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Tereza Coraggio

Third Paradigm is an out-of-the-box thinktank on community sovereignty and regenerative economics.

We look at how to take back our cities, farmland and water; our money, production and trade; our media, education and culture, our religion and even our God.

We present a people's history of the Bible and a parent's view on how to raise giving kids in a taking world.

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Finance is an Extractive Industry

June 14, 2009

3P-031 Show Information (includes MP3 download link)

Welcome to the 31st episode of Third Paradigm. Last week, we scooped Democracy Now twice, once with the David Rovics song about George Tiller, and on Peru's Friday massacre of protesting indigenous Amazonians. It's being called Peru's Tiananmen Square. On this 20th anniversary of Tiananmen, HP and Dell are collaborating with China's government to censor information and suppress free speech. After July 1st, all PC's sold in China will have to include Green Dam software to bolster the Great Firewall. AT & T has already given them access that's resulted in the imprisonment of bloggers. But Credo has an e-letter campaign to tell Dell CEO Michael Dell and HP CEO Mark Hurd not to support the suppression of free speech. If you need other reasons not to buy from Dell or HP, I can tell you about the problems with my last computer, or the three printers in my house, none of which I can use. I was complaining about this while in line at an office supply store, when I gathered a crowd of other people ready to toss their HP printers out the window. They're designed to thwart anyone ecologically-minded who's refilling cartridges. But the software is so touchy that the whole printer becomes fodder for the junkpile within six months – totally unusable, and impossible to fix, even if you're willing to pay more than it cost new. What goes around, in how corporations treat others, comes around in how they treat us.

But back on Peru, the mainstream media seems nearly oblivious to the police attack, which I'm hearing about from Amazon Watch, the Rainforest Action Network, the Quixote Center, Public Citizen's Global Trade Watch, Avaaz, Huffington Post, and Rights Action in Canada. A 19-yr-old actress, Q'orianka Kilcher, is leaving Hollywood to fly into these remote regions with 50 flip-video cameras to document the genocide. But even less reported in the mainstream is the strong and resilient indigenous movement that stands behind and with Peru's Amazonians, the summit of Abya Yala, where 6500 delegates from 22 countries gave a resounding, "We're not gonna take it anymore," in the Kuna language of course.

In their declaration, they list extractive transnationals and international financial institutions together as two sources of pollution. In this week's rant, I'd like to make the point that finance is an extractive industry. We'll look at the investment paradigm and how it functions. As a case in point, we'll examine the Firestone plantation in Liberia, where rubber wastewater is polluting the Farmington River. So maybe the Abya Yala are right: finance is pollution.

But first we'll read three poems about grief, optimism, and pilgrimage for the families of the victims of the Peru Amazonian massacre. The poems are by Gregory Orr, Jane Hirschfield and Czeslaw Milosz.

Grief will come to you

Grip and cling all you want,
It makes no difference.

Catastrophe? It's just waiting to happen.
Loss? You can be certain of it.

Flow and swirl of the world.
Carried along as if by a dark current.

All you can do is keep swimming;
All you can do is keep singing.

~ Gregory Orr ~
From How Beautiful the Beloved

* * * * * * *


More and more I have come to admire resilience.
Not the simple resistance of a pillow, whose foam
returns over and over to the same shape, but the sinuous
tenacity of a tree: finding the light newly blocked on one side,
it turns in another. A blind intelligence, true.
But out of such persistence arose turtles, rivers,
mitochondria, figs -- all this resinous, unretractable earth.

~ Jane Hirshfield ~
From Given Sugar, Given Salt

* * * * * * *

On Pilgrimage

May the smell of thyme and lavender accompany us on our journey
To a province that does not know how lucky it is
For it was, among all the hidden corners of the earth,
The only one chosen and visited.

We tended toward the Place but no signs led there.
Till it revealed itself in a pastoral valley
Between mountains that look older than memory,
By a narrow river humming at the grotto.

May the taste of wine and roast meat stay with us
As it did when we used to feast in the clearings,
Searching, not finding, gathering rumors,
Always comforted by the brightness of the day.

May the gentle mountains and the bells of the flocks
Remind us of everything we have lost,
For we have seen on our way and fallen in love
With the world that will pass in a twinkling.

~ Czeslaw Milosz ~
From New & Collected Poems (translations by Czeslaw Milosz and Robert Hass)

These poems are dedicated to the victims of the police assault on the peaceful, legal protest against the entry of foreign multinational mining companies to the Peruvian Amazon. Next week, we'll look at President Garcia's history of violence and how the Free Trade Agreement gives him the license to kill.

Here in California, we've just dodged a free trade bullet aimed by another extractive corporation, Glamis Gold. Under NAFTA, CAFTA, and individual F-TAs, if environmental, labor rights, or public interest laws affect a foreign investor's profit, they can demand that taxpayers compensate them for lost "earnings" which is a term I use facetiously. Glamis filed against CA mining laws that protect public health, the environment, and the cultural and religious practices of Indian tribes. To invoke the Chapter 11 foreign investor clause you need to be, well, foreign. But to acquire these mining rights you needed to be a US citizen or US corporation. So Glamis played it both ways – the US subsidiary bought the mining rights but the Canadian parent company sued. They were free to sell their mining rights, but without even finishing the permitting process, they went right to NAFTA, because we all know CA's a cash cow - that's why we're going bankrupt. Maybe suing CA was the gold mine they were drilling for in the first place.

The case was dismissed, but that's little comfort. $6 billion in US taxpayer compensation is pending in four other NAFTA investor lawsuits. We're the Amazon zoned ripe for exploitation. Do you get what this means? Let's say that in CA's fire sale of assets, a Canadian hog farm buys Wilder Ranch State Park. Then they start pumping out fertilizer field, which turns into excrement lake. We pass laws protecting health standards for us and the pigs and the ocean. According to NAFTA, we could then be forced to pay them for the money they could have made if they'd continued with full-tilt pollution and abuse. It's insane! But the same insanity is what Peru has been subjected to by Citibank, and what they will be subjected to if Chevron and Exxon don't get their way. Instead of drilling for oil they can squeeze the Peruvians. When they're bled dry, they can assault the Amazon again. It never grows old, the thrill of the drill, because the purpose of the global economy and the governments that serve it is to concentrate wealth and power in as few hands as possible.

We'll now break for Just a Shadow by Big Country.

[Big Country – Just A Shadow]

Just a hint for those who were Big Country fans in the '80's – don't go back and watch the videos. The music still stands but what were we thinking with those tight white jeans and blown-dry do's? And did it really look that dorky when we danced? I'm afraid to unearth the videos of myself and find out.

Speaking of shadowy deals, in a story sent by Robin Upton in Bangladesh, two Japanese men were stopped on the Italian border with $138 billion in US bonds – either real or high quality forgeries. To put it in perspective for his students, Robin translated it into 100 million years of salary for a Bangladesh manual laborer. Or $1000 for every man, woman, and child in Bangladesh. His students were boggled. How could two people pretend to have worked 100 million years between them?

There's a playwright who compares the value of people's time in different countries and different jobs. How many hours of a Bangladesh sweatshop worker does one hour of your time buy? Green America, formerly Coop America, sent the story of Kalpona, whose father became ill when she was twelve. She went into a garment factory and cut fabric 14 hours a day for $6 a month. At her next job, she made $8 a month but worked 17 hours a day, with one day off every other month.

To compare, my teenage daughters today will make $8/hr babysitting. If I multiply 17 hours a day for Kalpona by 29.5 days, it's 500 hours a month, which is twice a 60-hr workweek. Kalpona stands at the tables all day and at 3 am, she sleeps on the cement floor of the factory until 8. Is one comfortable hour of my daughter's time worth 500 torturous hours of Kalpona's? It is according to our monetary system. If my daughters were to shop at JC Penneys, Wal-Mart, or Sears, for clothes to wear dancing on my grave, I'd assume, they'd be trading Kalpona 5 seconds of their time for an hour of hers. Are my daughters worth 500 Kalponas? What are our lives except the sum of our time?

But if my girls spent $8 on an item Kalpona made, she would get less than 1% or 8 cents for having made it. The Walton family would get the other $7.92 as part of their $404 Billion in 2009 WalMart revenue. This money, which they earned with a nanosecond of their time – for once, I think that's not an exaggeration - gives them the power of employment over 2.1 million people. Each US employee makes an average of $8/hr, the same as my daughters for babysitting, but with families to support instead of a Japanese comic book habit. As the largest employer in 25 States, the Waltons have more power than the governor in half of the country. My daughter's $7.92 will give them more power over the millions of Kalponas in their supply chain, and more power than the elected officials in the countries where they operate.

For every $8 Kalpona makes for working 500 hours in a month, the products of her labor will bring in $800 to the Waltons, with which they can control another 100 months of her life in which she'll work 50,000 hours. With the revenue they brought in from one month of Kalpona's labor, they can buy her life from the time she's 12 until she's 20. But all WalMart consists of is the products they sell. Without the products, they're an advertising campaign and a tacky facade. In reality, Kalpona and the other producers should hold 99% of the power over WalMart. How has this coup been accomplished, that millions of people serve the interest of one family? We'll look at the underlying investment paradigm after this song, Pale Horses by Moby.

That was a preview of Pale Horses by Moby, from their Wait for Me CD, due out later this month. If you can't wait, their website features video blips of cute little Martians dancing to the song, which are sure to be less dated than Big Country in 20 years. Although are those Martians wearing tight white jeans with blown-dry antenna?

We're looking at the investment paradigm and why finance is an extractive industry. Sometimes the most dramatic proof just falls in your lap. I was opening the mail yesterday and came across a proxy statement for our Fidelity Retirement account. Every corporation is required to send out board proposals to their shareholders, who can vote by mail or on line. Like us, I suspect most people toss them in the recycling. But the Interfaith Center for Corporate Responsibility has very cleverly used the power of the proxy statement to bring issues to public attention. First, there was a list of board proposals that the directors recommended voting for, and then one introduced by shareholders that they recommended voting against. It proposed,

"That the Board institute procedures to prevent holding investments in companies that, in the judgment of the Board, substantially contribute to genocide or crimes against humanity, the most egregious violations of human rights."

Let me repeat this one more time. The Directors of the Board for the Vanguard Treasury Funds recommend against procedures to prevent investments in companies that, IN THEIR OWN JUDGMENT, contribute to genocide or crimes against humanity - in black and white, mailed to every shareholder in the fund, stated boldly and without apology or explanation. It's just the impetus I was waiting for to transfer our account Monday to a community credit union IRA. Let's bring our money home where it's not committing genocide and crimes against humanity, plus coming back like our soldiers, a shadow of its former self.

Our last topic looks at the Firestone plantation in Liberia as a prime example of how finance is extractive. In 1926, Liberia gave Firestone a concession on 1 million acres of land for 6 cents an acre for 99 years. At the same time, Firestone wanted to loan Liberia money. Liberia refused, saying it was bad business to be in debt to someone who was leasing land. Plus, they didn't need the money. Firestone not only insisted, but threatened to get the US army to invade. It wasn't an idle threat, and Liberia gave in.

For 80 years, Firestone has extracted Liberia's rubber using Liberian labor under quotas that require 21 hours of work per day. This can only be met by families using their children to carry the 70-lb buckets, or else their $2.66 daily wage is cut in half. Firestone has never built a processing plant to make tires in Liberia – the rubber is all shipped to the US. The worker housing hasn't been upgraded since the 1920's and lacks electricity or indoor plumbing. And since October, serious illness has broken out in the communities downriver from the wastewater facility, which consists of three equalization tanks that let solids settle and degrade before pumping them out onto a natural wetland. In their PR, they brag about this organic process.

What have Liberians gotten out of this deal? Their back-breaking labor has contributed to the ruin of their natural resources. Their living situations haven't improved in the 80 years they've slaved and had their children born into the same slavery. They're still in debt. Firestone still owns the rubber plants and a 36 year lease at $.50 an acre negotiated under an interim government. To break their contract with Firestone, they would owe them whatever money Firestone had invested along with being sued for future earnings. What's Firestone gotten out of it? 100,000 tons of rubber a year through no labor of their own and no resources they've brought to the table.

What's the right amount of profit when someone invests in a business? When corporations were first given concessions in the US, to attract private investments in large public projects, they were allowed to get a 12% profit on their investment, after which ownership of what was built transferred to the public. Today, an investment in the means of extraction gives the investors entitlement in perpetuity to the resource extracted through the labor of others. The harder that these people work, the more control they give the investors over them. Rather than paying off the investment through their labor, they up the ante for what the community can be sued for if they pass new labor or environmental laws. Corporations were first allowed to limit liability because the return on investment was also limited. It didn't mean, like it does today, that investors can't be held accountable for genocide by proxy or crimes against humanity, the most egregious violations of human rights.

This has been Tereza Coraggio with Third Paradigm. Thanks to Skidmark Bob for production, editing, and the poetry-music mix. Our last song is Bread and Roses by Comrade Fatso from his debut album, House of Hunger. His radical street poetry is banned in his home country Zimbabwe but has received international acclaim.

[Comrade Fatso – Bread & Roses]

Thanks for listening.