Let’s Talk About Corporate Colonialism
Colonialism never really ended, it just morphed into new forms
When one thinks of colonialism one may think of European powers invading current day Global South countries in order to pilfer natural resources and subjugate the native population. Although the countries of the Global South are now considered independent, they certainly are not on equal footing in terms of wealth and power compared to the former colonial powers. To understand these continuing disparities in wealth and power between Global North and Global South countries it’s necessary to go back to the late 1940’s, which were the beginnings of modern globalization.
In the aftermath of World War II, international entities such as the World Bank and the International Monetary Fund were created in order to integrate the countries of the Global South into the global capitalist economic system. The goals of organizations like the IMF and the World Bank are to ‘‘develop’’ poor countries. I think it’s necessary to define ‘‘develop.’’ When I think of developing a country, I think of improving infrastructure, building more schools and hospitals, and improving the standard of living for the general population. The IMF and World Bank’s definition of ‘‘develop’’ is quite different. Their definition entails implementing policies (i.e neoliberalism, austerity, privatization, deregulation, structural adjustment, etc.) that make it as easy as possible for Western multinational corporations to invade a poor country, steal natural resources, and exploit the hell out of the native peoples. Entities like the IMF and World Bank are nothing more than neo-colonial instruments designed to keep formerly colonized countries in perpetual debt to the Global North and allow Western Corporations to rape and pillage the 3rd world.
Here’s how it works. The IMF/World Bank offers a poor country millions and millions of dollars in loans in order to spur economic growth. This loan comes with a lot of strings attached. To get this money, the country must implement austerity policies, which means cutting social spending on things like healthcare and education. The country is encouraged to privatize public goods, meaning citizens may have to pay for access to things like healthcare and utilities. The country must deregulate, which allows corporations to exploit workers and destroy the environment. In addition, many of these poor countries are lead by corrupt governments. Government leaders may pocket the loan money and nothing in the country improves. The results are predictable. The standard of living for the average person plunges, the majority of the population lives in poverty. The biggest beneficiaries are Western corporations which are swimming in profits. Top government officials and industrialists in the developing country may also benefit.
The global economic system has made it easy for Western multinational corporations to practice corporate colonialism. The Progressive Cynic has defined corporate colonialism as, ‘‘…characterized by giant corporate interests capturing power in society through economic and social factors, and then using their power to exploit humanity for a massive profit…Colonialism is an attractive concept to corporations because it allows the colonial power to extract resources (profits) from the host country without having to worry about giving anything back. Because the colonial power has no stake in the welfare of the indigenous population, they have no need to worry about negative externalities (ex. pollution) or the effects of their exploitation on the local economy — they can simply extract resources and pay poverty wages while living elsewhere and avoiding all of the negative consequences of their conduct.’’ To further illustrate what corporate colonialism is, I will present the United Fruit Company as a case study.
You have probably enjoyed a Chiquita banana before, but did you know Chiquita used to be called the United Fruit Company? The United Fruit Company was founded in 1899 by American businessman Minor C. Keith, and was virtually an occupying force, with an empire stretching across Central America and the Caribbean. Keith began acquiring banana plantations as well as constructing railroads in Costa Rica in 1872. In 1884, he came to an agreement with the Costa Rican government. Keith would fund the national debt and lay an additional 50 miles of rail road track in exchange for exclusive rights to the constructed rail lines and 800,000 acres of tax exempt land. The United Fruit Company monopolized the banana industry. By 1930 the corporation was worth 215 million dollars and was the largest employer in Central America. By this time, the United Fruit company controlled 3.5 million acres of land and was the largest land owner in Guatemala. They also owned the world’s largest private navy, called the Great White Fleet.
The United Fruit Company worked in tandem with the dictatorial governments of Guatemala, Panama, and Honduras. The governments would quash any labor organizing efforts made by workers while the company would provide access to the global markets for the aforementioned countries largest export product. Many Latin American journalists referred to the United Fruit Company as “the Octopus” due to its outsized reach and influence. The company would often resort to racial politics to increase productivity and deflect any worker ire aimed at United Fruit. The upper level managers were often white Americans while the laborers were mainly Hispanic or West Indian. The 2 groups were pitted against each other by the managers to keep the laborers from unionizing and advocating for their common interests.
One of the most infamous events the United Fruit Company is known for is staging a coup against the Guatemalan government in 1954. In the first half of the 20th century, the U.S military routinely interfered in Guatemalan political affairs to protect the interests of United Fruit; this consisted of violently suppressing any labor organizing attempts. The U.S used the threat of communism as an excuse for intervening in Guatemala. In the early 1950s, Jacobo Arbenz was the president of Guatemala. He attempted to implement policies that would limit the power of the United Fruit Company and empower the people of Guatemala. The company painted Arbenz as a communist which served as a pretext for a CIA backed military coup. The coup resulted in the deaths of 200,000 mainly indigenous Guatemalans.
Although the countries of the Global South formally declared themselves independent nations, with most nations in Latin America becoming independent in the 19th century and African nations becoming independent in the 20th century, the truth is these countries remain colonized by corporations. From the period of 1990–2015, it is estimated that $242 trillion dollars ( !!!) worth of resources and labor was transferred from the Global South to the Global North. The current global economic system is unsustainable. You cannot treat the majority of people on Earth as virtual slaves and lay waste to the environment without facing repercussions. Perhaps climate change is karma for all of humanity’s misdeeds.
Thanks for reading. If you’re interested in learning more about corporate colonialism, check out these resources:
Imperialism in the Twenty First Century: Globalization, Super-Exploitation, and Capitalism’s Final Crisis by John Smith
Free Markets and Food Riots The Politics of Global Adjustment by John Walton and David Seddon
Human Rights and Structural Adjustment by M. Rodwan Abouharb
Imperialist appropriation in the world economy: Drain from the global South through unequal exchange, 1990–2015, this journal article can be found here: https://www.sciencedirect.com/science/article/pii/S095937802200005X
Fantasy Island: Colonialism, Exploitation, and the Betrayal of Puerto Rico by Ed Morales
I, Rigoberta Menchu an Indian Woman in Guatemala edited and introduced by Elisabeth Burgos-Debray
How Beautiful We Were by Imbolo Mbue