From Paraguay to the U.S.: Learning from Gradual Corporate Coups

Finance Insurance and Real Estate as share of US GDP

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Last updated on February 8th, 2013 at 06:09 pm

Finance Insurance and Real Estate as share of US GDP

Many of us Americans take a megalomaniacal track to self-identification in our American Exceptionalism. Much like the hundreds of “the chosen people” before us, we rarely stop to think about the moral hypocrisy of political, social and economic self-convenience in such a philosophy. Moreover, we forget that after generations of introspective atrophy part of what keeps Americans politically, socially and economically oppressed is exactly what oppresses all the other 99 Percenters of the world. The very Exceptionalism they think serves the national community as a whole, or more cynically their own meat and potatoes issues, actually eases the way for oppression both at home and abroad. Were we to look beyond our borders, into the struggles of folks just like us who are dealing with the same type of corporate-colonized societies and governments (but just a few miles further away) we might find many similarities, and derivative experiences, from which to draw lessons.

Right now, for example, both the American and Paraguayan people are faced with a failing economy that, to varying degrees, has become dominated by a single dimension and the class that runs that dimension of the economy. While our respective economies are quite different, we’re both hobbled by ruling classes that manage us and our politics with the help of these economies. In America, it’s the finance, insurance and real estate industries. In fact, most of us would be surprised to find out that these industries represent about 70% of the GDP of total goods-producing industries in America. Here’s a chart courtesy of Monthly Review showing just how outsized these industries have become in the United States.

For Paraguay, on the other hand, as we will further discover below, it’s an elite dominated agricultural economy that is used to then dominate the national government. As explained by People’s World:

In Paraguay, 1 percent of the population owns 77 percent of the land. Wealthy landowners, prone to anti-communist rhetoric and dedicated to military power, collaborate with international agribusiness corporations to produce and export agricultural commodities, primarily soy, cotton, corn, rice, and meat. Such exports account for 30% of the country’s GDP, which in 2010 expanded by 15 percent. Land taxation adds only 0.04% to the government’s tax income.

The 1% of each country managed to enrich the 1% while impoverishing most of the rest of their respective people. Furthermore, the power of those riches, or profits, were then bent towards controlling public functions. While many variables make our experiences with corporate colonization unique to each of our respective situations, we as Americans should learn from the dramatic lessons of Paraguay just how powerful the unchecked hand of corporations can be.

Feel free to let out a sigh if some of this starts sounding a bit familiar. Going into 2008, a hopeful left of center candidate, former Catholic bishop Fernando Lugo, was elected president of Paraguay behind populist promises to respect indigenous rights, increase social spending and engage in the grueling task of land reform (the greatest fulcrum of social inequality in Paraguay, a predominantly agricultural country). Lugo led a progressive-ish party, the Alianza Patriotico Para el Cambio (Patriotic Alliance for Change), that had built a wide popular front leading up to Lugo’s election but had not yet achieved the majority in the Congress of Paraguay at the time of his taking office. Whether because of his minority position, his own political inclinations or the immense pressure of corporate powers, this somewhat left-of-center candidate has ended up walking a fairly corporate line in the three-plus years since his election. The popular movement withered out and suddenly Lugo, the slight-leftist, was left without allies when the corporate coup came knocking.

Despite his predominantly centrist path, Lugo, in at least his incrementalist approach and populist rhetoric became an obstacle to the corporate interests that easily dominate Paraguay’s politics. Very early into his term, Lugo came under fire from the corporate interests and the right-leaning Colorado Party, which is largely dominated by corporate interests. Lugo’s ultimate ostensible undoing was an ugly incident that appears more and more like a sprung trap. With threadbare evidence, millions in corporate money and a public discourse easily manipulable by the mega-corporations (especially through Zuciollio Group, something like a souped up combination of the Chamber of Commerce and ALEC combined, made up of the country’s largest corporations, like Syngenta and Cargill, that also controls one of the country’s leading newspapers) a soft coup was accomplished where the corporations removed a slightly irritating president so they can further continue their looting of the Paraguayan people.

And the looting of the Paraguyan people is of long and ugly proportions. We even find that some of the same corporations that dominate Congress and regulatory agencies in America so they can loot our land and dodge our taxes (for accrued usage of public goods and restorative, recovery measures) are the same ones colonizing the Paraguayan Congress and regulatory agencies so they can continue to loot their land and dodge their taxes. Since corporations like Cargill, Monsanto, Syngenta have already dominated the powerful governments of richer countries like the United States, they can then use those governments, ours specifically in this case, to project their interests into other, less-powerful countries, like Paraguay in this case (often through the innocuous sounding USAID). Here are some of the details courtesy of this detailed article from TruthOut:

–“Sixty percent of the 6.5 million Paraguayans live in poverty. ”
–“Much of the poverty has to do with the fact that while the economy is entirely based on agriculture Paraguay has some of the hugest concentrations of land in the region: 85% of the land is in the hands of 2% of the population. ”
–“None other than the infamous Monsanto is a major player in Paraguay. The company collects royalties on the transgenic soy and cotton seeds planted throughout Paraguay, and in 2011 it collected $30 billion tax-free.”
–“40% of the production and refining of Paraguayan soy is owned by private U.S.-based giant Cargill ($100 billion annual profits a year)”
–“one of the reasons behind Lugo’s removal was his cabinet’s unfavorable stance toward the release of Monsanto’s transgenic cotton seed into the country.”
— “USAID has poured over a billion dollars into “decentralization” efforts in Bolivia and $60 million in Venezuela. By setting up various Offices for Transition Initiatives (OTIs) and funding anti-government non-profits, USAID has promoted separatist and opposition movements …the current U.S. ambassador to the country is Liliana Ayala, none other than the former director of USAID in Bolivia. ”
— “Politically, rule over Paraguay had been in the hands of the Colorado Party for 61 years …. In December of last year, the Colorado Party signed an agreement with the Resource Information Center (CIRD), the local arm of USAID, which proposed greater inter-party “dialogue.”

Despite the fact that Lugo actually presented more than occasional challenges to the corporations’ hegemony over Paraguayan government, he was enough of a bottleneck to profit and corruption as to merit a soft coup via a trumped up incident (the TruthOut article linked to above has an excellent detailed analysis of the “incident” which Lugo is ostensibly being impeached over).

Surely, the situation is at least a bit different in the United States. Past the vast intrigue of international mega-corporations, local politics and the agitating nature of social poverty, there’s the simple, repetitive modern story of the 1% colonizing government so as to control its actions, its resources and specifically its application of its official powers. Political power itself is a mechanism to achieving the 1 %’s permanent addiction for ever larger profit. In this continuous struggle, perhaps there are some noteworthy similarities between the challenges faced by the 99% of both countries.

Paraguay and America share a few terrible common afflictions including a 1% that controls government so that even the smallest reform is nearly impossible. We Americans also have a Progressive sounding president, who (although he hasn’t prosecuted Bush Era war crimes, hasn’t prosecuted Wall Street to the extent that the grassroots wants, hasn’t taxed the 1% at nearly a responsible rate, has in fact even lowered regulations for many industries) manages to accomplish important incremental changes from increased focus on domestic equal rights to small, but potentially very dramatic changes to the way Americans receive health care. Much like Lugo, Obama hasn’t taken nearly the hammer that his populist base would like to see to the abuses of the 1%. And yet, the 1% has decided to treat Obama like some Little Red Book-quoting comrade raging about dictatorship of the masses. The response to even a center-left politician (nevermind a progressive populist one) has been multi-billion dollar effort to discredit him from the 1%.

Much like happened to Lugo, the mega-corporations have supported the right-wing party to the extent of even conjuring up imagined crimes and trumped up pseudo-incidents with which to hopefully impeach members of the executive branch.

These corporate shenanigans have all the puppetry of Kabuki theater with ten times the tragedy but zero entertainment value, outside of the most sadistic quarters.

In fact, part of what got lost in the corporate media hub-bub over the Supreme Court ACA ruling is the heartbreaking decision by the Supreme Court not to reconsider the Citizens United ruling from two years ago that allowed the biggest modern infusion of 1 Percenter money into American politics. The strategists and propaganda jockeys of the 1% know exactly what this refusal to rehear Citizens United means.

“Within minutes of that announcement, right-wing partisans were crowing about the advantage they now own, an advantage not due to ideas or personalities but to the sheer force of money.”

Corporations in America no longer have to worry about lobbying politicians–for the last two years they’ve been able to simply buy them according to need. They no longer even need to worry about fomenting and instigating violent large-scale coups either at home (research the Banker’s Plot against FDR if you don’t think it’s possible) or abroad.

Now corporations can simply buy a “softer,” less-noticeable style of gradual coup.

The reason countries like Argentina, Bolivia and Venezuela are able to resist both soft and hard coup efforts is that beyond their politics they’ve developed large critical mass networks committed to social change, and social activism, into the indefinite, and perhaps perpetual, struggle. Evo Morales, Cristina Fernandez and Hugo Chavez have far more than political parties. Despite the CIA and State Department drip-feed of right-wing corporatist propaganda, you can examine the large social bases committed to social change throughout their countries and note that despite even as far as military coup attempts, the overwhelming, unremitting tide of a popular critical mass is in recent history capable of resisting even the most powerful international and corporate forces.

In Paraguay, after Lugo was elected he took a generally conciliatory tone with the corporate forces running havoc in his people’s country. There are better experts to explain the balance between his increasingly corporate stance, the right wing’s solidified support from both corporate and international interests and the connection to a social movement that eventually petered out. However that formula works out, it becomes evident in comparing which citizenries have been able to repel the worst corporate encroachment and which haven’t that at the kernel of it was a large critical mass of committed activists.

Whether it comes to projecting goals or defending from the terrible excesses of the 1% and their corporations, we too need to start thinking of our struggle as one of preparing a society and a people that can maintain the government, economy and politics that will actually serve them. A handful of the 1%’s corporations control the production of our culture and over 90% of traditional information dispersal, so we can be talked over and made to look the fools to the information-illiterate. The 1% knows that even though it doesn’t always work, we the 99% can easily be outbid for politicians. They control the levers of finance, production and the government that regulates their functions–so we can be bullied in the economy.

So yes, the 1% can talk over us, they can bully us in the economy and they can outbid us for politicians. But they can never outnumber us.

Since we and our southern sisters and brothers of the 99% face so many similar challenges in fighting back against corporate colonization, perhaps we should remember and value the power of a critical mass in other countries and imagine, just for a moment, what we could accomplish with our own.