Vampire Capitalism

Following the piece I posted earlier this week on the Coalition government’s plans to sell off the UK’s plasma supplies to a private US company, a reader has sent me a link to a really shocking story that I wasn’t aware of before, about a similar phenomenon in the United States which deserves wider attention.

Written by Mark Ames at Alternet five years ago, the story is a bleak and symptomatic symbol of the world that we have constructed, and a reminder that there is really nothing that some companies won’t do to make a profit, especially when no government is willing to do anything to stop them.

Ames describes how the Wall Street hedgefund/private equity company Cerberus Capital made a $1.8 billion profit from extracting and reselling plasma from the poor to the poor.  This is how it was done.   In 2006 Cerberus paid $82.5 million for a company called Talecris, which operates a number of ‘plasma-milking factories’ on the American side of the US-Mexico border.

These ‘factories’ were advertised on the Mexican side of the border, and located in ‘plasma-farm buses’ on the American side, where poor Mexican migrants were  paid $30 dollars to hook up to a machine which drained their blood to sift out their plasma, before the blood was re-pumped back into their veins.

The plasma was then sold, according to Ames, to ‘ the most desperately ill—patients suffering from hemophilia, severe burns, multiple sclerosis and autoimmune deficiencies’ in a US market where plasma costs are so high that ‘ American health insurance companies have been dropping or denying their policyholders in increasing numbers.’

In 2009, Cerberus Plasma Holdings LLC/Talecris opened four new ‘farms’ along the Mexican border that netted a $1.2 billion profit on its original investment. Since Ames wrote that story, Cerberus has sold Talecris to the Barcelona-based Spanish company Grifols SA for $3.4 billion – a sale that has been challenged by the Federal Trade commission (FTC) as a violation of US anti-trust laws.

As a result Grifols has been obliged to sell off some of its plasma holdings to satisfy the commission and open the market to competition.   All these wheelings and dealings have resulted from the transformation of a ‘product’ that ought to be an essential and protected resource into another speculative investment.

In the UK at least, the nation’s plasma supply was protected  – until  the Coalition decided to sell it to Mitt Romney’s former company Bain Capital.  According to the Independent, the Department of Health ‘ overlooked several healthcare or pharmaceutical firms and at least one blood plasma specialist before choosing to sell an 80 per cent stake in Plasma Resources UK’ to Bain – a private equity and hedgefund company worth $65 billion whose sole interest in its new company will be making money out of it and then re-selling it.

And where will that plasma come from?  Well it probably won’t be from Mitt Romney or David Cameron’s veins – though if they or any of the other plutocrats and their political servants who are currently running the world ever have a car crash – they might just need it.

 

 

 

2 thoughts on “Vampire Capitalism

  1. Matt,
    “U.S. private equity firm Cerberus Capital Management is selling its investment in gunmaker Freedom Group, whose AR 15 rifle was used in a U.S. school massacre last week, following pressure from a major investor. The California State Teachers’ Retirement System (CalSTRS) said on Monday it was reviewing its investment with Cerberus in the wake of Friday’s shooting in Newtown, Connecticut which claimed 27 lives, including 20 school children.” (http://pvfunds.com/2012/12/cerberus-to-sell-gunmaker-after-school-shooting/)

    What’s particularly disturbing is that here you have a teachers’ pension fund investing in Cerberus which in turn owns a company that produces a gun that is used to kill other teachers and their pupils. And they are merely “reviewing” their investment.

    “Meanwhile, Cerberus, unchained and unchallenged, pillages the ruins of the economic landscape. With exquisite irony, the secretive private equity firm that bought Chrysler last year, chaired by a former Secretary of the Treasury of the current
    Bush administration, proudly flaunts Cerberus—the three-headed monstrous dog of Greek mythology that fiercely guards the gates of Hades—as its corporate name. With Cerberus loose, unchained, on the prowl and off the proverbial porch, the direct
    challenges of Economic Justice are all the more imperative…”
    DAVID L. GREGORY
    Dorothy Day Professor of Law, St. John’s University School of Law.

    • Well, this is really a company with an eclectic range of interests isn’t it? And the fact that a teachers pension fund doesn’t seem to mind investing in it is, as you say, disturbing – and disgraceful.

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