5/22/2018

Marx and anticapitalism



Marx pro-capitalism


Roberto Bolaño: 2666. “Al mes siguiente, en mayo, se encontró a una mujer muerta en un basurero situado entre la colonia Las Flores y el parque industrial General Sepúlveda. En el polígono se levantaban los edificios de cuatro maquiladoras dedicadas al ensamblaje de piezas de electrodomésticos. Las torres de electricidad que servían a las maquiladoras eran nuevas y estaban pintadas de color plateado. Junto a éstas, entre unas lomas bajas, sobresalían los techos de las casuchas que se habían instalado allí poco antes de la llegada de las maquiladoras y que se extendían hasta atravesar la vía del tren, en los lindes de la colonia La Preciada.”

Marx considered that capitalism was a necessary and desirable stage in the evolution of society to prepare the advent of its supposed scientific socialism whose placenta could not be other than capitalism. No other way was possible without going through capitalism. Therefore, the sooner capitalism globalized, the better to advance towards its socialism. Marx was thus among the first to justify (and desire) the necessary and rapid capitalist globalization.


The productive forces (Marx's pro-capitalist carrot)

 



Manifiesto comunista 1848 : "Capitalism is a "universalizing system, a mode of production that will sweep all other modes of production and eventually encompass the entire globe”.

“the bourgeoisie draws civilization to all nations, including the most barbarous. The cheapness of its merchandise constitutes the heavy artillery with which it destroys all the Chinese walls and imposes the capitulation to the barbarians of more stubborn xenophobia

“ the bourgeoisie has created enormous cities, increasing the urban population in a very high proportion with respect to the rural one and with this has taken a considerable part of the population out of the idiocy of rural life. In the same way that it has made the countryside dependent on the city, it has also made the barbarians nations or semi-barbarians dependent on the civilized ones, the farmers dependent on the predominantly urban people and the East dependent on the West.."

Marx understood economic growth and the accumulation of capital as something good, desirable, civilizing, and revolutionary in itself. No future for the systems that do not adapt to the level reached by the productive forces! He understood that capitalism was a necessary and essential system to boost the growth of the productive forces to a sufficient level to be able to start another superior system.

The feudal system was swept by its maladjustment to the level reached by the productive forces. But the reasoning also covers any precapitalist or non-capitalist social formation (the barbarian or semi-barbarous nations) and in general any form of resistance to the advance of capitalism.

The middle classes, the small industrialist, the small merchant and the peasant fight, all of them, against the bourgeoisie to ensure their existence as such middle layers and save themselves from their collapse. They are not, then, revolutionary but conservative. Moreover, they are reactionary, in that they try to turn the wheel of history back.”
Marx considers the capitalist system necessary to develop the productive forces and to generate the proletariat. It attributes to the proletariat the exclusive role of a revolutionary agent capable of establishing socialism. Ergo, every aspirant to socialism should favor capitalism as a necessary evil since one can not reach "scientific" socialism without first going through capitalism.

Therefore the American Indian nations, the Congolese surprised by the voracity of the rubber capitalists, the Africans surprised by the trade boom that turned them into slave capitalist productive forces, the small merchants, the artisans and small industrialists, the peasants, etc., they should sacrifice and accept their sad fate at the hands of capitalism, since their resistance to capital is something semi-barbarous and uncivilized and accept that their only revolutionary future is to wait to become proletarians and wait that capitalism mature sufficiently the productive forces so that scientific socialism can be established. Sic!

Of course, capitalism accelerates the growth of productive forces, productive forces in the very short term, but destructive forces in the long run. The capitalist environmental disaster has turned the human being who will inherit "scientific socialism" into a sickly creature that develops its sad existence in a self-destructive toxic capsule. Capitalism has become a cancer with social and ecological metastasis. Socialism at this time can no longer aspire to "enjoy" the level of development of the productive forces achieved by capitalism (Marx's pro-capitalist carrot) but humbly attempt to repair the monumental messes that the destructive forces are causing to the only planet we know to live.

Marx also did not put a limit the development of the productive forces. The more the better. Nor did it distinguish between constructive and / or destructive, rational or irrational forces, since it was necessary for capital to make them grow as much as possible so that scientific socialism could take over once the capitalist system was exhausted (due to its internal contradictions) and could not make them grow anymore.

Marx intuited the capitalist environmental disaster that was already evident with the depletion of agricultural land and the need to import guano and nitrates from Perú and Chile on a large scale. "Work is first and foremost a process that takes place between man and nature, a process in which man regulates and controls his metabolism with nature through the mediation of his own action" ... "acting on the external nature and modifying it by this movement, it also modifies its own nature "(Capital I). But these considerations could only have a very limited practical relevance in capitalist society, by definition incapable of such a rational and coherent action, and therefore should be sacrificed in favor of the advent of scientific socialism that would finally take action on the matter.

In reality, capitalism has never been good for humanity and for the planet. It is a cancer whose initial malignant tumors tried to resist the workers, the farmers of all the continents, the small merchants, the slaves, the Indians of America, the trade unions, the small craftsmen, industrialists and manufacturers, the civilizations "discovered" and massacred and the indigenous tribes that defended their peculiar forms of socialism, their communal lands, their forests, meadows, coasts, lakes, tundras, agricultural lands, fisheries, fauna and flora, ..., in front of the infinite greed of capitalism.

Nor is it true that capitalism is the only system capable of developing the productive forces so that it can be passed on to the socialist system. There were socialist societies long before the planet became contaminated with capitalist cancer. And the sustainable development of the productive forces had been rather the norm before the advent of the reign of capital.

Marx argues that capitalism will end up failing as a driver of the productive forces. In his great work "The Capital" concludes that the internal contradictions of the system cause crises that slow down the growth of the productive forces. Socialism will resolve these allowing the productive forces to grow without obstacles of any kind. This socialism, necessary son of capitalism, will be the "scientific socialism."

The Marxian concept of productive forces is a concept without nuances. It is the same productive forces that the capitalist cancer develops that socialism will inherit in order to continue to develop them even faster. The sin of capitalism, as it was at the time of feudalism, is that it does not develop them with sufficient tenacity.

Initial primitive accumulation or Permanent primitive accumulation


 Roberto Bolaño (2666): “… En la plaza había seis árboles, uno en cada extremo y dos en el centro, tan cubiertos de polvo que parecían amarillos. En una punta de la plaza estaba la parada de los autobuses que traían a los trabajadores desde distintos barrios en Santa Teresa. Luego había que caminar un buen rato por calles de tierra hasta los portones en donde los vigilantes comprobaban los pases de los trabajadores, tras lo cual uno podía acceder a su respectivo trabajo. Sólo una de las maquiladoras tenía cantina para los trabajadores. En las otras los obreros comían junto a sus máquinas o formando corrillos en cualquier rincón. Allí hablaban y se reían hasta que sonaba la sirena que marcaba el fin de la comida. La mayoría eran mujeres.


R. Luxemburgo (Acumulación primitiva): “From the beginning, and at present, the forms and laws of capitalist production aim to encompass the entire globe as a reservoir of productive forces. Capital needs to appropriate the productive forces to carry out its exploitation and therefore plunder the whole world, procuring means of production from all corners of the world, snatching them, if necessary by force, from all kinds of social and economic formations. civilization levels ". ... "When the War of Secession interfered with the import of American cotton, causing the notorious "cotton starvation" in the Lancashire district, new and immense cotton plantations emerged in Egypt almost immediately, as if by magic. Here the oriental despotism was combined with an old system of slavery, alltogether put at the service of European capitalist accumulation. "..." The English Blue Book on the practices of the Peruvian Amazon Company, Ltd., in Putumayo, has recently revealed that in the free republic of Peru international capital can, for all intents and purposes, enslave the natives, to appropriate the means of production of the primitive countries through exploitation on a larger scale. Since 1900, this company, financed by British and foreign capitalists, has launched approximately 4,000 tons of Putumayo rubber onto the London market. During this time, 30,000 natives were killed and most of the 10,000 survivors were crippled by beatings.

Karl Marx: "The discovery of the countries of gold and silver in America; the extermination, the reduction to slavery and the burial in the mines of the indigenous population; the principle of the conquest and looting of eastern India; the transformation of Africa into a commercial hunting territory for black skins, were the procedures that characterized the dawn of the epoch of capitalist production. These idyllic processes constitute the main moments of primitive accumulation" (8) El Capital, I, p. 716.

Marx argues that the exogenous forms of appropriation of resources and surplus value not properly "capitalist" (primitive accumulation according to The Capital) were necessary for the takeoff of industrialization. Once set in motion, the system generates endogenous mechanisms of accumulation. Hence the adjective "primitive" (in the sense of initial).

Marx was confident that after the initial consolidation phase accumulation would occur endogenously according to the functioning of the system described in The Capital, necessarily generating more and more proletariat.

K. Marx (Labor and Capital): “Capital can only be multiplied by exchanging for labor power, creating wage labor. The labor force of the salaried worker can only be exchanged for capital by increasing capital, strengthening that same power of the one who is a slave. The capital increase, therefore, is an increase of the proletariat, that is, of the working class. "..." capital and wage labor are the two sides of one and the same relationship ". ... "If capital grows, the mass of salaried work grows, the number of salaried workers grows.

But history has shown that the capitalist mode of production has used and uses continuously and increasingly unconventional forms of exogenous accumulation (which do not create necessarily direct wage labor or new proletariat) such as theft, expropriation / forced and / or fraudulent appropriation of land and natural resources, a varied and more sophisticated range of new forms of "informal" labor exploitation and a growing criminalization of production relationships with hundreds of millions of semi-covert slaves, with their assassins journalists and trade unionists killers , with its waves of undocumented immigrants, with the indissoluble connection between free zones, slave maquiladoras, trafficking in human beings, pimping, drug trafficking and free trade agreements.

Thus, it is not an "original or primitive" accumulation previous to start functioning in a capitalist way, understanding capitalism as a higher form of cumulative production (better, more advanced, purer, more scientific, more revolutionary).

In fact, it is not even a type of accumulation different from the "normal" or "usual" capitalist cancer. All the conceptual terms used in this regard (primitive, original, exogenous, etc.) have up to now only distorted the essential and permanent reality of this lever indissolubly linked to capitalist growth.

Thus, the reality of the "normal" globalized capitalist accumulation generates more lumpenproletariat than proletariat. It generates more expulsion and marginalization than employment. More crime, traffic, slavery and servitudes than the law of value.

The law of Marxist value does not explain how the system works


The law of labor value which is presented as a special category of the capitalist system (Capital) hardly works during the initial phase of capitalism and even less during the current monopolistic phase.

In reality, there is no one form of labor exploitation characteristic of the capitalist system as the Marxists have wanted to see. In practice, the system has managed and continues to handle a wide, varied and somewhat sophisticated deck of forms of exploitation and appropriation that coexist, compete, re-adapt and are often interchangeable.

Capitalism is an eminently inclusive system, it constitutes the supreme form of exploitation of humanity and nature capable of taking advantage of and perfecting all possible forms of exploitation and appropriation, both prior to the system and the actually existing in other areas far from its initial core of expansion, and also, of course, those that have arisen as supposed opposition to it (the suposed really existing socialism).


Interestingly, one of the most unsuspected defenders of the law of value turned out to be Stalin himself:

Joseph Stalin: (Economic problems of socialism in the USSR): “The operation of the law of value is not confined only in the sphere of the circulation of goods. It also extends to the sphere of production. ... in fact, consumer goods, necessary to compensate the labor force spent in the production process, are produced in our country as merchandise subject to the operation of the law of value. It is precisely here where the law of value exerts its influence on production ... since it trains and teaches our executives to properly handle the magnitudes of production, to improve production methods, to lower production costs, to practice accounting of costs, and, in short, make your companies produce profits.”

Stalin did not have enough with the brutality of his "primitive socialist accumulation". He wanted more. He dreamed of adding the mechanism of the law of value to his system to extract more capitalist surplus value from the Soviets. In this line (introduction of competition stimuli) their successors continued until the desideratum of Perestroika.

¿The only revolutionary agent is the salaried proletariat?


Christian Rakovsky (old Bolshevik victim of Stalin): “… What has happened to the revolutionary spirit of our party and our proletariat? Where has your revolutionary initiative gone? Where are your ideological interests, your revolutionary values, your proletarian pride? Surprising such apathy, weakness, pusillanimity and opportunism, …”

K. Marx (Communist Manifesto): “The lumpenproletariat is an essentially parasitic group, largely the byproduct of the oldest and most obsolete stages of social development, and which normally could not play a progressive role in history. In fact, because it acts only for its own socially ignorant interest, the lumpenproletariat is easily bribed by reactionary forces and could be used to combat the real proletariat in its efforts to achieve the end of bourgeois society. Without a clear class consciousness, the lumpenproletariat could not play a positive role in society. Instead, it exploits society for its own ends, and is exploited in turn as a tool of destruction and reaction”.

Vincent Spotted Eagle (1934): "Before the white man arrived, our mode of production and distribution worked on a cooperative basis, without any exploitation, this is communism, which is pure Americanism."

Marx considers that the proletariat is the only revolutionary class. The lumpen, the marginalized, the expelled from their lands, the indigenous American nations, the indigenous Asian nations, the indigenous African nations, the small merchants, the peasants, the artisans and small industrialists, the slaves, the unpaid house workers ( unpaid reproducers of the labor force), the undocumented, the uberized, etc., are either useless for the revolution, or counterrevolutionary.

In this Marx erred resoundingly. It was the peasants who overthrew Tsarism in Russia and created the soviets of peasants and soldiers (peasants in revolutionary arms before the Bolsheviks decaffeinated them) during the 1st GM. It was the Chinese peasants who took Mao and the CPC to power after the 2nd GM.

The lumpenproletariat and the peasants (idiotic people according to Marx), the hundreds of millions of Hukou undocumented migrant farmers, those who built the infrastructures and buildings of the Chinese monopolistic neoliberal miracle, those who manufacture smartphones in Chinese maquiladoras like Foxconn, are (and not the salaried proletarians with papers) with their "savage" strikes have ended up beating the monopolistic multinationals and their suporters of the Chinese Communist Party, forcing them to raise wages.

They are the ("idiotized" ) Chinese peasants the only vanguard to fight against the expropriation of land, pollution and climate change in China.



It is the lumpen-American Indian nations that face the big mining, energy and agro-food corporations that want to take over and destroy their lands and crops and they are the first line in the defense of the environment and climate change.

Yes, they are anti-capitalist fighters who "fight, all of them, to the bourgeoisie to ensure their existence and save themselves from their collapse" and they are revolutionaries and not reactionaries (as Marx says) since they try to turn the roll of capitalist history back. On the contrary, it was the European salaried proletariat that supported their respective bourgeoisies in both the 1st and the 2nd GM. And it was the proletariat of the countries of the center that supported the imperialism and the colonial empires of their respective bourgeoisies and it was the proletariat of the USSR that confidently embraced the return to capitalism.


The formal-informal dichotomy and the segmentation of exploitation


Roberto Bolaño (2666): …” En el basurero donde se encontró a la muerta no sólo se acumulaban los restos de los habitantes de las casuchas sino también los desperdicios de cada maquiladora. El aviso sobre el hallazgo de la muerta lo dio el capataz de una de las plantas, la Multizone-West, que trabajaba asociada con una transnacional que fabricaba televisores.”

Silvia Federici: “The perspective, then, is to analyze the salary as an instrument of division and construction of different labor and disciplinary regimes, to which correspond different power relations among the workers -construction that has been fundamental in the diffusion of capitalism on a world scale.


Marx wanted to justify the revolutionary character of capitalism as a form of exploitation that used the trick of converting the labor force into a commodity that the proletariat sells under contract to the employer in exchange for a salary and he exploits it to extract his benefit. In reality, this contractual form of employment relationship has nothing "capitalist" per se. It is a conquest of workers, such as social protection, reduction of working hours or pensions, after years of struggle and resistance against the greed of capital.

But the worker with a salary, with a working day, with social security, etc., that is, the proletarian of the "formal" sector that has managed to extract certain concessions from capital, among them the contract that stipulates the conditions of the sale of the only merchandise he possesses. It is a rather unlikely privilege, since much of his "labor conquests" have been at the expense (and as a consequence) of allowing the merciless exploitation of other workers without papers, without contracts, immigrants, blacks, slaves , marginalized, informal, etc., the lumpen-proletariat  of using and throwing, both those who live in the vicinity of the central cities of the system and  those of the colonial or neocolonial peripheries.

 The competitive dichotomy between the formal sector (wage-earner) and the informal sector has become a fundamental feature of globalized monopoly capital. The formal-informal dichotomy is inherent in monopolistic globalization and is reproduced in each and every sector and on a planetary scale. While in the rest of the world the informal sector predominates overwhelmingly over the formal sector, in the central countries the informal sector is advancing by leaps and bounds with paperless immigration and progressively informalizing (mini-jobs, temporary employment agencies, etc.) with new forms of digital e-exploitation and control (telematics version of old putting out system (Uber-eat, Mechanical Turk, CrowdFlower,….).

The formal-informal dichotomy segmentize and divides the exploited, generating categories and ladders. The white wage-earner is considered superior to the salaried employee of color, and this is considered superior to the informal worker without salary or the undocumented immigrant and all the female equivalent. Monopolistic corporations, in the same way that they segment consumers and markets to place their products and services, also segmentize their employees to achieve the highest possible exploitation rates.

In China, the communist party together with the human resources experts of the big monopolistic transnationals took advantage of and perfected the Maoist institution of the Hokou  to convert hundreds of millions of Chinese workers into undocumented (informal) immigrants in their own country, labor force that multinationals and their Chinese emulators have taken advantage of for the meteoric and irrational Chinese capitalist accumulation of recent years.

Capitalist Slavery neither primitive nor original


Roberto Bolaño (2666): “... Los policías que vinieron a buscarla encontraron a tres ejecutivos de la maquiladora esperándolos junto al basurero. Dos eran mexicanos y el otro era norteamericano. Uno de los mexicanos dijo que preferían que recogieran el cadáver lo antes posible. El policía preguntó dónde estaba el cuerpo, mientras su compañero llamaba a la ambulancia. Los tres ejecutivos acompañaron al policía hacia el interior del basurero. Los cuatro se taparon la nariz, pero cuando el norteamericano se la destapó los mexicanos siguieron su ejemplo”.
 
Silvia Federici (Caliban and the witch):The plantation system was decisive for capitalist development not only because of the immense amount of surplus labor that accumulated from it, but because it established a model of labor administration, export-oriented production, economic integration and international division of the work force that since then has been the paradigm of capitalist class relations. With this immense concentration of workers and a captive labor force, uprooted from their land - which could not rely on local support -, the plantation prefigured not only the factory but also the subsequent use of immigration and globalization aimed at reducing labor costs. In particular, the plantation was a key step in the formation of an international division of labor that - through the production of "consumer goods" - integrated the work of slaves into the reproduction of the European labor force, at the same time that kept workers enslaved and salaried, geographically and socially separated.

Capitalism has been able to perfect slavery and to diversify it into hyper-sophisticated forms of slavery (Cotton Kingdom, slave plantations in the Caribbean, exploitation of the indigenous rubber tappers by the Belgian capital in the Congo and English capital in Latin America, ..., as a lever for the "normal" accumulation of the system. The slaves of the south of the USA produced the raw material of the 1st industrial revolution, Congolese rubber slaves and the Latin American forests produced the basic raw material of the 2nd industrial revolution while the enslaved (by the Rwandan military) Congolese produce coltan, gold and bauxite for the manufacture of computers and cell phones of the 3rd industrial revolution.

Experts in human resources of large corporations are constantly sniffing for possible forms of fraudulent exploitation with the collaboration of corrupt local authorities (caste system, premarital traditions, ...), to achieve the highest possible rates of exploitation, forms "Innovative" of accumulation that have nothing of "primitive" and are in continuous growth.

Guest workers. In the monarchies of the gulf, the vast majority of the working population is made up of immigrant workers in a regime of debt slavery ( Indentured workers </ i>) and controlled by mafia organizations in collusion with the large multinationals whose human resources departments design and perfect in real time the modern system of slavery in the gulf.


Expropriation / appropriation of common


Roberto Bolaño (2666): “... La muerta era una mujer de piel oscura y pelo negro y lacio hasta más abajo de los hombros. Llevaba una sudadera negra y pantalones cortos. Los cuatro hombres se la quedaron mirando. El norteamericano se agachó y con un bolígrafo le apartó el pelo del cuello. Mejor que el gringo no la toque, dijo el policía. No la toco, dijo el norteamericano en español, sólo quiero verle el cuello.”

Land enclousures

Silvia Federici: This period in Nigeria was very important and productive. It has shown me clearly that the enclosures of lands, the enclosures of which Marx speaks, are not a phenomenon only of the past. The original accumulation continues today. It is a permanent accumulation. My experience in Nigeria made me see directly what Marx described in the chapter on original accumulation. For example, I saw in particular how oil companies threw people off their land to extract oil from them.



ProSavana Project

In the agricultural community of Wuacua, near Nakarari (Mozambique), one day in 2012, district officials came to ask residents to sign some documents. In return, they were promised a sum of money and the realization of "social projects". But it was a different matter: they signed the explicit renunciation of the DUAT (Direito de uso e aprovechadamento da terra), a document by which the State, the owner of the entire land of Mozambique since independence and according to the 1990 constitution, gives land for its direct cultivation to the peasants. They were deceived. They were told they would take part in a rural development program and they signed documents they did not understand. They received a compensation, between 4,500 and 6,000 metical [60 to 80 euros], after which they had to leave their land. Shortly thereafter, Agromoz, a mixed Brazilian and Portuguese capital company, obtained a concession of 9,000 hectares, which has converted the extension into a soy monoculture. They took advantage of the fact that a large part of the population was illiterate and few understood Portuguese well.

Today, Wuacua is a ghost town, surrounded by Agromoz plantations. The security guards recruited by the company do not allow anyone to approach.

It is a clear example of how "primitive accumulation" (forced expropriation, theft, cheating, swindle) plus "primitive socialist accumulation" (socialization of the land) are combined in 21st century capitalism.

The Agromoz example served as an incentive for agribusiness investors, brokerage companies, hedge funds, investment funds, etc., together with Japanese and Brazilian development agencies and revolving door politicians, to expand the scale in a monstrous project that it would cover 14 million hectares. The ProSavana project was conceived (in secret) in 2009 during the G8 summit in L'Aquila. Taking advantage of the fact that the land was owned by the State, more than 5 million peasants would be expropriated and expelled to convert their land into a monoculture of transgenic soybean, cotton and maize. Bill Gates, described the collusion of "example of innovative partnership." The example to follow was El Cerrado in the Brazilian Mato Grosso (where it was enough to evict a few bands of indigenous people and small farmers in the 1970s), and razing the land to install the current largest area of ​​soybean cultivation on Earth.

The secret remained until August 2011 when the Mozambican minister of agriculture mentioned it (small slip) in an interview that was published in a Brazilian newspaper. In the same article, Brazilian agricultural entrepreneurs claimed to be enthusiastic about emigrating to the African country, where they were promised land for ridiculous rents. "Mozambique is a MatoGrosso in the middle of Africa, with free land, few environmental obstacles and much lower freight costs for China"

But the example of Agromoz also served for the peasant resistance struggle. The Mozambican peasantry rose en bloc against ProSavana. Informational caravans toured the country advising the peasant communities about the intentions of the officials who had recently deceived the community of Wuacua. Delegations of farmers traveled to Brazil to study the Mato Grosso model on the spot. A documentary filmed during that stay (which certified the environmental and ecological disaster of the Cerrado) circulated massively throughout Mozambique.

23 Mozambican organizations signed an open letter to the governments of Japan, Brazil and Mozambique, denouncing "the total absence of a broad, transparent and democratic public debate on an issue of great social, economic and social importance with a direct impact on our lives. " 40 international organizations signed the document together and distributed it.

The large peasant mobilization managed to stop ProSavana and the 5 million peasants in the area continue with their traditional crops.

Mike Davis: Planet of Slums: After the fishermen's houses were cut off from the sea by a new highway, their fishing areas polluted by urban waste and the neighboring hillsides deforested to build apartment blocks, they had no choice but to send their daughters to the Japanese maquiladoras. It was the destruction not only of the livelihood of people who have always lived symbiotically with the sea, but also of the psyche and the spirit of the fishermen"

During the 1990s, the peasants of the periphery countries were subjected by the World Bank and the IMF to the economic strategy of "sinking or swimming". Through programs of structural adjustment and deregulation, the peasants had to cope ruinously with the world commodity markets and "swim out" towards the cities.

Formal housing markets in the Third World rarely provide more than 20% of new housing, so people resort to self-built shacks, informal rents, pirate subdivisions or sidewalks. In 2015, Africa had 330 million urban slum dwellers.

Since the beginning of the second millennium transnational corporations (oil and automobiles, mining and forestry, food, chemical, bioenergy and biotechnology, etc.) and state agencies (Gulf countries, South Korea, Japan, China, etc.) with the participation of financial capital, are acquiring large tracts of land and displacing huge groups of people from their lands, completely stripping them of their few assets and undermining the food security of the communities.

Since 2006, between 15 and 20 million hectares of farmland in poor countries (mainly in Africa and post-Soviet Eurasia) have been sold or leased to foreign entities. The deals are often abusive and lead to dispossession, especially when the "local communities" do not have formal, legal and clear property rights over the disputed lands. These agreements are often opaque, in general they are not consultative and are plagued by corruption cases of both local and central government entities collaborating in the expropriation / appropriation.

The main actors in land grabbing do not necessarily have to be transnational corporations. In Brazil, Malaysia, Cambodia, the Philippines or Indonesia, among others, the hoarding agents are mainly national capitals. Vietnamese and Thai corporations accumulate land in Cambodia and Laos, South African companies do so in Africa and Brazilian companies in South America. In China, and in India, as a consequence of their subordinate role in monopolistic globalization, Chinese corporations and state agencies increasingly monopolize land for non-agricultural purposes, such as mining, industrial development and infrastructure, business parks, residential and other real estate.

The result is the planet of the Slums, the growing agglomeration in the slums, shantytowns, shantytowns and slums of urban areas. " The current cities of monopolistic globalization, instead of being made of glass and steel as predicted by previous generations of town planners, are mostly built with raw brick, straw, recycled plastic, cement blocks and wood from scrap Instead of cities of light that rise to the sky, much of the urban world of the twenty-first century squats in misery, surrounded by pollution, excrement and rot.” (Mike Davis)

While only 6% of the population of the city of the developed countries lives in slums, 78.2% of the inhabitants of the cities in the less developed countries live in this type of informal slums, this is equivalent to one third of the global urban population.

In Ethiopia, 99.4% of the urban population lives in slums, in Chad also 99.4%, in Afghanistan 98.5% and in Nepal 92%. Bombay, with 12 to 14 million squatters, is the world capital of slums, followed by Mexico City and Dhaka with 10 and 12 million each. Lagos, Cairo, Karachi, Kinshasa-Brazzaville, Sao Paulo, Shanghai and Delhi have from 7 to 10 million each.


Uberización: Expropriation / appropriation of the internet and the contributions of the so-called collaborative economy

En la actualidad los grandes monopolios de internet se dedican a la apropiación y acumulación en masa de activos de conocimiento controlando los vectores de información, es decir, los medios a través de los cuales tienen que pasar la información y los productos creativos, para que puedan realizar su valor de intercambio. Internet se ha convertido en una verdadera bomba de aspiración y apropiación acelerada de los comunales generados por millones de internautas por parte de unas pocas empresas monopolistas que encabezan el ranking de las bolsas de valores del globo.

Nowadays, the big internet monopolies are dedicated to the appropriation and mass accumulation of knowledge assets controlling the vectors of information, that is, the means through which information and creative products have to pass, so that they can realize their exchange value. Internet has become a real aspiration pump and of the communal generated by millions of Internet users appropriated by a few monopolistic companies that head the ranking of the stock exchanges of the globe.

Amazon, Uber, Google, etc., have been specifically designed to appropriate the innumerable networks of communal cooperation and reciprocity that the digital era allows and generate amazon-minijobs , uber-contracts and in general e-contracts of all kinds of garbage to profit by exploiting its suppliers and their increasingly precarious lumpen-employees.

Primitive socialist accumulation?


Roberto Bolaño (2666): “.... Los dos ejecutivos mexicanos se agacharon y observaron las marcas que la muerta tenía en el cuello. Luego se levantaron y miraron la hora. La ambulancia está tardando, dijo uno de ellos. Ya mero llega, dijo el policía. Bueno, dijo uno de los ejecutivos, usted se encarga de todo, ¿verdad? El policía dijo sí, cómo no, y se guardó el par de billetes que le tendió el otro en el bolsillo de su pantalón reglamentario. Esa noche la muerta la pasó en un nicho refrigerado del hospital de Santa Teresa y al día siguiente uno de los ayudantes del forense le realizó la autopsia. Había sido estrangulada. Había sido violada. Por ambos conductos, anotó el ayudante del forense. Y estaba embarazada de cinco meses.”

Preobrazhensky (1926): “Primitive socialist accumulation is the accumulation by the state of material resources, mostly or in part, from sources outside the complex of the state economy. This accumulation must play an extremely important role in a backward peasant country, accelerating to a great extent the arrival of the moment when the technical and scientific reconstruction of the state economy begins and when this economy finally reaches the purely economic superiority over capitalism.".

If the primary resource of primitive capitalist accumulation is the colonies, the only "external resource" of the Soviet state is the "non-socialist" village. Therefore, the state must appropriate the surplus product of the peasant to accumulate capital for industrialization and the rapid transition to socialism”.

The controversy over capitalism in Russia and the debate over Soviet industrialization (1920-1929)

The controversy


At the end of the 19th century the Russian Social Democrats argued with the Narodniki of Alexander Herzen and N.G. Chernyshevsky on the suitability of traditional communalism of the Russian peasant village (which incorporated values of communal control over greed and individual competition and that considered land as a social utility) as the basis for the construction of socialism.

Faced with the penetration of foreign monopolies, they proposed a state program of sustainable rural and artisanal development.


These approaches were fiercely opposed by the orthodox Marxists, Georgi Plehanov and Vladimir Ilyich Lenin. Lenin argued that the Russian village was a well of superstition and backwardness and in his book " The development of capitalism in Russia </ i>" (1889) claimed that the ruin of artisanal and peasant production, and the consequent proletarianization of the Russian masses would create the internal market necessary for self-sustained capitalist development.

He argued that capitalist development was historically necessary in Russia so that in the future it could be passed on to socialism. In What to Do </ i>? (1902) warned that the Russian proletarians (in minority against the peasants) should not be encouraged to fight for a communist society. (Lenin, Collected Works, vol 5 (Moscow, 1960-70)).

The debate on Soviet industrialization 1920-1929

The "War Communism" 1918- March 1921 (nationalization of companies and resources, forced labor and prohibition of strikes, centralized control of production, requisitioning and rationing), imitated Germany's war economy during the 1GM. In March 1921 the system drastically changed direction and the NEP (new economic policy) was inaugurated based on a partial return to market mechanisms during which the peasants were encouraged to sell their surpluses in the market. These surpluses could be exported to acquire goods necessary for industrialization so that agriculture and industry would grow in a homogeneous and balanced way (N. Bukharin).

However, the debate on the need for rapid industrialization was rising, especially after 1924. The then Bolshevik left wing, headed by Trotsky, advocated a rapid path of industrialization. The theorist of this fast track was Evgeny Preobrazhensky. In his book "L The New Economy </ i>" (1926) he proposed to put into operation a new form of primitive accumulation, which he called primitive socialist accumulation.

The new socialist state, with no colonies to exploit, the only option left for rapid industrialization and catching up with the other imperialist powers, is the internal accumulation at the cost of robbery or forced expropriation of the non-socialist parties of the economy (peasants) based on fiscal policies and low monopsony prices by the state that resell agricultural production at high prices (monopoly) in the cities.

Stalin, defeated the Trotskyite faction, immediately assumed his ideas and plans of "primitive socialist accumulation" and in the winter of 1927-28 ordered the forced confiscation of the grain and went personally to the Urals to supervise the operation. In April 1929, the sixth congress of the CPSU approved the first five-year plan with a massive increase in industrial investment of 228% and sector production of 180% which implied the forced collectivization of the agricultural sector. At a conference in 1931, Stalin made his goal clear: " We are fifty or a hundred years behind the most advanced countries. We have to cut this distance in 10 years or we will be eliminated"

As we see, the primitive "socialist" accumulation is very close to the primitive "capitalist" accumulation. The aim is to destroy all forms of prior production or resistance to the system (small peasantry, communal lands and pastures, peasant communes, nomadic communities, etc.) and achieve high rates of accumulation from expropriated land and assets and the diversification of the forms of exploitation both pre-capitalist and "socialist" (Stakhanovites, war socialism, re-education through labor, etc.) criminalizing any kind of resistance and subjecting millions of citizens to forced labor (gulak).

Another aspect of primitive "socialist" accumulation is that, as in the case of capitalist accumulation, it is a mechanism for the creation of proletarians. Bifore Stalin it had been capitalism the most efficient system in the creation of the proletariat. Now it was the Soviet economy that created explicitly and massively proletariat.



From primitive socialist accumulation to primitive capitalist accumulation in a jiffy


Socialist forced labor camps : The work, according to official theory, was an integral part of prisoner reeducation. But the most obvious purpose of the labor camp was economic. The production of labor camps was large enough to figure as a separate factor in Soviet planning. The labor regime was strenuous, tiring and often dangerous. Workplaces were poorly ventilated and heated in winter. Clothing for outdoor workers was inadequate. The machinery was old and in disrepair. Failure to comply with the high production quotas was punished with lower food rations and the loss of the right to correspond or visit rights. Injuries were frequent, particularly in three uranium mining camps in Ukraine, where few prisoners survived their sentences. Poor diet and hard work often result in illness. Medical treatment in the labor camps was minimal and the prisoners rejected the operations due to the ineptitude of the medical personnel.

The socialist ideal was placed at the service of accumulation. With the forced collectivization and the consequent proletarization, the majority of the population was subjected to a sophisticated regime of "socialist" exploitation (primitive "socialist" accumulation).

The Gulak, the forced labor camps, the reeducation camps, the "socialist emulation", the Stakhanovism, the artificial state of permanent emergency, etc., replaced the law of value and the usufructs of the "socialist accumulation", after being enjoyed by a corrupt nomenklatura, would pass in their totality to private hands at the beginning of the 90s. in the process of capitalist primitive accumulation more meteoric of history.

A new class of owners, known as "oligarchs", formed quickly in the mid-1990s, from the distribution of state ownership among a handful of businessmen selected by the ill president Yeltsin and his entourage through a trumped auction . As a result, Mikhail Khodorkovsky obtained a 78 percent ownership stake in Yukos (worth $ 5 billion) for only $ 310 million, and Boris Berezovsky acquired the Sibneft company (worth $ 3 billion) for such only $ 100 million.

These controversial agreements in the framework of "share loans" provided the basis for the emergence of the majority of Russian multinationals and made their owners immensely wealthy.

In 2000, almost all of the immense primitive socialist Soviet accumulation resulting from decades of forced collectivization, forced proletarianisation, forced labor and gulak, had been transformed overnight into primitive capitalist accumulation in the hands of a few large private corporations. 70 large financial and industrial groups controlling 40% of Russian GDP.

In 1997, the last theoretician of primitive socialist accumulation wrote a book with the remarkable title "The State and Evolution". The author was Yegor Gaidar, the prime minister of Boris Yeltsin's government in 1992, economist and proponent of "shock therapy". The title of the book evoked the famous "The State and the Revolution" of Lenin and proposed a "peaceful" transition from socialism to capitalism through reforms and the so-called evolution of the State towards the market economy.

The book is full of quotations from Marx and Lenin to support the argument about the need for free market and shock therapy. The book analyzes and compares the dynamics of primitive accumulation in the Soviet Union and in the young post-Soviet Russia. He argues that primitive capitalist accumulation had already begun in the Soviet Union, when the elite of the nomenclature was secretly and illegally privatizing public property and state property and argues that the basis of primitive post-Soviet accumulation would be the capital accumulated by the nomenclature. .


China and its “socialism with Chinese characteristics


In the Chinese case the primitive capitalist accumulation has been directed by the same supposed socialist regime. It has been the state of the communist party that has led and organized the expropriation and large-scale theft of the lands and natural resources of the Chinese people to hand them over to the capitalist multinationals in an orgy of enormous growth of destructive forces unparalleled in history.

It has been the communist bureaucracy together with experts in Western human resources, who have lumpen-proletarianized hundreds of millions of young peasants to turn them into undocumented workers in their own country, susceptible to unimaginable rates of exploitation, perverting and subverting the Maoist Hukou institution (who forbade peasants to settle in the cities) to adapt it to the unlimited greed of the multinationals.

It has been the corrupt communist bureaucracy that has created the enormous network of free zones throughout the territory that have allowed the large monopolistic corporations to improve the model factory complex Foxconn, the best exponent of monopolistic globalization.


9/22/2017

Neoliberal Separatism. The catalan case

 


Catalan Flag after  1-O

Neoliberal Separatism , the catalan case



Natalie Sabanadze in hes book Globalization and Nationalism: The Cases of Georgia and the Basque Country, unlike the conventional explanation that argues that globalization and nationalisme are opposing and conflicting positions, argues that, at present, globalization and nationalism tend to become allied forces.


She recognizes that nationalism reacts against growing globalization and represents a form of resistance to globalizing influences, but when studying specific cases such as the cases of Georgia and the Basque Country, there is an apparent paradox. In the case of Georgia as well as in the Basque Country, there is little evidence to suggest the existence of strong politically organized nationalist opposition to globalization if not on the contrary, it is the nationalists who are most dazzled by globalization. These are pro-globalization nationalisms, which leads she to conclude that globalization and nationalism are complementary and non-contradictory forces.

Sabanadze's error is that although she recognize two kinds of nationalism, one anti-globalization and another pro-globalization, she is not capable of solving the apparent paradox since she does not go deeper into the analysis of the functionality of the second type.

In fact Sabanadze's approach is veiled because she does not thoroughly analyze the mechanism of capitalist globalization.

Capitalism needs nation-states, a precise institutional legal framework that strictly protects their property rights and regulates their markets. But this framework can turn against it as long as the power of the state falls into inadequate hands.

A democratic state, in which 99% of the losers of monopoly globalization can vote, is dangerous for multinationals, the more so the greater the state. Several big centralized nation-states can sign agreements to harmonize financial, industrial, fiscal, environmental, health, social, labor, etc. policies. which are detrimental to their interests.

To shield the interests of the 1%, a legion of economists (Friedrick von Hayek, Milton Friedman, Stephen Gills, James Buchanan, Barry Weingast, etc.) have for decades been designing strategies to neutralize democracy by subordinating political order to economic neoliberal order.

Globalizers design various types of strategies to discipline states and empty them of economic governance.

Monopolization and the "free" international mobility of capital (through liberalized financial markets and free trade enhance the disciplinary effect on democracies, and thus constitute the key element of neoliberal globalization. Capital momobility force states to practice democratic dumping to compete for transnational monopoly capital, providing the kind of neoliberal policies that investors and multinational corporations demand.

Globalizing strategies from above: International organizations and treaties



In order to ensure the submission of States and the international mobility of capital, supranational mechanisms such as the International Monetary Fund (liberalization of the capital market are a condition of membership), the World Trade Organization (WTO) , the North American Free Trade Agreement (NAFTA), the Single European Act, etc., have been created, all with specific clauses that ensure the free mobility of transnational direct investment.

Other examples of mechanisms to block the intervention of States are the provisions on intellectual property rights of investors contained in various trade agreements. The WTO Agreement on Trade-Related Aspects of Intellectual Property (TRIPS) and Chapter 11 of NAFTA are just two examples of provisions to set States on the bench where multinational corporations consider that government policies have violated their rights. The TPP and the TTIP would abound exponentially in this line.

Globalizing strategies from below: Federalism and neoliberal nationalism



Neoliberalism is perfecting two below strategies designed  to neutralize the capacity of government intervention in the economy and its possible anti-globalization reaction:  neoliberal federalism and neoliberal separatism.

Neoliberal Federalism, the USAID Handbook



Adam Hanieh: "Neoliberalism promotes decentralization to displace the resistance that the states can offer under the pressure of their citizens."

A Google search 'market-preserving federalism' and you have a long list of articles defending federalism as the best political weapon for the defense of the neoliberal monopoly market in the face of possible democratic reaction of the states. Wikipedia define "market preserving federalism" federalism as "federalism to preserve the market," it proposes to decentralize authority to formulate economic policies, this federalism reduces the ability of the central government to act arbitrarily (it has renounced these powers) and subnational governments face competition among them for scarce capital and labor. "

USAID (the leading agency in the promotion of global neoliberalism) has edited a manual titled Decentralization and Democratic Local Governance Programming (May 2000), which serves as a detailed recipe to promote decentralization in a variety of different national contexts where there may be resistance to neoliberal reforms.

A central theme of this manual is the shifting of responsibility for the provision of public services from the state to local governments. The manual provides for a situation where: "Local governments must do more than simply clean up the streets; they must assume a variety of responsibilities for non-traditional services such as securing primary health care, basic education, security public, public services, environmental protection, and building regulation."

In order to provide these services, local governments will be forced to increase their own incomes, and enter into competition to privatize, and borrow money on international capital markets. "They may employ new or innovative approaches, including public-private partnerships, proactive participation in development programs with national government or donors, and outsourcing of services."

"Build subnational administrative capacities to develop transparent and accountable budgets under the law of effectiveness and carry out local economic development .... and strengthen the capacity of local authorities to participate in discussions on appropriate devolution of responsibility at local levels of government. "

To ensure market discipline in the context of a country, a type of federalism is promoted where sub-national governments compete to attract capital in the context of a national economy.

Hayek argues that "the ideal outcome would be the transformation of local and even regional governments into quasi-commercial corporations competing with each other to attract investors."

The mobility of capital creates a kind of "market" for government policies in which firms demand to locate in those jurisdictions that offer them the most favorable mix of taxes and services.

The federal states (or the autonomies as in the case of Spain), for their part, will have a primary regulatory responsibility for the economy (fiscal, social, labor, health, environment, etc.) so that they should flexibilizar their political jurisdictions to compete among themselves, in a race to the bottom, in order to attract the elusive and capricious capital. The greater the degree of federalism or autonomy of the states (Spain, Germany, USA), better the respond  to the interests of the large neo-liberal monopolist groups.

It also promotes the autonomy and competition between "local communities" in terms of pro-globalization policies as well as a mechanism to compensate for market failures. This is another area in which cities or regions urban areas become important in the neoliberal project, since they are the main sites of the citizens' initiative, and where economic and social tensions are accumulated as a result of neoliberal projects.

Neo-liberal separatism


In 1992 the Dutch entrepreneur Freddy Heineken proposed a US of Europe. The book, Eurotopia,
proposed breaking the larger European countries into a number of smaller, more ethnically and linguistically homogeneous states.




Map of Europe proposed by Heineken / Van den Doel / Wesseling (1992)


Heineken with the advice of historians Henk Wesseling and Wim van den Doel designed a Europe composed of states with approximately 5 to 10 million citizens according to the map attached. Under the motto of the small is beautiful (evidently not referring to its brewing emporium), the administration in the mini states could be more efficient.
A more ambitious neoliberal option is the promotion of separatism. The large state entities (France, England, Spain, Italy, Germany, etc.) represent a danger to the advance of globalization since they are susceptible of deviation for the left or economic nationalism in the face of the neoliberal monopolistic multipolar crisis. Better than federated states or autonomous communities, why not small independent states competing to death each other to attract the investments of the elusive monopoly capital? The Scottish tiger, the Gaelic tiger, the Catalan tiger, the Piedmon tiger, etc. all ready to tear the skin off anyone who dares to confront neo-liberal monopolistic globalization. (The request of the Bavarian party for a secessionist referendum was rejected by the Federal Constitutional Court of Germany in January 2017)

The previous trials took place in Eastern Europe with the dismemberment of the USSR and the shredding of Yugoslavia and Czechoslovakia. All the new independent states came to compete with each other by privatizing their state assets and bursting their labor and social legislation to attract investment, thinking that neoliberal globalization would improve their lives. Today the most absolute failure of this dream is evident and a nationalist anti-globalization reaction is taking place in many of them (Hungary, Slovakia, Serbia, Poland, Czech Republic, etc.)

Catalan neoliberal separatism (catalexit)


The most paradigmatic and exemplary case of separatism promoted by globalized capital is that of Catalan separatism of the 21st century. Catalan wealthy classes have seen the possibility of enriching themselves on a global scale, separating the autonomous region from the rest of Spain with international support in face of the threat of a leftist escalation after 11M. From the outset they hope to quickly reintegrate the new independent state into the international agencies, mechanisms and forums of globalized capitalism.

Monopoly neoliberal system caught a death scare in 2011 when it burst the 15 M. The squares of Madrid and Barcelona full to brim with indignants against the system.

 Madrid and Barcelona 15M

Not a Spanish flag, no catalanista flag, and new budding political formations with ability to pass over corrupt Spanish and Catalan pro-business politics.

From then on, Catalan independence began to find support in neoliberal forums, especially Anglo-Saxon, while the EU mercilessly smashed the aspirations of the Greek nation, set in Syriza. It was necessary to replace the indignados against the system by separatist nationalists indignant with Spain.

The mechanism for the catalexit is of the purest neoliberal design. It takes advantage of a first "autonomous" phase in which the disaffected Catalan autonomous community takes advantage of all decentralized mechanisms and resources (autonomous government and parliament, autonomous legislation, assets and public companies, ceded taxes, press, radio and autonomic public television, police , etc.) to meticulously prepare for secession.

The experience of other "revolutionaryt" nationalist attempts, promoted, supported and often financed directly by globalized monopoly capital (Soros, and company), calls for the intervention of disenfranchised "leftists" (CUPs and elements from other leftist parties) as a nationalist clash force.

They convert the autonomic elections of September 27, 2015 to a supposedly "plebiscitarian" votation, uniting all the nationalist forces  in a unique candidacy denominated "Junts pel si" (All together  for the Yes"). The coalition, in spite of a lying campaign worthy of Goebbels (they control the TV3, the public autonomic TV), only got 48% of the votes thanks to the unexpected massive participation. However, the separatists, thanks to a favorable electoral law, gained more parlament seats and finally formed autonomic government thanks to the support of the CUP.

Changed foot timing


From then on all the autonomic machinery was readjusted to prepare the secession. The 2015 campaign was amplified over the next two years. The TV3 (Catalan public TV), became a kind of permanent selfie of the virtual reality of the separatist process.

But the accumulation of reality manipulation and/or information lies seems to have affected the heads of the process of secession more than the whole population, so that they began to set concrete dates, a rigid and inflexible strategy  with no other exit than the victimism before the predictable reaction of the Spanish state.

 

But the independence timing  do not corresponded with the neoliberal timing. All the promises of neoliberal forums and media vanished. Scotish separatism inducing brexit, defeated Syriza, Podemos in free fall and Rajoy as the best European adalit of drastic neoliberal reforms, the moment chosen for independence could not be worse.

Economic consequences of catalexit



Given the high specialization of Catalonia in the sale of products to the rest of Spain, it is estimated that in the middle scenario catalexit would mean a 44% drop in bilateral trade. Thus, Catalan GDP would fall by 14% and unemployment would increase by 16%.

The United Kingdom occupies the 9th position in the world ranking of competitiveness, Spain occupies the position 35º. By regions London ranks third in the ranking of competitiveness in European regions. Catalonia 142 (the most competitive is the Community of Madrid, which occupies the 57th position).

Should the secession succeed (without violence), the immediate expulsion of the EU would entail putting itself in the line of readmission with the sure threat of the Spanish veto. This long transition would lead to the departure of the European Monetary Union and the Single Mechanism of Financial Supervision.

For Catalonia, the euro would become a foreign currency whose use, if adopted as currency, could increase its exports and dangerously reduce its competitiveness. Outside the Monetary Union, it would be disconnected from the ECB, so that financial institutions domiciled in Catalan territory would lose access to their cheap financing lines.

European subsidies would also disappear from the Structural Funds (the European Regional Development Fund (ERDF), the European Social Fund (ESF), the European Agricultural Fund for Rural Development (EAFRD) and the European Maritime Fund. (FEMP).

Insecurity would lead to the risk premium at unassuming levels, as it no longer has the protection network of the Spanish State and the finance of the new republic would inevitably sink.

Outside Europe and Spain, exports to these areas are subject to tariffs, as they would no longer benefit from the advantages of belonging to an economic zone with free movement of goods. The payment of these extra costs would make Catalan exports much less competitive.

The separatist "process", if materialized, would reduce the rights, well-being and future of the majority of the Catalans to ashes. The economic impact, even excluding the terrible consequences of a more than possible violent drift of the secessionist processes (it does not seem that the Spaniards are going to let them leave), would be enormous and devastating.

Hence the misrepresentation, lying and systematic manipulation of information (amplified by the work of the public media in their hands: TV3, Radio, regional press, etc.) that are forced by the separatist leaders to hide the reality of the consequences on the population majority.

However, for the global interests of monopoly neoliberalism, the disaster for the majority of the Catalan population would be, as is often the case, a simple collateral effect (as in the case of Ukraine and many other picturesque neoliberal "revolutions").

For the globalized capital, the emergence of the new Catalan republic would mean the end of an ever-latent threat to its interests of a populist, leftist, or simply economic nationalism (such as the English or French case) of the Spanish nation that could drag other great european  nations. The separatists hope to reach a privileged position in the ladder of neoliberal globalization, erecting themselves as a strong bulwarks of globalization.

No wonder the Wall Street Journal controlled by Rupert Murdoch, the Washington Post owned by Jeffry Bezos of Amazon or the Financial Times, fervently applauds the ravages of the increasingly thundering Catalan fury.

Catelexit, a Win Win process for neoliberal monopoly capitalism



For the neoliberal monopoly capital, the secessionist strategy in Europe, and in particular in Spain, is proving beneficial in every way. The separatist threat in Spain, although it may prove to be a failure, is favoring the recovery of the corrupt and asocial neoliberal political class (PP - PSOE) to the detriment of the left, unable to understand the neoliberal character of the new separatism of the 21st century. (CUP) or defending it with more or less nuances (Podemos and their regional variants), which is losing a good part of the possible electoral base.

The neoliberal Macron would be delighted with a secessionist movement of French Catalonia to be able to strain his neoliberal labor reform in the path of Rajoy's. In fact, his predecessor, F. Holande, already initiated in 2014 an express reform of the French territorial scheme * in favor of a greater territorial "economic autonomy".


* The neoliberal pressure was already noted in France with the Constitutional Reform of 17 March 2003, with respect to Title XII of the Constitution, "Of territorial collectivities." The reform seeks to reduce state unitarism by deepening administrative decentralization. The reform enshrines in article 72.2 the financial autonomy of territorial communities, recognizing them in consequence the possibility of fixing the quota of certain taxes, as well as of setting the tax base. But the 2003 reform, although it represents a first step in breaking the classical unity principle of the French unitary state, found strong unitarian opposition and is far from being a political decentralization for the regions compared to the regional model adopted by Spain in the Second Republic (1931) and in 1978, and by Italy in the Constitution of 1947. In these countries the adopted model is the "political" region, that is based on the application of the elective principle to the holders of the governing bodies, the constitutional attribution of legislative powers to regional councils and assemblies, and economic power to the regional executive (participation in national taxes and regulation of certain tax matters). In practice, the Spanish Autonomous Communities have a political power very similar to that of the states in a federal organization, their differences are reduced to the degree of political decentralization.

 Anti-neoliberal Referendums


Bloomberg Businessweek 11-2017: Colombians Yank The Welcome Mat:

Small towns are exercising their constitutional right to block oil and mining projects. Coffee and fruit growers in the mountains around Arbeláez, a small farming town 35 miles from Bogotá, may have a significant amount of oil wealth under their feet. In July they defied the government and foreign investors and voted to leave it there.

In Arbeláez, Colombia, residents voted 4,312 to 38 against allowing Toronto-listed Canacol Energy Ltd. to carry out seismic testing or drill exploratory oil wells. Residents were concerned that the drilling could impact the water supply and would not provide jobs for local residents. The area produces tomatos, peas, blackberries, and other food for larger cities.

The chief executive officer of Canacol said “The worst investment signal for a foreign investor is to invest in a country where there’s no contractual stability”.

Local referendums are increasingly being used to block oil an mining projects, causing alarm among companies. More than 40 such votes are planned, threatening to paralyze exploration across the Andean nation.

There have been more than 40 similar referendums, or popular consultations, in Colombia. As this level of local democracy is enshrined in the national constitution, there is little the federal government can do, even though it could use the foreign direct investment and export earnings. While existing oil and mining operations can not be stopped, any new projects can rejected by local residents. This uncertainty whether a project will or will not go ahead increases the risk for foreign firms interested in investing in Colombia.

Finance Minister Mauricio Cárdenas has said the rules need to change to keep small communities from vetoing projects. But since Colombia’s grants citizens the right to hold these types of referendums and a simple law wouldn’t be sufficient. It is necessary to change the constitution.

In all five of the popular consultations held this year, locals voted overwhelmingly against letting oil and mining companies intro their communities.

4/28/2016

Tax havens, location, how they operate



 In a few years the planet was populated by tiny "anti-state" where the wealth of nations of Adam Smith is suctioned with increasingly powerful and sophisticated forms of pumping.
Tax havens became inherent to Capitalism system in its last and final path. As in the Middle Ages, the rentier classes have been exonerated from paying taxes. Big business and the rich no longer contribute anything to the maintenance of public institutions that depend only on the VAT and income tax of those who can not evade.

A one day raid in Cayman Islands would produce a massive capture: bankers, oil men, famous showmans, corrupt politicians, ... amiably mixed with mobsters, thugs, kleptocrats, white slavers, arms dealers, dictators, torturers, ... the true elite of the planet.

Christian De Brie: "The offshore havens, like Dracula, fear the light ... Who will sent these "paradises" to hell? "

Dani Rodrik, Harvard political economist: "In a globalized world, the interest rate is set in New York, the real wage in Shanghai and income tax in the Cayman Islands."

A German police: "Organized crime is a capitalism more acute" (dossier ATTAC)

Tax haven are in the phone book



The offshore havens are absolutely legal and therefore maintain internet portals where they freely offer their services to customers. You type "offshore banking" in Google and the third entry is:


 "Panama Offshore Legal - Offshore Asset Protection Services
There are a number of factors one must look for when setting up a secure asset protection structure. The tax-free status of the jurisdiction being used is always a major consideration. The anonymity of the corporations and foundations is also important.

The availability of quality banks covered by bank secrecy laws is of paramount importance. Attorney client privilege is something to never be taken lightly and the protection must be tight.

Don't make the mistake of using jurisdictions that used to be good but in recent years have compromised their secrecy and privacy. Click here to read more about asset protection
."

A law firm will create a shell company (trust or trust). In exchange for a few hundred or thousands of euros, according to the paradise, a legal representation and a numbered account is achieved. Shipments to the ghost company account wil be made through financial gateways, country to country, from account to account, to clear the money trail. You have to complete an online form and soon you're anabled to evade taxes, hide black money, assets that could be jeopardized by insolvencies, real estate bites, etc.

In the Financial Times or the Wall Street Journal there are published ads such International Company Services or Scope International, for a few hundred pounds or $, offers registration in your name (ICS), or for your company in the Bahamas, Gibraltar , Jersey, ... They offer services such as "fictitious names of shareholders and directors of the company" or "proxies" - real people hired as managers or shareholders of the companies, just in case, sign an "internal" document that is up to the evader, which specified the date (blank) in which all business is transferred to their real masters - assistance to open bank accounts or "facilitate firms from third parties, the movements are registered in his name "and for a modest plus we provide a kind of complete "Comanche" set for the new company: stamps with the company name, stock certificates, certificates of incorporation, a manual ... entitled "Save your fortune from unfair taxes" credit cards that leave no trace and finally even a set of "camouflage passports"".

It would be difficult to locate your laundry in Jersey but if you are a dot.com can hardly will resist the succulent conditions offered by certain tax havens: online betting (in Costarrica NASA operates the largest online gambling center in the world), an online bank ( Luxembourg Lebanese Byblos Bank, Altamira International Bank of Barbados, the European Union Bank in Antigua & Barbuda, ...), online payment systems like First Atlantic Commerce in Bermuda, etc.

Amount of its operations: In 2007 the British Virgin Islands invested more in China than Japan or the US. Mauritius was by long the largest investor in India in the same year that 47% of foreign investment in France came from a tax haven.

Fortis, a multinational banking and insurance Company, based in the Benelux, holds about 300 establishments "offshore", Fortis Intertrusts (BVI), Fortis Investment Management (Cayman Islands), Fortis Private Wealth Managment (Netherlands Antilles) etc. and using camouflage names: JEB Ltd (Liberia), Comanche Ltd (Bahamas), Jasmette Valley Inc (Liechtenstein) Swilken Holdigns (Panama), ... and so on a ten pages list according to the Center for Reaserch on Multinational Corporations.




Multinationals turn to the strategy of the spinning top. This is the "corporate inversion" or to turn up down the company. The parent company is moved to a tax haven - which will not pay income taxes - and what remains in the original territory become mere "affiliates" with losses.  Accenture Ltd., Tyco International Ltd., Foster Wheeler Ltd., Inglesol Rand, McDermott International, Inc., are examples.

How a tax haven work?


Tax havens are a specially designed environment to deposit, save, invest or recover bad or evaded money by CEOs, dictators, drug dealers, organ traffickers, etc. They enjoy a sophisticated advisory service, tax lawyers, auditing firms and, of course, branches of the "legal" banking system specialized in this type of operations. They enjoy bank secrecy, commercial secrecy, administrative and registry secrecy while the administration of the tax haven rejects any kind of mutual assistance, cooperation or exchange of information with other administrations.

Companies or individuals constitute societies, "foundations", trusts, etc. with tax residence in one of those territories and proceed to move their money or financial assets.

The "trust" is a flagship of Jersey fiscal Paradise (called the rock of billionaires, 20 km off Normandy, as a "Crown Dependencie", it is not part of the UK or the EU). This status allows you to steal taxes, etc. by registering under a false name. Formally, the money does not belongs to you, but in practice it is all yours. The advantages of wealth without its drawbacks.

To send money to a tax haven, legally or illegally, the first step is to hire a lawyer in that country. If it all is just a "tax evasion" it is likely that the lowyer ask bank references and identity documents to avoid problems. In any case, the lawyer creates a society in the country and acts as head in front of the authorities to manage the money received by the society.

Should the client be a criminal, this company will be constituted as a 'front company', a false mirror to mislead police investigators. Most likely, this "company" will receive numerous cash deposits in small amounts. Thanks to internet, money can come from anywhere in the world from many accounts of bogus companies run by straw men.

Every day are becoming more common trusts designed to protect the founder against lawsuits from its own country  (Asset Protection Trust). They include the "escape clause" which involves the immediate transfer to other tax havens in case of threat of research or communication of opening a process.

The "proxies"


The "proxies" constitute a second layer of protection. If an inspection or a journalist gets to skip the traditional obstacles raised by the tax havens to conceal the identity of the real owner of the funds or the shell company they found that the "president" and the "owners" in the documents are " proxies ", ie, lawyers, agents, ... or companies created by" proxies ". The proxies signed an (internal) undated document by transferring the shares to their real owners. You can even "drive" the shell company through an empowerment by the proxy, without appear in any kind of document of the company.

A further guarantee is the signature, by the proxy, of a document of resignation with blank date according to which all acts from that date on are null.

Tax Havens for campanies: transfer pricing



Evaders are not just individuals. Most of evasion is carried out by companies through various techniques based on the system of "transfer prices"designed  to emerge profits in tax havens and losses in the country of origin. The company "sells" at low prices to an ad hoc intermediary company (so the profits of this operation are low or zero). Then the intermediary (a subsidiary in a tax haven) sells at full price pocketing the profits taxed at 0.01%.

Similar operations occur when companies attribute most of their earnings to service subsidiaries in tax havens.

Transactions related to transfer pricing to evade taxes accounts for half of all international trade. Grand Cayman, a transfer pricing center, turns out to be the second most important trading partner of Brazil.

Every major country has "its" own havens. India is being bled by Mauritius. Russian oligarchs operate through Cyprus, Switzerland, Jersey and the Isle of Man.

The oil company Repsol YPF has established twenty subsidiaries in tax havens (Bermuda, Cayman Islands, ...)

Specialized tax havens


. Andorra and Monaco are specialized in asset management for wealthy individuals. Numbered accounts and total secrecy.

. Bermuda specialize in reinsurance operations, and especially of called "captive insurers", because they provide services to a group of companies as subsidiaries of the parent company. Paradise lax legislation requires less reserves and insurance premiums are not taxed.





. Bahamas, Liberia, Malta and Panama formerly, specialize in the FOC to record oil tankers or cargo of toxic waste ships, with no controls on the safety of the ship and without labor standards for the crews.

. Cayman Islands: Specialized in CEOs accounts and shell companies. Zero taxes. Directors of companies registered there need not be residents and their accounts can not be audited. 544 international banks are home to some 420,000 million dollars in deposits, and have registered more than 30,000 companies. The minimum bank deposit required is around US $ 10,000 and five times more, if denominated in other currency. To establish a trust a minimum fund worth US $ 250,000 are required. The Cayman Islands are the home of 80% of hedge funds.

The Cayman Islands are not really a country but a financial company disguised as "country". More than 12,000 "companies" are operated from a single building known as Ugland House, headquarters of the firm Maples & Calder.

The "laws" of the Cayman Islands prevent these firms of any operation within its territory except, of course, accumulate assets and benefits without label. They hold the 5th worldwide in bank deposits with a figure of $ 2 trillion.

But overall the trend is to merge or grouping many services in offshore multiservice centers such as Singapore which has become the Asian Switzerland.

Competition between tax havens


They compete to attract capital. To see who offers better security, secrecy, taxes, etc. Jersey imposed a rate of "10%" to corporate profits and the Isle of Man reduced its rate to "0%". Jersey reacted by lowering its level of taxation to zero while maintaining 10% only for local financial services companies. The difference in revenue was offset by the creation of a kind of tax on consumption and the "non-financial" services of the island. He also created a new type of company (shell company) that allows, from $ 1 million to speculate in risky markets without control or supervision. An appropiate bait for hedge funds.

Round triiping


Capital that flees a country can then go back, honorably, in the form of foreign direct investment (IMF defines up to 12 different varieties), once it has been "restructured" (wash) in a specialized tax havens specialiced in this type of operations. The phenomenon has reached impressive dimensions in the case of China where 30 to 40% of foreign equity investments come from this traffic laundering and tax evasion. Chinese law allows its companies be filed  in Muricio Island, Bermuda, the British Virgin Islands or the Cayman Islands.

Global Financial Integrity estimated at more than $ 120 billion the annual "round-tripping" between Russia and Cyprus, through which Russian money is laundered as deposits in the Cyprus tax haven and then reinvested in Russia.

Tax Havens: How the illicit money is washed?


A series of successive operations are performed: placing, acumulation,  integration, centrifuging between each and the final bleaching.




1. Placement or prewashing is to move money and currency from acquisition place to financial establishments on different places, spread over multiple accounts.

This operation does not require suitcases full of bank notes; banks help move the funds to tax havens. According to Eduard Guroff, German tax fraud fical, in Liechtenstein evasion is done through simple transfers. "A bank, for example, collect in an account 10 million from several customers in Germany and sent it to Liechtenstein as if they were their own, without names. Months later, sends a note explaining who each part belongs. The bank in Liechtenstein then creates a numbered foundation for each customer . As only the bank and the client know who is the foundation owner, the system is easy, clean and opaque to the treasury. "

2. Stack, or mixture which makes it impossible to rewind the wire to the source of illicit profits: multiplication of transfers between accounts in various banks located in tax havens, .... and conversion of funds in investments securities  and channeled to various financial markets using clearing houses such as Clearstream in Luxembourg or Euroclear in Brussels.

3. Integration: Finally, the last stage, and again using Clearstream or Euroclear, integration and legal reappearance of blanched capital, regrouped in naw visible bank accounts, and prepared for use in a totally legal form.

That is, clearing firms act as centrifuge machines throughout the all the process to phase in various stages of washing the "dirt" of the badly earned money.

The same washing and bleaching techniques and the same circuits are also used for covert management of the fortunes of corrupt rulers, embezzlement of public funds, fortunes  achieved by insiders, the black money of sports or showbiz, fraud tax, illegal financing of political parties, payment of kickbacks on government contracts, money from the mafia, the drug, the business of trafficking, the trade in organs, newborns, slave, etc.

The deregulated financial system has become a global giant washing machine. A growing part of the funds managed by "markets" come from illegal, tax evasion and prevarication, which placed here and there will whiten in exchange for succulent bonus entering senior executives of financialization traffic.

Organized crime and financial centers press together and converge on the removal of regulations and controls. The synergies between the two groups intersect and overlap as "markets" become the arbiters of permanent global depression.

Financial services tax havens


The tax haven that want to attract this netherworld offers a range of shady appropriate "financial" services:

Plots in "technological parks"with equipment and perfect logistics, particularly in computer-electronic facilities allowing free access in real time to all world markets, and guaranteed correspondence with large banking networks, usually represented in the same place. Thus, the Spanish government had to grant some 100,000 fixed lines in 2002 to Gibraltar phone so he could be reconverted into a competitive tax haven  serving real estate and mafias of the Costa del Sol.

Facilities to attract a mass of unscrupulous lawyers, economists, financiers, brokers, accountants, auditors, tax advisers, ...  to offer assistance, expertise, arbitration, legal and accounting local management to customers.

Security and political stability; weak (or no) repression of financial crime, and weak (or no) international cooperation.

Banking secrecy against any criminal investigation, absence of exchange control, right to establish any form of society, real or fictional, with guaranteed anonymity for participants; tax exemption or symbolic imposition.

Virtual tax havens



The boom that have registered tax haven countries  as Luxembourg, Liechtenstein, Andorra, Panama, etc. has led to a proliferation. The ultimate in this field are tax havens located in virtual countries such as The Dominion de Melchizedek or the Kingdom of Enenkio, who claims to be located in Micronesian atolls, but thanks to its operations online it "work" with the same effectiveness or more than their material counterparts, in a world where virtuality is a rising star.

Tax havens and clearing houses: Clearstream, Euroclear.



In fact, if there would be the political will to do so, the control of capital movements is technically very simple.

Currently 99% of monetary transactions and securities (shares, bonds ...) are electronic records  that at the end the day involve balances in favor or against the owner. These adjustments of currency and securities are made through  SWIFT and CHPIS networks converge into two or three companies of international clearing:  CLEARSTREAM in Luxembourg and Euroclear in Belgium.




These companies keep a record of each and every one of the operations carried out and, contrary to popular belief, the vast majority of transactions in criminal funds also go through these records, ie, by the formal financial system.

Thus the financial system has simplified processes so that it works fine with very few and simple mechanisms.

But on the other hand under the 80s R.Reagan and M.Thatcher deregulation, a complex legal structures tangle (related to the new financial "products", trust companies and offshore havens) financial markets have become an opaque  landscape in which to navigate without worrying about the existing legal obligations in the parent country.

Denis Robert unmasked the shebang and suffered the consequences:

 "It requires that a Clearstream senior  be dismissed for that we learn about the operations of Banco Ambrosiano, Bank Menatep and Russian mafias, illegal commissions for sales of french ships or illegal CIA operations in Iran; it requires that someone pull out a DVD of Liechtenstein with data on billions of euros evaded from Germany, Italy, USA or Spain".

"All financial transactions are recorded and this information is centralized and stored in large fiancial stores. Clearstream, Euroclear and Swift, with branches and customers around the world, have become, thanks to the microchip and the progress of technology information, the essential tools of globalization.

Clearstream and Euroclear are the traffic managers in the global village, the transport companies of financial capitalism, their cash registers are their control towers. All banks in the world and multinational companies are permanently connected to their networks and use them to move, buy, sell, cheat, steal, hide and disappear. SWIFT records and transmits transfer orders from bank to bank. iIf you are in Italy as a tourist and rent a car, by using your credit card, the transaction is transmitted by SWIFT network who charges your account and credits the account of the rental company.

Clearstream and Euroclear, meanwhile, organize cross-border trade in stocks and bonds, guarantee the solvency of customers, offset exchanges, made cash transfers to pay operations and act as custodians of much of the titles."

Naw paying taxes is a voluntary matter for businesses and the wealthy



The ability of evasion is total. Today gains from property sales or stock trading, inheritances and legacies, ..., any kind of profit could be attributed to trusts or foundations subsidiaries located in offshore centers so that paying taxes is a voluntary matter for companies and the rich. The full weight of tax collection of states is via VAT or income tax only for those who can not evade.

To return dirty money to the legal circulation evaders and smugglers enjoy the invaluable assistance of bank clearing (Clearstream, Euroclear) that filter dirt from operations, and allow deposit accounts, ready to spend the money free of impurities.

Witn offshore havens large corporations enjoy a whole set of advantages: avoiding change control within the own country or evade currency convertibility. Other times, the aim is to centralize the financial management of the company (Enron). They are used for commercial brokerage operations and chargeback (transfer pricing) or to install captive insurance companies aimed to self-insurance operations. The most common operation however is the investment through holding companies so that profits are taxed in the tax haven.

Absolute freedom for capital movements worldwide, and electronic communication, allow operations to be performed from any office of a bank or a corporation. The isolation of Liechtenstein in the Alps, with no airport or railway station is not an obstacle to their operations. Transactions are simple electronic notes between different entities. The "paper" (securities or documents) are deposited at the source and "notarial" records in the clearing and settlement system (Clearstream).

 The tax haven of London



The main backer of the system of tax havens is the financial center of London.

With weak or no taxation for non-residents (200,000 non-residents are exempt from tax: City financiers, footballers, singers, ...), banking secrecy, professional secrecy, simplified registration procedure, complete freedom for capital movement, supported by a solid financial structure, good brand image and a dense network of bilateral agreements with other tax havens, London has become a key part of the financial derivatives industry  becoming the haven and operations base of hedge funds.

Tax havens and financial crisis



For decades it has been its existence that has generated a suicidal regulatory and tax competition between jurisdictions that has led most governments to cut taxes and deregulate at all costs. Lax or null "offshore"regulation  has created a systemic infection, poisoning "onshore" regulations  in a hasty run "down to the bottom" applauded by the neoliberal forums as the most important pillar of economic growth.

Contagion has spread from places like the Cayman Islands to places like Luxembourg, the Netherlands and Ireland. In the US, a state of the union, Delaware, provides foreign capital the same "profits" tax and regulatory that any tropical turtle island. Netherlands has become a haven for rock bands and record companies because Netherland do not taxe "royalties".

Actual complex corporate structures are opaque creatures that could not have been engendered anywhere else. They are artificially divided across multiple jurisdictions so that any notion is lost of where is rally parked the risk. This competition for capital has overheated speculation boilers so that everything has blown up.

The shadow banking system, permanent threat to the global financial system, would never have been possible without OFCs. All entities of some entity had and have hundreds of establishments in tax havens where they organize their undercapitalized and deleveraged operations , regardless of regulations and taxes, failed operations that are costing outrageous public bailouts.

Tax havens and tax regression


According to a Justice Network report (2005), private fortunes in tax havens amounted to a figure of $ 11.5 trillion that would generate an annual income of $ 0.86 trillion tax free. If these taxes were counted they would add $ 0.255 trillion.

This has resulted in an increasing tax reversal as governments are constrained to raise indirect taxes, taxes burden almost exclusively for the non-rich, and postponement of infrastructure investment and redistributive social spending .

Justice Network  for 2005

A powerful magnet that absorbs huge public funds and forces to lower taxation on companies and the wealhty. .They are true parasites that progressively weaken the health of nations.

Paradises "off world"



Dubai, on the Pirates Coast, former refuge for pirates, smugglers and traffickers, has become by the clever hand of emir Mohammed bin Rashid al-Maktoum a multifunctional tax haven. It is not only a center for money laundering on a large scale, but has become an international financial center, a tourist and residential paradise for wealthy people, a safe haven for gangsters, kleptocrats and terrorists, free  taxes and 100% foreign ownership processing zones,  ..., and the most impressive real state bubble ever dreamed.


Burj tower (buble?) Dubai and its tween of Saruman

The huge skyscrapers, artificial residential islands, airports, etc., build by forced labor immigrants deportable to the slightest complaint, and "invisible" to the wealthy elite public except for taxi drivers, maids or prostitutes.

It is the dream of neoliberalism come true, "the apotheosis of neo-liberal values ​​of contemporary capitalism." A world of luxury, waste and unbridled lust, speculation without limits, without taxes, without political parties, served by a proletariat without holidays, without pay, without consumption, no unions, no papers, no nights, invisible, in permanent debt bondage state, repatriable a whim, reproduced in another galaxy "... A perfect "off world " for the XXI century.

Tax havens, powerhouses of criminal-capitalism



In depressed economic conditions mafia business thrive. As entire sectors succumb to the crisis, the mafia control and their income grows exponentially.

Tax havens are a specially designed mechanisms to recycle short-term funds regardless of the source. In situations of lack of liquidity - liquidity trap - a desperate hunt for short-term capital occurs, wherever they come from. Banks and other businesses in distress come unabashedly in search of fresh money from the mafia, via tax havens.

Tax evasion, money laundering, drugs  and arms , human beings trafficking, extortion, production and marketing of counterfeit currency, theft, fraud and smuggling of all kinds, ... a volume of business that already around 40% of the world "legal" economy  thanks to tax havens.


Tax havens are at the root of corruption and the increasing poverty in poor countries. Oil revenues from Nigeria, Congo, Guinea, etc., is systematically diverted and attracted by these specialized in protecting deregulated fraud and illegal accumulation magnets , leaving the local population mired in abject misery.

Tax havens, hubs and catalysts of globalization


Tax havens are inherent in the system in its last and most destructive journey. They are their hubs. Any transaction, any business of a certain size pass through them. Today's globalized world, in advanced stages of criminal penetration, would not be understood without them. Suppress tax havens would mean literally terminate capitalism. Therefore all media or official talks against them is pure demagogic fallacy. Tax havens are here to stay.

Finally Capital in its pure form, detached from his dark and gruesome origins, washed the blood, exploitation, fraud, theft and extortion that generated it, can to roam and is welcomed and pampered everywhere. From Gibraltar to Isle of Man, Monaco to Liechtenstein, through Clearstream. Tax havens inflame and lubricate financial markets.

Tax havens and underdevelopment



About 50% of assets in Latin America are invested in tax havens. In the Middle East the percentage is 70%. The losses for developing countries are estimated at $ 500,000 million per year (5 times the total amount of development aid). Given the precarious tax system in many poor countries, tax evasion is especially severe.

The fight (sic!) Against tax havens


The European Commission looks away. The "European Constitution" could not be sneaked with a referendum but was imposed anywhere by force (simple Lisboa Treaty, without de bombastic "constitutional" title) abounds more and more on deregulation for capital while Luxembourg (Clearstream) and Belgium (Euroclear) have become the centrifuge laundering  machines of the world dirty money.

In Germany there have been many scandals for tax evasion but under the Treaty of Lisbon, the consent of all 27 member states of the EU is needed to change the actual  2005 EU Fiscal directive  on the protection of banking secrecy. (The directive is like "Swiss cheese, full of holes," say tax experts.)



After the outbreak of the Liechtenstein case, the European Commission criticized Spain measures against evasion of capital to Liechtenstein and recommended "avoiding disproportionate measures" in the investigation.

Rules governing taxation policy 2005 affect interests, but not dividends. In addition they apply to individuals, but not foundations (Klaus Zumwinkel, chairman of Deutsche Post in its recently discovered large-scale tax fraud used fundations). Tax havens quickly adapted to the soft policy. There are more than 50.000 Foundations (stieftung) in Liechtenstein  in a country of 35,000 inhabitants.

The Principality of Liechtenstein has more than twice companies than citizens. 35,000 citizens and 80,000 companies, many of which reported as address a post office box . Local law allows the establishment of foundations for private purposes. The tax on this capital is a derisory 0.1 percent upon capital less  than two million francs; if such amount is increased, the rate is reduced to 0.075 percent and if the amount exceeds 10 million francs, the tax burden almost disappears: is 0.005 percent (reverse tax progressivity).

A Spanish citizen instructs LGT Group  the creation of a foundation. A Spanish office will be the mediate agent. Liechtenstein LGT will place employees on the boards of the foundations to leave no trace of the transfers, LGT Group provides intermediary companies, Special Purpose Vehicles, etc.

Tax havens and actual capitalism


All this is no secret. This is not something marginal. What for the liberal capitalism of the 80s was a "necessary slip" that lubricated the functioning of the system has become a monstrous degeneration that determines the current operation of the system.

Faced with criticism everywhere the G7 created in 2000 the Financial Action Task Force against money laundering (FATF) which in practice was a real jinx, giving, after studies and various assessments, approval of "respectable financial centers" to real Turtle islands  as Cayman Islands, Jersey, etc. Later OECD joined the whitening process of offshore centers so that in 2004 only Andorra, Liberia, Liechtenstein and the Marshall Islands were "tax havens". The rest apparently were true prodigal sons returning to the law.


Spanish tax havens and spanish banking



Banking that one can find in tax havens is created, managed and continuously used by the big American  and European banks, and, of course,  the Spanish banks.

Large companies such as Telefonica, have installed holding companies in the British Virgin Islands. Santander and BBVA, have management investment funds firms in Bahamas, Jersey, Isle of Man, Cayman Islands, Virgin Islands and Netherlands Antilles.


La Caixa, Banco Popular, Sabadell, etc., all have their section of offshore companies, competition imposes. Caja Sur established in Cayman Eurocapital  Finance Ltd, which issued preferred stock whose dividends were exempt from taxes. Then Eurocapital  Finance Ltd "lent" to Caja Sur the money deposited so that it could continue adding fuel to the housing bubble.

In 2004, according to annual reports submitted to the Spanish shareholders, 11% of the companies in the BBVA group were based in tax havens, La Caixa group 10%, 15% Sabadell group. Santander and BBVA are among the 50 banks with more assets abroad (in positions 37 and 47 respectively).

The Financial Action Group reported in 2006 that the Spanish legislation does not establish any prohibition to have relations with screen societies. Neither the Spanish Government has an estimate on screen companies serving Spanish companies in tax havens.

If money is Barbuda, Bahamas or Cayman, banks are behind it. Santander (SCH) has more than  hundred "consolidated" societies (their accounts are added to the accounts of the parent) based in tax havens and can boast of having managed the funds of the Pinochet family during their most bitter days through the Coutts USA Internacional, owned by SCH.

Currently BBVA controls the second largest bank in Colombia and the first of Mexico and holds leading positions in 14 other countries in the region, where is the first group in insurance and pension plans. It is, by many accounts, one of the most efficient washing machines of American drug trafficking.

In May 2007, the magazine Capital noted a list of 27 BBVA known companies based in tax havens such as Jersey, the Cayman Islands, Luxembourg and Switzerland.

In 2002 the National Court and the Spanish anti-corruption prosecutor investigated dark transactions linked to the Expo 92 in Seville that would lead them to BBV Privanza and a vast international plot: Colombia, Puerto Rico, Panama, Jersey Islands, Grand Cayman, Switzerland, Mexico ( Probursa), Peru (Continental), Venezuela (Provincial), the United States (Bank of New York) and even to Chile and Cuba. In total a network in 13 countries. In 2007 the court  declared the nullity of the proceedings and filed the case because of  "absence of injured".

BBV operated a "B box", opened in 1987 in Jersey and expanded in 1991 to Liechtenstein, with 224 million euros invested in 22 pension funds on behalf of former directors of BBV, members of the country economic elite, among which was included the then President Emilio Ybarra. Bank CEOs where seeking freedom of action outside shareholders control to get exorbitant pensions for themselves. In the end the case was also filed.

Caja España, like other financial institutions exhibited their own company  "Caja España de Invbersiones Finance Limited", established in the offices of Maples And Calder, lawyers in the Cayman Islands (Ugland House, South Church Street, PO Box 309 ).


Gescartera (advised by BBVA?) Also used Jersey where he had installed the SPV Stock Selection for camouflaging the gains of their unfortunate clients.

More than half of companies in the IBEX-35 have subsidiaries in tax havens according to the ORSC.



The SICAVs, tax havens within Spain



They are investment funds so that the rich that do not want to pay taxes, do not have to "expatriated" their capitals. Here in Spain (in a Spanish bank) as a SICAV, you can legally avoid taxes. The Sicav are joint stock companies and its theoretical action field is the collective investment activity. Many Spanish SICAVs (Capital Variable Investment companies ) are domiciled in Luxembourg.


These are clearly schemes by the banks offered  to the rich to place their capital and "legally" evade taxes. To maintain the fallacy that it is a society of "collective" investment creating a Sicav legally requires a minimum of 100 participants and a minimum capital of € 2,400,000. Are the same banks that organized fraud by providing the 99 shareholders who are missing, the trick is based on bringing together different customers with the same interests according to the scheme: "I will help you to build your company, and you help me me to ride mine. " Of the 2.4 million evaded you must just spend a few thousands to participate as a shareholder of the "friends" Sicavs.

The authorization of a Sicav corresponds to the CNMV that usually turn a blind eye to such dealings. The profits obtained by these companies are taxed at 1% in corporation tax in front of the  35% or more to pay in the IRPF (Personal Income Tax).

Andorra, a tax haven


In Andorra, usual place of pilgrimage of athletes, jet set, and wealthy Spanish. The Spanish banks assets controlled up to five banks there Credit Andorrà, Banc Internacional d'Andorra, Caixa Bank and Banc Sabadell d'Andorra.

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The transformation into a tax haven has been a boost for the business concentration. In 2001 Banca Reig and Banc Agrícol merged. A year later the company was born Andbanc, wholly owned by Andorran capital while Crèdit Andorrà announced the purchase of CaixaBank Andorra -the subsidiary of La Caixa- for 356 million euros.

In March 2006 Banco Internacional Banca Mora (BIBM) bought BBVA de Andorra for 395 million euros. In September of the same year La Caixa sold its stake in Credit Andorrà for € 927 million.

Integration in July 2007 of Banco Internacional Banca Mora (BIBM), Banc Agrícol Reig and Andbanc to form the Andbanc Group Mora, involved the largest corporate transaction ever made in Andorra and allowed the creation of the most powerful banking group in terms of resources managed, collaborators and results. With 500 employees the new group (data from 2006) has a volume of social assets of 5,480 million euros, a credit investment of 2,315 million and customer funds of 14,340 million.

With regard to business volumes, the bank has 16,655 million, of which 604 correspond to equity. The group has branches in Switzerland, Mexico, Panama, Brazil and the Bahamas and operates like a giant evasion funnel  of Catalan and northern Spain capital.


More information: Blog de Luis Ordóñez Gonçalves

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