If Not President Sirleaf, Who's The Next For Greedy Capitalists
By: J. Yanqui Zaza
Certainly, any nation, even the great USA, will fail to obtain adequate revenue needed to finance social programs like those offered by nations like Sweden, Norway, Finland, etc., if unscrupulous profit-driven investors are allowed unchecked control of a nation’s lucrative assets. As in the case of Liberia, once capitalists took control of diamonds, gold and iron mines, they accumulated more wealth, perpetuated corruption, and discouraged genuine reforms. In addition, they created conditions for the continuous election of weak or dictatorial leaders who promoted and defended big business’ interests.
In the U.S., the recent rapid increases in prices recorded below are examples of how the influence of profit-driven investors can cause high cost of living and sufferings for ordinary citizens (Consumer Price Index, U.S. Bureau of Labor Statistics).
|3) 4 bedroom house (NYC)||150,000.00||450,000.00||300,000.00||200%
|4) Dow Jones (stocks)||3,000||11,000||8,000||267%|
Prior to the gyration of oil prices ($63.00 in 2003 to $145.00 in 2008), economists were divided on the causes (i.e., market manipulations or market fundamentals) of the 75%, 145% 200% and 267% increases shown above. Now, market fundamentals’ advocates have recently accepted the view that market manipulations, through advertisement, artificial shortage and outright fraud can be primary causes of the price increases. (Documentary by “60 Minutes” of CBS).
Experts state that increase in profits during the last two decades was based principally on government policies and propaganda, rather than the ingenuity of capitalism. In Liberia, policies are pro business because of a sustained propaganda that government bureaucrats are ineffective, although Botswana government's involvement in the diamond industry is showing success. But, quite recently, the promotion of capitalism has come under a dark cloud. For instance, George Soros, a billionaire, said "the owners of capital seek to maximize profits...Left to their own devices, they would continue to accumulate wealth." Apparently, that’s part of the reasons why capitalists coerced stakeholders to begin the TRC investigation from 1979, excluding prior years capitalists exploited Liberia’s natural resources.
Was it the idea of protecting the corrupt activities of profiteers that the World Bank, a fiduciary, has not detailed which corporations bid for any of the $240 million dollars pledged in 2004 for Liberia’s reconstruction? Is the World Bank recent allotment of $7.4 million to improve accountability and transparency in Liberia an attempt to cover up the inability hired competent expatriates (experts of GEMAP) to curb corporate bribery? How will the World Bank explain why citizens of Iceland and Ireland or 13 countries such as Latvia, Ireland, Estonia, etc are awash in poverty even though they abandoned socialism, embraced capitalism and made $1 trillion dollar investments? (NY Times, 3/8/09).
If nothing else, why don’t those who argue that allowing big business to make more profits will bring prosperity find out why measures such as competitive spirit of capitalism, effective accounting, good pay, prosecutorial system and regulatory agencies, used on Wall Street have not solved the U.S. economic problems? These mechanisms were strengthened after each financial meltdown in 1680, 1909, 1934, 1987, and 2002. And what did big business do in response? Again, their profit motives, experts argued, encouraged them to violate laws, undermine regulation and caused more corruption, fraud and price manipulations.
So the idea of investigating corporate bribery is not only about deterring professionals such as Harvard University professors from engaging in conflict of interest. (NY Time, 3/3/09). Rather it is also about reducing the influence of big business and changing policies so that government can undertake projects and institute effective regulations. It is worth understanding why capitalists use propaganda to control lucrative assets, but prefer government to manage less lucrative assets. If government is efficient at managing toxic assets, why doesn’t it manage lucrative assets? In the bailout debate, for instance, capitalists want U.S. government to take control of American International Assurance (AIG), but do not want the Federal government to have control of banks. Why? Is it because AIG is not currently profitable but banks are more likely to be? American International Assurance has insured 350 million insurance policies, which translate into 17 trillion dollar liabilities that might become due anytime. For the banks, once the assets are appreciated, they will become profitable; hence, profiteers want the banks, but not AIG.
Obviously, some government bureaucrats are inept in managing bad or good assets just as chief executives on Wall Street. Nonetheless, some bureaucrats have and continue to perform successfully with rigid regulations. Bureaucrats in China, Russia, and as well in the United States of America have performed successfully. For instance, government-owned entities do manage the John F. Kennedy Airports in NYC, Amtrak, the train service company in the U.S., NYC Subways, etc. In addition, U.S. Government bureaucrats operate one of the most effective institutions in the world, the U.S. Military. Negative views about government did not stop the Chinese government from managing lucrative assets. More so, it did not only generate $815. 2 billion dollar profits in 2003 (People’ Daily Online Major Industries), it is also constructing one of the largest damps in the world. Beyond the enormous profits, China accumulated excess cash reserves, and also provided main power grids all over cities and rural towns.
In 1934, the U.S. government's involvement was not about managing good or bad assets; rather it was about providing jobs and stimulating the economy. Successfully, Franklin D. Roosevelt hired unemployed citizens who planted three (3) billion trees, restored 49,000 bridges, built 69,000 monumental stones, etc in 1934.
The influence of greedy capitalists has not only coerced Liberia into selling its natural resources cheaply, but their propaganda has perturbed the Sirleaf Administration from undertaking projects that would create significant employment for unskilled youths. Just imagine how many Liberians would be employed if the Liberian government actively engaged in rice production or much more if it were directly managing the diamond, gold, and logging industries. Evidently, the small percentage (3 to 10 percent) of the profits from Liberia natural resources usually received from the corporations managing them would never be adequate to finance Liberia’s social programs.
On the other hand, negotiating with big business for an increase in the country's share of profits and the dividends would cause a reduction in business share of the profits and hence resisted by the greedy owners of the businesses. Consequently, as the 2011 election approaches, greedy capitalists will worry about who will be the next Liberian president. Ultimately, profiteers wanting to earn enormous profits, will promote their choice, especially so since there is little or no information on how corporate corruption breeds chaos. And as it is in the United States, Liberian pro business candidates would continue to ignore corruption and delay the prosecution of perpetrators since they will need money from big business owners to finance their election.