Corporate Power

I taught Business Ethics for many years and during those years I came across a great many reports of the abuse of the power of corporations. It became increasingly clear as I read and thought about this misuse that it stems from the fact that the publicly owned companies ignore the stakeholder because they are primarily (if not exclusively) concerned about the return on the dollar, i.e., profits that can  be paid out to shareholders (and overpaid CEOs who typically make 400 times as much as their  average employee). What I now take to be an obvious fact has many ramifications.

I have posted before about the oversight on the part of the founders who were so sensitive to the abuse of power and who simply did not see the possible abuses of power that might result from the millions of dollars the corporations rake in every year. — and this despite the fact that Jefferson, for one, was fully aware of the dangers of immoderate wealth in the hands of a few. But the founders simply couldn’t see this coming, clearly. They did realize, however, that the Constitution was a document that required up-dating from time to time; it is not written in stone. Henry Adam thought that when Grant was elected there would be a drastic overhaul of a document he realized was already out of date. But that didn’t happen. But, surely, one of the issues that needs to be addressed in our day is the abuse of the power of corporations that can simply buy elections and determine who is allowed to hold public office and what those who have been elected will do when in office (if they want to be reelected).

In 2010 the Supreme Court decided by a vote of 5-4  in the “Citizens United” case that corporations are “persons” and have rights of free speech as protected by the First Amendment. Under that umbrella, they were given the green light to contribute to political campaigns — which they have subsequently done, in spades. Elections were increasingly a battle of the rich against the also rich, but the contributions of the corporations — not to mention those who run the corporations — have upped the ante considerably. Now we find ourselves faced with continuous requests for money from candidates and political parties to “take on” the corporations — as though this can be effectively accomplished.

I don’t buy the notion that corporations are persons and I think the claim I have seen argued that, as persons, they might somehow be shamed into behaving ethically is a bit dubious. If the shame were to result in lower profits corporate CEOs would simply pass along the losses to the customers until the PR people could direct attention elsewhere and convince the public that no real harm was done. This was the case with the Exxon Valdez oil spill in the waters off Alaska a few years ago when Exxon sent a team of people up to the region of the spill where they cleaned up several hundred yards of oil from the shoreline and then had it filmed and used the film in a public relations campaign to convince customers that they had eradicated the effects of the spill. Ignored altogether, we have since discovered, were hundreds of yards of shoreline out of sight that remained covered in oil. It seems to be in the corporate DNA to do whatever it has to do to “right the ship” in the case of an accident and make sure the image of the company is not seriously damaged. They have public relations people who do nothing else but address this issue. And they have lawyers, who they often call “ethics officers,” whose job it is to see that they take no steps that could possibly end them up in court — because they identify morality with legality and pride themselves in “doing nothing wrong.”

The recent attempts by the current administration to weaken, if not eradicate altogether, the E.P.A. and other regulatory agencies is extremely disturbing because history has shown that the corporations will not police themselves and if their feet are not held to the fire they will do whatever it takes to increase profits, full stop. In an economy like ours regulations are anathema to the corporations and their highly paid officers. But from the public’s perspective they are essential.

Furthermore, those corporations should not be regarded as persons and given the right under the First Amendment to contribute to political campaigns. The founders missed this one, but we are becoming increasingly aware of the abuses of power by the corporations and the need to rein them in by limiting their impact on the public domain. The first step, clearly, is the rejection of the Citizens United decision which at least two of the judges who voted for it now realize was a mistake. And, if we cannot revise the constitution, we can certainly modify it to see to it that controls are placed on otherwise unfettered power. That is, we can if we have the will.


I must confess I am not a big fan of compromise. When there is a problem to be solved there is usually one correct solution but when a group addresses the problem it often sacrifices the question of a solution in its pursuit of “consensus.” Principles often get trampled in the rush to keep the group calm, making sure no one goes away mad. The majority is not always right, and compromise is frequently a matter of “settling” for the least offensive solution. This always bothered me when I sat on endless committees during my tenure as a philosophy professor. I hated committees and hated compromise.

But there are times when compromise is necessary, especially when both sides in a conflict have legitimate concerns, or when one side could make the call without even consulting the other side. One such issue is the current assault on the environment and destruction of the breeding grounds of hundreds of endangered species of animals, fishes, and birds. The large corporations that want to rape the earth and exploit the seas in the name of “development” or “progress” seem to hold all the cards* and the best those who want to protect the planet and the living things that populate it can do in many cases is settle for a compromise. Thus, though I hate to say it, every now and then a compromise actually makes sense — as in the case of migratory caribou that venture to Western Alaska every Spring to give birth to their young.

Big Oil and Big Gas want to “develop” (read “exploit”) the territory where the birthing takes place — areas such as Utukok and Teshekpuk in Northern Alaska. The Wildlife Conservation Society is passing around a petition in which they ask supporters to get behind a compromise with these corporations to help save at least some of the critical areas for the caribou. A recent appeal says, in part,

As the BLM [Bureau of Land Management] considers several proposals for what to do with the land, one of their top choices is a smart, workable plan we are excited to stand behind as it balances areas for development with key protection from development in the most important areas for wildlife. In addition to our commitment to saving the region’s precious wildlife, we have a concrete proposal for how to develop its natural resources, too.

This is the best proposal for wildlife conservation in the western Arctic. It protects the coastal plain around Teshekpuk Lake – home of millions of migratory birds that come from all over the planet, and tens of thousands of caribou – and the Utukok Uplands, a landscape rich in caribou (the largest herd) and their natural predators – wolves, grizzlies, and wolverines.

This does seem to be the best those who care about the preservation of the planet and the future of animal species other than humans can hope for. Whether Big Oil will agree to the compromise remains to be seen, but it is the sort of positive thinking that we must look for in the struggle between the Goliath of large corporations and the Davids who lack political cloud or the millions of dollars required to take them on in court. David must try somehow to get Goliath to the table and find a middle ground. Compromise stinks because it satisfies no one. But in the real world, it may be the best we can hope for.


*Indeed they do! According to a recent Huffington Post article, the sitting President, a Democrat, has made a deal with a number of large multinationals that violates a promise he made to the American people prior to his election. WASHINGTON — A critical document from President Barack Obama’s free trade negotiations with eight Pacific nations was leaked online early Wednesday morning, revealing that the administration intends to bestow radical new political powers upon multinational corporations, contradicting prior promises.

Under terms of the agreement foreign corporations operating in this country would apparently be allowed to bend environmental regulations that are already quite lax. Later in the article, a spokesperson for the Sierra Club is quoted: Speaking to the environmental concerns raised by the leaked document, Margrete Strand Rangnes, Labor and Trade Director for the Sierra Club, an environmental group, said, “Our worst fears about the investment chapter have been confirmed by this leaked text … This investment chapter would severely undermine attempts to strengthen environmental law and policy.” Given the nature of the multinationals, it will be interesting to see if they are willing to buy into the compromise offered by The Wildlife Conservation Society regarding the Alaska wilderness. As I say, it may be the best we can hope for.