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Is 'Corporate Citizen' an Oxymoron?
theodp writes "Citing expert testimony from a recent House Science Subcommittee hearing on Globalizing Jobs and Technology, The Economic Populist challenges the conventional wisdom that maximizing profits should be a corporation's only responsibility, suggesting it's time for the US to align its corporations to the interests of the nation instead of vice versa. Harvard's Bruce Scott warns that today's global economy is much like the US in the later 19th century, when states competed for funds generated by corporations and thus raced to the bottom as they granted generous terms to unregulated firms. Sound familiar, Pennsylvania? How about you, Michigan?"
this is advocating a form of fascism, right?
A Corporation's rights and responsibilities should be listed in a charter, and failing to uphold their responsibilities should cause them to lose their rights.
The lack of a charter has caused corporations to grow to be superior to nations, but with little or no accountability.
Corporations have only two responsibilities: Maximize profits, and follow the law.
It is our responsibility to make the law just.
This is how a democracy harnesses the power of greed to provide justice and prosperity to all.
From 1917 to about 1980, fear of communism helped keep capitalism in line. During that period, capitalism had ideological competition, and there was a very real fear on the part of business owners that their companies might be nationalized. During that period, most telcos were state-owned. Britain nationalized the steel and coal industries during the 1950s, and most of the rental housing units in the country were state-owned. During the Great Depression, the U.S. Government ran many programs that employed people and built things, a form of socialism.
For over a century, communism was taken seriously as an alternative to capitalism. (Yes, it never worked all that well in Russia. Neither did monarchy, democracy, capitalism, or oligarchy. Russia did better in its communist period than before or since.) During that period, when it faced competition, capitalism had to deliver an ever-higher standard of living. Which it did. There was more talk of "corporate responsibility" during that period than there is now.
Companies used to fear public opinion. That ended during the Reagan administration. (This is why Reagan was such a darling of business.)
The triumph of unbridled capitalism may be temporary. Something similar happened in 1900-1929, when railroad and power companies ruled the world. That ended in the Depression, and for the next fifty years, businesses were strongly regulated and kept in line.
Wait, are you blaming corporations for the crap that *you* bought?
Also, I have arbitrarily determined that your pay is excessive. Please hand an additional 10% your income over to the government so that they can put it to better use.
Nerd rage is the funniest rage.
Today, the very concept of a corporation entails the idea of profit maximization. That's why singling out one (Nike, Monsanto, Microsoft) and getting angry at it for making short-sighted moves in the name of profit is like getting angry at an alligator for eating meat. What did you expect? That's what it does.
"Corporate citizenship" or "corporate responsibility" are nothing more than marketing slogans. You can't ask an alligator to eat veggieburgers, and you can't ask a corporation to play nice. Even if it actually did so, its competitors would roll over it.
If you want an economy that responds to more than the richest 1% of 1% of the population, you need economic entities that are qualitatively different -- that measure success differently. That doesn't mean more government interference, because the state and the corporation have the same flaws, for the same reasons. The state and the corporation are rivals, not enemies.
Rather, what we need are economic bodies that are expressly designed in the interests of their employees and clients. The effective way to do it is through cooperatives.
There are countless examples that demonstrate that employee control works. It avoids practically all the evils of the corporate model: outsourcing, management/labor tension, secrecy, poor working conditions, creative accounting, and the list goes on.
Co-ops automatically are what corporations want you to believe they are. A co-op is a citizen of your community in a way a corporation never could be, because all its owners are citizens of your community.
What if I do the same thing, and I do get different results?
The current corporate governance situation began with the "shareholder rights" movement that started in the 1980's. That movement was fostered by corporate raiders who had no long term interest in the corporations they attacked. They wanted to get in, make a quick profit, and get out.
The movement was focused on disregarding the rights and interests of the non-shareholding stakeholders in a corporation -- the communities in which they operate, their employees, their customers, those affected by their impacts on the environment and markets, and possibly others.
Those rights and interests had previously been protected by unwritten understandings, the so-called "social compact". The shareholder rights movement effectively broke the social compact because there was no legally-enforceable impediment to their doing so.
The way to fix this is to restore the social compact and protect the interests of non-shareholder stakeholders by law, regulation, or contract. This means restoring the power of unions, strengthening regulation of markets, and providing safeguards for the interests of communities, especially those that provide benefits to corporations without written agreements reflecting the reciprocal obligations of those corporations.
Nowhere in that article does the author advocate fascist corporatism. A straw man is when you create a new position that your opponent is not advocating, and then attack that new position. The position of the article is quite clear, although it isn't sound byte short like GGP's post.
That position is clearly very different from fascism, thus making GGP's post a straw man argument.
A corporation is a "pretend person" created by a governmental process. There are various kinds, but they're all imaginary: charities, educational corporations, membership associations, foundations, etc. Corporations have no existence beyond what the government chooses for them, so their functions can be adjusted by the government as necessary.
No fascism about it.
I piss off bigots.
Communism is a whole other thing. Go back to Poli Sci 101.
I piss off bigots.
They don't exist in natural law; they are a fiction established by legislation. We can set them up to do anything we want them to do (hence nonprofit corporations, etc.). There's no reason why we can't change what they're supposed to accomplish.
I piss off bigots.
The people of Michigan want fair wages and a clean environment to live in. How dare they! They'll eat poision and breath coal dust and LIKE it or else all the companies will leave and they will die.
Blar.