[this is an excerpt from George Monbiot's new book (pub. 23 September) Captive State: The corporate takeover of Britain.(Macmillan 2000). Mark] If I had sought to be comprehensive, this book would have been very long and even more boring. I have been able to examine only a few of the areas of public life into which corporations have intruded, and I'm sorry to find that I have neither the time nor the space to handle many others. But, before concluding, I would like to mention a few of those I have been unable to cover in depth. The most important of my omissions, I feel, is the corporate takeover of schools. According to the European Round Table of Industrialists, "The provision of education is a market opportunity and should be treated as such."*1 The British government seems to agree. Most of the ideas now being tested in the United Kingdom were first developed in the United States. Schooling there is a commodity, widely traded on the stock market, and worth around $650 billion. There are many ways of making money from education, but the most widespread is the use of school as an advertising medium. It is a lucrative business. Children are easily swayed by advertising, and in school they are, of course, a captive market. "The kids we're reaching," one marketing executive has observed, "are consumers in training."*2 While playgrounds, gyms, corridors and even exercise book covers are used as billboards, the principal means by which most advertisers reach children in American schools is through sponsoring teaching packs and television programmes. Schools, especially the poorer ones, take them, as they are often desperately short of resources. But, while nominally free, many carry hidden costs. The US Consumers' Union studied sponsored teaching packs distributed to schools by some of America's biggest corporations.*3 Nearly 80 per cent of the packs, it found, "contained biased or incomplete information, promoting a viewpoint that favors consumption of the sponsor's product or service." A pack produced by Procter and Gamble, for example, suggested that the clear-cut felling of forests "mimics nature's way of getting rid of trees".*4 Disposable nappies, whose manufacture consumes large quantities of wood pulp and which pose major waste disposal problems, were, it claimed, more environmentally friendly than cloth nappies. The company forgot to add that it is one of the world's biggest manufacturers of disposable nappies. An education pack produced by the American Coal Foundation maintained that, "the earth could benefit rather than be harmed from increased carbon dioxide".*5 The "Kids Get Going With Breakfast" teaching pack, sponsored by Kelloggs, teaches children to beware of foods with high fat contents, but omits to warn them to look out for sugar and salt.*6 The "Critical Thinking About Critical Issues: Freedom of the Press" pack, produced by Mobil Corporation, "confuses freedom of the Press," the Consumers' Association notes, "with free enterprise, suggesting that the First Amendment guarantees free-market capitalism."*7 Forty per cent of American secondary schools, generally the poorest, have signed deals with a broadcasting company called Channel One Communications. Channel One gives televisions, video recorders and satellite dishes to schools, in exchange for a guarantee that its programmes will be shown to 80 per cent of the pupils nearly every day. It broadcasts a twelve-minute news programme, containing two minutes of advertisements. Advertisers pay up to $200,000 for a thirty-second commercial. It is a good investment, for unlike the ads on their televisions at home, these ones have to be watched. The advertisements promote sweets and fatty foods, clothes, music and trainers. They undermine, some teachers complain, their efforts to encourage children to eat healthily, and subject the poorer pupils to commercial pressures to which they cannot respond. Children in schools with Channel One, American researchers found, were more likely to accept the propositions: "I want what I see advertised"; "designer labels make a difference" and "a nice car is more important than school".*8 British children have been inoculated with similar ideas. Here too teaching packs have been distributed whose educational value is open to question. A contribution from Cadbury's, for example, explained to children, "Chocolate is a wholesome food that tastes really good. It is fun to eat at any time of the day and gives you energy and important nutrients that your body needs to work properly".*9 British Nuclear Fuels explained the mishaps in the nuclear industry with the information "Accidents happen all the time. Can you think of some accidents that have happened in school, at home, or locally?"*10 When WH Smith gave �1 million-worth of promotional materials to schools, David Blunkett, the Secretary of State for education, publicly thanked them, earning the lucky company a three-minute feature on the BBC's nine o'clock news. This is worth, I am told, the equivalent of well over a million pounds spent on advertising. McDonalds has produced packs which ask children to find the names of the company's products in a word puzzle, to choose matching images of its french fries and milk shakes, and to compose a song entitled "Old McDonald had a Store".*11 A leaked copy of the company's "Operations Manual" reveals that "Schools offer excellent opportunities. Not only are they a high traffic [sales] generator, but students are some of the best customers you could have."*12 In 1998, billboards appeared in British schools for the first time, accompanied by financial contributions from a company called Imagination for School Media Marketing. The costs of providing free email accounts for all schoolchildren, generously supplied by the internet company Excite Inc, will be recouped through on-screen advertising. But since the mid-1990s, companies have been lobbying for still greater access. According to the European Round Table of Industrialists, "All too often the education process itself is entrusted to people who appear to have no dialogue with, nor understanding of, industry and the path of progress. � A profound reform of education systems in Europe is needed."*13 The round table suggested that "partnerships should be formed between schools and local business."*14 The British government has supplied precisely what it requested. In 1998 it launched what it called a "partnership between businesses, parents, schools and LEAs [Local Education Authorities]."*15 Britain's Education Action Zones (EAZs) are clusters of schools whose standards are lower than they should be, which apply to the government for special treatment. If selected, their management is handed over to an "action forum", on which all the "partners" are represented. EAZs are not allowed to form unless businesses are involved. The corporations give the schools extra money or payments in kind, which are supplemented by matching funds from the government. They also help to run the zone. Education Action Zones, the government announced in 1998, "are the test bed for the education system of the 21st-century."*16 The money, for schools which are chronically under-resourced, is welcome, but many parents and teachers fear that its receipt is accompanied by a new set of problems. Among the action zone partners are a number of Britain's most controversial companies. The London borough of Lambeth's Education Action Zone is run not by the local authority but by the oil company Shell, which has been fiercely criticised by human rights and environment campaigners. The EAZ in Wythenshawe, Manchester, is run by Manchester Airport, which encountered furious local and national resistance when it built a second runway through one of the region's most striking landscapes. The weapons manufacturer British Aerospace helps to run zones in Hull, Plymouth and Teesside; Tesco is guiding the development of schoolchildren in Herefordshire; and ICI, a company with one of Britain's most egregious pollution records, is helping to shape young minds in Blackburn. Cadbury Schweppes, which has, as detailed above, circulated partisan educational materials in Britain, sits on an action forum in Birmingham, while Kellogg's, which has attracted similar opprobrium in the United States, helps to run education in Salford and Trafford. McDonalds is managing schools in Dudley, Teesside and North Somerset. In return for their financial contributions, the munificent companies can reap both public relations benefits - as their good works become known to both parents and teachers - and potential recruits, as they can guide educational policies better to meet their employment needs. This role has been made explicit in some zones. Lambeth's EAZ, for example, aims to "increase understanding and experience of employer culture".*17 Some parents fear that one result will be that children come to identify with these companies, accepting that they are upright and ethical, whatever the firms' records and intentions may be. Some of the corporations involved in EAZs are hoping for still closer unions with schools. In the United States, over 1,000 state schools have already been contracted out to private companies. The consequences for education have been, in some cases, disastrous, as the needs of shareholders conflict with those of the children. The two companies which appear to be represented on more EAZs in Britain than any others are British Telecom, which is hoping to expand its involvement in information technology for schools and a firm called Nord Anglia, whose core business is "education management". Education management in Britain looks as if it is about to become big business. In February 1999, King's Manor School in Guildford, Surrey, became the first state school in Britain whose administration was handed over to a private company. One month later, the government announced that it would contract out educational services to private companies in Hackney, east London. In November 1999, the Department of Education named a consultancy company as its "preferred bidder" to run the schools in the London borough of Islington. Nord Anglia predicts that 200 state schools will be wholly managed by private companies in Britain within five years.*18 While the companies involved so far have good track records, there are inherent conflicts between corporate needs and educational needs. Not the least of these is that the companies running schools will come under pressure from their shareholders to select out pupils who do badly, in order to raise their ratings and win more contracts. OOO School is not the only means of reaching our "consumers in training". In Britain the advertising industry, another sector whose activities I would like to have covered in more detail, is powerful and poorly regulated. British children, as a result, are exposed to more advertisements than any others in the EU. While Sweden, Norway, Belgium and Austria all ban direct advertising to children on television, children's TV in Britain shows an average of 17 advertisements per hour. British advertisers now spend over �150 million on selling toys and games, six times more than they spent in 1992.*19 Soft drinks, confectionery and fast food command still greater sums. McDonald's alone spent �22 million on TV advertising in 1997.*20 When it tried to sue two campaigners for libel, the judge ruled that the campaigners' claim that the company's activities "exploit children by using them, as more susceptible subjects of advertising, to pressurise their parents into going to McDonald's" was "justified" and "true."*21 Several agencies, including some of the biggest, such as Saatchi and Saatchi and McCann-Erickson, have opened special children's divisions. Stephen Colegrave of Saatchi and Saatchi has explained the logic of targetting children. "Children are much easier to reach with advertising. They pick up on it fast and quite often we can exploit that relationship and get them pestering their parents".*22 The Independent Television Commission's code on advertising to children could scarcely be clearer. "No method of advertising," it insists, "may be employed which takes advantage of the natural credulity and sense of loyalty of children". "Advertisements must not exhort children to purchase" or "ask their parents or others to make enquiries or purchases". "No advertisement may lead children to believe that if they do not have or use the product or service advertised they will be inferior � or liable to contempt or ridicule". The rules, in other words, are a precise description of the scope and purpose of children's advertising. It is hard to see how any current advert aimed at children would slip through the net, were the regulations applied. But both the Independent Television Commission and the Advertising Standards Authority are weakly constituted and reluctant to use their limited powers. Both authorities, for example, ban the encouragement of "pester power", but, according to Marketing Week magazine, this bane of all parents - much of it driven by advertising - is worth �8.4 billion a year in Britain.*25 This could be one of the reasons why spending on children's toys and clothes has trebled, in real terms, in 30 years. Poorer families complain that the bombardment of messages is impossible to resist. One mother interviewed by Friends of the Earth in 1998 reported, "You can't keep up with what they want. It's one toy after another, they play with them for a week, a month and they're rubbish, they want another toy. Adverts make them think they can have everything they want."*24 Another observed, "He just wants everything. I can't explain that I can't afford it. I have to buy what he wants.�*25 Advertising executives are unsympathetic. "If parents have become so wimpish that they can't stand up to their children and are putting the blame on advertising, that's a sorry state of affairs", according to the director-general of the Incorporated Society of British Advertisers, John Hooper.*26 Standing up to your children might be easy when you have a salary like Mr Hooper's and can buy them most of what they want. It is surely far harder when you are struggling to make ends meet and your children are made to feel like second class citizens because they arrive at school without the latest sportswear. When Sweden assumes the European presidency in 2001, it will attempt to relieve these inordinate pressures, by introducing new restrictions on children's advertising throughout the European Union. British advertising agencies have been mobilising to stop them. They are also attempting to overturn the ban on advertising toys on Greek TV and the French ban on advertising alcohol.*27 Sanctions against advertisers who break codes of practice in Britain are ineffective. The Advertising Standards Authority (ASA) has no statutory powers. It can report persistent offenders to the Office of Fair Trading, but it is reluctant to use this deterrent. It usually requests that the offending company withdraw an advertisement it finds to be misleading or untrue.*28 As the ASA works slowly, this is often easy for companies to do: the rulings are frequently made long after the advert has ceased to be published. Were the ASA permitted to fine companies, or force them to publish retractions at their own expense, it might command some respect among advertisers, but in the absence of effective sanctions, many firms produce deliberately offensive or misleading campaigns in order to provoke controversy. There is also concern that the Advertising Standards Authority, which is funded by the advertising industry, has come to identify itself with its paymasters. When the Consumers' Association challenged its effectiveness, Caroline Crawford, the ASA's director of communications, claimed that "Advertising causes very few problems for consumers and the industry is performing extremely well."*29 The government has made it clear that it has no intention of doing anything about this. Self-regulation, it believes, is working. But, while encouraging people to buy is easy for British corporations, whether or not their advertisements are accurate, using advertisements to encourage people not to buy is next to impossible. The regulation of advertising in Britain ensures that we are allowed to hear only what is good about a product or activity, and expressly forbidden to hear what is bad. Broadcast promotions are governed by the Independent Television Commission's code, which insists that "no advertisement may show partiality as respects matters of political or industrial controversy or relating to current public policy."*30 This regulation does not appear to apply to corporate campaigns presenting partial accounts of controversial business activities, such as those commissioned by British Nuclear Fuels, Shell and British Airways. It does, however, apply to pressure groups. In 1999, the campaigning organisation People for the Ethical Treatment of Animals commissioned an advert to be broadcast on Sky Sport during National Fishing Week, in which it was to relay the shocking intelligence that fish feel pain when they are hooked. The advertisement was banned by the ITC, on the basis that it was "political". Interestingly, a few months before, the National Society for the Prevention of Cruelty to Children had run a campaign on national television campaigning against child abuse. This was judged to be non-political. One thing distinguishes the politics of the two campaigns. No one sells child abusing kits, or organises a National Child Catching Week. The NSPCC ad, in other words, offends no legitimate vested interests. Most pressure groups no longer bother to try to advertise, after a series of rulings in the mid-1990s. In 1994, the Radio Authority blocked a radio recruitment campaign by Amnesty International, on the basis that Amnesty is a political organisation. In 1995, the Advertising Standards Authority told Friends of the Earth to withdraw a cinema ad warning that mahogany logging destroys rainforests, on the grounds that "expert opinion � is divided" (experts funded by the industry deny that there's a problem).*31 In 1997, Christian Aid's television advert calling for an end to Third World debt was stopped because the organisation's "objects are � of a political nature".*32 The Independent Television Commission's prohibition, its guidelines continue, "precludes � campaigning for the purposes of influencing legislation."*33 What this appears to mean is campaigning for the purposes of changing legislation. Advertisements whose aim is to create the impression that all is well with an industry are an essential component of the lobbying process against, for example, a reduction in public funds for nuclear power, or the tougher regulation of oil production. If the influence you seek to exert is to prevent political change, your advert is acceptable. "Political", the rulings of the regulatory authorities appear to suggest, means offensive to the status quo. The ITC itself is not without affiliations. Its chairman, Sir Robin Biggam, is also a non-executive director of British Aerospace, which sells anti-personnel weapons to Turkey. Some of them have been used to attack Kurdish separatists. In 1999, the ITC revoked the broadcasting licence of Med TV, the Kurdish satellite station based in Britain, after Turkish government complaints that it provided a forum for Kurdish separatists. OOO The Labour government has sustained the central project bequeathed by its predecessor, namely to �repeal daily any wholesome act established against the rich, and provide more piercing statutes daily, to chain up and restrain the poor.�*34 For the past fifteen years, people seeking to challenge corporate power have been increasingly regulated. The 1986 Public Order Act restricted the right to demonstrate. The 1992 Trade Union Act criminalised many previously legal union activities, among them such grave threats to public order as carrying insulting banners. The 1994 Criminal Justice Act empowered the police to break up most public protests. The 1996 Security Service Act and 1997 Police Act included in their definition of serious crime "conduct by a large number of persons in pursuit of a common purpose": peaceful protesters were thus exposed to state-endorsed bugging, burglary and arbitrary searches. MPs warned the government that the 1997 anti-stalking act could be used against non-violent demonstrators. The warnings were ignored, with the result that several campaigners have been served with injunctions or arrested for protests outside company premises. The Terrorism Bill, debated in parliament in 2000, expands the definition of terrorism to include "the use or threat, for the purpose of advancing a political, religious or ideological cause, of action which � involves serious violence against any person or property". Anyone found in possession of "information" which might indicate a "reasonable suspicion" that it could be used for such purposes is identified by the bill as a terrorist. This definition would re-classify, for example, both the activists tearing up genetically engineered crops and the sympathisers receiving their literature. As the MP Alan Simpson has pointed out, were the new law applied even-handedly, dozens of members of parliament would have to be jailed as terrorists. Business, on the other hand, has been released from many of its obligations. When Labour came to power, David Clark, the Chancellor of the Duchy of Lancaster, indicated that he would drop the Conservative policy of removing as many restrictions on business as possible. He replaced the Conservative government's "Deregulation Unit" with a "Better Regulation Unit". "A fair, safe and prosperous society," he explained, "depends on good regulation. People look to the government to ensure benefits such as fair terms of employment, a cleaner environment and safer products. In many cases statutory regulations are the only or best way to pursue such aims."*35 Nigel Griffiths, the minister for Consumer Affairs, appeared to share his views. In May 1998, to the fury of corporate lobbyists, he refused to water down Britain's implementation of the European Union's consumer protection directive. In July 1998, both ministers were sacked. David Clark had been obliged to appoint as chair of the "Better Regulation Taskforce" Lord Haskins, who is the head of the wholesaling company Northern Foods. He was also a member of the Hampel Committee on corporate governance, which did nothing to disguise its contempt for regulatory burdens on business. The report he helped to compile for the committee declared, "The emphasis on accountability has tended to obscure a board's first responsibility ... to enhance the prosperity of the business over time".*36 Unsurprisingly, his taskforce argued that there should be fewer rules for British business. It suggested that state regulation be replaced by self-regulation, economic incentives and codes of practice, such as those "operated by the Advertising Standards Authority".*37 By September 1998, the government had entirely reversed its initial policy. There would, it announced, be fewer government inspectors, enforcing fewer regulations. The inspectors would cease to be industry police, and become advisers instead. In June 1999, Stephen Byers, the Secretary of State for trade and industry, told the British Chambers of Commerce that the government "will be applying the following key principles to our work from now on: � a presumption against regulation. Regulation will only be introduced where absolutely necessary and where all other avenues have been pursued."*38 Regulations would "automatically lapse" after a certain date. Enforcement, he promised, would be "business-friendly".*39 In April 1999, the Better Regulation Unit was replaced by the "Regulatory Impact Unit". Rather than balancing the interests of the public and corporations, as David Clark had proposed to do, the new unit would "help Government reduce the cumulative burden of regulation" and ensure "greater consultation with industry".*40 It would, it promised, seek out any regulations it deemed unnecessary and eliminate them. The business-friendly press campaigns stoutly against regulation - or red tape, as its opponents always call it - and it is true that some rules have fallen too heavily on small businesses in Britain. But regulation is all that prevents companies from dumping their costs onto society. If corporations are allowed to encourage smoking by advertising cigarettes, for example, more people are likely to contract smoking-related diseases. If car manufacturers are not prevented from attaching bull bars to the front of their vehicles, then more of the children hit by cars will die. If pollution control measures are abandoned, the environment will be destroyed. Deregulation, in other words, can become a subsidy for careless or greedy companies. Its effects are felt most keenly by workers in hazardous industries. In 1996, the government's Health and Safety Executive instructed its inspectors to reduce their prosecutions of companies putting their workers at risk. The Conservatives had already repeatedly cut the executive's budget, and this new advice resulted in a 25 per cent decline in health and safety enforcement notices in 1997. Perhaps unsurprisingly, the change was accompanied by a 20 per cent increase in deaths and serious injuries in the workplace: the first time the figures had risen for decades.*41 There appears to be, in other words, a direct relationship between the vigour with which companies are prosecuted for endangering their employees and the number of people killed, maimed, blinded or disabled. If companies are treated gently, workers are treated harshly. In Britain, money is officially more valuable than human life. The directors of British companies are individually responsible for keeping the price of their shares as high as they can. If they neglect this "fiduciary duty", they can be prosecuted and imprisoned. If, on the other hand, they neglect to protect their workforce, with the result that an employee is killed, they remain, in practice, immune from prosecution. The company, if it is unlucky, will suffer an inconsequential fine, which will not touch the lives of the directors. Around 360 people are killed at work every year in Britain. Research by the law professor Gary Slapper suggests that around 80 of these deaths should result in prosecutions for corporate manslaughter.*42 But only two companies, both of them tiny, have ever been convicted of this crime. The problem is that while corporations have acquired many of the rights of human beings, they have managed to shed many of the corresponding responsibilities. A company can be convicted of manslaughter only if a director or senior manager can be singled out as directly responsible for the death. If responsibility is shared by the board as a whole, the firm, bizarrely, is innocent of reckless or intentional killing. The problem is compounded, as I have suggested, by the notorious reluctance of the government's Health and Safety Executive (HSE) to prosecute anyone for anything. The Centre for Corporate Accountability calculates that of the 47,000 major injuries in the workplace reported between 1996 and 1998, the HSE investigated just 11%.*43 Of these investigations, only 10% resulted in a prosecution. The police, by contrast, investigate all incidents, outside the workplace, which cause serious injury. Interestingly, the executive is five times more likely to examine injuries on farms than in the mining industry, which might suggest that it is rather braver when dealing with small companies than it is when dealing with large ones. And though the HSE's own studies suggest that 70% of deaths in the workplace result from "management failure", it prosecutes in only 19% of cases.*44 Even when it does secure a conviction, the penalties are slight. In Britain, a human life is now worth an average of �18,000: it is often cheaper for companies to kill their workers than to improve their safety records. The truth, unpopular with business leaders, is that red tape saves lives, while deregulation kills. In 1996, the Law Commission reported that the corporate killing laws were in urgent need of reform. In 1997, two weeks after the Southall rail crash, in which seven people died, the Home Secretary told the Labour Party conference that he would introduce "laws which provide for conviction of directors of companies where it's claimed that as a result of dreadful negligence by the company as a whole, people have lost their lives."*45 It took nearly three years for Mr Straw to initiate a change in the law. Even so, while companies can be convicted of corporate manslaughter whether or not a director has been singled out for neglect, it appears that their directors will remain immune from prosecution: the only penalty will be a stiffer corporate fine. Unable to discharge its duty, the Health and Safety Executive has attempted, instead, to stifle its critics. In March 1998, a confidential memo was leaked from its "Open Government Unit".*46 It warned recipients that four individuals were "becoming persistent in their enquiries to HSE." The note continued, "We wish to monitor those who appear to have an interest in a range of HSE's activities and who may be looking to exploit replies received in ways unfavourable to HSE � any contact with these people should be reported to the Open Government Unit."*47 The four people it named were all highly respected professionals, with an expert interest in health and safety issues. They were distinguished from others who might have been "persistent in their enquiries", however, in that they had all been critical of the HSE's failures to prosecute. When the agency's novel approach to open government was questioned in parliament, the health and safety minister, Angela Eagle, offered an intriguing interpretation. "The purpose of the memorandum is to ensure that the named enquirers get all the information to which they are entitled in a consistent, fully explained and usable form".*48 Ms Eagle agreed to deposit a copy of the note in the House of Commons library, but, in accordance with the principles of open government, she carefully blotted out all the names. As a result, MPs were unable to see that the recipients of the memo included the HSE's Director-General. OOO If governments are not prepared to regulate, they must, as Lord Haskins suggested, use "economic incentives" to amend corporate behaviour. Compliance, in other words, must be bought. There are already plenty of means by which money is transferred from the state to corporations. Corporations have learnt that, by threatening to move elsewhere, precipitating the loss of thousands of jobs, they can ensure not only that the regulations they dislike are removed, but also that governments will pay vast amounts of money to persuade them to stay. By playing nations or regions off against each other, the companies can effectively auction their services, securing hundreds of millions of pounds of taxpayers' money which might otherwise have been spent, for example, on hospitals or schools. State benefits for individuals might be diminishing, but the corporate welfare state is booming. In 1997, British Aerospace, a company little known for its poverty, insisted that it needed �120 million from the government if it were to build a new jet in Britain rather than overseas. At first, the government resisted. Officials at the Treasury pointed out that aid was wholly unnecessary: the company could finance the new model itself. But by the end of 1998, it caved in, and handed British Aerospace the money it was demanding. In March 2000 the government generously threw in a further �530 million, to help the destitute company build another new model. In 1997, another distressed corporation, Rolls Royce, won �200 million to build a jet engine in Britain. Scores of smaller donations have been made to such good causes as Ford, Rupert Murdoch's Sky TV and the lottery company Camelot. When Labour came to power, it hinted that it would stop handing out money to corporations. But its three largest deals alone, when averaged across the three years in which they were concluded, represent an increase of 130 per cent on the favours distributed by the Conservatives during their last five years in office. Critics have suggested that if individuals sought to extract money by similar means, they would be charged with blackmail. While taxpayers' money is being given to corporations, corporations are required to contribute ever decreasing amounts of tax. Even before the Labour government came to power, corporation tax in Britain was the lowest of any major industrialised country. The Conservatives had reduced it from 52 per cent to 33 per cent. In 1997, the Labour government cut it by a further two per cent. In 1999, it cut the tax again, to 30 per cent. The Chancellor, Gordon Brown, boasted that this was "now the lowest rate in the history of British corporation tax, the lowest rate of any major country in Europe and the lowest rate of any major industrialised country anywhere, including Japan and the United States."*49 In March 2000, Gordon Brown cut the capital gains tax levied on higher rate taypayers from 40 per cent to 10 per cent, half the level in the United States. He also abolished the "withholding tax" on bond sales by British financial corporations. This annulment cost the Exchequer �300 million and infuriated other European governments, which had been trying to introduce a standard rate throughout the EU. The biggest lorries on Britain's roads - but only the biggest - would also be exempted from much of the duty they had to pay. Yet, while these corporate taxes have withered, personal taxation in Britain, as the Conservatives have pointed out, rose by some eight pence in the pound during the first three years of Labour's term in office. This reflects a long-term trend. Corporation taxes in the United States, the Economist magazine reports, rendered one-third of total federal tax revenues before the Second World War. Now they account for just twelve per cent, a quarter of the amount delivered by personal tax.*50 More mobile than ever before, big businesses can bully governments into relieving them of their responsibilities. If a state won't cut the taxes it levies, they threaten to disinvest, and move to somewhere which will. The highly paid, like the corporations which employ them, can also play one state off against another, driving down the top rates of income tax. The tax burden, as a result, has shifted to those who can't get away: the poor and middle-incomed. To some corporations operating in Britain, taxation levels are irrelevant, for they manage to pay nothing. According to the Economist, News Corporation, Rupert Murdoch's main British holding company, made �1.4 billion in profits in the twelve years to 1999. But, as a result of legal tax avoidance measures, it has paid no net British corporation tax.*51 While businesses devise ever more ingenious means of escaping taxation, they also lobby to ensure that the rest of us pay our dues. In October 1999, the Confederation of British Industry told the government that it should not reduce taxes on consumers, but should spend its surplus money, instead, on public infrastructure*52 (this would, incidentally, provide more revenue for corporations, especially those hoping to secure more contracts under the Private Finance Initiative). In the same statement, however, it suggested that corporation tax should continue to be reduced. The corporate takeover of Britain is to be financed not by the corporations, but by you and me. OOO When aristocrats enjoyed inordinate power in Britain, they insisted that they were the only ones who had the wisdom and expertise needed to run the country. Today business people make the same claim. Governments as well as newspapers appear to have convinced themselves of this proposition, and it has led, among other interesting phenomena, to the curious spectacle of government seeking a mandate from the corporations. The flow of power prescribed by the democratic model has been reversed. Big business has become the leviathan of the third millennium, the monster before which our representatives feel obliged to prostrate themselves. The people we have appointed as the guardians of our liberties have delivered us into its maw. Some of the measures required to tame this creature are narrow and specific. The Private Finance Initiative, for example, must be scrapped. Hospitals, schools, prisons and transport systems will respond to the wider public interest only when they are publicly managed. The planning system must be reformed, granting objectors the right to appeal against developments which have not been foreseen in local plans and forbidding developers to hand money to the councils assessing their proposals. The Department of Environment must stop promoting the industries it is supposed to regulate. The government needs to detach itself from the grip of the supermarkets, and find the courage to break up the largest chains. Some of the most damaging out-of-town stores could be either closed altogether or turned into covered farmers' markets, in which local producers could sell directly to consumers. Now that the Prime Minister acknowledges "legitimate public concern" about genetic engineering,*53 the government should reassess its farming policies, bolstering those parts of the market in which demand is unmet, while withdrawing support from those parts decisively rejected by consumers. The patenting of genes must be repealed. We also need a new approach to the funding of our universities, with clear guidelines regulating the use of corporate money, to prevent the stifling of research results and other constraints on academic freedom. It is surely not beyond the means of a government which has secured a significant budget surplus and speaks with such conviction of its commitment to the "knowledge economy" to bring the state funding of university research up to or even above the global average. It should clean out the research councils, encouraging them to support work of the kind which might lead to major breakthroughs in understanding, and close down the deeply flawed Foresight programme. The corporate intrusion into schools should be stopped dead. A government which wanted to protect the workforce, consumers and the environment would be seeking carefully to re-regulate the businesses threatening public health and safety. The legal advantages corporations enjoy over people should be withdrawn. They should, for example, no longer be able to sue for libel. Britain's libel laws are the most draconian in the world. As they are formidably expensive to apply, they favour those with the deepest pockets. The burden of proof rests on the defendants: they are guilty until proven innocent. However poor the defendants might be, they are not entitled to legal aid. So journalists, editors, publishers, printers, broadcasters, even newsagents and bookshops engage in self-censorship, avoiding hazardous subjects. As a result, the corporations are able to prevent exposure of their activities and silence dissent. In America, the judiciary has ensured that "public figures", the corporations among them, shouldn't be allowed to sue for libel, on the grounds that this would stifle free speech. Other measures require a wider reassessment of public policy. While certain powers have been devolved to regional and local government, for example, powers must also be devolved from local government to ordinary people. In theory, community planning events, in which everyone with an interest in the neighbourhood assembles to decide jointly how their area should develop, provide the means of ensuring that the needs of society as a whole are met by development, rather than only those of the developers. Chapter 3 shows how these events can go terribly wrong. But were they conducted fairly, within a legally recognised framework, and were their results given statutory weight in planning decisions, they would become a powerful means by which people could reclaim control over their own lives, forcing companies to respect their wishes. We should also, perhaps, start to engage in the politics of scale, seeking to reduce the size of businesses, so that they become more amenable to the persuasions of governments, citizens and consumers. Mergers and takeovers should be, wherever possible, resisted. Perhaps we should consider establishing a size limit for corporations, forcing them to divest parts of their business if they become too big. But most importantly, when a corporation has proved to be a menace to society, the state must be empowered to destroy it. We should reintroduce, in other words, that ancient safeguard against corporate government, the restrictive corporate charter. In 1720, after corporations had exceeded their powers in Britain, the government introduced an act which provided that all commercial undertakings �tending to the common grievance, prejudice and inconvenience of His Majesty�s subjects� would be rendered void.*54 Corporations which broke the terms of their charters could be wound up. Big business, once again, must be forced to apply for a licence to trade, which would be revoked as soon as its terms are breached. OOO None of these measures are likely to be either workable or lasting if businesses are able to escape our enhanced standards by moving to countries with looser regulations and more attractive incentives. Big business has seized so much of the economy that when large corporations leave, the economic consequences can be disastrous. By bidding against each other to attract companies, countries undermine each other's standards and expose their populations to predatory practices. We need, in other words, global trade agreements which set harmonised minimum standards, rather than only harmonised maximum standards. Multinational firms must be forced to conform to the international rules binding those states which have joined the United Nations. They should be legally obliged, for example, to protect their employees from accident and neglect wherever they operate, and to withhold from harming consumers or the wider community and damaging the environment. They should be subject to human rights laws, enforceable anywhere on earth, whose neglect would result in prosecution at international tribunals. Global taxation measures - harmonising corporate taxes, preventing companies from shifting their money to tax havens, and levying a tarriff on all international currency transactions - would forestall one of the world's gravest impending problems: the erosion of the tax base as states offer ever more generous terms to the ultra-rich in order to attract their money. These would not be easy either to implement or to enforce, not least because they would hand a formidable advantage to countries playing outside the rules. Whether we intervene or not, however, corporate taxes will converge worldwide, but downwards, rather than upwards. It is possible to conceive of a system of sanctions against tax havens, rather like the sanctions imposed today upon countries seeking to protect their markets. Perhaps there should also be a worldwide cap on executive pay, tackling inequality by ensuring that managers and directors cannot be given more than a certain multiple - eight or ten perhaps - of the salary of the lowest paid member of their workforce. If bosses wanted to raise their wages, they would have to raise everyone else's as well. But corporations will never be subjected to meaningful international rules while the negotiation of global agreements is opaque and undemocratic. We need to democratise international decision-making, so that it remains within the public domain, rather than being removed to the murky world of corporate lawyers and unaccountable committees. This might involve, for example, prior parliamentary approval of all national negotiating positions. We should consider holding referenda on the most important international decisions, just as the government proposes a referendum on whether or not to enter the European single currency. OOO All this, of course, looks wildly optimistic and unrealistic. While corporations are being granted ever greater freedoms, how on earth could we contemplate such sweeping restrictions? What could possibly prompt governments to reverse their policies and confront the very faction of which they are most afraid? Where are the powers which could make these propositions viable? Well, dear reader, they lie with you. The corporations are powerful only because we have allowed them to be. In theory, it is we, not they, who mandate the state. But we have neglected our duty of citizenship, and they have taken advantage of our neglect to seize the reins of government. Their power is an artefact of our acquiescence. Governments will reassert their control over corporations, in other words, only when people reassert their control over governments. If political participation could break the bars of totalitarian state communism, it can certainly force elected governments to hold corporations to account. This will happen only through the peaceful mobilisation of millions of people in nations all over the world. Globalisation, in other words, must be matched with internationalism: campaigning, worldwide, for better means of government. We have little power as consumers. Consumer democracy is an illusion, not least because some have more votes than others. Those with the most power in the market are disinclined to use it to change the system which has rewarded them so well. There are, moreover, few parts of the economy from which we can withdraw our custom: we might dispute the merits of the Private Finance Initiative, for example, but if we fall ill we have to go to hospital. At present, many people have no choice but to shop at supermarkets or to eat food containing the products of genetic engineering. Nor is there a political system which, if we were only to embrace it, would solve all our problems. There is no utopia, no perfect state. Political arrival is the prerequisite of tyranny, as the architects of heaven always end up designing a hell. Rather, democracy is sustained not by the system which prescribes it, whatever that might be, but by the challenges to that system. A political system is only as good as the capacity of its critics to attack it. They are the people who enforce the checks and balances which prevent any faction - the corporations, the aristocracy, the armed forces, even, for that matter, trades unions or environment groups - from wielding excessive power. Our power, in other words, lies in our citizenship, in our ability to engage in democratic politics, to use exposure, enfranchisement and dissent to prise our representatives out of the arms of the powers they have embraced. We must, in other words, cause trouble. We must put the demo back into democracy. Legitimate protest takes many forms, including parliamentary opposition, lobbying by constituents and pressure groups, campaigning journalism and adamantly non-violent direct action. It should not be confined to parliamentary politics or even to strictly legal channels. Parliament is incompletely representative. It tends to concentrate on the concerns of target voters and powerful institutions, rather than on those of the poor, the vulnerable or the unborn. Elections are blunt instruments, generally won or lost on a small number of issues: tax, for example, or the economy. They do not allow us to refine our demands. Their results can be fine-tuned only by means of more persistant political activity. While corporate lobbyists infiltrate every particle of government, it is absurd to suggest, as some do, that the extra-parliamentary politics which seeks to counteract their influence is undemocratic. The legal framework on which parliament builds, moreover, pre-dates democracy. It was designed to protect those who drafted it - the titled, propertied, literate few - from the rightful claims of those they had dispossessed. Possession remains nine-tenths of the law and, as corporations seek to expand their domain, seizing resources which once belonged to all of us, the law dilates to accommodate their demands. Trouble-making is the means by which both our dispossession and the laws enforcing it are challenged. It is a costly nuisance, a drain on public resources, an impediment to the smooth functioning of government. It is also the sole guarantor of liberty. It forces our representatives to listen to those they have failed to represent. It inoculates the political agenda with new ideas and new perspectives. Without it, political systems sclerotise and succumb to corruption. As the freed slave and anti-slavery campaigner Frederick Douglass remarked in 1857, "Those who profess to favor freedom, and yet deprecate agitation, are men who want crops without plowing up the ground. They want rain without thunder and lightning. ... Power concedes nothing without a demand. It never did and it never will."*55 There are signs that agitation is already beginning to extract a few concessions. Both the superstores and the biotechnology companies have had to adjust some of their practices in response to popular protest. The World Trade Organisation has been forced to take note of some of the concerns of developing countries, after their sustained objections and the demonstrations in Seattle. The initial attempts to approve a flawed Multilateral Agreement on Investment were abandoned after the revelation of its contents precipitated a public outcry in many parts of the world. Some trading relationships are also beginning to shift. While governments have been attempting to engineer a single, harmonised global trading system, throughout Europe and the United States citizens' groups are breaking the market up. Organic box schemes and local farmers' markets have begun to restore some balance to commercial encounters, reducing the scale of business until the power of producers and consumers is roughly equivalent, reintroducing accountability to the food chain, curbing the environmental impacts of production and transport. In some sectors, such as farming, forestry and fishing, some companies have been obliged to seek a licence to trade, submitting their products to independent certification by bodies such as the Soil Association and the Forest Stewardship Council. Though the power of consumers is, as I have suggested, limited, such constraints are likely to spread to other sectors. While governments are ever more reluctant to regulate, citizens seem to be able to force corporations to shoulder a few of their responsibilities. It would be a mistake, however, to assume that big business will be easily subjugated. The corporations' grip on the state is firm, and most of the citizens' movements resisting it are, as yet, weak. Those seeking to contain corporate power will be forced to confront not only the corporations themselves but also the states which have succumbed to their dominion. They will suffer privations, vilification and, as the law is further distorted to accommodate business demands, even imprisonment. But the struggle for freedom was ever thus. No one else will fight this battle for us. There will be no messiah, no conquering hero to deliver us from the corporate leviathan. Most of our representatives have been either coopted or crushed. Only one thing can reverse the corporate takeover of Britain. It's you. _______________________________________________ Crashlist resources: http://website.lineone.net/~resource_base To change your options or unsubscribe go to: http://lists.wwpublish.com/mailman/listinfo/crashlist
