Mike Vickers' Blog

April 13, 2013

Countries and Global Corporations – a need for set of rules of interaction

Filed under: economics, Europe, Politics — derryvickers @ 7:23 pm

In my last blog I set down a few of the points that Stefan Lehne made at a seminar on the EU’s foreign policy.  At that seminar I posed a question ‘in this world increasingly dominated by large corporations’ is it not increasingly difficult to distinguish between a policy to corporations and that of foreign countries ?‘.  Lehne responded vigorously stressing that only a grouping the size of the EU could negotiate with corporations the size of Microsoft.  This is very true; in UK we have been tax side-tracked by Google, Starbucks and Amazon – they just set up in countries with low tax and arrange to purchase materials and declare their profits there avoiding paying almost no tax in the UK.  However this is not what I meant by my question.  It appears to me that large global corporations are now of a financial size of many smaller countries and increasingly weld power well beyond their physical size.  Yet they have no responsibilities; for instance when Google, Starbucks and Amazon were summoned to a committee of the UK Parliament they were quite taken aback by being challenged on their tax dealings.

Countries interact with one another through formal channels set up over centuries: embassies, consulates and visit one another through delegations.  No such formalities have been set up between Countries and Global Corporations.  Corporations just set up shop wherever they want to.  Worse than that as Colin Crouch sets out in his book Post-Democracy large Corporations use their money to influence Countries’ Governments through lobby groups to get preferential treatment and oppose laws that would impact their business. Small local examples are the Whisky traders in Scotland lobbying against minimum alcohol prices, tobacco companies fighting against plain cigarette packets.  Readers will know of their own local situations, particularly where major oil companies are involved.  It is not that Corporations are irresponsible, most are but it is their responsibility to their shareholders.

And situation is not easing; the internet is now all pervasive; lobbying is much softer, almost subliminal but it is there.  And it would be so easy for large corporations to make use lobbying more than they apparently do at present.  One example would be if Facebook opened its databases, at a price of course, to corporations wanting targeted access to Government Organisations.

What I am saying is that where Countries work with one another through well defined, understood and respected rules, no such rules or protocols exist between Countries and Global Corporations and this needs to be rectified and at the highest level.

1 Comment »

  1. Reblogged this on bermanj1forchange and commented:

    Comment by bermanj1 — April 13, 2013 @ 7:34 pm

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