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Why World Financial Markets Are Imploding

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December 20, 2010

Why World Financial Markets Are Imploding

John Perkins (Seattle, WA), economist, Huffington Post contributor and author. "Transforming global economics away from predatory capitalism."

John Perkins is an economist, Huffington Post contributor and author of Hoodwinked and Confessions of an Economic Hit Man. He believes that our current economic crisis is unsolvable without dramatic systemic changes in the way we do business.

John Perking explains that the world today is a global empire run not by nations but by multinational corporations. This is not a backroom conspiracy but completely out in the open. It is motivated by profit regardless of economic impact or consequences. Upper level executives for these companies are mercenaries who move from company to company and always make millions, no matter how the company fares. There is little incentive to be a corporate "good neighbor." The companies also affect legislation and get people elected.

The United States has 5% of the global population and uses 30% of the world's resources while workers in other countries starve. This is "predatory capitalism" as advocate by Milton Friedman, and it is failing.

Sharon noted that these are "publicly held" companies in business to make money for shareholders. She also noted that the greed may not lie in the company itself but in top level ("golden parachute") management and portfolio managers.

John Perkins notes that we all know who the corporate bad actors are and that we have the power not to buy from them. When we choose company A over company B, we should let both companies know. For example, many US oil companies do not use OPEC oil in their product. The public should insist on corporate responsibility as a condition of profitability, as it did with trans fats, apartheid, aerosol cans, dumping mercury into the Great Lakes, etc.

Sharon observed that current business accounting systems are based on the Milton Friedman model and that components of a company's investment can have value without necessarily generating bottom line profits. She also notes the Nike had to go out of the country because with labor unions practicing the same corporate greed, they could not be competitive and manufacture its products in the United States.

John Perkins noted that instead of giving Tiger Woods $40 million, they could give him $5 million and the rest to their workers. And that Tiger Woods also could insist on this if he wanted to (Note: Since 1996, Tiger Woods has been paid at least $145 million by Nike and has generated $600 million in golf related sales for them).

It was noted by John Perkins that the power base is controlled by corporations in the United States, China, Japan, Israel, Europe and elsewhere. The main exception is Latin America, which has a recent history of standing up to corporate exploiters. These same countries (such as Argentina) had to overthrow CIA backed dictators. Brazil is an excellent example of a thriving, democratic economy based on locally grown ethanol (made from sugar cane) rather than petroleum. Brazil respects its indigenous people and understands the need for all species to survive and thrive on the planet.

The goal is a sustainable, just and peaceful world. If Nike chooses to utilize workers in Indonesia, they need to pay them a living wage, not exploit children and treat them fairly.

Nike is very powerful and could change these things.

Website: www.johnperkins.org.

(Perkins, John, Hoodwinked, Crown Business, 2009)