1975 saw the publication of the infamous The Crisis of Democracy – report on the governability of democracies by the Trilateral Commission which argued that democracy had gone too far and was endangering the very stability of the system. It carried the names of Michel Crozier and Samuel Huntington; made respectable the phrases “state overload”; and effectively launched neoliberalism. Some 2 decades later – when communism collapsed in Central and Eastern Europe – the effort moved into a higher gear. “Silent Coup: How Corporations Overthrew Democracy,” by Claire Provost and Matt Kennard is a rare book which charts the way the corporate coup d’état was orchestrated. It examines the use of an international legal system (International Centre for the Settlement of International Disputes or ICSID) to control and plunder the resources in the developing world, including the overthrow of governments that challenge corporate dominance. Although one of the authors has been a Financial Times journalist, the MSM has been remarkably quiet in its reviews. One of the few journals prepared to review the book was a leftist one
By mid-2014 it had heard nearly 500 cases almost all since the mid-1990s. This was the era when neoliberal free market capitalism was let off the leash following the collapse of the Stalinist states in the former USSR and Eastern Europe. This temporarily opened an era of a unipolar world dominated by US imperialism, which by the early 21st century gave way to the multipolar world we have today. By 2021, the number of cases heard by the ICSID had risen to almost 900 – with more than
one new case a week that year. This growth reflects the new multipolar world and the growth of the power of multinational giants. It is part of the international investor-state legal system.Little-known legal system What has developed over decades allows investor access to a little-known legal system.
Through thousands of treaties, a state gives advance consent to allow foreign investors to take them to international tribunals, such as the ICSID. This means that countries that signed up contracts for foreign investors were also signing up to resolve any dispute between the national government and companies by agencies such as the ICSID – a subcommittee of the World Bank and other imperialist institutions. A huge lucrative legal industry has sprung up around this system. In the early period of the ICSID, most cases were from companies taking legal action
against countries in the neocolonial world. Now, as this book reveals, this is in the process of changing. German investors had filed cases against countries in the neocolonial world. But in 2009, Germany found itself in the dock, when the Swedish company Vattenfall filed a case against Germany with the World Bank’s ICSID over its controversial new coal-fired power plant near Hamburg. This change illustrates the growing power of these enterprises, to the point where they come into conflict with competing nation states.The international investor-state dispute system has evolved over decades; possibly being traced back to a conference of international bankers held in San Francisco in 1957. Around 500 of the world’s senior bankers, industrialists, and politicians gathered together and began campaigning for a new ‘capitalist Magna Carta’ to enshrine and protect the rights of private investors worldwide. A key figure at this gathering was the German banker, Hermann Josef Abs, head of Deutsche Bank and director of several giant corporations like Daimler-Benz and Lufthansa. His rise in the financial world took place under the Nazi regime in Germany, but it didn’t end with its fall. Although he never joined the Nazi Party, Deutsche Bank had handled its accounts. World events in this era in the neocolonial world, such as the nationalisation of the oil fields in Iran in 1951 and the Suez Canal in 1956, were undoubtedly events that drove the ruling capitalist classes in the imperialist countries to instigate steps to muzzle democratic voice.
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