A recent New York Times headline asked an insinuating question: "After the Attacks, Which Side Is the Left On?" The Times should find the nerve to put the same question to the major players of business and finance. Which side is Citigroup on? Or General Electric and Boeing? Where does loyalty reside for those American corporations that have rebranded themselves as "global firms"? Our resurgence of deeply felt patriotism, with official assurances that Americans are all-in-this-together, raises the same question. At a deeper level, the patriotic sense of unity collides with familiar assumptions advanced by the architects and cheerleaders of corporate globalization. The nation-state has been eclipsed, they explain, and no longer has the power to determine its own destiny. The national interest, they assert, now lies in making the world safe for globalizing commerce and capital.

In these threatening times, such claims sound suddenly unpersuasive. Frightened citizens turn naturally to their government for security--the original purpose of the nation-state--and business enterprises do the same. The global corporation, however, intends to have it both ways: American first when that serves its interest, but otherwise aloof from mere nationality. Since these companies are busy waving the flag at the moment, one needs to recall how they described themselves during the past decade, as they dispersed production worldwide and planted their logos in many distant lands. "The United States does not have an automatic call on our resources," a Colgate-Palmolive executive once explained. "There is no mindset that puts this country first."

The much-admired CEO of General Electric, Jack Welch, portrayed GE as a "borderless company," and he brutally enforced the logic. When GE wanted additional cost savings on turbines, jet engines and appliances, it told its US suppliers to pick up and leave, or else--that is, move the jobs to Mexico or other locales where the labor is much cheaper, or GE would find different suppliers. A GE executive in Taiwan once remarked, "The US trade deficit is not the most important thing in my life...running an effective business is."

An aerospace executive who supervised McDonnell Douglas's production in China told the New York Times: "We're in the business of making money for our shareholders. If we have to put jobs and technology in other countries, then we go ahead and do it." A few years later, McDonnell was swallowed by Boeing, which likewise subscribes to an unsentimental view of national identity. Boeing's on-site manager at the Xian Aircraft Company in China, where $60-a-month machinists make tail sections for the 737, told me, "We've got suppliers that we've dealt with for fifty years, and we're asking all of them to offload production to China." In addition to the low wages, American firms trade US jobs and technology for access to such burgeoning markets. The US government looks the other way or sometimes even facilitates the transactions.

Then there is Citibank, a pioneer in global banking and now part of the mammoth financial conglomerate called Citigroup. John Reed, Citibank's former CEO, used to complain regularly about the stultifying bank regulations imposed by the United States, and he often threatened to relocate Citibank's headquarters to a more banker-friendly nation. "The United States is the wrong country for an international bank to be based," Reed asserted (though the US government more than once bailed out his bank when it was on the brink of failure). Citibank, it happens, is also a notorious channel for wealthy autocrats trying to spirit ill-gotten fortunes (including drug money) out of their home country ($80-100 million for Raul Salinas, the corrupt brother of Mexico's corrupt former president). Citigroup has lobbied to weaken the new regulatory rules required to halt the flows of terrorist money in the global financial system.

Which side are you on? In the aftermath of September 11, the question was swiftly resolved by the multinational lobbyists who mobbed Washington for handouts. Boeing, the second-largest military contractor, expects to be a big winner from the crisis (never mind the 30,000 workers it is laying off) because Boeing agents, in and out of Congress, are pushing for huge new orders of modified jetliners and cargo transports for the Air Force and Navy. IBM, though the majority of its work force is now non-American, has lined up at the trough with Silicon Valley's high-tech firms to lobby for new government subsidies. American International Group, the world's biggest insurer and a leading apostle of unfettered global markets, is out front promoting a new federal safety net for the insurance companies--a bailout that will compel US taxpayers to share in the industry's risks. GE, Citigroup, AIG and other financial-services firms persuaded House Republicans that the US economy should be stimulated by giving them a $21 billion tax break for their overseas operations. When the going gets tough, these guys turn out to be real, red-blooded Americans.

Other Americans will be rightly infuriated as they see the urgent need for national unity exploited for private gain. Activists associated with the Seattle movement might devote some energy to educating other citizens who don't yet grasp the contradiction. But this new crisis exposes much more fundamental issues than corporate hypocrisy. It upends the fictitious premises used to sell the supposed inevitability of corporate-led globalization. Nation-states, at least the largest and strongest ones, have not lost any of their powers to tax and regulate capital and commerce, to control international capital flows and other globalizing practices. In the face of market pressures, major nations simply retreated from exerting those powers. The United States, as principal promoter and defender, led the way. Other advanced economies gradually followed, often reluctantly. Poorer nations, of course, did not have much choice but to go along if they wished to attract investment capital from the wealthy economies.

Now, crisis requires leading governments, especially that of the United States, to do an abrupt about-face and begin to employ their neglected sovereign powers, that is, to intrude purposefully in the marketplace and impose some rules in behalf of society. The most compelling example is the need for new regulatory controls on capital flows in the global financial system in order to smash the terrorists' critical support base--the secretive, cross-border access to money. The global bankers, led by Citigroup, resisted, claiming it's too complicated to trace movements of illicit money. Complexities do exist, but the plain truth is that the United States, joined by a handful of wealthy nations (Germany, Japan, France, Britain and a few others), has the power to shut down any subsidiary banking system in the world that refuses to cooperate--simply by rejecting all money transfers from that country.

Citigroup and other major banks want weak enforcement not because they are soft on terrorism but because they recognize that policing terrorist money can lead to tougher enforcement aimed at their own activities--their profitable role serving wealthy clients in money laundering and the massive tax evasion that occurs through offshore banking. The evasion of national laws is a principal hallmark of the laissez-faire global system, one that governments have lacked the will to confront. The Bush Administration's sincerity will be tested on this issue since it must choose between defending the privileges of international banking and protecting the security of American citizens.

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