Monopolies within Sleaze Capitalism
Sleaze capitalism is defined here as the form of capitalism in which profits are privatized and costs are socialized.
Inequity is institutionalized inequality, or the unfair and unjust use of wealth and power to maintain economic and social disparities. Underlying most human suffering in this world is the inequity within and between nations created and maintained through the power of wealth. Oligarchs and plutocrats—working on all scales, from the local to the global—have, by definition, the most power to defend and expand their wealth. The consequences of their actions often adversely impact the poorest, therefore perpetuating inequity, chronic hunger, and the perpetual famine.
Of the many and complicated ways that wealth is defended and expanded at the expense of the poor, here I am addressing only the abuse of monopoly as it directly exacerbates chronic hunger, the perpetual famine, and the coming great famine of this century:
By hyper-industrializing agriculture, the Green Revolution scaled up farm-related technologies and fed enormous profits to large corporations, often to the detriment of millions of smallholder farmers around the world. Industrial agriculture, with its reliance on expensive hybrid seeds, fertilizer, water, and pesticides, along with the machinery and fossil fuel necessary to support these inputs, requires substantial capital investments and thus favors the concentrated wealth found in First World banks and businesses, in large authoritarian governments like China’s, and in large corporate farms. And, since the rewards for substantial investments are substantial returns, the high yielding hybrids and the economies of scale enjoyed by large farms make them more profitable than smallholder farms. The winners then, not surprisingly, have been the already wealthy who can afford the outlays and loans and who then reap the profits. The losers have included millions of farmers around the world who have either lost their farms or simply abandoned them for manual work in the cities.
Consequently, like all other goods and services that have been privatized and commodified (energy, transportation, communication, information, incarceration, education, health), food has become a big business. Today, most everything about food—from the specific food products sitting on supermarket shelves to global food security—is determined in large part by corporations and organizations that, like gods, are invisible and unanswerable to us, entities such as Archer Daniel Midland, Yara Fertilizer, Agrium, Cargill (once named “the worst company in the world”), Syngenta, Corteva, Monsanto (now rebranded under Bayer), The World Bank, the World Trade Organization, and the USMCA (perhaps better recognized as NAFTA2.0). As of 2019, “the Big 4” ag corporations—Bayer, Corteva, ChemChina, and BASF—controlled more than sixty percent of global sales of “proprietary seeds.” Four corporations—Cargill, Archer Daniels Midland, Bunge, and Louis Dreyfus—controlled close to ninety percent of the global grain trading business. In 2018 the largest four corporations—Bayer, DowDupont, Syngenta, and BASF—dominated 84 percent of global herbicide and pesticide sales. As corporations merge (Dow and Dupont formed DowDupont in 2017), acquire each other (Bayer bought Monsanto in 2018), and split for the advantages that come from streamlining businesses (in 2019 DowDupont split to form Dow, Dupont, and Corteva, the last focusing on agricultural products), the upshot is that ever fewer companies control an increasingly larger share of the food system. As a result, farmers are paying more for inputs and receive less at the market (where corporations buy their products wholesale), and consumers are paying more for less nutritious foods.
The four largest suppliers of feed cattle in the U.S.—JBS, Tyson, Cargill, and National Beef—control over eighty percent of the market and have repeatedly demonstrated the illicit power of monopoly. In various combinations, the four have been sued for collusion, price fixing, and corruption, and lawsuits have been brought against the USDA for aiding and abetting them.
The largest of them, the family-run, Brazilian conglomerate JBS, has been rocked with headline-grabbing lawsuits in the past few years. The Batista brothers, Joesley and Wesley, who are controlling shareholders, and at least a dozen JBS executives have been charged for numerous crimes of bribery, insider trading, cutting supplies to drive up meat prices, securing illegal loans, and for flouting environmental and labor laws. They paid almost $250 million dollars to 1,829 Brazilian politicians, including three past presidents, in what Fox News called a “vast corruption and bribery scandal.” JBS has also been found guilty—and fined a mere $7.7 million pittance by the Brazil’s environmental agency, IBAMA—of violating rainforest protection laws by buying illegal cattle linked to the burning of Amazon rainforest. Their slaughterhouses in the Amazon are located in the heart of the worst destruction. Valued at over fifty billion dollars, JBS remains the number one processor of beef and pork, and its profits and share prices continue to soar.
Of course, malfeasance is not unique to this transnational corporation. JBS is but one among the pantheon of agribusinesses (Cargill, Bunge, Marfrig), retail stores (Walmart, Costco, Peapod, McDonalds) and banks (JP Morgan Chase, HSBC, Santander, Barclays, Wells Fargo, you name them) that are implicated in systematic corruption and together control the world’s food system. They are the exemplars of sleaze capitalism, pocketing the profits and hiding their costs that are paid by the rest of us, often unwittingly, in the form of deforestation, environmental degradation, lost soil fertility, hunger, obesity, and violent conflict. And not surprisingly, the decline of “natural capital” has been far greater—five times greater—in developing countries than in the rich countries. Oil spills in Nigerian rivers and estuaries, heavy metal contamination from mines in Zambia and Congo, discharge from garment factories in Bangladesh, air pollution in India and Indonesia, … and so on.