e-Con e-News

No, no one else plays, it is a game purely for one.

Once a chess piece is moved; ‘we’ (USA)

simply turn the board the other way around

– & move the other side’s chess pieces (for ‘them’).

There is ‘no other’ in this game.

– Zbigniew Brzezinski, The Grand Chessboard,

US Primacy & Its Geostrategic Imperatives (1997)

*

A naked woman is waving her hands and jumping up & down in the middle of Thunmulla roundabout at 8am on a sunny day, shouting: ‘You can’t see me… I can say what I want’, etc. It appears this nakedness is what all talk of ‘free speech’, ‘privacy’, etc., amounts to on the US-policed internet, in countries such as Sri Lanka. The internet, as it presently operates, was initiated by the US military (e.g., DARPA; tho early prototypes were mooted by the socialist USSR, Chile, etc). The US internet maybe like the paved Kolomba-Nuvara A1 Road, albeit built by unfree Sinhala labor, to connect port & plantation via the Fort – a creation of an invading English army.

     Critics respond that the right to free speech does not guarantee the ‘the right to be amplified’. US tech giants profit from amplifying online harms, spreading false & distorted information, hurting the mental & physical health of children & adults. They also erode any economic basis for a professional & national news media, while toxifying an increasingly digital public sphere upon which any democracy depends.

*

Meta Digital Government Day in Sri Lanka! – Yes, that’s what it was called – as US Meta (which owns Facebook & WhatsApp) this week trained Sri Lanka’s media secretaries & state media representatives on ‘enhancing’ their use of US social media apps. Meanwhile, the Securities Exchange Commission (SEC) embroiled in its own ‘corruption’ scandals was announcing that its ‘state-of-the-art trade surveillance system’ is from Wall Street, New York-based NASDAQ (National Association of Securities Dealers Automated Quotations). The earlier SEC system was from the London Stock Exchange! The Colombo Stock Exchange (CSE) claims their system is now ‘homegrown’, though before that, it was from the National Stock Exchange of India. (see ee Finance)

     Recall the now infamous 2015 Central Bank bond-scam involving the then Central Bank Governor Arjuna Mahendran (a refugee in rule-of-law Singapore, where Sri Lanka recently held an investors’ conference!) & his son-in-law whose company secured most of the bonds issued at that time, acting on confidential information he had access to. In May 2024, then-President Ranil Wickremesinghe, claimed the stock market was being manipulated by ‘some individuals’ spreading contradictory information on economic downturns. And now we get NASDAQ! Meanwhile, the recent postal strike here with the related issues distorted by a capitalist media – that is their job! – may be a harbinger for US ‘logistics’ corporations like Amazon fully privatizing such services.

*

• This week’s local media has been busy faking a feeding frenzy about the arrest, remand, hospitalization & bail of a member of the seemingly-still-ruling dynasty. This media, largely owned by his relatives (family of Ranil Wickremasinghe’s nephew Ruwan Wijewardena, who’s UNP deputy leader), is turning RW into a hero, hoping he’ll be a rallying pivot for the capitalist cause. Meanwhile, US warships enter & leave Colombo, with Maharajah media (News1^st) reporting a US embassy press release as their own ‘news’ (see ee Sovereignty, Fast, Armed & Friendly – USS Tulsa Visits Colombo Port!), just as the USAID-funded National Peace Council wants the Sri Lankan Government to share its ‘Plan for National Reconciliation’ with the people; then there’s the Ceylon National Chamber of Industries (another US front), claiming to avoid ‘lobbying for narrow interests’, lamenting that they too are ‘in the dark about what is being negotiated & what the Government plans to offer the US’ with regard to easing tariffs.

*

• In early 2023, the Government of Sri Lanka sought to increase revenues through a Digital Service Tax, to tax the huge digital multinational corporations (MNCs) reaping profits through sales to customers in Sri Lanka. Sri Lanka could generate $104.5million from a 4% digital service tax, as opposed to the ~$29.5mn from the Inclusive Framework on Base Erosion & Profit Shifting (BEPS) pushed by the Paris-based Organization for Economic Co-operation & Development (OECD). According to internationally renowned economists, including Jayati Ghosh, Joseph Stiglitz, et al, the Sri Lankan Ministry of Finance then came under ‘severe pressure’ from the IMF to drop their plans for a digital service tax and to use the OECD solution, as a condition for receiving additional lending from the IMF. The IMF however denied it had any such discussions with the government (see ee Economists).

     There are increasing indications that the Sri Lankan government will also ‘cave’ in to the US demands on a digital tax as part of the tariff threats. Our current President AKD recently noted that Sri Lanka may have political sovereignty, but no economic sovereignty. The failure to control these US corporations spreading misinformation, especially without promoting local alternatives, indicates that we lack both political & economic sovereignty.

*

• The USA (& their regional poodles) are escalating war on Iran & Yemen, which threatens to send fuel prices booming, undermining all economic forecasts & IMF prescriptions. This week, saw SL’s Ministry of Defence, as well as the Communist Party of SL celebrating the 80^th anniversary of winning the World Anti-Fascist War & the Chinese People’s War against Japanese Aggression, which falls on 03 September (see ee Sovereignty). Meanwhile, the US & its colony Japan stand accused of threatening countries not to attend the grand commemoration in China, with US leaders claiming it is they who have won all the world wars! Well… They certainly are thrilled to begin them. Many of the wars led by the USA now are world wars in the making – if not yet, in the doing. From East & West Africa, East & West Asia, to Eastern Europe (with an increasingly Nazified Ukraine – the 17^thC German settlers in the western part now being opposed to the more ancient Russian speakers in the eastern. It would be naive not to understand these wars are largely the doing of the old colonial powers working overtime under the leadership of the US to maintain, if not extend, their old domains.

The US nuked Japan, not to force their surrender as always claimed – when Japan had already begged the Tokyo USSR envoy for surrender terms – but as a warning to their then-allied Red Armies, Soviet & Chinese. The US media now spreads disinformation about the still-free Korea (DPRK) participating on the Russian side in the NATO war on Ukraine. The DPRK has an old relationship with China & the USSR & Russia and have every right to support their trusted & true allies, let alone acquire versatility in the latest materiel. South Korea, Japan, Taiwan, etc, have to pay for 100,000 US troops on their soil, and like most NATO countries are all but US colonies, and have all participated in US wars on China, Korea, Vietnam, West Asia, etc.

*

• In Sri Lanka, a US front group called the Asia Internet Coalition (AIC, note: it’s not called Indo-Pacific Internet Coalition, though representing the same imperialist US designs) has demanded the withdrawal of the SL government’s ‘draconian’ Online Safety Bill. The usual NGO-dollared suspects (CPA, NMSJ, etc.) have also criticized the Bill, claiming it undermines privacy & free speech. None of them mention any need for a mass media truly independent from such imperialist monopolies & agencies from AP to BBC to CNN to Reuters, etc. They have also criticized the Inland Revenue Department (IRD)’s April VAT amendment on foreign digital services, which is set to begin on October 1, after a 6-month delay was ordered, following a Supreme Court challenge by the USA’s Uber. They have also opposed proposals to tax huge e-commerce websites like booking.com, mooted in 2 recent budgets but not implemented. The decision, debated in Parliament, aims to level the playing field between local & foreign service providers. Local hotels have complained that, while they have to pay the high local taxes on hotel bookings, including through these travel platforms, the higher-profiting international websites don’t pay any taxes to the local exchequer. The so-called Sri Lankan online ride-hailing Pickme, whose CEO recently exposed these ‘global’ digital companies for legally stealing billions without paying local taxes, has also joined in the anti-VAT whine; though Pickme has supported Uber being also taxed like them (do note: the US World Bank’s International Finance Corporation made a $2.5million venture capital investment in PickMe in 2018).

     The US has been able to force countries (India, Canada, New Zealand etc) to withdraw Digital Services Taxes, claiming they discriminate against the US companies that dominate the internet and supposedly enable ‘free speech’. The Canadian tax was expected to generate $7billion in revenue over the next 5 years. The US government proudly announced that they had forced the Canadian government to ‘cave in’. The US had threatened to ‘terminate all discussions on trade’ with Canada, calling the digital services tax ‘a direct & blatant attack on our country’. (see ee Sovereignty, ee Media) Note: The US has declared a national emergency on trade, because a trade imbalance is harmful to US national security. But what of the rest of the world including Sri Lanka’s colonially wrought ‘imbalances’ & ‘emergencies’?

    How much of Sri Lanka’s advertising rupee is paid to foreign companies? The PR business in Sri Lanka has been dominated by English multinationals like Unilever, Ceylon Tobacco etc. In Canada, 70% of advertising expenditures (comprising $13.5bn) was paid to foreign-owned digital media in 2022. In 2023 alone, US tech giants made $20.7billion in Canada from distributing online content. The withdrawal of digital taxes has been demanded by the US Computer & Communication Industry Association (CCIA), which represents: Alphabet, Amazon, Apple, Bookings.com, BT Group, Cloudflare, Deliveroo, Dish Network, eBay, Facebook, Google, Intel, Instagram, Intuit, Meta, Mozilla, Nord Security, NordVPN, Pinterest, Rakuten, Red Hat, Samsung, Shopify, Texas.net, Twitter, Uber, Viagogo, Waymo, What’s App, Yahoo, Zebra, etc.

     A Digital Services Tax can ensure foreign tech giants are fairly taxed & held accountable for their enormous power over our societies & economies. The alignment of CEOs of Alphabet, Meta, Apple, Amazon & X Corp with the current US administration’s agenda, threatens all our political & economic independence. Foreign tech giants make massive unfair profits in Sri Lanka and should be taxed to invest in our digital sovereignty, building homegrown alternatives to US monopolies. Sri Lanka must invest in building our own communications infrastructure in the national interest. National companies can help build platforms, networks and tools that advance the country’s values, strengthening cultural and information ecosystems, enabling communities across the country to better serve our own needs to communicate & connect. Even England has not made concessions to its digital services tax to get a trade deal with the US. Sri Lanka should also not make concessions without any gains.

    Edward Snowden in 2013 revealed that the rising digital economy also posed serious security dangers. Digital activity concentrated in a handful of US companies effectively grants the US the power to spy on the world. China actively promotes greater digital sovereignty, restricting US monopoly digital services. But a powerful lobby in Sri Lanka and India is instead pushing for greater integration with the US. They claim the economic benefits of using US digital services outweighs the risks of coercion, and can benefit from the global reach of US power by collaborating with US surveillance. Yet, any US administration can at any time threaten to cut off Sri Lanka from intelligence sharing.

    Critics of such collaboration with the USA say that US monopolies’ online platforms challenge personal data protection and cultural sovereignty, and are the greatest national security threat. Dependence on US digital infrastructure places sovereignty at risk. Digital sovereignty is associated with safeguarding the autonomy and security of a country’s digital infrastructure. Next to protecting critical physical infrastructure and computer networks, it must guarantee the ‘country’s access to data collected on its territory’. Law-enforcement authorities still ‘struggle to access data held by companies located in other countries’. Digital sovereignty must also ‘maintain a country’s economic autonomy’. Most countries rely on a few large US tech companies for their digital services. The absence of national providers can pose a threat to their economic development in case of any external disruption and leave them at risk of unfair practices, including higher prices.

Dependence on SpaceX’s Starlink services for internet connectivity (as in Ukraine) weakens a country’s negotiations with the US. Digital sovereignty also includes a country’s ability to promote and enforce its digital regulatory preferences. Digital technologies connect economic actors across national borders, and risk ‘regulatory arbitrage’ where companies selectively choose which regulations they want to apply. Over the last 30 years the EU & US have clashed ‘over the protection of privacy rights as the EU attempts to ensure its regulations are respected regardless of where their citizens’ data are processed… As with the recent contract handed over to India to develop Sri Lanka’s digital ID cards, data-localization policies can also compel companies to store data collected in Sri Lanka on our soil, thereby limiting its regulatory autonomy.

US companies provide the majority of cloud services: 60% of Canada’s cloud market is owned by 5 US companies; 2 US companies – Microsoft (65%) & Google (28%) own 93% of their office software market. Other than TikTok, Meta & Google dominate the social media landscape and digital advertising, and can at any time cut the country off from such critical services, as Meta did in response to Canada’s Online News Act, which established a revenue-sharing obligation with Canadian media for Meta and other US companies. Microsoft banned the use of specific digital services in Canada after EU sanctions against Russia. Yes, promoting greater sovereignty would not be without costs. Countries rely chiefly on US companies for digital services because they offer significant economic benefits. Governments & businesses, for example, rely on Microsoft Office, which has inserted ‘backdoors’ in the software, to gather intelligence (see ee Industry)      

    Sri Lanka can defend its sovereignty by reducing the risks associated with its dependence on the US by focusing on developing ‘cloud-agnostic services’. Building such digital services, public and private organizations can ensure that if there is any disruption in US cloud services, they can easily move their activities to local or other clouds. Developing a domestic digital industry is part of a vast national investment strategy.

*

• ee continues looking at US-occupied Korea’s form of industrialization, enabled under what the authors claim to have been: ‘an especially powerful, transnationally active post-WWII Pacific capitalist class’. Their example is Samsung, founded by a Korean industrialist who collaborated with Japanese colonialism, and was then given access to the US military industrial market. Just like the Japanese capitalists & army who joined in the war on Korea (1950-3), South Korean capitalists were recruited to aid the war on Vietnam, to join US forces as the US shifted toward Southeast Asia and needing more international support for the US-backed puppet regime in Saigon. US-occupied Korea went further than other Asian countries and offered to send troops (along with Thailand, Australia, New Zealand) after the USA in 1965 committed US ground troops. Soldiers were promised 22 times regular Korean military pay and allowed to send US$s home, while Korean capitalists sold cement and other supplies & services to the US war on Vietnam: all packaged under ‘responsibilities to the Free World’.

*

• SBD de Silva analyses were more nuanced & dialectical than ee may make them out to be. He felt such ‘geopolitical’ explanations for US-occupied Korea’s industrialization were not sufficient. ee Focus therefore continues reproducing Chapter 1 from his classic The Political Economy of Underdevelopment (PEU). Here he carefully takes apart all the usual explanations for Sri Lanka’s economy being underdeveloped. Read any news about Sri Lanka’s economy and we are told we lack foreign investments, need to export more, and also diversify. Yet, the types of production that foreigner capitalists have invested in, have never made a positive contribution to the advance of underdeveloped economies. SBD catalogued the destructive effects of plantations and mines, giving examples from Malaysia and Nigeria. Contrary to the nonsense about free trade, he showed how the colonial state power allocated the best land to whites, and crippled local enterprise. The ‘basic nature of the plantation system’ is neither modern nor capitalist, with no spread effects or positive impulses to share with the so-called backward peasant economy. He listed the oversimplifications of economists, who only speak of levels of development, ‘ignoring the fact that some nations not only lack development but are locked into a stagnant state where development is impossible’. He meanwhile also contrasted the state role in the white settler colonies, where it was an ‘engine of growth’. He examined the levels of technology, and the conditions of production, and downplayed the conditions of exchange.

*

Upon being taken to Blackwell’s Island, the Warden

of the Penitentiary asked him the usual questions:

‘What occupation?’ ‘Statesman!’ he replied.

‘What religion?’ ‘None.’

• This ee Focus also continues looking at New York’s political machinery, through Gustavus Myers’ 1917 History of Tammany Hall, that famous New York ‘charity’. It proceeds like a teledrama, with ‘stupendous thefts, forgery, bribing & election frauds, weapons of bribery and intimidation, if not violence’, examining the growth of yet another ‘reform movement’ to overthrow the ruling politicians. In the last ee we watched as New York’s city politicians bought off journalists & editors & media owners, and rose to great power. However, in this ee see how in fact these politicians are but creatures of an even higher power, the monopoly capitalists. When Big Boss Tweed decides to divert municipal advertising budgets into his own media outlet the Transcript’ and a printing house he steps on the toes of the mighty New York Times. The NYT rides in like the US cavalry, to provide ‘the proper machinery’ for the exposure of the ‘villains’ and awakens ‘the dormant public conscience’. We get front row seats into the rise & fall of one set of petty oligarchs: ‘The newspapers which had profited most by his thefts grew rabid in denouncing him and his followers, and urged the fullest punishment for them… If Tweed had died in 1870… Broadway would have been festooned with black, and every military and civic organization in the city would have followed him to Greenwood.’

*

• Those controversial red-flagged 323 containers released uninspected by SL Customs earlier this year – were some of them from that ill-fated ship heading to Sri Lanka that crashed a Baltimore bridge in 2024? Meanwhile, there is still no mention about the Sri Lankan seafarer, still kept under house arrest in Baltimore, USA, over a year and 4 months after the ship Dali crashed into and destroyed the bridge? Grace Ocean Private & Synergy Marine, the owners of the Dali, filed a lawsuit last week against Hyundai Heavy Industries in US District Court for the Eastern District of Pennsylvania.

     Baltimore’s Francis Scott Key Bridge is named after a US slave owner & US national-anthem composer. Oh say, can you see: The Dali ship was made in US-occupied Korea’s Hyundai shipyard, chartered by US-military-linked Danish shipper Maersk. True ownership is kept highly opaque. The ship is supposedly owned by British Virgin Islands-based Grace Ocean Investment, with Singapore-based Synergy Marine ‘overseeing safety’ and managing the crew of 21 mostly Indian nationals. Synergy’s parent, investment holding company, Unity Group Holdings International is based in Hong Kong. It then turns out that the main carriers that also had containers on the Dali are: HongKong’s Gold Star Line, AP Moeller-Maersk, Italy’s MSC, and Israel’s ZIM Integrated Shipping Services. Israel’s Zim’s containers were hidden beneath the other containers to avoid detection. Some speculate those containers contained weapons for Israelis on our East Coast, and a Jihadi-Zionist binary is being promoted, to further weaken the Sri Lankan state…

*

___________

Contents:

US Tech Monopolies Stunt Sri Lanka’s Economic & Political Sovereignty