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  • Corporations are people? Really?

    by Larry Robinson

    Once upon a time in America, corporations did not enjoy the privileges they do today. The Founding Fathers would have been appalled at the idea that "corporations are people."

    The modern business corporation is an artificial creation which shields its owners and managers from accountability and public scrutiny.

    The American Revolution was as much a revolt against British corporations as it was against the English parliament and king. The Boston Tea Party was, in fact, a protest against the monopoly on tea sales by the royally chartered British East India Company. It is ironic that today's "tea party" movement is primarily funded and directed by corporate interests.

    The newly formed United States of America was rightfully mistrustful of corporate power; the states were very careful in how they granted charters. Most of the early corporations were for the express purpose of establishing towns and colleges, or for building roads, bridges and harbors -endeavors that were prohibitive for individuals.

    Business corporations were the exception. In fact, nowhere does the U.S. Constitution mention the rights of corporations.

    For the first 100 years of our nation's history, corporations were chartered by individual states for a specific purpose and for a specified and limited time. When they had achieved their purpose - or failed to - they were dissolved.

    They were prohibited from participating in politics and from owning stock in other corporations. In most cases their charters did not shield owners from responsibility for harm done by the corporation.

    In the early 19th century bank charters were limited to 3 to 10 years and they were prohibited from engaging in trade.

    Corporations that abused their charters were dissolved and their owners held liable for any debts or damages.

    Most states had statutes specifying that corporations existed only to serve the public good. In 1809 the Virginia Supreme Court wrote: "If the object is merely private or selfish; if it is detrimental to, or not promotive of, the public good, they have no claim upon the legislature for the privilege (of being granted a charter)."

    Over time, however, corporate interests were able to convince courts to grant them increasingly greater powers and privileges.

    In a landmark case in 1886 (Santa Clara County vs. Southern Pacific Railroad), the U.S. Supreme Court declared that a corporation was a "natural person" entitled to all the rights of a real human being. Unsurprisingly, the clerk of the court who wrote the summary was a former railroad company president.

    This decision opened the floodgates for what has amounted to a hostile takeover of America's political system.

    The 14th amendment, which was intended to redress some of the evils of slavery by recognizing the humanity and citizenship of African Americans, has since been used as the pretext for extending corporate pregogatives and privileges.

    However, Mitt Romney's protestations notwithstanding, the distinctions between corporations and human beings are obvious and significant

    Corporations enjoy the power of succession, which means that they can continue to live and accrue capital beyond the possibilities of mortal humans.

    They are bound by no moral strictures or conscience; in fact, they are usually bound by their charters to place profits ahead of moral and ethical considerations.

    Because corporations tend to accrue capital and influence, it is no surprise that this capital and influence are used to affect public policy in ways that grant greater influence and profit.

    Lucrative defense contracts, farm subsidies and tax breaks for oil companies are examples of how corporations use this power. The greatest return on investment is from lobbying. A $10,000 investment in a political action committee can yield a $10 million government contract.

    Regulatory agencies established to safeguard the public welfare are eventually captured by the very industries they regulate.


    Two years ago, in the Citizens United case, the Supreme Court struck another body blow against democracy by equating money with speech, allowing corporations to spend unlimited amounts of money to influence elections. It is indisputable that money determines the outcome of elections.

    Why aren't we more outraged? Why do we accept this assault on democracy? Isn't it time we real and human citizens of the United States reclaimed our country? Can we at least level the playing field so our voices can be heard as loudly and clearly as Goldman Sachs or Exxon?


    Larry Robinson is a Sebastopol resident and former 12-year member of city council.
    Comments 14 Comments
    1. Tes's Avatar
      Tes -
      It was interesting to read this article from the point it only shares the writers dislike of corporations. I am an artist and because a drunk tripped over one of my public art sculptures I was sued. The lawsuit forced me to think like a corporation; “Protect what I have”.

      I incorporated myself to protect what little I have from lawsuits and the unethical legal system in this country. The article paints a picture of corporations that are here only to protect owners and managers from accountability, but in my case and that of thousands of other business owners it is the only way to protect us from the sue happy American public. I am an American Citizen, artist, community volunteer, lover of the human race, and a corporation.
    1. theindependenteye's Avatar
      theindependenteye -
      >>>]It was interesting to read this article from the point it only shares the writers dislike of corporations. I am an artist and because a drunk tripped over one of my public art sculptures I was sued. The lawsuit forced me to think like a corporation; “Protect what I have”.
      >>>I incorporated myself to protect what little I have from lawsuits and the unethical legal system in this country. The article paints a picture of corporations that are here only to protect owners and managers from accountability, but in my case and that of thousands of other business owners it is the only way to protect us from the sue happy American public. I am an American Citizen, artist, community volunteer, lover of the human race, and a corporation.


      Tes, hi--

      There are a number of good reasons to incorporate. Our theatre has been a non-profit corporation for 38 years and has enjoyed a number of protections and privileges as such. I don't feel that makes us at all evil, but then we haven't wielded our power to buy congressmen, drive dozens of other theatres into bankruptcy, corner markets, or dump toxic waste onto the corner bakery.

      The issue, obviously, isn't the legal structure of the outfit, or even its size: a corporation is one way to aggregate funding for the masses of materials and workers to create the computer I'm writing this on. It could start in somebody's garage, but it can't stay there very well. I don't think corporate capitalism is the only way to do it — Bechtel didn't build the Pyramids — but it's definitely a powerful tool, whatever its flaws. It's essentially a group of people pooling resources to accomplish something — nothing wrong with that.

      But those who object to corporate power are objecting to UNBRIDLED corporate power. Unless your public art involves filling up Grand Canyon to put a string of casinos on top, I don't think your example is comparable. These very-small-potatoes experiences with unnecessary regulation, frivolous lawsuits, etc., are held up as examples that have relevance to the battles — in terms of environmental regulation, taxation, electoral influence, etc. — going on with the huge multinationals, and frankly that's like comparing firecrackers with hydrogen bombs.

      Cheers--
      Conrad
    1. briverwood's Avatar
      briverwood -
      Quote theindependenteye wrote: View Post
      >>>]It was interesting to read this article from the point it only shares the writers dislike of corporations. I am an artist and because a drunk tripped over one of my public art sculptures I was sued. The lawsuit forced me to think like a corporation; “Protect what I have”.
      >>>I incorporated myself to protect what little I have from lawsuits and the unethical legal system in this country. The article paints a picture of corporations that are here only to protect owners and managers from accountability, but in my case and that of thousands of other business owners it is the only way to protect us from the sue happy American public. I am an American Citizen, artist, community volunteer, lover of the human race, and a corporation.


      Tes, hi--

      There are a number of good reasons to incorporate. Our theatre has been a non-profit corporation for 38 years and has enjoyed a number of protections and privileges as such. I don't feel that makes us at all evil, but then we haven't wielded our power to buy congressmen, drive dozens of other theatres into bankruptcy, corner markets, or dump toxic waste onto the corner bakery.

      The issue, obviously, isn't the legal structure of the outfit, or even its size: a corporation is one way to aggregate funding for the masses of materials and workers to create the computer I'm writing this on. It could start in somebody's garage, but it can't stay there very well. I don't think corporate capitalism is the only way to do it — Bechtel didn't build the Pyramids — but it's definitely a powerful tool, whatever its flaws. It's essentially a group of people pooling resources to accomplish something — nothing wrong with that.

      But those who object to corporate power are objecting to UNBRIDLED corporate power. Unless your public art involves filling up Grand Canyon to put a string of casinos on top, I don't think your example is comparable. These very-small-potatoes experiences with unnecessary regulation, frivolous lawsuits, etc., are held up as examples that have relevance to the battles — in terms of environmental regulation, taxation, electoral influence, etc. — going on with the huge multinationals, and frankly that's like comparing firecrackers with hydrogen bombs.

      Cheers--
      Conrad
      Conrad, it's such a joy to read your writing. So articulate. Such great examples. Thanks. Bev Riverwood
    1. Gus diZerega's Avatar
      Gus diZerega -
      It is important to distinguish between individuals and even families who have incorporated a business, but which continue to reflect the values, good and bad, of the individual or family, and the sociopathic entities that arise when a corporation is publicly held. This soullessness is required by law, and corporate raiders guarantee that it will serve overwhelmingly financial values to the exclusion of all others. The issue gets complex of course, but this is basically why our society is dominated by organization which, were they truly people, would be classified as among the worst people in the population. It seems as if many select for CEOs with a similar incapacity to act in an ethical manner.


      Quote Tes wrote: View Post
      It was interesting to read this article from the point it only shares the writers dislike of corporations. I am an artist and because a drunk tripped over one of my public art sculptures I was sued. The lawsuit forced me to think like a corporation; “Protect what I have”.

      I incorporated myself to protect what little I have from lawsuits and the unethical legal system in this country. The article paints a picture of corporations that are here only to protect owners and managers from accountability, but in my case and that of thousands of other business owners it is the only way to protect us from the sue happy American public. I am an American Citizen, artist, community volunteer, lover of the human race, and a corporation.
    1. Barry's Avatar
      Barry -
      I didn't notice that Larry's article expressed a "dislike" of corporations. Corporations are a major advance in the world of economics and the creations of wealth and even public welfare (how many products of corporations have you used today?)

      The biggest problem at the moment is that the government treats corporations as people with the same rights and it treats money as speech, both of which are plainly incorrect. Given that that's the system (which, granted that corporations had a hand in codifying) the are just "investing" in the government (like buying a legislator - particularly in those sparsely populated states where they can be had at a discount) just like they'd invest in some R&D to improve their bottom line. And the ROI on legislators is very high! Point being is that the main problem is the government and not the corporations.

      There is a secondary problem, though, in that corporations must always maximize their highly imprecise financial bottom line, as opposed to taking other factors into account (such as the triple bottom line)

      There's really no need to " distinguish between individuals and even families who have incorporated a business", especially since small corporations can't buy a legislator. What is needed is to restore democracy for The People, and to regulate corporations and encourage them to maximize their service towards a larger basket of the public needs.
    1. Gus diZerega's Avatar
      Gus diZerega -
      Barry- There is a need to make that point of distinction. An individually controlled corporation is capable of acting honorably, and allowing other values to override profit. The same is true for families with a strong sense of identity. Not so for publicly held ones. The take away from this is that public corporations will always lie, cheat, and break the law when they think it in their interest.

      Two important examples: here in N. Calif the Pacific Lumber Company when family held was both profitable and admired by a great many environmentalists. Once it became public it was taken over by Charles Hurwitz and his MAXXAM Corp., and became the rapacious monster that finally, blessedly, went bankrupt. There is also a wonderful book out now, "Chocolate Wars" by Deborah Cadbury that gives a history of the chocolate industry including the moral issues that colored its founders and were ignored by publicly help companies and the sociopaths who ran them.

      There are lots and lots of examples but the first is pretty local and the second a good read.

      Of course we need to take power back from the plutocracy that largely rules us today.

      Gus
    1. podfish's Avatar
      podfish -
      Quote Gus diZerega wrote: View Post
      Barry- There is a need to make that point of distinction. An individually controlled corporation is capable of acting honorably, and allowing other values to override profit. The same is true for families with a strong sense of identity. Not so for publicly held ones.
      that's a romantic notion. It's also capable of acting selfishly, treating the interests of anyone not 'in the family' with contempt. There are actually more constraints (though not as effective as they should be) on the activities of a public corporation, made up of disparate individuals.
    1. Gus diZerega's Avatar
      Gus diZerega -
      Nothing I wrote implies individuals and families are always honorable. And I gave two easy to grasp examples of my point illustrating the difference. Nothing "romantic" just paying attention to facts.

      It is romantic to pretend publicly held corporations are better behaved than privately held ones, however. Have you been reading the news the past ten years? Exxon, Enron, Citi Bank, Goldman Sachs, Massey Energy, the list just goes on and on and on. 84 percent of foreclosures in San Francisco were illegal according to the NYT. http://crooksandliars.com/susie-madr...re-audits-esti

      Look at the percentage again: 84%. 66% had at least 4 violations. Taking people's homes.

      Yep, laws written by servants to the corporatocracy are really keeping them on the straight and narrow.

      Quote podfish wrote: View Post
      that's a romantic notion. It's also capable of acting selfishly, treating the interests of anyone not 'in the family' with contempt. There are actually more constraints (though not as effective as they should be) on the activities of a public corporation, made up of disparate individuals.
    1. podfish's Avatar
      podfish -
      Quote Gus diZerega wrote: View Post
      And I gave two easy to grasp examples of my point illustrating the difference. Nothing "romantic" just paying attention to facts.
      isolated examples don't prove anything. It's kind of a silly argument at this point, especially without numbers to back it up. But sure, there are a lot of examples of corporate malfeasance - most of them from big publicly-owned corporations. Isn't that because most big corporations just happen to be publicly owned?
      The numbers of interest for this part of the debate: what percentage of publicly-held corporations are poor citizens vs. what percentage of privately-held ones are equally evil. I have no clue (as I suspect is true of you as well).
      Regardless, corporations exist to relieve individuals of civic liabilities. This is clear in the advice given to individuals about why they should incorporate. It's explicitly to limit their liabilities!! The problem is then, if the corporation is allowed to have the rights of a person, they become super-citizens, with equal rights but fewer liabilities. Why the ownership is let off the hook in your estimation if the ownership group is related by blood, I don't get...
    1. jbox's Avatar
      jbox -
      Quote podfish wrote: View Post
      isolated examples don't prove anything. It's kind of a silly argument at this point, especially without numbers to back it up. But sure, there are a lot of examples of corporate malfeasance - most of them from big publicly-owned corporations. Isn't that because most big corporations just happen to be publicly owned?
      The numbers of interest for this part of the debate: what percentage of publicly-held corporations are poor citizens vs. what percentage of privately-held ones are equally evil. I have no clue (as I suspect is true of you as well).
      Regardless, corporations exist to relieve individuals of civic liabilities. This is clear in the advice given to individuals about why they should incorporate. It's explicitly to limit their liabilities!! The problem is then, if the corporation is allowed to have the rights of a person, they become super-citizens, with equal rights but fewer liabilities. Why the ownership is let off the hook in your estimation if the ownership group is related by blood, I don't get...
      The reason people form corporations to limit their liability is due to the fact that the legal system in this country has morphed into a huge liability enabling system. Individuals are held liable for any little thing (or big thing) and ordinary folks regularly get sued for stuff that is beyond their reasonable control. People are not held to a very high level to protect themselves from harm and if something bad happens, mild or serious, real or imagined, individuals can get blamed and sued, often for simply being in the wrong place at the wrong time. Should someone lose their entire life savings because somebody slipped on a banana peel in front of their shop?

      That said, people are not corporations, money is not speech. Incorporating is a legitimate way to protect oneself and should not be elevated to the status of personhood.
    1. DeadwoodPete's Avatar
      DeadwoodPete -
      Hi Larry and all,

      A friend said that he saw a bumper-sticker recently that said, "I will believe that corporations are people when Texas executes one."

      Bruce

      Quote Tes wrote: View Post
      It was interesting to read this article from the point it only shares the writers dislike of corporations. I am an artist and because a drunk tripped over one of my public art sculptures I was sued. The lawsuit forced me to think like a corporation; “Protect what I have”.

      I incorporated myself to protect what little I have from lawsuits and the unethical legal system in this country. The article paints a picture of corporations that are here only to protect owners and managers from accountability, but in my case and that of thousands of other business owners it is the only way to protect us from the sue happy American public. I am an American Citizen, artist, community volunteer, lover of the human race, and a corporation.
    1. DeadwoodPete's Avatar
      DeadwoodPete -
      After I sent that quote, "I will believe corporations....", I friend wrote back and said, " I will believe corporations are people when they send an executive to serve in the military".

      B

      Quote DeadwoodPete wrote: View Post
      Hi Larry and all,

      A friend said that he saw a bumper-sticker recently that said, "I will believe that corporations are people when Texas executes one."

      Bruce
    1. The"A"Team's Avatar
      The"A"Team -
      ... when they take some responsibility and give me a grandchild.
    1. MarilynO's Avatar
      MarilynO -
      Yep, that would be great to send those guys not just into the military, but right into combat. Unfortunately until the law no longer defines corporations as persons, the courts of the USA will be obligated to interpret all cases and all proposed law concerning corporations based on the constitutional definition of a person's rights. That's why corporations can't be given anymore restrictions on their contributions than an individual can. Those of us who are sickened by this should make it a priority to change the legal definition of a corporation. I wish that and taking private money of any kind out of elections would be the two main goals of Occupy. In fact for a while I wish those would be the only two goals so that the energy is not diluted. If those two things changed, there would be much more power in the will of the people to change everything else.

      Quote DeadwoodPete wrote: View Post
      After I sent that quote, "I will believe corporations....", I friend wrote back and said, " I will believe corporations are people when they send an executive to serve in the military".

      B