Body Corporate Anti-People
posted 31st August 2000

Richard Grossman answers some questions about the legal status of corporations. Richard is co-director of the Program on Corporations, Law and Democracy. He is co-author of Taking Care of Business: Citizenship and the Charter of Incorporation. He lectures widely on issues of corporate power, law and democracy. You write in an essay, ³Giant corporations govern. In the Constitution of the United States they are delegated no authority

Q: to make our laws and define our culture. Corporations have no constitutions, no bills of rights. So when corporations govern, democracy flies out the door.² What do you mean by that?

A: On one level, it¹s that corporations are in fact making the fundamental decisions that shape our society. They determine essentially what work we do, which technologies get developed, which production methods are used as opposed to other productions methods. They are constantly pushing the concept that production has to expand, and from that comes wealth, liberty and freedom. Most of the decisions that they make are essentially beyond the public¹s ability to interfere with. They have increasingly, through the law, got their decision-making to be declared private property. The society is structured in such a way that people don¹t even second-guess. We¹re left with trying to as best we can deal with the impacts of the major decisions, trying to make them a little less bad. But in terms of having this fundamental authority to shape our society, to make the real decisions, to control investment, to control production, to control our work, they have been able to get the law to reflect their position, which is that this is private property of these private entities. Our position is first, we are not willing to concede that a major business corporation is in fact private. All through our history there has been a big conflict over what¹s public and what¹s private, not just in terms of property but in terms of decision-making. What decisions are appropriate for people who are governing themselves and what decisions are off the agenda and left as so-called private decisions? In addition, the federal courts, and the Supreme Court in particular, have bestowed the equivalent of human rights on these artificial entities. They now have the protection of law and the Constitution, which means the protection of the police and the military, to interfere in our elections and in our law­making. They participate in our elections as if they¹re just another person. They lobby, and more than lobby. We all know how they do it intensively. They¹re able to field fifty or a thousand lobbyists. They¹re able to take politicians to dinner, to buy all kinds of advertising, to shape the culture. Increasingly over this century even citizen activists and activist organizations, have not challenged the claimed authority of corporations to make the fundamental decisions. What¹s happened is, we¹ve been channeled into regulatory administrative agencies, like the Federal Communications Commission, the Environmental Protection Agency, the Securities Exchange Commission and the National Labor Relations Board, where we try to make the best of the worst of a bad situation, to make the corporate attacks on life, liberty, property and democracy a little less bad, usually one attack at a time and usually after the fact, when the harm has been done. We¹re saying that if we are to be a self-governing people, which is what the American Revolution was about, that we would govern ourselves, then we have to be in charge of everything. There can be no realm of decision-making that should be considered private, beyond our authority.

Q: The conventional wisdom would have it, though, that we are governed by local, state and federal governments.

A: That¹s the conventional wisdom. Look at the proposed Multi­lateral Agreement on Investment, the MAI. What it does is grant to property, to corporations, to artificial concentrations of wealth, authority to go into other countries, and exercise the same kind of so-called private rights of decision-making that they have exercised in this country since the beginning of this century. If you go back and look at populist and other public resistance to increasing corporate power in the 1880s and 1890s, you find a vigorous debate, very different from today, about what is the right and the role of the states in creating corporations. The states, after all, are the jurisdiction over the corporations. It¹s our states that charter the corporations and are supposed to define them and keep them subordinate. What happened was, towards the end of the nineteenth century corporate leaders realized that they needed to get away from the authority of the states to define them. They ran to mama, to the federal government, and said, This is unconstitutional. This interferes with the interstate commerce clause, our property rights and our freedom of contract. Help us. And the federal courts helped them. They stripped the states of their ability to define the corporation. What you have is sort of a shell now. The states charter corporations, but the federal government has taken their clout away to decide what they in fact can¹t do. The states are not keeping the corporations subordinate. They¹re not nurturing liberty and democracy by preventing the rise of concentrated economic power, which is easily translated into political power. So not only do you have corporations running rampant and exercising the authority and the rights of natural persons, which is just crazy according to the ideals of our system, we have our elected officials, actively aiding and abetting. Here¹s something that comes out of the whole mythology, that jobs, progress and the good life, where do they come from? They come from giving these corporations a free hand and saying, Do whatever you want because we¹re incapable as people of creating jobs, of figuring out how to grow our food, of arranging our affairs. We need you. The politicians say, We have to create a good business climate. We have to give the corporations whatever they want, including all kinds of subsidies and special privileges. All the money goes to them. They have the law on their side. We as the people are left with, well, if anything bad happens to this corporation, what will happen to jobs, to taxes? How can we possibly compete with the rest of the world? The whole gamut of mythologies that the corporations have created in our culture means that at the local level we have very little control. Most people know that. Towns are groveling to ask corporate leaders to please, put your factory here. Please don¹t close your factory. We¹ll give you tax rebates for a thousand years. We¹ll give you incentives. We¹ll build a highway, a railroad. Please come here. We don¹t know how to do anything for ourselves. We turn over to them our sovereignty. When we turn our sovereignty over to these so-called private entities that don¹t have constitutions or bills of rights, then democracy goes out the window.

Q: You emphasize redefining democracy and law.

A: And in the process redefining us. What¹s happened over the last hundred years is that the corporations have defined us human beings as consumers. We¹re told we can vote with our dollars and with our feet and not buy. That¹s just crap. If we¹re citizens, if we¹re a self-governing people, then our main job is to nurture the democratic process. That¹s a job that has been entrusted to us by previous generations and that we want to help empower future generations to do. One of the advantages of corporations is that they became legal persons in 1886 when the Supreme Court so declared. This is prior to African Americans being legal persons, women being legal persons, most men without property being legal persons, debtors and Native Americans. They all had to struggle to gain their rights as persons, to gain the equal protection of the law. One of the things that we stress is that corporations don¹t have rights. Rights are for people. Corporations only have privileges, and only those that we the people bestow on them. If we abandon our responsibility of defining the corporate entities that we create, if we just let them run rampant and overpower us and go around the world and in our name do what they¹re doing, it¹s incredibly irresponsible. That¹s to a large extent what we have done.

Q: You use an interesting quote from President Franklin D. Roosevelt. ³The liberty of a democracy is not safe if the people tolerate the growth of private power to a point where it becomes stronger than the democratic state itself. That in its essence is fascism: ownership of government by an individual, by a group or any controlling private power.²

A: Roosevelt wrote that in his message to Congress creating the TNEC, the Temporary National Economic Committee, in 1937, which was then to spend the next three years, under the leadership of Senator O¹Mahoney of Wyoming, looking into the concentration of wealth and power in the U.S. There¹s now forty-odd volumes in the Library of Congress and other libraries of that testimony, finding that there was enormous concentration. World War II interrupted the political agenda that they had, the things they were going to try to do with this evidence, so the issue has been forgotten and most people have never heard of the committee. The language that the President used in creating this committee is very clear. When the decision-making and the information that must be public for a democracy to function is privatized and the law has been turned topsy-turvy to support that these decisions and information are private, and when these so-called corporate entities have the rights of persons, have free speech and constitutional protections, then they are doing the real governing and we are becoming consumers or objects. It has a name, which was more current then than now, which was fascism. It¹s a hard concept, a troubling concept for people to deal with. We are constantly being bombarded with information telling us that we have the greatest democracy in the world and more freedoms than anybody and more wealth and goods than everybody. I think there¹s a growing disconnect in people¹s minds around the country. People realize that the real decisions that shape what they can do and increasing what you can grow or buy are being made in a private way by our creations, these corporations. We don¹t have standing to intervene. A good example is in a New York Times editorial recently applauding a court decision granting to people, to human beings, we the people, due process rights dealing with HMO corporations on medical care issues. Think about that. The corporation already has due process rights because the courts have already made clear that they think the corporation is a person, a legal person. But on company property workers don¹t have First Amendment rights. They don¹t have due process rights. And on issues that are concerned with these insurance companies, these medical companies, it¹s not just generally assumed that all human beings have due process rights. It¹s nuts. Corporations are acting like a government, but they¹re not constitutionalized. So we have no standing. It¹s a disconnect that is extremely troubling to me and a tremendous source of our woes today. Another good example is in some of the famous corporate speech cases over the last fifteen years. There have been a number of cases where the Supreme Court has expanded the privileges of free speech to corporations. One of them came out of a case in Massachusetts. The Commonwealth of Massachusetts passed a law saying that in referendum elections corporations don¹t have the right to spend money to sway the vote one way or the other. Corporations took that to court and went all the way to the Massachusetts Supreme Judicial Court, the highest court in the Commonwealth. It approved the law. The corporations then took it to the U.S. Supreme Court. The Supreme Court sort of changed the question and said, When is democracy the most helped? When all voices are heard. These corporate voices need to be heard. Therefore this law is unconstitutional. They refused to acknowledge the finding of the Massachusetts legislature and courts that in fact great concentrations of wealth and power that were not constitutionalized, that are considered private in our society, are a menace to the functioning of democracy and therefore the state has the total right to say, We¹re going to keep our elections pure and only persons, corporate leaders as individuals, of course, can participate, but that corporations could use shareholder money to sway votes without having even polled the shareholders they thought was inappropriate. What the Supreme Court did was totally throw out the logic and say, Democracy means all voices, and since corporations are persons, they have voices. Let them be heard, even if they¹re going to outspend humans a billion to one.

Q: How can some of the issues and concerns that you¹re raising be injected into the mainstream discourse if that discourse is largely driven, shaped and formed by corporate-controlled media? All the networks are owned by large corporations: Westinghouse, General Electric, Time Warner, Disney.

A: That¹s a challenge. First of all, we have to understand that from an organizing educational strategy the media corporations are the adversary, more than the adversary, they¹re part of the whole structure of corporate dominance and governance. It¹s funny now, sometimes I go to conferences, particularly environmental conferences, and I see environmental magazines. There¹s always a section on how to deal with the media. It¹s about how to curry favor with reporters, how to write a press release, how to get them to cover your issue, how to give them advisories and keep them informed, and slip them special information. I think we¹re well beyond that. The issue is how to force them to cover our concerns while challenging also the claims to privilege that they wield as giant corporations. Many of them are not just media corporations but subsidiaries of other kinds of conglomerates like entertainment or nuclear companies. We have to challenge in every realm of society, whether it¹s the corporate realm, the media corporate realm in particular, or academic corporations like universities, or professional associations. We have to start bringing this debate in about who¹s in charge, about the rights of people versus the rights of property and artificial entities. It¹s going to be hard because the giant media corporations dominate the way people see information and news. However, there¹s an enormous, incredible alternative, grassroots media. When we first came out with our early publications, like the pamphlet Taking Care of Business in 1993, none of the mainstream corporate media would touch it. We were forced to go to the grassroots. We got hundreds and hundreds of reviews and excerpts in print, newsletters, magazines, radio, some videos. The word spread in a very effective way. I¹m delighted that we ended up going that way. The base we¹ve been building is much stronger because people have had to grapple with this stuff. I think that the opportunities are there. In a couple of years, when there are challenges to corporate privilege, the idea of the corporate person, free speech, a challenge to a corporate charter in a state, even the corporate press is going to be forced to grapple with this. That will be our opportunity to take some major steps. But we have to remember we¹re challenging the control of the corporations, and if we¹re talking to media corporations we have to be very clear that we¹re also challenging their claim to authority.

Q: What are your views on the notion of socially responsible corporations? I notice that you cite Tom Paine, for example.

A: We asked, Why didn¹t Tom Paine encourage people in colonial times to search for a more socially responsible king? I¹ve done a little research on that. The notion of social responsibility was proposed in the 1920s by some law professors who were very concerned about the powers and privileges that corporations were wielding. They were trying to create some legally binding doctrine and to put it into law that the corporations had responsibilities to the community, to society. It was unfortunately a concept that was crushed by the corporations prior to the stock market crash and the Great Depression. What happened is that in the 1950s and 1960s some civic groups pulled the phrase out and started using it. Corporations were delighted to use it because it wasn¹t linked to a concept of making this the law, but more like voluntary conduct, that they had a responsibility and would you please, Mr. Corporate CEO, be a little nicer. That has translated into what we see now, a set of voluntary codes of conduct that some groups are asking corporations to sign on to. I think it¹s a terrible and dangerous diversion. If all we¹re going to do is create organizations and develop materials and educate people to come together in order to say to corporations, Please, you have a responsibility not to be so destructive. Please be a little less harmful. Please be nicer. What you¹re doing is reinforcing the corporate worldview that they have ultimate authority, like petitioning a king to be a little nicer or a little less bad. It¹s an extraordinary diversion. It undermines our sovereignty and self-esteem. Some of the groups have invested ten years into these voluntary codes, an incredible amount of time and energy getting their members involved, and when they win, what do they get? Pretty much codes without teeth and no law backing them up. We don¹t talk in the language of corporate social responsibility. The only people who have responsibilities here are we the people. It¹s our responsibility not to create and sustain corporate entities that cause harm, that exceed their authority. That¹s our responsibility to this generation, to the earth and to future generations. We¹re the ones who have to be responsible. Besides, organizations can¹t be responsible. It¹s only people who can be responsible. A principal purpose of a business corporation is to shield decision-makers from responsibility. That¹s why there are limited-liability corporations. They shield them from responsibility. The corporation can be doing all sorts of horrible things, assaulting democracy, destroying property, taking people¹s future income, assaulting liberty, and nobody¹s responsible. What happens when a corporation is brought before a regulatory body or even into court on a criminal case? The worst thing is it¹s fined. Maybe it¹s declared a felon and the corporation itself is fined. But that¹s not going to have a deterrent effect. A corporation doesn¹t think. It doesn¹t have feelings, a soul. It doesn¹t have a conscience. It¹s playing games to think that these minor fines, which by the way are usually tax deductible, have any real impact on the corporation. It¹s nuts to think that people begging a corporate CEO, like Tom Paine didn¹t beg the King of England, to be a bit nicer is going to change the balance of power. We have to face that there¹s an imbalance of power, the kinds of powers and privileges that corporations have under law are inappropriate, such that most of the harms that giant corporations do to life, liberty and property are considered legal and are generally regarded as acceptable by the culture, if not inevitable. You have to break an egg to make an omelet. If you want growth and progress and the good life, you have to have a little creative destruction. Of course you¹re going to have problems here and there, but in the long run things will work out. In the long run we¹ll all be dead. Corporations are able to wield power under law. They have the law on their side, which means they have the military and the police on their side. That turns things around. Up to about 1840 or 1850, if you were a mill owner and you dammed a stream in order to create a mill to grind grain, and your mill was flooding into my land, I had the right under common law, I and my neighbors, to go on your land and take your dam apart in order to save my property. Now if I and my neighbors go on the property of Louisiana Pacific Company in order to stop them from using chemicals and pesticides that are killing the salmon and destroying the whole ecosystem, Louisiana Pacific calls the police and we then become pawns in the so-called justice system. The law favors their property over our property. It¹s not that the law favors private property. It¹s that it favors corporate property over the property of the citizens and the corporate future income over the future income of people and the liberty of corporations over the liberty of people.

Q: What is your response to the corporate chieftains who argue that, We are creating jobs, we are creating wealth, this is a capitalist economy?

A: There¹s nothing in the Constitution that mentions corporations or capitalism. There¹s nothing in the Constitution other than protecting contracts that sets up a system which is so overly competitive and not cooperative. The Knights of Labor in the 1870s and 1880s were really clear that they wanted to build a society based on cooperation, not on competition. There are a lot of people throughout our history who believed that everything doesn¹t have to be cutthroat, that people can cooperate. I would say that the smartest corporate leaders from the 1870s on have always understood that what they wanted was the ability to cooperate among the top corporations and make everybody else compete. Recently there was a piece in the New York Times by Walter Goodman that quoted James Randall, the president of Archer Daniels Midland Corporation. ADM was caught in some scam in which they were fined $100 million, peanuts. Randall was secretly taped saying to some of his associates, ³The other corporations are our friends and our customers and our suppliers are our enemies.² I think that¹s how big corporations have felt for a hundred years. They created the regulatory system and laws to minimize competition among themselves but maximize competition among workers and the community so they could play one community off against another and one country off against another. So of course corporations bring some jobs. That¹s where all our money goes, our subsidies, our wealth. With all these privileges they have, they damn well should be creating some jobs. But the question is, Is that the only source and the appropriate source of getting things done? Are we so helpless that if we didn¹t have these giant corporations we wouldn¹t have wholesome food, we couldn¹t build our own houses, we couldn¹t have newspapers and radio and television and magazines, we couldn't heat our homes and create electricity? If people and communities had any fraction of the vast authority and the public wealth that has been channeled into these corporations, we would be able to do what¹s needed to be done. One of the ideas of democracy, of self-governance, is that if you have lots of people participating, the chances are you¹ll have a better decision. These corporate CEOs continue to make the wrong decisions primarily because they make them in private, based on their own values and on immediate return. What do we have now? Poisoning of our food supply, our air, our water, the warming and poisoning of the whole planet, an incredible increasing gap between rich and poor, and CEO salaries which are a billion times higher than workers¹ salaries. You have the center of the society imploding because of decisions made by a few people. That¹s what Roosevelt was talking about. When you have private power making the decisions, that¹s fascism.

Q: You alluded to the imperiled environment. Could you elaborate a little more on the long-term environmental consequences of the current path that we¹re on?

A: We have a number of environmental laws, toxic chemical laws, clean air and water laws, that have been passed since the 1970s. These are regulatory laws, regulating what the corporations can put out. Despite these laws, the amount of toxic chemicals produced every day by corporations is increasing. The amount of harm that people and other species are suffering is increasing. That process hasn¹t worked. If you go back and look at these regulatory laws, what they do is legalize the corporations¹ ability to put out poisons. They channel us, as activists and environmentalists, into trying to deal with one poison at a time rather than saying to the corporations, It¹s illegal for you to be poisoning in the first place. So we have poisons in the air and the water, in the food. We have enormous corporate effort to make sure that cities and towns don¹t build mass transportation systems so that the country still relies upon the internal combustion engine. Many people may know the story of how in the 1940s Firestone and General Motors bought up the urban trolley systems and shut them down in order to sell buses and cars. We have what I prefer to call the poisoning of the atmosphere, global poisoning. Others call it global warming. You have overwhelming evidence in the Arctic and the Antarctic that there¹s a warming trend that is going to have enormous con­sequences. Wherever you look in areas where giant corporations have been particularly powerful you¹ll see enormous impacts. In the Northwest, where the timber and mining corporations have been so dominant, you see many species of salmon that are extinct, thousands of salmon streams that have been destroyed. People¹s property rights, fishermen¹s future rights to future profits have been destroyed by corporations taking their profits. I live in Province­town, Massachusetts. This used to be a fishing village. Because of corporate trawlers with their ten-mile nets, the local fish industry is basically destroyed. Off the Gulf Coast of Texas the shrimp industry is destroyed because of all the poisons coming out of the chemical and petrochemical companies. In Maine, you have a handful of timber corporations owning two-thirds of the state and exercising not only control over the land but also control over the political process. The politicians all turn to them before they do anything. So from an ecological standpoint, from an equal distribution of wealth standpoint, from a justice standpoint the rule by giant corporations has brought us problems. It¹s certainly brought us a lot of raw wealth. There¹s a lot of production. We are the masters at producing things in this country. We produce more than anybody else in the world, more poisons and more garbage and more crap than anybody else in the world. People keep buying a lot of it, for whatever reasons. But the earth cannot sustain this kind of approach. It cannot sustain the theory that our economic institutions can only exist and thrive if they keep producing more and more and keep expanding and gobbling up other businesses. It just can¹t last.

Q: Talk about practical things that people can do in terms of reversing mental colonization and reframing the debate.

A: We and other organizations have been producing materials over the last four or five years. Those can be very helpful to people, to read the history that they didn¹t know and see how other folks in other generations have been addressing this. We¹re suggesting that folks who are interested form some kind of study group, read and start thinking and talking about this. That¹s very important because we have to start using a different language, thinking about ourselves in a different way. But as important is that people who belong to activist civic organizations need to bring these debates into churches, academic institutions, professional societies or in places like New England town meetings. We need to start bringing these discussions into the body politic. In terms of when people see a harm taking place and mobilize to stop the harm, we need to do that in ways that start to change the context. It¹s difficult because when the corporation is pouring chemicals out of a factory and polluting the environ­ment, obviously people come together to stop the immediate harm. But the equivalent harm is the way the corporation is interfering with our liberty and democracy. There¹s no doubt in a community where a toxic chemical corporation is polluting in a big way out of its stacks and pipes that it has a pipe into the city council and the state legislature and into the newspaper editors and the television station managers, that they¹re helping to create the climate where people say, There¹s nothing we can do. This is the price of progress. In order to have jobs we have to kill some of our children with leukemia. We have to start challenging all these privileges that these corporations have been given, their claims to human rights. Increasingly people at community, town, county, city and state levels can start passing laws that challenge all these corporate privileges, that start denying corporations free speech, all these other Bill of Rights protections, denying them their legal personhood, and that start asserting that within our jurisdiction we have a responsibility to protect life, liberty and property of the people and species in place in our community. We are not going to allow it, even if the Supreme Court talks about the commerce clause or freedom of contract or all the other theories that they put forward. We are going to challenge that. As enough communities start challenging that, the debate will change. I take hope from looking back historically. Many of the key Supreme Court decisions granting corporations all kinds of privilege were 5-4, 6-3 decisions, very flimsily based, and their logic is ques­tionable. As we the people start to challenge, as we start asserting our authority and our claim that corporations have no right to any of these privileges, they don¹t have any human rights, we¹ll start having a very different debate. People will start feeling empowered and start demanding what we really in our hearts know we want, which is the right to control our own futures, our own communities, clean air, not poisoned air, food and water without poisons in it, atmosphere that isn¹t warming up and being poisoned, banks, insurance companies and utility companies that don¹t boss us around and dominate all our government and our elections and write the laws. " n end to poverty. These foot-soldiers are mobilisi