Economic Highlights

New Delhi, 24 December 2010

Klepto Lords, New Corporate Czars

20 YEARS OF TRILLION DOLLAR LOOT

By Shivaji Sarkar

Two decades of globalisation shatters the world, particularly India, with scams mastered by the new corporate czars, Kleptomaniac Lords. Globally trillions of dollars has been looted. This was not a Robin Hood-type activity that robbed the rich for the sake of the poor. The Kleptomaniac Lords mastered the reverse process. They loot the common man to enrich the rich and create a new class of neo-rich.

Importantly, growth has become suspect which does not translate into good governance. India’s first brush with it started with the partial process of integrating with the world when the Bofors cannon purchases fuelled a financial scam (Rs 65 crore). It fired political salvoes that brought down the Rajiv Gandhi Government in 1989 and changed the political groupings and economic processes.

In fact, the 1991 liberalisation and globalisation became the password for frauds of unimaginable scale. Today, technologies like internet have emerged as a perfect medium for scams and swindles. Whereby, every new process has helped large corporates to amass disproportionate wealth.

Worse, the common man’s cry is lost in the jungle of corporate-trampled national sovereignties. They are even controlling Governments and inciting them to wage wars to protect their interests.

Iraq is the worst example of corporate canards and waging a war against a supposed tormentor and war monger. It is also an instance of how the most powerful of all nations could be a pawn in the hands of the mighty oil transnational corporations (TNC), who have the capacity to ruin the world economy.

Indeed, the sub-prime US housing crisis, Lehman Brother-AIG collapse, Burney Madoff’s New York Stock Exchange manipulations of 2007-08 and the Euro zone crisis have their genesis in the collapse of the power giant Enron, chartered accountant firm Pricewater House, WorldCom and many other US companies in the mid-1990s.

Each of these scams scathed India as it saw the beginning of a process of corrupting Indian political leaders, a phenomenon that these corporates had mastered in Latin America. The telecom firm AT&T is even known to have organised a coup in Chile. Other large corporates caused disturbances in Argentina and Panama. Some lesser known African countries have been their victims as well.

Those who believe that scams taking place in India are the mere creations of some stock brokers, officials or politicians are too naive to understand the ways of these TNC. Else how would one justify the purchase of an Rs 70 crore balloon for use twice during the inaugural and closing ceremony during the Commonwealth Games? It was only a small part of the Rs 71,000 crore CWG extravaganza that had doled out a contract of Rs 200 crore for removing debris!

Surprisingly, the poor man of this country, where farmers are committing suicide every day and the number of people sliding below the poverty line is swelling, did not utter a word against the opening and closing shows. The companies were the largest beneficiaries with some nuts thrown to officials and politicians. None has raised a finger against one company – so subtle and “efficient” is their operation.

Harshad Mehta the most hated name of the 1992 Rs 30,000 crore stock scam is on record of asserting that he was not working on his own but for some big companies. He was a mere tool as possibly Ketan Parekh had been. Every stock price manipulation benefits one or the other company. People like Mehta, Parkeh or Madoff in the US are their known agents.

This is not all. Interestingly, neither the Rs 64,000 crore UTI scam could not have been the handiwork of some individuals nor the Burney Madoff’s NYSE manipulations his solo effort. Behind every “successful” scam is a group of TNC and other corporates.

The Abdul Karim Telgi’s Rs 30,000 crore stamp scandal was not possible without active connivance of a large network. Nobody has till date probed how the sophisticated imported printing machine, supposedly purchased as junk from the Nasik Security Press, was maintained without the help of its manufacturer. If the people in this country are so efficient, why do they themselves not manufacture it?

How much has Ramalingam Raju of Satyam fame swindled away – Rs 60,000 crore, Rs 70,000 crore or more in January 2009? These figures are all guesses. But it was a neat operation with the collusion of chartered accountancy firm PriceWaterhouse Cooper and banks. Utter emasculation of the labour and Employees Provident Fund Organisation (EPFO) officials, under corporate pressure, aided the process.

Last year, 2009 also saw a scam in manipulative prices of sugar, food-grain and butter. Nobody has quantified the losses. This year too has seen five major scams and four of these in the last four months. Namely, the IPL-T-20 cricket scandal, Commonwealth Games, Adarsh Housing Society, 2G Spectrum and last but not least the LIC Housing Finance swindle. The sixth one, the onion scam is in the making.

Most scandalously, this sleaze has resulted in India slipping to the 87^th spot in Transparency International’s latest ranking on corrupt nations. The Global Financial Integrity (GFI) has noted that over Rs 575,000 crore ($ 125 billion) has been siphoned off by “corrupt politicians and officials” between 2000 and 2008 from India. The GFI notes, “As money flows, however, the poor continue to stay poor. Both corrupt political and corporate officers manage to siphon off funds intended to aid the people to political and private sector elite”.

Arguably, should we be looking for a reversal of the globalisation process? Should we call for a protectionist policy to shield the country against this loot?

Clearly, it calls for a change at the policy level to prevent Posco, Vedanta, Reddys' or Jaiprakash et al from brazenly eyeing public land, property and wealth. Thus the “kleptocracy” --- rule of thieves --- has deprived the poor of their land. They have become homeless in their own habitats.

Shockingly, the rulers have either been purchased or threatened to speak the language of the few mighty corporates. Be they TNCs, national or local level companies. The loot is not restricted to the Central level. These corporates are functioning in UP, Uttarakhand, Madhya Pradesh, Orissa, Andhra Pradesh, Karnataka, West Bengal etc.

The tragedy of it all is that India was perceived to be different not so long ago. However ‘Manmohanics’ has changed that. Could we go back and emulate the Mahatmas, Gandhi and Gautam Buddha, to stave off this loot? If this is not done, the world’s poor would welcome global warming so that the dishonest and corrupt are drowned and the world ushers in a new order! --- INFA

(Copyright, India News and Feature Alliance)