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Research and analysis to provoke public awareness and critical thinking

We contribute to the liberalisation of the democratic instituions of society, for they have been captured by the owners of the market. They work in tandem with their market agents, who, posing as public servants, are entrenched in the halls of government. The political class has betrayed its public mandate and instead operates to impose a marketocratic state to maximise the shareholder value of the institutional investors of international financial markets. They own the global corporations and think they own the world on behalf of their very private interest.

Our spheres of action: true democracy – true sustainability – living wage – basic income – inequality – ecological footprint – degrowth – global warming –human development – corporate accountability – civil, political, economic, social, cultural and environmental rights, responsible consumption, sustainable autonomous citizen cells...

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Parting from an ethos of true democracy and true sustainability, We, the citizenry, work to advance the paradigm whose only purpose is to go in pursuit of the welfare of People and Planet and NOT the market.

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2019 Report: Living-wage assessment – PPP Wage rate gaps for selected "developed and emerging" economies for all employed in manufacturing workers (1996 up to 2017).

Overall, 2017 is the first year in the 22-year span in this report that US hourly wage rates dropped (0,9%). This enabled the vast majority of countries to reduce their comparative wage gaps or increase their surpluses in their manufacturing wage Eq-Index or at least keep their position.

Of the twelve economies in this report with data since 1996, Germany continues to have the best position with an actual equalisation advantage over the US in real PPP terms in its hourly wage rates, followed by France with a one point advantage over US wage rates. All other countries continue to record wage gaps vis-à-vis equivalent manufacturing wage rates in the US. Seven out of the twelve countries in this chart improved their position in 2017 vis-à-vis 2016 by increasing their advantage (Germany and France) or decreasing their wage gaps (Canada, UK, Spain, Japan and South Korea). Brazil and Mexico remained with their same gap in 2017 as in 2016. Only Italy, Singapore and Australia increased their gaps from the previous year. Mexico and Brazil continue reporting the worst wage gaps.

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2019 Report: Living-wage assessment – New assessment of Argentina's wage rate gap 1996-2017

With the staunchly neoliberal Macri government, Argentina reverted the impressive progress achieved in living-wage equalisation in the manufacturing sector of more than one decade. Repairing the damage will be a daunting task of the upcoming Fernández government, if it has the political and economic skill to materialize it.

Argentina is once again in the midst of an extreme economic crisis, as it was in 2002, as the direct result of the deep neoliberal economic policies that were reinstated by the Macri government to return to supply-side economics that depletes labour’s share of income. After the 2002 economic crisis, Argentina experienced a steady improvement of real wages. The Eq-Idx increased 93% between 2002 and 2012 to then drop gradually 19% to 2016. Macri’s government, claiming that their new economic plan would stop the unrelenting increase of inflation and stabilize the economy, did everything it could to reverse the demand-side policies of the preceding Kirchner and Fernández governments. These governments’ policies were instrumental in recovering Argentina’s economy, and, all the more important, much of the standard of living enjoyed prior to the 2002 “corralito crisis”, when Argentinians were unable to have free access to their private funds in their bank accounts for a full year, could not exchange their funds for other currencies, and could only withdraw a very limited amount on a weekly basis.

Prior to Macri’s government, manufacturing wages and their equalisation with US equivalent wages began to recover at a fast pace after 2002. The equalisation with equivalent wages in the US increased at an unprecedented pace, reaching a 58 Eq-Idx in 2012, almost twice the 30 index of 2002. This made Argentina’s manufacturing compensation cost the highest in Iberian America by a large margin. However, the steep increase of both the minimum wage and manufacturing wages, which, for the period 2003-2012, increased an average of 27,5% and 25,1%, respectively, in local currency, were faced with a corresponding inflation average of 16,3% for the same period, that Argentinian governments were unable to control and that subsequently exploded. The race to outperform inflation became unattainable and in 2014, inflation reached 38,6% whilst manufacturing wages increased only 30,3%. In 2015, the last year of the Fernández government, inflation dropped to 26,8%, but then, with Macri, jumped to 39,2% in 2016, dropped again to 24,8% in 2017, exploded to 47,6% in 2018, and it reached 53,5% in the last twelve months (September 2019) and it is expected to reach 57% in 2019.


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2019 Report: Living-wage assessment – New assessment of Brazil's wage rate gap 1996-2017

With the Temer and Bolsonaro governments against demand-side economic policies, Brazil’s labour remunerations are bound to lose in real terms. Temer’s government passed a new law (PEC 55) that freezes all public spending for 20 years, which implies that constitutionally-protected government expenditures in the areas of health, education and other social sectors would remain stunted until 2036. This has in practice ended Brazil’s commitment to sustain its minimum wage appreciation policy, after the minimum wage had more than doubled in real terms since 1996. Manufacturing wages actually lost ground since 1996, until the minimum wage appreciation policy began to have a positive influence from 2009 onwards. But with a renewed recession during the 2014-2016 period that is only beginning to subside and the staunchly neoliberal supply-side approach followed by Bolsonaro’s new government, Brazil will no longer sustain the closing of its Eq-Idx and it is likely to actually increase its equalization gap with comparative wages in the US.

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Living-wage assessment – Table T5: 1996-2017 Real wage-gap rates for fourteen selected economies, in purchasing power parity (PPP) terms, for all employed in manufacturing. *(The base table used for all PPP real-wage gap analysis)

2017 is the first year in the 22-year span in this report that US hourly wage rates dropped (0,9%). This enabled the vast majority of countries to reduce their comparative wage gaps or increase their surpluses in their manufacturing wage Eq-Index or at least keep their position.

Japan has reversed the downward trend in living-wage equalisation (Eq-Idx) that began in 2013. South Korea sustained the growing trend of its Eq-Idx that resumed in 2014 after a brief downturn in 2013. A strong drop of Singapore’s hourly rate in local currency produced a 1 point loss in its Eq-Idx.

•In the euro zone, Spain, Germany and France stopped their downturn that began in 2012, after steady and stronger growth of the US hourly rate vis-à-vis the growth of their comparative hourly rates in euros. In contrast, Italy’s drop of its hourly rate of almost 4% in local currency and 2% in US dollars, produced further erosion of its Eq-Idx that began in 2014.

The United Kingdom, reversed the sustained erosion of its Eq-Idx that began in 2008 and gained four points from its 2016 position. In contrast, Australia continued to decrease its Eq-Idx that began in 2014, with 4,4% drop of its hourly rate in local currency and a 1,9% increase in the PPP cost of living. In the case of Canada, the combination of its hourly rate increase in Canadian dollars of 9,4%, its currency revaluation of 2,2% and the 0,9% US rate decrease, produced an 11,8% increase of its hourly rate in US dollars between 2016 and 2017.

South Africa is a new economy incorporated into this report, showing a steady increase of its Eq-Idx since 2004, the earliest year with available data. Extremely strong growth of hourly rate in local currency (41%) at a much higher rate than strong currency devaluation (17%) produced a strong 31% increase of Turkey’s Eq-Idx, the highest of all economies included in our reports.

In Brazil the hourly rates and the Eq-Idx are bound to drop in 2018 and 2019, given that Bolsonaro’s new government is deepening the anti-labour policies initiated by the Temer government. In Mexico wage policy appears to have changed in 2017 after the execution of consistent supply-side policies over more than three decades. Yet, Mexico continues to have one of the widest living-wage gaps among the 41 countries included in all our reports, just ahead of China, India and the Philippines.

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2019 Report: Living-wage assessment – New assessment of Mexico's wage rate gap 1996-2017

Mexico’s fraudulent government, fixated on the precarisation of Mexican society, deliberately contained real wages in manufacturing and across all economic sectors as a core matter of its economic policy for nearly 36 years. This appears to begin to change.

Mexico’s track record since 1996 exposed a deliberate state policy of maintaining modern-slave-work real wages between 1996 and 2015. However, wage policy appears to have changed in 2017 after the execution of consistent supply-side policies over more than three decades. For the first time the federal minimum wage was increased above inflation in 2017 and 2018. Through a so-called “Independent Recovery Amount”, the minimum wage for 2017 was increased arbitrarily by 9,6%, including 3,9% to offset the estimated CPI inflation rate. The same criterion was applied for 2018, for a total minimum wage increase of 10,4%, including a 3,9% increase to offset CPI inflation. In 2019, Mexico’s new government, touting to implement a strong minimum wage recovery policy, increased the minimum wage by 16,2%, including a 5% increase to offset inflation.

All of this seems to have a direct positive impact on manufacturing wages in real terms and on its equalisation with comparative US wages. Between 2014 and 2017 the hourly rate in local currency increased 41,2%, but the peso experienced a steep devaluation of 29,8%. Thus the hourly rate in US dollars decreased slightly by 0,8%. However, due to the devaluation of the Mexican peso and low inflation, the PPP conversion factor dropped 23,6% for the same period. This allowed the Eq-Idx to gain four points, to 23, both in 2016 and 2017, the highest recorded index in the 22 year span of time. Yet, Mexico continues to have one of the widest living-wage gaps among the 41 countries included in all our reports, just ahead of China, India and the Philippines.

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2019 Report: Living-wage assessment – New assessment of Spain's wage rate gap 1996-2017

Spain experienced a very meaningful increase of its Eq-Idx in 2017, gaining 4 points equivalent to a 4,5% increase; the result of the combination of the increase of its hourly rate in euros, the euro revaluation against the US dollar and the drop of 0,9% of the US hourly rate. Although this is a reversal of its previous drop between 2014 and 2016, the change is in line with the vast majority of European economies for the same reasons.

Spain had made great economic strides in its convergence with the major European economies in the last part of the twentieth century, but began to stall after 1996, during the rule of its conservative government. Spain’s Eq-Idx for production-line workers in manufacturing rose powerfully from 51 in 1975 to 84 in 1990, but then it began to hover in the mid 70s indices. In this way, the Eq-Idx —in purchasing power parity terms— of total hourly compensation costs for all employed in manufacturing has not reached an 80 index and has continued to linger since joining the euro between 70 in 1999 and 77 in 2017, averaging nearly a 73 index for the period. This is the result of supply-side economic policies applied by both right and left of centre governments that no longer sought to put at par Spain’s labour compensations in manufacturing with the compensation rates of equivalent workers in the major economies of the euro area (Germany, France and Italy) under the principle of equal pay for equal work of equal value. The end result appears to be the deliberate decision to keep wages —in terms of living wage equalisation— at the same level they have recorded vis-à-vis the US, Germany, France and Italy.

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Living-wage assessment – twenty-eight European economies.

2017 is the first year in the 22-year span in this report that US hourly wage rates dropped (0,9%). This enabled the vast majority of countries to reduce their comparative wage gaps or increase their
surpluses in their manufacturing wage Eq-Index. Most European economies improved their living-wage equalisation position very meaningfully.

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Living-wage assessment – eight Asia and Oceania economies.

2017 is the first year in the 22-year span in this report that US hourly wage rates dropped (0,9%). This enabled the vast majority of countries 9except for Australia and Singapore) to reduce their comparative wage gaps or increase their surpluses in their manufacturing wage Eq-Index or at least keep their position. This allowed most countries in the region to improve their living wage equalisation position to improve.

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Living-wage assessment – the four largest economies in the Americas (Canada, Brazil, Mexico and Argentina).

2017 is the first year in the 22-year span in this report that US hourly wage rates dropped (0,9%). This enabled the vast majority of countries to reduce their comparative wage gaps or increase their surpluses in their manufacturing wage Eq-Index. In the Americas, all four major economies reduced their equalisation gaps or remained at the same level.

In the case of Canada, the combination of its hourly rate increase in Canadian dollars of 9,4%, its currency revaluation of 2,2% and the 0,9% US rate decrease, produced an 11,8% increase of its hourly rate in US dollars
between 2016 and 2017. This enabled its living wage equalisation index (Eq-Idx) to grow 10,2%, from 75 to 83, its highest since 2010.

In Argentina, In 2017, in local currency, the minimum wage managed to increase by 17,2% in nominal terms but inflation grew by 24,8%. In 2018 the minimum wage increased 12,9% but inflation reached 47,8%. In 2017, manufacturing hourly rates increased 29,1% in pesos and 15% in US dollars, whilst the US hourly rate dropped almost 1%, This allowed Argentina’s manufacturing hourly wage rates to increase its equalisation index by three points to a 50 Index. However, with inflation close to 48% and a devaluation of 41% in 2018, Argentina’s hourly rates and their equalisation index with comparative US rates are certain to drop dramatically in 2018, with CPI and exchange rate indicators looking even worse for 2019.

In Brazil the hourly rates and the Eq-Idx are bound to drop in 2018 and 2019, given that Bolsonaro’s new government is deepening the anti-labour policies initiated by the Temer government.

In Mexico wage policy appears to have changed in 2017 after the execution of consistent supply-side policies over more than three decades. This allowed the Eq-Idx to gain four points, to 23, both in 2016 and 2017, the highest recorded index in the 22 year span of time, but still the country continues having the widest living-wage gap in the Americas by far.



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Why Ecosocialism: For a Red-Green Future

 

The capitalist system, driven at its core by the maximisation of profit, regardless of social and ecological costs, is incompatible with a just and sustainable future. Ecosocialism offers a radical alternative that puts social and ecological well-being first. Attuned to the links between the exploitation of labour and the exploitation of the environment, ecosocialism stands against both reformist “market ecology” and “productivist socialism.” By embracing a new model of robustly democratic planning, society can take control of the means of production and its own destiny. Shorter work hours and a focus on authentic needs over consumerism can facilitate the elevation of “being” over “having,” and the achievement of a deeper sense of freedom for all. To realise this vision, however, environmentalists and socialists will need to recognise their common struggle and how that connects with the broader “movement of movements” seeking a Great Transition.

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Global Wage Report 2018/2019

Lowest wage growth globally in 2017 since 2008


Global wage growth in 2017 was not only lower than in 2016, but fell to its lowest growth rate since 2008, remaining far below the levels obtaining before the global financial crisis. Global wage growth in real terms (that is, adjusted for price inflation) has declined from 2.4 per cent in 2016 to just 1.8 per cent in 2017. If China, whose large population and rapid wage growth significantly influence the global average, is excluded, global wage growth in real terms fell from 1.8 per cent in 2016 to 1.1 per cent in 2017.

Real wage growth is calculated using gross monthly wages, rather than hourly wage rates, which are less frequently available, and fluctuations therefore reflect both hourly wages and the average number of hours worked.
 

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Human Development Indices and Indicators — 2018 ststitical update

Inequalities in human development —a grave challenge to progress. — Going beyond the average achievements, the IHDI and disaggregated assessments reveal large inequalities across human development dimensions. When the HDI is adjusted for inequalities, the global HDI value falls 20 percent


Human development is about human freedoms. It is about building human capabilities—not just for a few, not even for most, but for everyone. In 1990 UNDP published the first Human Development Report (HDR). Since then, it has produced more than 800 global, regional, national and subnational HDRs and organized hundreds of workshops, conferences and other outreach initiatives to foster human development. These activities have extended the frontiers of analytical thinking about human progress beyond economic growth, firmly placing people and human well-being at the centre of development policies and strategies.

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Farewell to Development

An Interview with Arturo Escobar

As inequality and environmental degradation worsen, the search is on not only for alternative development models but also for alternatives to development itself. Leading post-development theorist Arturo Escobar, co-editor of The Post-Development Dictionary and author of Design for the Pluriverse, discusses the fight for pluralism and justice in Latin America with Allen White, Senior Fellow at the Tellus Institute.

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Transitioning to Geocratia

the People and Planet and Not the Market Paradigm — First Steps

Following up on my commentary to the March 2020 Great Transition Initiative (GTI) forum: “Planetise the Movement”,1 I assess the diverse ideas discussed in the forum and concurrently elaborate with far more detail in this essay how I envision the first steps to materialise the change of paradigm from the current unsustainable market-centred ethos to a global movement that rescues our planet and provides sustainable life systems for our future generations and all living things.

Parting from the fact that saving Planet Earth, our home, changes everything, we need to build a new ethos where the majority of humankind commits to a system whose only purpose is the pursuit of the welfare of people and Planet Earth. This requires that all Earth resources necessary for the enjoyment of life of all living things be managed to achieve true long-term sustainability. Beginning with removing the market from its encroachment of the institutions of society, this is a paradigm that will break many of the structures, beliefs and notions that we now regard as permanent into a sort of Geocratia—from Greek ge and kratos: government of the or by the Earth—which is the name I chose to refer to the new paradigmatic proposal. As you may expect, saving the planet will radically change our consumer-driven cultural frameworks and life systems, including the standards of living, consumption habits, use of energies, economic indicators, the conception of development, progress, growth and the concept of democracy. We do not know yet, but this may include a reconfiguration of the so-called nation states to give way to the formation of smaller social and geographical identities. Essentially, we must establish a new global citizens’ contract between us and Mother Earth, where we commit to design new structures of social organisation devoted to living in harmony with our planet, where the use of the resources necessary for life will be managed so that consumption does not happen faster than the time required by the planet to replenish them. Concurrently, by building Geocratia’s ethos we achieve happiness, peace and freedom, as in Epicurus’ ataraxia, the enjoyment of peace, absence of fear and happiness, and aponia, the absence of pain.

This paper argues that the underlying causes of the unsustainability of market societies belong solely to the intrinsic nature of capitalism, and of the unrelenting pursuit of the reproduction and accumulation of wealth, which requires the infinite consumption of resources, with no regard whatsoever for its impact on the economic, social and environmental dimensions. It also probes to demonstrate that this is completely incompatible—a true oxymoron—with the premiss of transitioning to a truly sustainable, democratic, equitable, peaceful and ecological paradigm. Lastly, this essay explores the key characteristics of the disastrous trajectory that we are still following, what we need to do to radically veer towards a sustainable path, my vision of where we should set course and the first steps to materialise a planetary movement to take us there.
 

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To Die for Wall Street

Coronavirus, Social Classes and the Prevailing Culture

The COVID-19 epidemic has clearly revealed the process of decomposition—progressively accelerated over the past half century—of the capitalist system in its political, economic, social and cultural aspects. The leading political elites that presented themselves as—and long ago were to a certain extent—mediators between the economic power and society, have ceased to be so and, with nuances, are now simply transmission belts of real power: towering financial, industrial and commercial capital. Even as managers of the dominant system they are in clear decline: two or three decades ago there were still some among them with some capacity and ability to manage the State. They were able to foresee, evaluate and decide. And they used to surround themselves with competent people.

Citizen intervention through so-called representative democracy could function as a counterweight to the degradation of the political elites. But it is increasingly evident that the myth of "representative democracy” or "delegative democracy" as some call it, after a long agony is now in a state of advanced decomposition. Will there be social awareness of a radically unprecedented and innovative new paradigm?

Will this brutal manifestation of the ravages that capitalism causes serve for a massive process of awareness and will provoke a profound change in the system, as some think? We do not know. In any case, it will not happen if the cultural ideological hegemony does not change the playing field and in this way the great majority begin to understand that there are alternatives to capitalism and intend to actively participate in the construction and implementation of a project— utterly unprecedented and innovative—truly socialist and authentically democratic.

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Planetise the Movement

Opening reflections for a GTI forum
 

In January 2020, as I was writing this essay, Americans celebrated the life and legacy of Dr. Martin Luther King, Jr., whose message of social equality, economic justice, and peace is as relevant today as ever—arguably more so. That month, the US and Iran (the country of my birth) seemed to be on the brink of war. Australia was experiencing climate change-related disaster, the opioid crisis continued to devastate communities and families across the US, and refugees and migrants still faced exclusion and disdain. Income inequality in the US and in many other countries grew ever wider, as the power of capital over labor remained strong. Across the globe, the rightward march of populist politics continued apace.

This is only a small list of the world’s problems, some of which are common to humanity and some specific to nation-states and communities. To echo Lenin, what is to be done? For an answer, we can echo Dr. King: “planetize our movement.”1 But what is “the movement,” and how can it be planetised?

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An Eco-Revolutionary Tipping Point?

Global Warming, the Two Climate Denials, and the Environmental Proletariat

In the summer of 2016, the acceleration of climate change was once again making headlines. In July, the World Meteorological Association announced that the first six months of 2016 had broken all previous global temperature records, with June being the fourteenth month in a row of record heat for both land and oceans and the 378th straight month of temperatures greater than the historical average. Heating has been especially rapid in Arctic regions, where thawing effects are releasing large amounts of methane and carbon dioxide. On July 21, 2016, temperatures at locations in Kuwait and Iraq reached 129oF, the hottest ever recorded in the Eastern Hemisphere. The disruptive effects of bi-polar warming were evident in the unprecedented crossing of the equator by the Northern Hemisphere jet stream, where it merged with the Southern Hemisphere jet stream, further threatening seasonal integrity with unforeseen impacts on weather extremes and the overall climate system. Meanwhile a report from the United Nations Environment Program (UNEP) described the December 2015 Paris Agreement on climate change as outdated even before it takes effect, with climatologists now expecting a global warming of at least 3.4°C (more than double the 1.5°C limit supposedly built into the agreement) even if the promised emissions goals of the nations involved are somehow achieved despite the lack of binding enforcement mechanisms. The world will still be pumping out 54–56 gigatons of carbon dioxide equivalent a year by 2030 under current plans, well above the 42 gigatons needed to limit warming to 2 degrees, according to the UNEP report.

The historical irony in this situation is hard to miss. Just a couple decades ago, we were told that neoliberal capitalism marked the “end of history.” Now it appears that the system’s ideologues may have been right, but not in the way they envisioned. The system of fossil-fuelled neoliberal capitalism is indeed moving toward an end of history, but only in the sense of the end of any historical advance of humanity as a productive, political, and cultural species due to the increasingly barbaric socio-economic and environmental conditions the system creates. There is now no alternative to the end of history as we know it. The sustainable development of human society co-evolving with nature including other species now depends on a definite historical break with capitalism (wage-labor, market competition, production for profit) as the dominant mode of production.

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 The Underlying Causes of Immigration

The New Imperialist Structure

Cntemporary capitalism is a capitalism of generalised monopolies. What I mean by that is that monopolies no longer form islands (important as they may be) in an ocean of corporations that are not monopolies—and consequently are relatively autonomous—but an integrated system, and consequently now tightly control all productive systems. Small and medium-sized companies, and even large ones that are not themselves formally owned by the oligopolies, are enclosed in networks of control established by the monopolies upstream and downstream. Consequently, their margin of autonomy has shrunk considerably. These production units have become subcontractors for the monopolies. This system of generalised monopolies is the result of a new stage in the centralisation of capital in the countries of the triad that developed in the 1980s and ’90s.

Simultaneously, these generalised monopolies dominate the world economy. Globalization is the name that they themselves have given to the imperatives through which they exercise their control over the productive systems of world capitalism’s peripheries (the entire world beyond the partners of the triad). This is nothing other than a new stage of imperialism.

As a system, generalised and globalised monopoly capitalism ensures that these monopolies derive a monopoly rent levied on the mass of surplus value (transformed into profits) that capital extracts from the exploitation of labor. To the extent that these monopolies operate in the peripheries of the globalised system, this monopoly rent becomes an imperialist rent. The capital accumulation process—which defines capitalism in all of its successive historical forms—is consequently governed by the maximisation of monopolistic/imperialist rent.

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Castellano The Underlying Causes of Immigration