Trendevents: Multinationals Not Welcome in India

Analysis of Trends and Events in the News

Clyde Wilson

1996

Published in:

Social Trends Newsletters, Jan. 1996, No. 143

Multinationals Not Welcome in India

Political activists in India are opposing Prime Minister P.V. Narashimha Rao's free market reforms, demanding the ouster of the big multinational corporations such as Coca-Cola and PepsiCo from India.

At a demonstration in front of a statue of Mohandas K. Gandhi, members of the right wing nationalist Bharatiya Janata Party and a group led by trade union leader George Fernandes welcomed a state government's decision to cancel a $2.8 billion deal with an American consortium.

Gandhi, who led India's struggle against British colonialists, favored self-reliance and the building of domestic industry, ideas that have been seized by politicians (and a number of organizations and groups) to criticize India's economic reforms.

With a few months before general elections, Hindu national groups have planned to campaign against the big multinationals such as Coca-Cola and IBM, which were allowed into India after Prime Minister Rao opened the country to outsiders in 1991. They maintain that the multinationals are crushing weaker Indian businesses. (Source: The Atlanta Journal-The Atlanta Constitution 8/10/95.)

The natives of the various countries are getting restless, seeing that there is no difference between the multinational corporations than the colonialism and imperialism of the past where these corporations come into a country, exploit its natural resources and labor (cheap), creating environmental problems and dislocation of the population, and move on to greener pastures when they have denuded the country. Multinationals, concerned only with the bottom line of maximizing profits for the parasitic elite, make national self-sustainable programs impossible.

Investors Reaching for Straws

Like vultures, lured by Vietnam's economic growth potential, the world's biggest automakers are rushing to produce vehicles in what they hope will become Asia's next booming car market.

Ford Motor Co. and Chrysler Corp. of the United States, Japan's Toyota Motor Corp., and France's PSA Peugeot are among companies investing or applying to invest more than $650 million in assembly plants.

Japan's Daihatsu Motor Co. Ltd., and Suzuki Motor Corp. have received project licenses, as did Germany's Mercedes-Benz AG. Four additional joint ventures are already building Japanese Mazdas, German BMWs and other vehicles from imported kits.

If all of the proposed projects come on line, by the year 2007 there will be 11 foreign joint ventures building and assembling more than 120,000 cars, trucks and buses each year.

But all of this investment and activity is planned in a country where the annual income is only $129, not enough to buy a new set of tires. Customers in Vietnam bought fewer than 5,000 new vehicles in 1944. The Ministry of Heavy Industry predicts annual demand to reach 40,000 by the turn of the century -- a big leap but still far short of the investor's bullish expectations. One or two factories would be enough to supply the Vietnamese market. (Source: The Tennessean, 7/2/95.)

Like sheep, governments and investors allow their euphoria to overcome any rational decision, thinking that opening a market disoriented economy under capitalism will succeed anywhere, and thinking that that alone will guarantee a lucrative outlet for investments, continued growth and huge profits. The political power brokers, economists, and financial and investment bankers do not take into consideration the physical factors such as population control, the impact upon the environment, the rate in the depletion of the natural resources, and the employment situation and the real purchasing power of the workers and the consumers. Without an effective distribution system, the people that are necessary to buy what is produced are incidental in the process under a financial system that demands a price for everything. When the failures come, it is usually the government that picks up the tab and bails out another country's economy at the cost of billions of dollars to the American taxpayer. Perpetuating and maintaining the financial and monetary system, no matter what the cost, is the name of the game.

AMERICA'S FUTURE CITIZENS

A study by the Food Research and Action Center estimates that 4 million low-income children are not getting enough to eat and are hungry part of the time. Another 9.6 million children are at risk of hunger. FRAC estimates that there are indeed one-third of American children going hungry or at risk of being hungry.

Although many poor families work and receive food stamps and other nutrition assistance, such as school lunches, the study illustrates that these programs are not adequate, and most poor families run out of food stamps long before the end of the month. As a result, millions of American children go hungry and suffer in a number of ways because they do not have enough to eat. (Source: The Billings Gazette, 7/20/95.)

The United States produces more than enough food and other products to provide a decent and quality standard of living for every American citizen and family. To allow hunger in the midst of plenty is an indictment of the present economic system and the present form of government. Taking away the price tag and implementing a new method of distribution would be an easy and simple way to solve the problem. If we really cared for the children of the United States, we could demand a fundamental change in the system that is designed to engender poverty and hunger when there is a plethora of goods and services. (The amount of money spent on weapons every day could feed 2,880,000 malnourished children for a year. Source: Oxfam America.)

Government for Sale -- To the Highest Bidder

The real government behind the scenes, and the most powerful brokers in Washington, are the thousands of lobbyists who manipulate the political process on behalf of the nation's corporate and multinational giants.

In his book, Lobbyists, Jeffrey H. Birnhaum illuminates an intense light on the more than 80,000 lobbyists who descend upon the nation's capitol, informing, bribing and bartering with Congress, responsible for passing or blocking any legislation, all for the richest interests in the nation.

The lobbyists have the power to make or break a member of Congress. They represent and have the backing of the largest corporate conglomerates in the country. They are in a position to provide members of Congress with the huge sums of money they will need to run an effective campaign to get elected or reelected to office. They even pack enough clout and resources to defeat a member of Congress that does not dance to their tune. Buying off politicians has been a part of Americana for a long time.

The business of influencing and determining the legislative agenda by the lobbyists has become a billion dollar industry. The major beneficiaries and recipients of the lobbyists influence peddling is the elite of the corporate and financial world. For their rewards, the lobbyists must be sure that the giants of corporate business get huge tax breaks of all kinds, government incentives, capital expenditure depreciations, deregulation of business enterprise, lower or no environmental standards, etc. All of the things that are a boon to the millionaires and billionaires.

This book gives a shocking insight into how the present system of government works or doesn't work. If the United States is ever going to have a viable or workable method of operation, then there will have to be a complete transformation from the present political and financial system.