A serial journal of cogent reflections and irreverent insights on the social effects of capitalism and the roots of partisan politics. Pairing prose with HDR photography and “flash points” drawn from current and historical perspectives, the author seeks to recover lost wisdom and courageous action beyond the shouting and noise of today’s headlines.
Chapter Ten
Corporate Persons
What Does Not Serve Me Shall Not Be My Concern
Time Range: 1985-Present
Who even knew that corporations had legal rights as if they were actual persons? In a strange twist of legal gymnastics, the originating idea of a corporation being birthed and legitimized by a government grant had been transformed into a corporate body beholden to no one but its owners.
Economic self-interest was the law of the land, and the corporate persons cultivated in such an environment could be as sweet as your dear auntie or as self-serving and weird as the guy down the block wearing just a raincoat. However, both would be legally obligated to prioritize their shareholder economic interests over other concerns such as the corporation’s effect on human beings or the earth’s resources. Economists even have language for this. Externality is the effect on others, positive or negative, by corporate action that is not calculated into the cost of the goods or services.
“An externality,” wrote the economist Milton Friedman, “is the effect of a transaction … on a third party who has not consented to or played any role in the carrying out of that transaction.” He offers a relatively benign example of a man who must clean his shirt more often due to smoke emissions from a local power plant. He tends to minimize the effects by calling them “neighborhood effects” or “spillovers.” In a free market, positive and negative externalities theoretically cancel each other out or are eventually internalized by the corporation. However, a less cheerful view might look something like this: persons who dissociate their actions from their effects on others are called sociopaths.
Sociopathic corporate persons would not hesitate to market cigarettes or foods high in toxic chemicals, trans fats, sugar, and salt. They would simply point to positive externalities such as jobs being created or the social benefits of smoking and snack foods. They would feel unjustly picked on, pointing out that government intervention is a slippery slope leading to arbitrary interventions. What next, they would ask, bread with too many carbohydrates? The same logic would be offered as a defense of corporations generating air and water pollution, battling safety regulations, depleting fish stocks, wiping out forests, or underfunding pension funds. Why pick on us?
Marx’s warning that capitalism would spawn a consciousness of immediate economic self-interest takes on darker shading when extrapolated through corporate externalities influencing climate change, epidemic rates of diabetes and obesity, international instability, and increasing numbers of retirees without adequate access to basic needs of food, housing, and health care. The point is not that these things are easily fixed or that government will always get the balancing act right, but that corporate sociopaths, with society’s legal approval, have a built-in incentive to muddy the water.
FLASH POINTS
Big
Tobacco says that smoking is about freedom and choices. But a battalion of
experts at Emory is showing that better choices can be made—and that not much
about tobacco is free…
“Industries like gambling, alcohol, and tobacco are ‘societal cancers,’ says [Ray] Gangarosa, that cause ‘exceptional social harm, including death, disability, addiction, and secondhand injury, on the scale of a commercial holocaust . . . (and have) escaped society’s usual controls by shifting blame for harmful commerce to their consumers, and then shifting associated downstream costs onto society. We must hold these harmful industries accountable for their costs.’
Gangarosa, who is working toward a PhD in epidemiology at RSPH [Rollins School of Public Health], was disappointed in the Master Settlement Agreement, in which he feels ‘some terrible compromises were made.’ But he acknowledges the complexity of the issue. ‘The tobacco industry doesn’t make enough money to pay for the social harm that they do. We would bankrupt them,’ says Gangarosa. ‘But if we don’t ask them to pay the social cost, then they are effectively being subsidized.’”
~ Public Health, Spring 2002
“After getting called out by an environmental group, General Motors has pulled support from the Heartland Institute, a Chicago-based nonprofit well-known for attacking the science behind global warming and climate change.
The automaker told the Heartland Institute last week that it won’t be making further donations, spokesman Greg Martin said. At a speech earlier this month, GM CEO Dan Akerson said his company is running its business under the assumption that climate change is real.”
~ Huffington Post, March 30, 2012
“Corporations Are Not People”
“Can grassroots victory in Green Mountain state spark national movement?
“With some results still yet to come in, reports confirm that at least 55 towns in Vermont approved municipal resolutions calling for an end to big money’s dominance in US politics and calling for a Constitutional amendment to reverse the Supreme Court’s ‘Citizens United’ decision that has opened the floodgates for secretive, unlimited campaign spending in US elections.
“The initiatives called on the Vermont Legislature and the state’s congressional delegation to support a constitutional amendment that clarifies that ‘money is not speech and corporations are not people.’”
~ Common Dreams, March 7, 2012
Next Week:
Chapter Eleven: Booms and Busts
The bull market of the 1980s saw greater numbers of people investing and realizing larger returns. A whole new financial investing industry was growing up alongside corporate growth. Workers were working longer hours and taking on second jobs, but day traders could get rich in an instant. As we headed into the ’90s, the political focus was on the economy, stupid. A new president argued that government could smooth out the economy’s rough edges, and by playing by the rules and working hard, we might finally see an end to capitalism’s wild gyrations.
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