Review: The People’s Business–Controlling Corporations and Restoring Democracy The People’s Business: Controlling Corporations and Restoring Democracy

5 Star, Capitalism (Good & Bad)

Peoples BusinessCharming Righteous Book–A Summary for Normal People, June 18, 2009

Lee Drutman

This is a charming righteous book, there is not a single thing lacking from my point of view, and as I made my way through the book my admiration for the authors and the work they put into this grew without reservation.

This is a superb orientation for any adult; a superb assigned reading for any level from undergraduate to graduate; and a truly stellar example of what informed advocacy and public purpose scholarship would be…

As with any book I immediately recognize as being best in class, I started with the index, the bibliography (many book titles I did NOT know), and the six pages of centers and web pages as resources.

I am late to finding this 2004 book, but would suggest that it is the perfect partner for Grand Illusion: The Myth of Voter Choice in a Two-Party Tyranny.

The authors set out to address the corporation within the framework of domestic politics, and they conclude that the corporate charter is a grant of, by, and for We the People, and therefore corporations must be subordinate to the sovereign people, and must not be allowed to harm the public interest.

The first three chapters define the corporate “threat” and attributes; the next two discuss the use of existing tools, the sixth addresses obstacles, and then the conclusion. Although a very broad mature reader could fly through a great deal of this, I was struck by the even pace, the concise sensible organization, and it occurred to me that there was not a word wasted. In my world, it takes a LOT of work to get a book to read this well. The authors strike me as exceptional.

The core concern with the corporation is combination of their being virtually no limits on corporate (mis)behavior, and virtually no liability for investors, owners, and managers.

I like the manner in which the authors review the history, both of the corporation as it systematically disembowels federal and state regulation (with lots of help as the states “race to the bottom”), and of the attempts by Ralph Nader, a Nobel Prize level reformer if ever there was one, who has often been misunderstood as being about safety rather than corporate responsibility, and as a spoiler of elections rather than a champion of honest democracy. The authors meet my high standards for crediting others, doing their homework, and tying it all together.

Page 44 gives us a list of corporate rights claimed, citing Carl Mayer:
+ First amendment guarantees of political speech, commercial speech, and negative free speech rights
+ Fourth amendments safeguards against unreasonable regulatory searchers
+ Fifth amendment double jeopardy and liberty rights
+ sixth and seventh amendment entitlements to trial by jury

Page 76 gives us the list of psychopathic attributes of the corporation, for those that have not seen this often quoted section before, Dr. Robert Hare as explained by lawyer Joel Bakan:
– irresponsible
– manipulative
– grandiose
– lack of empathy
– asocial tendencies
– refuse to accept responsibility for their own actions
– unable to feel remorse
– relate to others superficially

The authors review the disconnects between corporate ownership and management, discuss all the standard aspects of corporate escape from accountability including impotent boards of directors.

I myself learn for the first time about 78 corporate governance reforms itemized by Richard C. Brendon, “Restoring the Trust,” in August 2003. Note 38 on page 290 provides a web URL that I am placing in the comment below.

I learn on page 119 of Robert Hinkley (author of the Cord for Corporate Responsibility) and his view that adoption of the following would be helpful in refining the role of directors and officers, now focused on maximizing shareholder profit: “but not at the expense of the environment, human rights, the public health or safety, the communities in which the corporation operates, or the dignity of its employees.”

Wow. Wal-Mart is toast if that ever comes to pass–along with most corporations.

The authors discuss the consequences of deregulation; the need for anti-trust, and the need to protect inherently governmental functions from being privatized.

I really appreciate the concise detailed overview of what Enron gave to George Bush, and what it got in return, including $7 billion in subsidies, over 50 key positions in the US government, and so on.

As the authors wind toward a conclusion, having discussed funded lobbyists, funded think tanks, legal attacks on regulations, and the 527s that are also a target in Grand Illusion (linked above), the authors made some critical final points:

1. They are at pains to distinguish between corporate crime by the corporation in all its forms; and white collar crime by individuals, noting that difference natures require different responses.

2. They are at pains to point out that financial crime is not the only crime, and cite a litany of others including crimes against humanity.

3. I am fascinated by the estimate of the cost to the public of corporate irresponsibility. The authors cite 1994 estimate by Ralph Estes of 2.6 TRILLION; others add up to at least 1 trillion; and the corporation kills 50,000 to 60,000 people in the USA alone (violent crime kills roughly 16,000). I compare this to the $2 trillion a year that organized crime pulls down within a global economy estimated at 7-9 trillion, and see clearly that corporate crime is every bit as toxic as organized crime. See Illicit: How Smugglers, Traffickers, and Copycats are Hijacking the Global Economy for the other half of global crime.

The book closes with a heartening list of initiatives local communities are taking (page 256), and a call for the labor, environmental, and consumer movements to coalesce around one shared common goal, “a just and sustainable economy [within] a functioning democracy.”

They challenge us all to be citizens rather than consumers, to demand media reform as a means of being empowered with knowledge, and conclude that in a democracy, the rights of citizens to govern themselves must trump the rights of corporations to make money at the expense of the public.

See also:
The Corporation: The Pathological Pursuit of Profit and Power
Wal-Mart: The High Cost of Low Price
The Shock Doctrine: The Rise of Disaster Capitalism
Confessions of an Economic Hit Man
The Global Class War: How America’s Bipartisan Elite Lost Our Future – and What It Will Take to Win It Back
Crossing the Rubicon: The Decline of the American Empire at the End of the Age of Oil
Rule by Secrecy: The Hidden History That Connects the Trilateral Commission, the Freemasons, and the Great Pyramids
Election 2008: Lipstick on the Pig (Substance of Governance; Legitimate Grievances; Candidates on the Issues; Balanced Budget 101; Call to Arms: Fund We Not Them; Annotated Bibliography)