Privatisation - paint it not with one stroke -part 3

Nationality of multi nationals - its shares, coffers, shareholders.

Its a tempting to think that since many exploitative private multinationals come from the West, they are part of a larger design of the West to dominate the world. But certain multinationals have promoted their self interests despite harming the interests of the citizens of the same country to which it belongs. Here are a few short stories that I have recently found about that have shocked me and have added more chapters to my learning journey about privatisation.

GM and the automobile industry
Anybody who has been to California, USA tell you that you need to have a car there to get around because there is hardly any form of public transport. The last person to tell me this was my friend who visited Los Angeles six months back and had to rent a car everyday despite being there only for four months. Well, one can thank the automoble industry for that because of what happened in the 1920s. Before road transport USA always had its railway systems which it got built by the Chinese. In the late 1920s General Motors secretly began to purchase the railway and trolley systems throughout the United States including Los Angeles, using a number of front corporations.GM then ripped out all the existing tracks, dismantled the systems, tore down the overhead wires. The trolley companies were turned into bus lines, and the new buses were manufactured by GM. The period defines a period of monopoly for automobile industry wherein they influenced the government not to invest in public transport so that the demand for cars increases. In 1947, GM and a number of its allies from the automobile industry who were also in the sceme were indicted on federal anti-trust charges. To know more read the book Asphalt America.

McDonalds and the fast food restaurant industry
The restaurant industry is now America's largest private employer and it pays some of the lowest wages. McDonalds is one of the big players, it annually hires one million people, larger than any other organization in America, public or private. But while these companies might be a boon for the employment scenario they certainly know how to keep their costs low so that they can increase their profit margins. In 1972 the fast foof industry lobbied the Congress and the White House to pass a new legislation known as the 'McDonald' bill" that would employers to pay sixteen and eventeen year old kids wages 20% LOWER THAN THE MINIMUM WAGE. The entire focus of the fast food industry is on technology so that the machines in the kitchen complete the process of making the processed food with minimum input of the workers. Thus the only skills that a fast food employee needs is how to get to the office on time and smile at the customers. So despite spending most of their millions on research of technology the fast food corporations still accept hundred of millions of dollars from government susbsidies for 'training' their workers. The fast food industry pays the minimum wage to higher proportion of its worker than any other American Industry. The companies only strive to drive the minimum wage lower and reduce the training costs for workers by making the kitchen machines more intelligent. All this while the average corporate executive bonus has had an annual increase of approximate 20% each year (1997). McDonalds has in the history gone to the extent of even shutting down its shops if it senses that the workers there are beginning to organize into a union, making their interest very clear. Sorry is somebody screaming labour market exploitation ????

Cargill, IBP - and the American farmer

In the 1980s large multinations like Cargill, IBP, ConAgra were allowed to dominate one commodity market after the another. Farmer and cattle ranchers began to lose their independence, essentially becoming hired hands for the agribusiness giants or being forced off the land. The scenario is very similar to what has happened to India because of these companies. Rural communities in America are losing their middle class and are becoming socially stratified, divided between a small, wealthy elite and large numbers of the working poor. The United States now has more prison inmates than full time farmers.

Note: Most of the above material has been taken from the book Fast Food Nation - Eric Schlosser. Read the book to find more damning facts about how McDonalds is impacting the world.