Political economist William Robinson, writing in 2004, argued that world economic activity had become dominated by transnational corporations. He drew from World Investment reports published by the United Nations Conference on Trade and Development (UNCTAD) and private reports to chart the growth of cross-border corporate mergers and acquisitions.
There were 14 in 1980 and 9655 in 1999. Between 2000 and 2007 inclusive, such deals in excess of US $1billion totalled 1335. In all sectors of capitalism, cross-border mergers and acquisitions advanced horizontal and vertical intergration, global economies of scale and inter-corporate strategic alliances.
In 2000 the 500 largest transnational corporations controlled approximately 80 per cent of the world`s foreign investment, 30 per cent of global output and 70 per cent of world trade. These trends represent a fundamental shift in the organisation of capitalism.
After the collapse of the Soviet Union and Eastern Europe transnational capitalism impacted upon vast new populations. National economies become incorporated, to a greater or lesser extent, into global networks of finance, production and consumption.
In rough outline this is global capitalism.
The entire arrangement required a loose transnational state structure which would advance the neoliberal policy preferences of transnational corporate elites. This structure included policy development organisations such as the International Chamber of Commerce (ICC), the Tri-lateral Commission (TC), the Bilderberg Group ,the World Economic Forum (WEF) and the World Business Council for Sustainable Development (WBCSD). Together, they formed a world of financiers and corporate executives who invited in major government leaders, NGO`s and leading intellectuals. Transnational policy research groups set the ideological boundaries for supra-national and international bodies such as the European Union (EU), the G8 , the G10 , the Organisation of Economic Cooperation and Development (OECD), the World Trade Organisation (WTO), the International Monetary Fund (IMF) and the Bank of International Settlements (BIS).
Crucially, the transnational state network also included the executive level of those nation states which had capitulated to neoliberalism. Office holders within finance ministries, policy advice groups and the senior civil service matched national economic priorities to the demands of global finance and transnational corporations. National legal systems, representative assemblies, electoral mandates and journalistic principles of inquiry were sidelined. In short, global capitalism through the transnational state, sought to overrule national democracy.
Back in 1997 and 1998 for example the OECD`s Multilateral Agreement on Investment enabled corporations to seek retrospective compensation from states that had extended regulatory controls over foreign companies and investors. Under MAI state-regulatory policies could be legally defined as acts of expropriation by supra-national dispute resolution bodies. This radical contraction of national state autonomy was prevented by a worldwide, three year campaign driven by activist groups, unions, political parties, NGOs and environmental organisations. Now, 15 years later, similar mobilisations will be required to undermine the TPPA and the investor state provisions it contains.
Let us now pause to consider the nature of this agreement.
Conventional accounts describe a trade arrangement among 12 Pacific Rim countries concerning various aspects of economic policy; agriculture, manufacturing, information technologies, pharmaceuticals, intellectual property, investor state relations etc. Some reportage emphasises the strategic role of the United States within the TPPA as a counterweight to China. Each round of TPPA negotiations was, typically, portrayed as a struggle for concession and advantage among the 12 states (Brunei, Chile, New Zealand, Singapore, Australia,
This was made clear on March 26 when Wikileaks released a (January 20 ) draft of the TPPA`s investor-state arbitration chapter. Julian Assange noted the proposed creation of a supra-national court or tribunal where corporations could sue states and obtain taxpayer compensation for future profits foregone at the expense of national judicial processes.
What New Zealand has signed up to here will be revealed by the lifting of the TPPA secrecy clause. It is already clear, however, that the executive state (National`s cabinet, Treasury, Reserve Bank, MFAT, other senior ministries and associated policy advice groups) have acceded to a deal which damages the precepts of national-legal sovereignty, parliamentary democracy and the electoral mandate. A vital question remains to be answered. Will this incursion of the transnational state incorporate the entire political class? The Greens and New Zealand First have deep concerns about the TPPA? So would the Maori Party,at least privately. What then is Labour`s position? Will their leadership oppose the TPPA and its investor –state provisions? Or will they, as part of the transnational state, allow transnational corporations to further threaten our democracy and national sovereignty?
New Zealand is waiting.