. In the far east, Japanese, Hong Kong, and South Korean workers have also seen their manufacturing jobs move to low wage (and more repressive/authoritarian) countries such as China and Indonesia.
As well as the mobility of capital, there is also the threat posed by public debt. As Doug Henwood notes, "[p]ublic debt is a powerful way of assuring that the state remains safely in capital's hands. The higher a government's debt, the more it must please its bankers. Should bankers grow displeased, they will refuse to roll over old debts or to extend new financing on any but the most punishing terms (if at all). The explosion of [US] federal debt in the 1980s vastly increased the power of creditors to demand austere fiscal and monetary policies to dampen the US economy as it recovered . . . from the 1989-92 slowdown." [Wall Street, pp. 23-24] And, we must note, Wall street made a fortune on the debt, directly and indirectly.
Commenting on Clinton's plans for the devolution of welfare programmes from Federal to State government in America, Noam Chomsky makes the important point that "under conditions of relative equality, this could be a move towards democracy. Under existing circumstances, devolution is intended as a further blow to the eroding democratic processes. Major corporations, investment firms, and the like, can constrain or directly control the acts of national governments and can set one national workforce against another. But the game is much easier when the only competing player that might remotely be influenced by the 'great beast' is a state government, and even middle-sized enterprise can join in. The shadow cast by business [over society and politics] can thus be darker, and private power can move on to greater victories in the name of freedom." [Noam Chomsky, "Rollback III", Z Magazine, March, 1995]
Economic blackmail is a very useful weapon in deterring freedom.
Yes. By capital flight, business can ensure that any government which
becomes too independent and starts to consider the interests of those who
elected it will be put back into its place. Therefore we cannot expect a
different group of politicians to react in different ways to the same
institutional influences and interests. It's no coincidence that the
Australian Labour Party and the Spanish Socialist Party introduced
"Thatcherite" policies at the same time as the "Iron Lady" implemented them
in Britain. The New Zealand Labour government is a case in point, where
"within a few months of re-election [in 1984], finance minister Roger
Douglas set out a programme of economic 'reforms' that made Thatcher and
Reagan look like wimps. . . .[A]lmost everything was privatised and the
consequences explained away in marketspeak. Division of wealth that had
been unknown in New Zealand suddenly appeared, along with unemployment,
poverty and crime." [John Pilger, "Breaking the one party state," New
Statesman, 16/12/94]
An extreme example of capital flight being used to "discipline" a naughty
administration can be seen in the 1974 to '79 Labour government in
Britain. In January, 1974, the FT Index for the London Stock Exchange
stood at 500 points. In February, the Miner's went on strike, forcing
Heath (the Tory Prime Minister) to hold (and lose) a general election.
The new Labour government (which included many left-wingers in its
cabinet) talked about nationalising the banks and much heavy industry. In
August, 1974, Tony Benn announced plans to nationalise the ship building
industry. By December, the FT index had fallen to 150 points. By 1976 the
Treasury was spending $100 million a day buying back its own money to
support the pound [The Times, 10/6/76].
The Times noted that "the further decline in the value of the pound has
occurred despite the high level of interest rates. . . . [D]ealers said
that selling pressure against the pound was not heavy or persistent, but
there was an almost total lack of interest amongst buyers. The drop in the
pound is extremely surprising in view of the unanimous opinion of bankers,
politicians and officials that the currency is undervalued." [27/5/76]
The Labour government, faced with the power of international capital,
ended up having to receive a temporary "bailing out" by the IMF, which
imposed a package of cuts and controls, to which Labour's response was, in
effect, "We'll do anything you say," as one economist described. The social costs of
these policies were disastrous, with unemployment rising to the then
unheard-of-height of one million. And let's not forget that they "cut
expenditure by twice the amount the IMF were promised" in an attempt to
appear business-friendly. it [Peter Donaldson, A Question of
Economics, p. 89]
Capital will not invest in a country that does not meet its approval. In
1977, the Bank of England failed to get the Labour government to abolish
its exchange controls. Between 1979 and 1982 the Tories abolished them and
ended restrictions on lending for banks and building societies:
Why? What was so bad about the UK? Simply stated, the working class was
too militant, the trade unions were not "shackled by law and subdued," as
The Economist recently put it [February 27, 1993], and the welfare state
could be lived on. The partial gains from previous struggles still existed, and
people had enough dignity not to accept any job offered or put up with an
employer's authoritarian practices. These factors created "inflexibility"
in the labour market, so that the working class had to be taught a lesson
in "good" economics.
By capital flight a rebellious population and a slightly radical government
were brought to heel.
Business spends a lot of money to ensure that people accept the status
quo. Referring again to the US as an example (where such techniques are
common), various means are used to get people to identify "free
enterprise" (meaning state-subsidised private power with no infringement
of managerial prerogatives) as "the American way." The success of these
campaigns is clear, since many working people now object to unions as
having too much power or irrationally rejecting all radical ideas as
"Communism" regardless of their content.
By 1978, American business was spending $1 billion a year on grassroots
propaganda (known as "Astroturf" by PR insiders, to reflect the appearance
of popular support, without the substance, and "grasstops" whereby influential
citizens are hired to serve as spokespersons for business interests). In
1983, there existed 26 general purpose foundations for this purpose with
endowments of $100 million or more, as well as dozens of corporate
foundations. These, along with media power, ensure that force -- always
an inefficient means of control -- is replaced by the "manufacture
of consent": the process whereby the limits of acceptable expression are
defined by the wealthy.
This process has been going on for some time. For example "[i]n April 1947,
the Advertising Council announced a $100 million campaign to use all media
to 'sell' the American economic system -- as they conceived it -- to the
American people; the program was officially described as a 'major project
of educating the American people about the economic facts of life.'
Corporations 'started extensive programs to indoctrinate employees,' the
leading business journal Fortune reported, subjected their captive
audiences to 'Courses in Economic Education' and testing them for
commitment to the 'free enterprise system -- that is, Americanism.' A
survey conducted by the American Management Association (AMA) found that
many corporate leaders regarded 'propaganda' and 'economic education' as
synonymous, holding that 'we want our people to think right'. . . [and
that] 'some employers view. . . [it] as a sort of 'battle of loyalties'
with the unions' -- a rather unequal battle, given the resources available."
[Noam Chomsky, World Orders, Old and New, pp. 89-90]
Various institutions are used to get Big Business's message across, for
example, the Joint Council on Economic Education, ostensibly a charitable
organisation, funds economic education for teachers and provides books,
pamphlets and films as teaching aids. In 1974, 20,000 teachers
participated in its workshops. The aim is to induce teachers to present
corporations in an uncritical light to their students. Funding for this
propaganda machine comes from the American Bankers Association, AT&T, the
Sears Roebuck Foundation and the Ford Foundation.
As G. William Domhoff points out, "[a]lthough it [and other bodies like
it] has not been able to bring about active acceptance of all power elite
policies and perspectives, on economic or other domestic issues, it has
been able to ensure that opposing opinions have remained isolated, suspect
and only partially developed." [Who Rules America Now?,
pp. 103-4] In
other words, "unacceptable" ideas are marginalised, the limits of
expression defined, and all within a society apparently based on
"the free marketplace of ideas."
The effects of this business propaganda are felt in all other aspects of
life, ensuring that while the US business class is extremely class
conscious, the rest of the American population considers "class" a swear
word!
“That’s a big honor,” commented Larry. “The passenger, while they were high up, threw something and hit the pilot, the seaplane went out of control, the man jumped—and then cut free his parachute, cut the sack holding the emeralds, and hid in the swamp.” “I see a light,” Sandy said as the airplane swung far out over the dark water. “A green light, but the hydroplane wouldn’t carry lights.” "No, no; it's a good deal, but it ain't too much. Not that it could be more, very well," he added, and he glanced furtively at the woman within, who had stretched out on the lounge with her face to the wall. Mrs. Taylor was fanning her. But though the 21st of January was to be the day of the grand attack on the Ministry, the battle was not deferred till then. Every day was a field-day, and the sinking Minister was dogged step by step, his influence weakened by repeated divisions, and his strength worn out by the display of the inevitable approach of the catastrophe. The first decided defeat that he suffered was in the election of the Chairman of Committees. The Ministerial candidate, Giles Earle, was thrown out by a majority of two hundred and forty-two to two hundred and thirty-eight, and the Opposition candidate, Dr. Lee, was hailed by a shout that rent the House. Other close divisions followed. The fall of Walpole was now certain, and he would have consulted both his dignity and comfort in resigning at once. This was the earnest advice of his friends, but he had been too long accustomed to power to yield willingly. He was oppressed with a sense of his defeats, and the insolence of enemies whom he had so long calmly looked down upon without fear. He was growing old and wanted repose, but he still clung convulsively to his authority, though he had ceased to enjoy it. "Should think they was bride and groom, if they wasn't so old." "March them right over to that shed there," said the Major, "and the Quartermaster will issue them muskets and equipments, which you can turn over again when you reach Chattanooga. Good-by. I hope you'll have a pleasant trip. Remember me to the boys of the old brigade and tell them I'll be with them before they start out for Atlanta." The train finally halted on a side-track in the outskirts of Chattanooga, under the gigantic shadow of Lookout Mountain, and in the midst of an ocean of turmoiling activity that made the eyes ache to look upon it, and awed every one, even Si and Shorty, with a sense of incomprehensible immensity. As far as they could see, in every direction, were camps, forts, intrenchments, flags, hordes of men, trains of wagons, herds of cattle, innumerable horses, countless mules, mountains of boxes, barrels and bales. Immediately around them was a wilderness of trains, with noisy locomotives and shouting men. Regiments returning from veteran furlough, or entirely new ones, were disembarking with loud cheering, which was answered from the camps on the hillsides. On the river front steamboats were whistling and clanging their bells. "Go out and git you a rebel for yourself, if you want to know about 'em," Shorty had snapped at the Orderly. "There's plenty more up there on the hill. It's full of 'em." "Drat 'em! durn 'em!" "He's dead," said Realf. Should you leave me too, O my faithless ladie!" The odds were generally on Reuben. It was felt that a certain unscrupulousness was necessary to the job, and in that Backfield had the advantage. "Young Realf wudn't hurt a fly," his champions had to acknowledge. Though the money was with Reuben, the sympathy was mostly with Realf, for the former's dealings had scarcely made him popular. He was a hard man to his customers, he never let them owe him for grain or roots or fodder; his farm-hands, when drunk, spoke of him as a monster, and a not very tender-hearted peasantry worked itself sentimental over his treatment of his children. Caro was frightened, horrified—she broke free, and scrambled to her feet. She nearly wept, and it was clear even to his muddled brain that her invitation had been merely the result of innocence more profound than that which had stimulated her shyness. Rough seaman though he was, he was touched, and managed to soothe her, for she was too bashful and frightened to be really indignant. They walked a few yards further along the path, then at her request turned back towards Odiam. Calverley reluctantly departed on his mission, cursing the interruption that prevented his enjoying the degradation of his rival, and the baron now inquired whether Holgrave had confessed himself his villein. HoME国家产免费一级毛卡片
ENTER NUMBET 0017 D.2.1 Is capital flight really that powerful?
"The
result of the abolition of exchange controls was visible almost
immediately: capital hitherto invested in the U.K. began going abroad. In
the Guardian of 21 September, 1981, Victor Keegan noted that 'Figures
published last week by the Bank of England show that pension funds are now
investing 25% of their money abroad (compared with almost nothing a few
years ago) and there has been no investment at all (net) by unit trusts in
the UK since exchange controls were abolished'" [Robin Ramsay, Lobster
no. 27, p. 3].
D.2.2 How extensive is business propaganda?
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