By Marshall Kirby.

Marshall is one of AIDemocracy’s 2010-2011 Issue Analysts. Find out more about Marshall below or take a look at the Student Issue Analysts.

The author with John Perkins

On Thursday October 14th, 2010 I had the honor of attending a speech given by John Perkins in Pittsburgh, Pennsylvania. Perkins is the author of the bestselling books: Confessions of an Economic Hitman, The Secret History of the American Empire, and Hoodwinked. As you might expect, the talk was very interesting and inspiring at the same time.

Perkins’ main points of discussion were about the history of the economic collapse, what brought us there, and where we can go from here to build a more sustainable and just global economic system. All of these I will discuss below.

How did we get here?

Perkins gives us his take on a much longer journey back through history. Prior to the rise of modern states, global power derived out of religious empires. With the rise of modern nation states, the religious structure in which global power was concentrated was displaced. Then, he said, something changed – power started shifting from sovereign states towards global corporations. Through lobbying, the power of money, and corruption, some corporations have been able to thwart democratic practices in certain thriving democracies. This has produced the economic system of today and the current crisis. Perkins’ explains that this was no fluke – it was inevitable.

Why was the collapse inevitable?

Perkins lays out several specific reasons, all of which relate to sustainability. The economic system we lived under was not environmentally sustainable, nor was it sustainable in its distribution of resources and wealth. The economic model that America and the Western Industrial world have lived under is not a model which can be transferred to the developing world such as India and Africa. The second reason is that the debt that countries take on for economic development and then pass on to their citizens is not sustainable. In the past, countries have taken out exorbitant amounts of money in loans for infrastructure and economic development projects which are designed at attracting corporations. The reason this is an issue of sustainability is that the true beneficiaries of these loans are not the citizens – they are the corporations and the wealthy elite in the country. However, it is the citizens who are charged with the repayment terms. And when the repayment terms are not met – an even more disastrous outcome occurs. The lenders set new terms in which countries sell their resources and assets for a very low price and dismantle any frameworks of regulations involving labor, environmental conservation, and taxes. This creates a true race to the bottom environment in these indebted developing countries.

These factors are part of the root problem of the collapse – it’s not capitalism that is the cause, but rather predatory capitalism. What exactly is predatory capitalism? Predatory capitalism is defined by Mr. Perkins as the following set of beliefs:

1) The goal of all corporations is to maximize profits regardless of any social or environmental cost.

2) Corporations should not be regulated. Any regulation will hurt the goal of maximizing profits.

3) Everything once in the public sphere should be privatized.

These principles have led us down the road to the current system where we have changed into an unbalanced and economically unjust world.

However, this is clearly not the end! Perkins has described this time as interesting and full of change, one in which all of us are part of a truly global revolution. How so? Perkins correctly has said that we live in a time where all humans are facing the same crisis, one in which all will face the same impact. This crisis is climate change. This gives us a tremendous opportunity as we live in the information age – an era in which technology has an amazing power to bring us together. And it already has. We have experienced global movements which have brought results in promoting fair trade and stopping certain genocide. And we are in the midst of a movement now – promoting better economic practices and a more environmentally conscious agenda.

Perkins points to several areas where he sees this global revolution occurring. We have seen a new wave of the democratic movement in Latin America. (Please note that neither I nor John Perkins make any claims as to whether the leaders involved are after real positive and beneficial change; that is up to the citizens and the electorate in each country). This new democratic revolution has produced results in which citizens are taking ownership over the development of their country and are standing up to corporations and international lenders saying that they don’ t want new loans and a new era of deregulation. In some instances, they are even standing up and saying the old debt is not legitimate as it was not made under democratic principles and not transparent.  The movement however, is not just in Latin America; there are numerous other examples as well.

What needs to be done in this new movement?

First, Perkins says we need a mindset change. We need to change our way of thinking to one where we think of the future and the consequences of present actions instead of looking for quick profits. In doing so, we will be able to look and reach sustainable solutions for our global problems. The second is that this movement needs to stand for ethical leadership in politics, public policy, and corporate governance. In this instance, ethical leadership means that we should promote a new conscience towards social, economic, and environmental justice. In doing so, we must fight against the notion that corporations have rights but not responsibilities. We need to understand that there is absolutely nothing wrong with making profits, but they have to be made in a way which is responsible and promotes the public interest. Remembering that corporate leaders are not bad people is important, for they too just need a mindset change.

Fighting for corporate responsibility is something we all have the power to do. We can write letters and emails to corporations telling them why we will not buy their products. And if these movements are strong enough, then they can work. Corporations are dependent upon the consumer. It is easy to say to just go out and vote in November, but it is equally important to go out every day and vote with our wallets.

What else can we do to promote ethical leadership? We need to recognize the power that individuals and groups have to create change. We also have to follow our passions and talents. Follow them into NGO’ s and nonprofits, government, or into the business world.

For more information on John Perkins please visit www.JohnPerkins.org and www.DreamChange.org where you can also find information on ethical leadership and more on how to get involved.

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