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Silent coup: How corporations overthrew democracy – book review

Counterfire | 31 August 2023

Silent coup: How corporations overthrew democracy – book review

by Reece Goscinski

This informative investigation of how corporations use international legal structures to exploit the world needs the context of a wider political analysis, argues Reece Goscinski.

The threat to democracy has evolved into a growing concern internationally. While Western news outlets and online circles have predominantly concentrated on the intervention of competing global powers in national political processes, Provost and Kennard redirect their attention towards the utilisation of the globalised political and legal system by international corporations to assert power and accrue profits.

Endorsed by figures such as Varoufakis and Chomsky, Silent Coup is written as a narrative piece of investigative journalism. Both Provost and Kennard are members of the Centre for International Journalism and Kennard’s Declassified UK regularly delves into British foreign policy. This journalistic background allows the authors to dramatise the highs and lows of their investigation journey, whilst also delving into case studies illustrating a twenty-first-century corporate dystopia. The book highlights issues of corporate justice, welfare, territories, and armies operating on a global scale on behalf of these corporations.

A corporate dystopia

The book initially spotlights a questionable international legal system exerting influence over the policies of developing states. When local communities in El Salvador voiced opposition to the establishment of a goldmine, citing worries about water contamination and usage, the Salvadorian government responded by preventing the mine’s operation in line with its environmental policies. In reaction, Pacific Rim, the company behind the mine, which was later acquired by the conglomerate OceanaGold, tried to sue the Salvadorian government for a hypothetical loss of profits (pp.10-11). Between 2009 and 2014, the authors find Pacific Rim had hired professional influencers from the neighbourhood, and spent $300,000 lobbying the US government on the development of the mine (p.19). While El Salvador did win its case against the company by 2016, OceanaGold was ordered to pay $8 million. However, El Salvador’s defence had cost $12 million, leaving the government $4 million out of pocket (p.18).

The case of El Salvador takes Provost and Kennard down a rabbit hole as they cover the existence of the International Centre for the Settlement of Investment Disputes (ICSID), a subsidiary of the World Bank established in international treaties to safeguard foreign investment (p.21). As their investigation progresses, they unearth instances of corporations attempting to overturn government legislation and environmental policies in the UK (pp.50-7), Germany (p.49), and France (pp.50-7) through the ICSID. Amidst these legal challenges, the book reveals that US firms (20%) and UK firms (8%) had made the most use of ICISD mechanisms, with Eastern Europe and Central Asia being hit with the most claims (p.58).

Whilst ICSID was one part of the puzzle, another area the book identifies as solidifying corporate power is the international-aid model. Provost and Kennard navigate through the intertwining of Non-Profit Organisations (NGOs), charities, and corporations, such as partnerships between Save the Children and GlaxoSmithKline (pp.87-8). The authors argue that this model has resulted in an international aid system which privileges private profit over charitable outcomes.

Additionally, the authors investigate special economic zones (SEZs) designed to tackle poverty in specific regions. However, this has resulted in corporations benefiting from preferential conditions and weak labour rights, as the book explores in the case of China (pp.116-23). This in turn has led to the creation of ‘corporate armies’ employed on behalf of corporations to intimidate local opposition, such as in the case of Honduras (pp.185-8).

A twenty-first-century imperialism

Silent Coup presents intriguing case studies that illuminate the Kafkaesque nature of an international system attempting to subvert democratic processes globally. The book utilises statistics, testimonials, and legal documents to contrast the professed intentions of international organisations with their actual actions.

However, the book does lack a political framework in which to interpret the findings. Whilst imperialism is mentioned within the book and testimonials, and some passages hint towards the currently popular ‘techno-feudalism’ analysis, the authors arrive at the conclusion that the power of good journalism will restore democracy (pp.221-2).

The book’s narrative structure is also distracting from the authors’ arguments. In certain passages, the exposure of the silent coup is sidetracked by diary-like reflections on the information-gathering process.

When Silent Coup’s findings are situated within a broader political analysis, it becomes evident how these international networks give rise to a twenty-first-century imperialism or neo-colonialism: developing nations are exploited by private organisations operating within the international political framework. This results in increased competition between states, such as the USA, China, and Russia as they scramble for hegemonic dominance. As such, for socialists, this book proves useful in illuminating the intricacies of contemporary imperialism, but it offers limited insights into broader analysis or potential solutions.

 source: Counterfire