Tzur Shupack

MNCs are complex. Do they cause exploitation, do they manipulate or control the government? I think that capitalism, and mercantilism before it, set up MNCs to exploit the third world and influence government policy. The history of modern MNCs start in the US with the Santa Clara vs. Southern Pacific Railroad and in England with the companies act of 1862. While Crawford argues that MNCs originate here, and I mostly agree with this, it’s important to see how MNCs had their networks of power and control prior to the 20^th century. MNCs built off the production and distribution networks of the state associated companies, the United Fruit Company was originally a state associated company, and then it was fully privatized by the late 19^th century. The United Fruit Company used their historical connections with Latin America, and the power of the American state to assume control over monopolies in natural resources in Guatemala. In the early 20^th century United Fruit Company had control over the rail, mail, and electricity. The United Fruit Company had access to gain these monopolies due to the fact that dictators controlling Guatemala gave the united fruit company cheap contracts over these resources for bribes. The United Fruit Company essentially used the influence and power of the American empire to maintain market control over much of Latin America. This is important to see because even before the Guatemalan coup the United Fruit Company had political and economic leverage over the US and Guatemala, due to historical factors such as imperialism and colonization. Yet the reaction that MNCs don’t really influence governments because sometimes governments hurt MNCs profits is looking at too narrow of a scope. An example of Governments not doing foreign policy action at the behest of MNCs is the oil interests in the first gulf war. A study showed that the oil interests influence as a reason for the gulf war was the 4^th most relevant factor. However, this scope is looking at violent foreign policy, not general foreign policy which includes trade treaties. Additionally, this example doesn’t even suggest that the government didn’t have the oil interests in mind, but that these oil interests weren’t the most critical factors influencing the war. I would respond to these criticisms by focusing on US trade policy, which resoundingly supports MNCs profits and control, especially as indicated by the TPP under the Obama administration.