Déjà Vu: South Africa and China

By John Harrington, AlterNet. Posted May 16, 2006.

As things change, everything stays the same. Remember apartheid South Africa? Remember the voluntary corporate code of conduct called the Sullivan Principles? Remember Reagan's "constructive engagement"?

In the early to mid-'80s, the Sullivan Principles and constructive engagement were a cover for "business as usual" in an effort to dispel criticism of the white minority government's brutal suppression of the majority of the South African population, financially underpinned by U.S. corporate investments, bank loans and trade.

Recently, there have been outcries by Republicans and Democrats alike in Congress about the U.S. technology companies being required by the Chinese government to spy on and violate the human rights of Chinese citizens. These companies make lots of money selling hardware, software and services to the totalitarian government, including its police and military. The suggested solution: another U.S. government task force to investigate, hinting that a new voluntary technology industry code of conduct might be in order. Déjà vu?

In the early 1970s, global corporations, including about 350 U.S.-based transnational companies, were pouring millions of dollars into racist, white-minority-ruled South Africa to earn lots of money. Why not? There was cheap, controlled and abundant black African labor, cheap natural resources, a western banking system, an industrial economy exporting products to Europe and the West and a police and military state elected in a whites-only "democracy" to keep the trains running on time.

In the People's Republic of China, we find a one-party dictatorship of the proletariat, welcoming global corporations into an enormous and expanding economy based upon cheap, controlled and abundant labor; cheap natural resources; an increasingly Western financial system; and an industrial economy with little or no environmental, health, safety, and labor protections. The country has an enormous trade surplus, thanks primarily to exports to the United States, and is one of the largest investors in our country's treasury market. Top it off with a military and police state, enhanced by the most sophisticated Western security technology money can buy.

Internet search engine companies such as Yahoo and Google were recently castigated by Congressional politicians for working for the Chinese government to censor the internet, spy on Chinese citizens, and turn over email records to Chinese security forces. Several years ago, it was discovered that Cisco Systems, Nortel, IBM, Sun Microsystems, Microsoft, and Oracle, among many others, were selling the government the technology to violate human rights, all to make money and have access to one of the largest national markets to make even more money. So what's changed? Not much.

Our wonderful Clinton and Bush administrations and Congressional Democrats and Republicans, taking corporate money hand over fist, and listening to thousands of corporate lobbyists in Washington, D.C., provided this terrorist government "most favored nation" (MFN) status, eventually making MFN permanent, welcomed it into the World Trade Organization (WTO), and lavished the Chinese economy with enough industry, technology, and capital to guarantee political, economic, and military impregnability.

In South Africa, you may remember, corporations came under increasing political pressure by the majority African population, while the world community, including many in the United States, supported the end of apartheid rule by exercising shareholder advocacy, divesting stock, and refusing to bank and do business with the South African government and corporations supplying capital and other strategic resources to help keep the white dictatorship in power. To counter this strategy, corporate management trotted out the Sullivan Principles, or a voluntary code of conduct in South Africa, for corporations operating there to legitimize their presence by advocating "equal pay for equal work," desegregating restrooms and cafeterias for workers, and verbally calling for political "change" in South Africa. Corporate management's Sullivan Principles, which were never opposed by the white minority government, were supplemented by President Reagan's "constructive engagement." The Reagan policy basically stated that the U.S. government should continue to operate in South Africa, publicly "deploring" apartheid, while continuing to economically strengthen it.

Of course, this was a convenient cover for corporations to continue "business as usual" and make money on the apartheid. It did, however, allow corporate management to publicly decry racial discrimination in South Africa and for politicians to jump on the meaningless bandwagon of humanitarian concern for the suppression of democratic rights, free speech, evil segregation, and … blah, blah, blah. In other words, corporations, politicians, and government officials in the United States all participated in the dialogue of "constructive engagement" to avoid destroying apartheid or, more importantly, disrupting ordinary business and reducing large corporate profit margins.

John Harrington is a founder of Working Assets, and the author of "Challenge to Power."

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