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World Economic power is being concentrated into an
ever-decreasing number of huge multi-national firms, mainly financed based,
according to a report published by researchers from the Swiss Federal Institute
of Technology. After working through data from millions of companies they
concluded that just 147 companies have an iron grip on the global economy.
According to a summary of the report (“The network of global
corporate control” Sept 2011) published on www.swissinfo.ch:
‘Researchers at the ETHZ examined the connections of 43,000
transnational corporations (TNCs). They found that the TNCs form a “giant
bow-tie structure” and that a large portion of control flows to a small
tightly-knit core of financial institutions.’
‘This structure is explained by the fact that a group of
around 1,300 companies are situated at the heart of global trade since they are
in control of 50% of earnings from all multinationals. At the core of this
group is a nucleus of 147 multinationals. This “super entity” controls 40% of
the total value of the multinationals.’
‘Topping the list is Britain’s Barclays bank, the American
investment group, Capital Group Companies and the financial services firm, FMR
Corporation, which is also American.’
‘The two big Swiss banks are also among the most powerful,
with UBS ranked 9th and Credit Suisse 14th. Other financial institutions
included in the “super entity” are Deutsche Bank (12th), Goldman Sachs (18th)
and Morgan Stanley (21st).’
"Interlocking ownerships"
The report explains: 'We start from a list of 43 060
translational corporations identified according to the Organisation for
Economic Cooperation and Development (OECD) definition, taken from a sample of
about 30 million economic actors contained in the Orbis 2007 database,… We then
apply a recursive search which singles out, for the first time to our
knowledge, the network of all the ownership pathways originating from and
pointing to transnational corporations. The resulting network includes 600 508
nodes and 1.1 million ownership ties.' In English this results in “…a core of 1
318 companies with interlocking ownerships. Each of the 1 318 had connections
to at least 2 if not more companies. On average, each company was linked to 20
others.”
According to Cordis News: “The team points out that while
the core accounts for 20% of the world operating revenues, the 1 318 seemingly
hold, through their shares, the majority of the globe's large blue chip and
manufacturing companies. The latter is considered by many to be the 'real economy',
making up another 60% of the global revenues. “
In an interview with Swiss economist Mauro Baranzini on the
swissinfo website it is explained that “A large multinational could have more
power than the president of a small or medium-sized state…”
Marx
Marx
explained this process over a hundred and fifty years ago when he outlined the
tendency for capitalists to merge with each other to create evermore-powerful
monopolies. Within this we also see the growing predominance of finance capital
over industrial. Note the high ranked positions of companies like Barclays, UBS
and Goldman Sachs – all recent stars of the banking crisis fiasco which
exploded in 2008. People are told that capitalism is all about free enterprise
and competition – in fact, as Marx explained, the reverse is the cash. It is
all about grabbing more and more capital for yourself and, in doing this,
increasing the rate of exploitation of the masses who are the people who
actually produce this wealth through their labour and see it stolen from them
in the form of rent, interest and profit – RIP for short!
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