Wednesday, March 21, 2007

Meet the Global Ruling Class

The Billionaires and How They Made It



Given the enormous class and income disparities in Russia, Latin America and China (20 Chinese billionaires have a net worth of $29.4 billion in less than ten years), it is more accurate to describe these countries as 'surging billionaires' rather than 'emerging markets' because it is not the 'free market' but the political power of the billionaires that dictates policy.

Countries of 'surging billionaires' produce burgeoning poverty, submerging living standards. The making of billionaires means the unmaking of civil society ­ the weakening of social solidarity, protective social legislation, pensions, vacations, public health programs and education. While politics is central, past political labels mean nothing. Ex-Marxist Brazilian ex-President Cardoso and ex-trade union leader President Lula Da Silva privatized public enterprises and promoted policies that spawn billionaires. Ex-Communist Putin cultivates certain billionaire oligarchs and offers incentives to others to shape up and invest.

The period of greatest decline in living standards in Latin America and Russia coincide with the dismantling of the nationalist populist and communist economies. Between 1980-2004, Latin America ­ more precisely Brazil, Argentina and Mexico ­ stagnated at 0 per cent to 1 per cent per capita growth. Russia saw a 50 per cent decline in GNP between 1990-1996 and living standards dropped 80 per cent for everyone except the predators and their gangster entourages.

Recent growth (2003-2007), where it occurs, has more to do with the extraordinary rise in international prices (of energy resources, metals and agro-exports) than any positive developments from the billionaire-dominated economies. The growth of billionaires is hardly a sign of 'general prosperity' resulting from the 'free market' as the editors of Forbes Magazine claim. In fact it is the product of the illicit seizure of lucrative public resources, built up by the work and struggle of millions of workers, in Russia and China under Communism and in Latin America during populist-nationalist and democratic-socialist governments. Many billionaires have inherited wealth and used their political ties to expand and extend their empires ­ it has little to do with entrepreneurial skills.

The billionaires' and the White House's anger and hostility toward President Hugo Chavez of Venezuela is precisely because he is reversing the policies which create billionaires and mass poverty: He is re-nationalizing energy resources, public utilities and expropriating some large landed estates. Chavez is not only challenging US hegemony in Latin America but also the entire PDD edifice that built the economic empires of the billionaires in Latin America, Russia, China and elsewhere."

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