How Corporations Are Fueling Geopolitical Tensions and Global Conflicts in the 21st Century

BY JOHN P. RUEHL

 JUNE 21, 2024
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Photo by Jurij Kenda

Shortly after the outbreak of the Israel-Hamas War and the beginning of the widescale destruction of Gaza in October 2023, McDonald’s executives in Chicago found themselves inadvertently entangled in the conflict. Local owners of McDonald’s restaurants are given significant autonomy over profits and operations, and franchisees had begun taking sides. Social media posts by McDonald’s in Israel highlighted the provision of free meals to Israeli soldiers, causing McDonald’s franchises across the Middle East to collectively pledge millions of dollars to support Palestinians in Gaza.

McDonald’s has since attempted to minimize commenting on the franchisees and navigate its way through the controversy. In April 2024, McDonald’s Corporation announced it would buy back 225 of its restaurants from Alonyal Limited, the Israeli company that manages McDonald’s in the country, for an undisclosed amount. Expected to be finalized over the next few months, the deal will keep McDonald’s busy as the company tries to reverse the decline in regional sales and stock price caused by the affair.

The incident demonstrates how multinational corporations with global footprints and decentralized operations can rapidly find themselves fueling opposing sides of conflicts. While McDonald’s top executives did not plan to show support for either Israel or Palestine, profit incentives have occasionally driven companies to support multiple sides in conflicts, often in more meaningful ways. The Iran-Iraq War from 1980 to 1988 saw Western weapons manufacturers directly and indirectly supply both sides with arms, capitalizing on the shifting Western government support for Iraq and Iran throughout the conflict.

However, as multinational companies have expanded their international operations amid increasing globalization and strains on the U.S.-led global order, they are now challenged with maintaining business dealings with both the U.S. and countries hostile to American interests. Additionally, these companies are becoming more entangled in fueling opposing sides of civil conflicts within other countries, directly and indirectly, in ways that can prolong or escalate violence.

The war in Ukraine has exposed how multinational corporations have become less willing to fully comply with the directives of any single government, including the U.S., when it conflicts with their financial interests. Despite Russia’s annexation of Crimea and instigation of a proxy war in Ukraine’s Donbas region in 2014, numerous Western companies continued operating in both countries, providing the Russian government with tax revenue, technological expertise, products, and employee knowledge, easing the Russian government’s efforts to support its war efforts. However, after Russia’s full-scale invasion of Ukraine in 2022, many Western companies faced the dilemma of complying with sanctions by exiting Russia or retaining access to lucrative government contracts and a 145-million-person consumer market.

Yet while most departed Russia due to public pressure and sanctions, other companies remained in the country, citing expensive exit costs. Others which officially left Russia or declared their intention to do so continue to operate in Russia and have proven essential to the Kremlin’s ability to reduce the impact of sanctions. Meanwhile, even China, Russia’s most important partner, had its largest commercial drone company, DJI, emerge as the largest drone provider for both Russia and Ukraine, showing the powerful allure of profits and how international markets allow the flow of products to war zones regardless of geopolitical alliances.

As tensions between the West and China have also intensified over recent years, Western companies have faced mounting pressure to sever ties. U.S. tech giants like Google, IBM, and Cisco have come under fire for aiding the development of China’s security capabilities, albeit ostensibly for domestic use. In 2019, comments by NBA officials over China’s response to pro-democracy protests in Hong Kong drew severe financial repercussions for the NBA’s operations in China, and drew a response from the White House criticizing companies that had “kowtowed to the lure of China’s money and markets.”

Yet Beijing continues to try to compel foreign companies to take a separate stance from their home governments on divisive issues, or at least ensure neutrality. Many U.S. companies already generate larger revenues in China than domestically and are not willing to ostracize the world’s second-largest economy and largest consumer market.

While multinational companies have historically operated under deference to the U.S. during the last few decades of neoliberal globalization, the challenges to the U.S.-led international order have made many reconsider their positions. This dynamic, coupled with globalized supply chains and markets, appears to have emboldened some multinational corporations to believe that they can support multiple sides in geopolitical confrontations with relative impunity, while their products and services will likely find their way to desired destinations and partners regardless of government directives.

Instead of marching in lockstep with Washington, companies appear more willing to try to maintain ties to the U.S. while simultaneously maintaining and building ties with countries hostile to it. This approach risks aggravating geopolitical tensions and undermining the coherence of the U.S.-led global order, as the profit motives of multinational corporations diverge from the foreign policy objectives of the governments where they are based.

Importantly, as globalization has advanced, multinational corporations have become increasingly involved in civil conflicts and regions with fragile governance. In some cases, they have actively exacerbated tensions by supporting rebel groups and governments. Chiquita Brands International S.à.r.l., one of the largest agricultural companies in the world, admitted to paying money to both the FARC rebel group and right-wing paramilitary groups in Colombia in the 1990s and 2000s to ensure the safety of operations.

This practice of companies supporting multiple sides in conflicts is particularly evident in Africa, often to secure access to resources. In Nigeria, U.S. companies Shell and Chevron have paid insurgent groups to safeguard their oil and gas interests, while also providing tax and developmental funds to the Nigerian government. Similarly, mining companies like Afrimex (UK) Ltd. and Belgium-based Trademet SA have made payments to rebel groups operating in the Democratic Republic of Congo (DRC), as well as working with the DRC government.

Chinese mining companies are also alleged to have paid Nigerian militant groups to access mineral reserves in the country, while simultaneously conducting business with the Nigerian government. In Myanmar, various Chinese and Thai firms have pursued a dual-track approach of officially signing deals with the military junta while covertly engaging with ethnic armed groups controlling territories rich in natural resources.

Mining, logging, and agricultural companies also paid “revolutionary taxes” to the New People’s Army (NPA) and other insurgent groups in the Philippines, including companies like Lepanto Consolidated Mining Company and Philex Mining Corporation, prompting public disapproval by Filipino officials. Louis Berger Group, an engineering consultancy, meanwhile paid the Taliban and other groups in Afghanistan to protect supply convoys and construction projects, while serving contracts for the U.S. military.

Banks and payment processing networks are also indirectly facilitating or turning a blind eye to financing designated terrorist and criminal groups. The FinCEN Files, released in 2020, also revealed how banks like the UK’s Standard Chartered PLC processed millions of dollars for Arab Bank customers, despite Arab Bank being found liable in 2014 for knowingly transmitting money to Hamas.

The growing direct and indirect role of corporations in conflict zones, particularly in regions with weak state enforcement, is also being led by private military and security companies (PMSCs). These firms are often employed by other private actors to safeguard investments and personnel but have a natural tendency to manage and prolong conflicts rather than resolve them. Across Africa in particular, PMSCs are present to serve private interests as well as governments. The increasing use of PMSCs globally has raised concerns about the ability of multinational corporations to swiftly shift their support between conflicting sides as their strategic interests evolve, potentially taking a far more active role in fueling and prolonging conflicts.

Governments, of course, regularly support rival actors in conflicts. Competing political factions, shifting interests, political expediency, economic motives, desperation, and a desire to promote instability. The Syrian Civil War saw Pentagon-funded Syrian rebels fighting those supported by the Central Intelligence Agency. Meanwhile, the Syrian government itself was paying the Islamic State (IS) to buy back its own stolen oil and natural gas while backing other rebel groups to fight IS.

But the risk of corporations more actively supporting multiple sides in conflict zones and carving up their own territories and spheres of influence is a concerning prospect, akin to the Dutch East India Company which governed its own territories through military force and trade monopolies. While there are still waning expectations that multinational corporations pick clearer sides in interstate conflicts, there appears to be little stopping them from fueling and prolonging intrastate conflicts featuring non-state actors, as long as it serves their financial interests. Urgent action is needed to strengthen the regulation and accountability of PMSCs and multinational corporations operating in conflict zones, as their ability to shape conflicts appears set to continue growing.

Source: Independent Media Institute.

John P. Ruehl is an Australian-American journalist living in Washington, D.C. He is a contributing editor to Strategic Policy and a contributor to several other foreign affairs publications. He is currently finishing a book on Russia to be published in 2022.

State Repression of Social Movements

BY ZARA JEMUEL

 JUNE 21, 2024
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Growing up in my hometown of Greensboro, North Carolina I heard all about the infamous 1979 massacre. My parents and teachers lacerated the adventurist Communist Workers Party/Workers Viewpoint Organization (CWP/WVO) for courting death through increasingly aggressive rhetoric against the Ku Klux Klan. Family friends who were there on the day emphasized the complicity of law enforcement in facilitating the murders.

CWP/WVO’s Greensboro chapter consisted mainly of white middle class professionals who’d decided on committing ‘class suicide’ otherwise known as ‘proletarianization’. The Greensboro chapter contrasted with the majority Asian membership at the national level including the leadership of Jerry Tung. CWP/WVO merged with the all-Black Revolutionary Workers League, the largest Black marxist organization in the history of the U.S., who brought in needed organizing skills. Members lived collectively and operated on the turn-to-industry strategy taken up by many in the New Communist Movement. Their organizing target was the textile industry which had migrated south for a cheaper labor market.

Plants where CWP/WVO salts got jobs were already unionized but lacked internal organization. Salts built relationships with the workers and found racial disparities in how managers gave out assignments. Black workers were routinely given the most dangerous and dirtiest jobs. By organizing Black and white workers together for health and safety improvements overall, salts at one plant were able to move a strike.

Plant bosses close to the Klan targeted salts for termination making it more difficult to effectively lead workers on strike, and ultimately workers went back in without having won their core demands. CWP/WVO had already shifted by then to focus on countering the Klan.

A new local coalition made up of Klansmen and neo-nazis dubbed itself the United Racist Front (URF). One of their stated goals was to crush CWP/WVO. URF was thoroughly infiltrated by Greensboro police informants as well as FBI and ATF agents who knew of plans to kill specific CWP/WVO members, namely those leading organizing efforts at local textile mills. The two organizations confronted each other at raucous rallies where both came armed. CWP/WVO unveiled its new guiding slogan: “death to the Klan.”

On the morning of November 3^rd, 1979, CWP/WVO members, their families, and community supporters gathered singing in a circle on the lawn of a housing project preparing to march under the new slogan. Police and FBI agents were stationed up and down the street. As demonstrators sang and chanted, a long car caravan of URF members pulled up.

“You wanted the Klan, you got em” a news camera recorded one URF member saying. Taunts and blows were exchanged before George Dorsett, an FBI agent, stopped his car at the head of the caravan, pointed a pistol out his driver’s side window, and fired once in the air. URF members took the signal. They calmly exited their vehicles, walked to their trunks, and withdrew guns. When the shooting was over, five CWP/WVO members were dead, and several others wounded. All URF members charged with the murders were acquitted twice, both times by all-white juries.

As a teenager this story led me toward anarchism. I viewed the state, particularly the repressive apparatus, as the absolute enemy of the masses. I got involved with a coalition of anarchists, faith leaders, and community groups which included the Greensboro Black-Brown Unity Coalition, led in-part by former CWP/WVO members, one of whom had lost her husband in the massacre.

The coalition included the Almighty Latin King and Queen Nation (ALKQN), formerly the Latin Kings, who put forward a bold new vision for their organization. They became a political force, organizing local gangs together into a peace treaty alliance they referred to as the Paradigm Shift, running for city council, and participating in calls for police reform.

The nascent coalition organized a caravan of their own up to Washington D.C. where ALKQN, NAACP, NOI and other organizations presented a formal civil rights complaint to the Department of Justice detailing abuses by Greensboro Police, including internal surveillance of Black officers. Three months later, federal agents kicked in the doors of leading ALKQN members early on a cold December morning and dragged their families outside after using flashbangs and wielding assault rifles.

The thirteen ALKQN members arrested were charged under the Racketeer Influenced and Corrupt Organizations Act (RICO), essentially a prosecutor playbook for going after criminal enterprises like the mob. Jorge Cornell, one of those charged, pointed out “if we’re a criminal enterprise, then we’re the poorest criminal enterprise there’s ever been.” Even those critical of the ALKQN understood this to be a politically motivated attack, though some white progressives were uneasy. The parallels were not lost on surviving former CWP/WVO members who took on leadership roles in the ALKQN Legal Defense Coalition.

My role was small. I took kids to softball practice whose parents were now locked up. I sat in court hearings and took rigorous notes. I visited our ALKQN comrades in jail. Ultimately, I saw good people found guilty of a crime they didn’t commit and sentenced to decades in prison.

I was seventeen by the time the yearlong ordeal reached its tragic conclusion. The experience hardened my anarchism. In 2012 I drove down in a smaller caravan to Atlanta for a “fuck the police march” organized by a contingent of ‘insurrectionary anarchists’. Halfway through the march, police attacked. I saw a person carrying the lead banner take a punch to the jaw before entering into a scuffle with the cops.

Before I knew what was happening, I received a kick to the chest that knocked me from the middle of the street onto the sidewalk. When I looked up, I saw one of the marchers being choked out by a cop, so I ran over and tried to intervene. From there I was tackled to the ground and my head slammed into the asphalt. I spent the night in jail with one of those arrested and was given a sentence of community service. During our time in holding, my newfound comrades and I debated the cops on the merits of what we were doing which obviously came to no avail, but that night further solidified my commitment to anarchism.

I had read some Marx and disagreed with many Atlanta and Greensboro comrades that he was an “authoritarian”, but I lacked clarity on state power. Marx advocated the seizure of the state by the vast majority, ushering in an era of true democracy—majority rule. By controlling the repressive apparatus of the state, the masses are able to fend off counter-revolution. This is not hypothetical. It has happened before in the United States.

As we know, the state is not a monolith. It consists of factions and blocs of classes each vying for power. This struggle goes on in every state apparatus—governing, repressive, administrative, and ideological. The Right understands this as evidenced by the Heritage Foundation’s Project 2025. MAGA forces plan to “dismantle the administrative state” and secure their apparatchiks in key positions throughout.

Many on the Left view the repressive apparatus only as an enemy rather than as a site of struggle. Understandably. The military has historically been a tool of imperialism abroad and for crushing domestic dissent. But military personnel themselves are public sector workers with a long history of organized resistance. The military has also been decisive in enforcing mass movement demands during this country’s two most progressive periods.

After crushing the Confederate States of America, Union troops enforced martial law over and against the will of southern planter elites. This was done to the extent formerly enslaved Black and poor white workers briefly shared an economic interest with northern capitalists in overthrowing the rule of enslavers in the U.S. south. In that brief time, backed by the military, southern workers replaced the planter aristocracy as executor of the state.

Reconstruction had been underway six years when Parisian workers rose up and took power in that city, declaring themselves The Commune. After a bloody defeat in an ill-conceived war with Prussia, the French national guard, bitter toward the bourgeoisie, offered armed support to the rising workers. When the new French government, temporarily based in Versailles, came in force two months later, national guard troops fought to the death alongside the Parisian proletariat. The resulting massacre has been underplayed in most establishment histories of that period.

Imperial Russian military officers during the first World War frequently mistreated regular soldiers from working class and peasant backgrounds, sending them to pointless death in “no man’s land,” and depriving them of basic necessities. Soldiers became increasingly disillusioned, and their resentment grew into anti-Tsarist sentiment. After years of careful organizing, soldiers became essential to Russia’s successful mass movement against Tsarist autocracy.

Where the Russian movement succeeded was in winning over entire regiments of the military, even those scattered across the Eastern Front, as well as civil society. Winning over at least some part of the military for holding key urban centers, as the Parisian workers showed, is necessary but not sufficient for winning state power. Advanced forces in Russia recruited the Tsar’s military out from under him, leaving the regime without the means for a comprehensive crackdown. By the time St Petersburg women walked off the job in February 1917, the uprising was set to spread throughout the Russian Empire.

These abridged examples point to patterns we can draw on. Workers in Paris achieved temporary state power as an isolated outpost but never gained national cross-class hegemony. Any support they might have had among the backward French elite and petty bourgeoise was nowhere near strong enough to vie for governing power with the government of the burgeoning Third Republic.

Conversely in Russia, revolutionary sentiment was present in all classes of society. Cadre built relationships among the middle-class intelligentsia from which many of them came, rich liberals, and even sympathetic military officers, creating a mass cross-class support for overthrowing the Tsar. Leaders of the Russian movement accomplished their revolution by organizing a critical mass of the forces that would’ve otherwise opposed them.

State power can be won with little to no use of arms and final success still hinges on winning military support. Not exactly a novel idea, yet with particularities of time and place continually oversimplified in analyses of the contemporary American case.

The masses in the United States don’t need a violent revolution to win state power. Yet without the ability to defend itself, the revolution is over before it starts. Yet misapplication of the Russian experience imagines Teamsters breaking into municipal armories and doing battle on Main St with the 82nd airborne. Brave movement ancestors have given their lives teaching the lessons missed in that conclusion.

Most recently, grassroots armed struggle in the U.S. has taken place in the context of movement decline and severe state repression. Black Liberation Army, United Freedom Front, Weather Underground and others operating during the Second Reconstruction won no demands and alienated most of the masses. The two biggest concessions won during that period were the Civil Rights Act and the Voting Rights Act, which came before the adoption of an urban guerrilla strategy and were enforced by U.S. troops.

Mass nonviolent direct action, like strikes and civil disobedience, can be directly traced to large-scale tangible victories in the contemporary United States. I’m not sure the same can be said for urban guerilla warfare. We can honor the sacrifice of fallen and captured revolutionaries by continuing the struggle and avoiding mistaken action at inopportune moments.

We have influence over the state now insofar as progressives are elected to positions of governing power across the country. Unions and other civil society elements in the ideological apparatus such as Black churches often emerge as militant champions of progress. Mobilizing civil society and labor in the public sector (the administrative apparatus) could be critical to win the fight we’ve entered known as the Third Reconstruction. Along with schools and the family, these constitute those components of the state most concerned with the masses.

Through civil society, and particularly labor, advanced forces can build the mass organizations necessary for fighting within the governing and administrative apparatuses. Winning governing power gives the masses the ability to influence the repressive apparatus as occurred during the First Reconstruction. Far from being elevated above the masses, the state is all around us. It is a site of mass struggle.

Zara Jemuel is a labor movement activist with an organizing background in health care and the public sector.

Marxists.orgwww.marxists.org/archive/luxemburg/download/mass-str.pdf

The Mass Strike, the Political Party and the Trade Unions

Publisher: Marxist Educational Society of Detroit, 1925. Translated: Patrick Lavin. Online Version: Rosa Luxemburg Internet Archive (marxists.org) 1999.