In These Times  [Printer-friendly version]
February 18, 2005


[Rachel's introduction: The combined impacts of super-sized
corporations (companies bigger than countries) corporate personhood
(giving companies the same constitutional protections as citizens),
and money-in-politics combined with unbridled consumerism can explain
the erosion of our democracy. The solutions proposed here by Lee
Drutman and Charlie Cray would invigorate our democracy, clean up
politics with publicly funded elections and take steps to limit
corporate power.]

By Lee Drutman and Charlie Cray

[DHN introduction: This essay is adapted from The People's Business
(ISBN 1576753093) by Lee Drutman (Citizen Works) and Charlie Cray
(Center for Corporate Policy).]

One does not have to look far in Washington these days to find
evidence that government policy is being crafted with America's
biggest corporations in mind.

For example, the Bush administration's 2006 budget cuts the
enforcement budgets of almost all the major regulatory agencies. If
the gutting of the ergonomics rule, power plant emissions standards
and drug safety programs was not already enough evidence that OSHA,
EPA and FDA are deeply compromised, the slashing of their enforcement
budgets presents the possibility -- indeed, probability -- that these
public agencies will become captives of the private corporations they
are supposed to regulate.

This should come as no surprise to anybody familiar with the streams
of corporate money that flowed into Bush campaign coffers (as well as
the Kerry campaign and all races for the House and Senate) in the 2004
election. The old "follow the money" adage leads us to a democracy in
thrall to giant corporations -- a democracy that is a far cry from the
government "of the people, by the people, and for the people" that
Lincoln hailed at Gettysburg.

At a time when our democracy appears to be so thoroughly under the
sway of large corporations, it is tempting to give up on politics. We
must resist this temptation. Democracy offers the best solution to
challenging corporate power. We must engage as citizens, not just as
consumers or investors angling for a share of President Bush's
"ownership society."

The problem of corporate power

Unfortunately, the destructive power of large corporations today is
not limited to the political sphere. The increasing domination of
corporations over virtually every dimension of our lives -- economic,
political, cultural, even spiritual -- poses a fundamental threat to
the well-being of our society.

Corporations have fostered a polarization of wealth that has
undermined our faith in a shared sense of prosperity. A corporate-
driven consumer culture has led millions of Americans into personal
debt, and alienated millions more by convincing them that the only
path to happiness is through the purchase and consumption of ever-
increasing quantities of material goods. The damage to the earth's
life-supporting systems caused by the accelerating extraction of
natural resources and the continued production, use, and disposal of
life-threatening chemicals and greenhouse gases is huge and, in some
respects, irreversible.

Today's giant corporations spend billions of dollars a year to project
a positive, friendly and caring image, promoting themselves as
"responsible citizens" and "good neighbors." They have large marketing
budgets and public relations experts skilled at neutralizing their
critics and diverting attention from any controversy. By 2004,
corporate advertising expenditures were expected to top $250 billion,
enough to bring the average American more than 2,000 commercial
messages a day.

The problem of the corporation is at root one of design. Corporations
are not structured to be benevolent institutions; they are structured
to make money. In the pursuit of this one goal, they will freely cast
aside concerns about the societies and ecological systems in which
they operate.

When corporations reach the size that they have reached today, they
begin to overwhelm the political institutions that can keep them in
check, eroding key limitations on their destructive capacities.
Internationally, of the 100 largest economies in the world, 51 are
corporations and 49 are nations.

How Big Business got to be so big

Corporations in the United States began as quasi-government
institutions, business organizations created by deliberate acts of
state governments for distinct public purposes such as building canals
or turnpikes. These corporations were limited in size and had only
those rights and privileges directly written into their charters. As
corporations grew bigger and more independent, their legal status
changed them from creatures of the state to independent entities, from
mere business organizations to "persons" with constitutional rights.

The last three decades have represented the most sustained pro-
business period in U.S. history.

The corporate sector's game plan for fortifying its power in America
was outlined in a memo written in August 1971 by soon-to-be Supreme
Court Justice Lewis F. Powell Jr. at the behest of the U.S. Chamber of
Commerce. The "Powell Memorandum," drafted in response to rising
popular skepticism about the role of big business and the
unprecedented growth of consumer and environmental protection laws,
was intended as a catalytic plan to spur big business into action.
Powell argued that corporate leaders should single out the campuses,
the courts and the media as key battlegrounds.

One of the most significant developments that followed Powell's memo
was the formation of the Business Roundtable in 1972 by Frederick
Borch of General Electric and John Harper of Alcoa. As author Ted Nace
has explained, "The Business Roundtable... functioned as a sort of
senate for the corporate elite, allowing big business as a whole to
set priorities and deploy its resources in a more effective way than
ever before.... The '70s saw the creation of institutions to support
the corporate agenda, including foundations, think tanks, litigation
centers, publications, and increasingly sophisticated public relations
and lobbying agencies."

For example, beer magnate Joseph Coors, moved by Powell's memo,
donated a quarter of a million dollars to the Analysis and Research
Association, the forerunner of the massive font of pro-business and
conservative propaganda known today as the Heritage Foundation.
Meanwhile, existing but tiny conservative think tanks, like the Hoover
Institute and the American Enterprise Institute for Public Policy
Research, grew dramatically in the '70s. Today, they are key players
in the pro-business policy apparatus that dominates state and federal

According to a 2004 study by the National Committee for Responsive
Philanthropy, between 1999 and 2001, 79 conservative foundations made
more than $252 million in grants to 350 "archconservative policy
nonprofit organizations." By contrast, the few timid foundations that
have funded liberal causes often seem to act as a "drag anchor" on the
progressive movement, moving from issue to issue like trust fund
children with a serious case of attention-deficit disorder.

From analysis to action

The vast majority of people, when asked, believe that corporations
have too much power and are too focused on making a profit. "Business
has gained too much power over too many aspects of American life,"
agreed 82 percent of respondents in a June 2000 Business Week poll, a
year and a half before Enron's collapse. A 2004 Harris poll found that
three-quarters of respondents said that the image of large
corporations was either "not good" or "terrible."

Corporations have achieved their dominant role in society through a
complex power grab that spans the economic, political, legal and
cultural spheres. Any attempt to challenge their power must take all
these areas into account.

There is a great need to develop a domestic strategy for challenging
corporate power in the United States, where 185 of the world's 500
largest corporations are headquartered. Although any efforts to
challenge corporations are inevitably bound up in the global justice
movement, there is much to do here in the United States that can have
a profoundly important effect on the global situation.

By understanding the origin of the corporation as a creature of the
state, we can better understand how we, as citizens with sovereignty
over our government, ultimately can and must assert our right to hold
corporations accountable. The task is to understand how we can begin
to reestablish true citizen sovereignty in a country where
corporations currently have almost all the power.

Developing the movement

To free our economy, culture and politics from the grip of giant
corporations, we will have to develop a large, diverse and well-
organized movement. But at what level should we focus our efforts:
local, state, national or global? The answer, we believe, is a balance
of all four.

Across the country, many local communities continue to organize in
resistance to giant chain stores like Wal-Mart, predatory lenders,
factory farms, private prisons, incinerators and landfills, the
planting of genetically modified organisms, and nuclear power plants.
Local communities are continuously organizing to strengthen local
businesses, raise the living wage, resist predatory marketing in
schools, cut off corporate welfare and protect essential services such
as water from privatization. Local struggles are crucial for
recruiting citizens to the broader struggle against corporate rule.

Unfortunately, examples of grassroots movements that have succeeded in
placing structural restraints on corporations are not as common as
they should be. One of the ways we can accelerate the process is by
organizing a large-scale national network of state and local lawmakers
who are interested in enacting policies that address specific issues
or place broader restraints on corporate power.

Just as the corporations have the powerful American Legislative
Exchange Council (ALEC) to distribute and support model legislation in
the states, so we need our own networks to experiment with and advance
different policies that can curb and limit corporate power. The
National Caucus of Environmental Legislators -- a low-budget coalition
of state lawmakers established in 1996 in response to the Republican
takeover of Congress and several state legislatures -- is a model that
could be used to introduce and advance innovative legislative ideas at
the state level. The New Rules Project has also begun to analyze and
compile information on these kinds of laws. Additionally, the U.S.
PIRG network of state public interest research groups and the Center
for Policy Alternatives have worked to promote model progressive
legislation, as has the newly founded American Legislative Issue
Campaign Exchange (ALICE).

Moving the movement

Despite their many strengths, many major movements of the past few
decades (labor, environmental, consumer) have all suffered from
internal fractures and a lack of connection to the broader society.
The result is that they have been increasingly boxed into "special
interest" roles, despite the fact that the policies they advocate
generally benefit the vast majority of people.

Cognitive linguist George Lakoff puts it this way: "Coalitions with
different interest-based messages for different voting blocks [are]
without a general moral vision. Movements, on the other hand, are
based on shared values, values that define who we are. They have a
better chance of being broad-based and lasting. In short, progressives
need to be thinking in terms of a broad-based progressive-values
movement, not in terms of issue coalitions."

If there is one group at the center of the struggle to challenge
corporate power, it is organized labor. As a Century Foundation Task
Force Report on the Future of Unions concluded, "Labor unions have
been the single most important agent for social justice in the United

Labor is at the forefront of efforts to challenge excessive CEO pay,
corporate attempts to move their headquarters offshore to avoid paying
their fair share of taxes, and the outsourcing of jobs. Labor also has
played a leading role in opposing the war in Iraq and exposing war
profiteers benefiting from Iraq reconstruction contracts.

As AFL-CIO President John Sweeney has written, unions need to start
"building social movements that reach beyond the workplace into the
entire community and offer working people beyond our ranks the
opportunity to improve their lives and livelihood." This is beginning
to occur more frequently. Union locals and national labor support
groups like Jobs With Justice have been a key force in building cross-
town alliances around economic justice battles such as living wage
campaigns and the new Fair Taxes for All campaign.

These union-led, cross-community alliances have in turn supported some
of the strongest union organizing campaigns, including the nearly two-
decades-old Justice for Janitors campaign that the Service Employees
International Union (SEIU) and its allies successfully organized in
Los Angeles and other cities across the country.

Clearly, labor unions, along with community-based organizations and
churches, will be central to the construction of lasting local
coalitions that can serve as organizing clearinghouses to challenge
corporate rule.

Constructing a new politics

To challenge corporate power we must also value and rebuild the public
sphere, and draw clear lines of resistance against the expansion of
corporate power, such as the current push by Bush to convert Social
Security into individual investment accounts that will allow Wall
Street to rake off billions of dollars in annual brokerage fees. Most
importantly, we must work to change the rules instead of agreeing to
play with a stacked deck.

In our hyper-commercialized culture, we spend far more time and energy
thinking about what products we want to buy next instead of thinking
about how we can change our local communities for the better, or
affect the latest debates in Washington, D.C. or the state capitol.
And when so much energy is spent on commercial and material pursuits
instead of on collective and political pursuits, we begin to think of
ourselves as consumers, not citizens, with little understanding of how
or why we are so disempowered.

The restoration of democracy requires us to address the backstory
behind this process of psychological colonization. It requires us to
address the public policies and judicial doctrines that treat
advertising as a public good -- a tax-deductible business expense and
a form of speech protected by the First Amendment. It's been so long
since we have seriously addressed such fundamental questions that, as
a result, the average American is now exposed to more than 100
commercial messages per waking hour. As of October 2003, there were
46,438 shopping malls in the United States, covering 5.8 billion
square feet of space, or about 20.2 square feet for every man, woman
and child in the United States. As economist Juliet Schor reports,
"Americans spend three to four times as many hours a year shopping as
their counterparts in Western European countries. Once a purely
utilitarian chore, shopping has been elevated to the status of a
national passion."

A consequence of the hyper-commercialization of our culture is that
instead of organizing collectively, we often buy into the market-based
ideology of individual choice and responsibility and assume that we
can change the world by changing our personal habits of consumption.
The politics of recycling offers a minor but telling example of how
corporations manage to escape blame by utilizing the politics of
personal responsibility. Although recycling is a decent habit, the
message conveyed is that the onus for environmental sustainability
largely rests upon the individual, and that the solutions to pollution
are not to be found further upstream in the industrial system.

The personal choices we make are important. But we shouldn't assume
that's the best we can do. We need to understand that it can't truly
be a matter of choice until we get some more say in what our choices
are. True power still resides in the ability to write, enforce and
judge the laws of the land, no matter what the corporations and their
personal-choice, market-centered view of the world instruct us to

Rebuilding the public sphere

With increased corporate encroachment upon our schools and
universities, our arts institutions, our houses of worship and even
our elections, we are losing the independent institutions that once
nurtured and developed the values and beliefs necessary to challenge
the corporate worldview. These and other institutions and public
assets should be considered valuable parts of a public "commons" of
our collective heritage and therefore off limits to for-profit

"The idea of the commons helps us identify and describe the common
values that lie beyond the marketplace," writes author David Bollier.
"We can begin to develop a more textured appreciation for the
importance of civic commitment, democratic norms, social equity,
cultural and aesthetic concerns, and ecological needs.... A language
of the commons also serves to restore humanistic, democratic concerns
to their proper place in public policy-making. It insists that
citizenship trumps ownership, that the democratic tradition be given
an equal or superior footing vis-a-vis the economic categories of the

Changing the rules Much citizen organizing today focuses on
influencing administrative, legislative and judicial processes that
are set up to favor large corporations from the very start. Put
simply, many of the rules are not fair, and until we can begin to
collectively challenge this fundamental unfairness, we will continue
to fight with one hand tied behind our backs. Instead of providing
opportunities for people to organize collectively to demand real
political solutions and start asking tough questions about how harmful
policies become law in the first place, many community-based
organizations seem content to merely clean up the mess left behind by
failed economic policies and declining social services.

The most successful organizing happens when it is focused on specific
demands. Two crucial reforms have great potential to aid the
movement's ability to grow: fundamental campaign finance reform and
media reform. Together, these could serve as a compelling foundation
for a mass movement that challenges corporate power more broadly.

The movement for citizen-controlled elections, organized at the local
level with support from national groups such as the Center for Voting
and Democracy and Public Campaign, provides a useful framework for
action for the broad spectrum of people who currently feel shut out of

Media reform is also essential. With growing government secrecy and a
corporate-dominated two-party political system, the role of
independent media is more critical than ever. As Bill Moyers suggested
in his keynote address at the National Conference on Media Reform in
2003, "If free and independent journalism committed to telling the
truth without fear or favor is suffocated, the oxygen goes out of

The media have always been and will continue to be the most important
tool for communicating ideas and educating the public about ongoing
problems. Thomas Paine wrote more than 200 years ago:

"There is nothing that obtains so general an influence over the
manners and morals of a people as the press; from that as from a
fountain the streams of vice or virtue are poured forth over a

History is replete with examples that show how critical the media's
role has been in addressing the injustices of our society. For
instance, many Progressive Era reforms came only in response to the
investigative exposes of corporate abuses by muckraking journalists
like Upton Sinclair and Ida Tarbell. Writing in popular magazines like
Collier's and McClure's, these writers provided a powerful public
challenge to the corruption of the Gilded Age.

Because of increased corporate consolidation of the media, coverage of
all levels of government has been greatly reduced. When people are
kept ignorant of what is happening in their communities, in their
states, in Washington, D.C. and in the world, it becomes much easier
for large corporations to overwhelm the political process and control
the economy without citizens understanding what is happening. Though
media reform is a complex subject, one approach bears mentioning --
establishing and strengthening nonprofit media outlets.

The long-term vision

Though campaign finance reform and media reform offer useful starting
points, ultimately, there is much more to be done. We need to get
tough on corporate crime. We need to make sure markets are properly
competitive by breaking up the giant corporate monopolies and
oligarchies. We need to make corporations more accountable to all
stakeholders and less focused on maximizing shareholder profit above
all. We need to stop allowing corporations to claim Bill of Rights
protections to undermine citizen-enacted laws.

Ultimately, we need to restore the understanding that in a democracy
the rights of citizens to govern themselves are more important than
the rights of corporations to make money. Since their charters and
licenses are granted by citizen governments, it should be up to the
people to decide how corporations can serve the public good and what
should be done when they don't. As Justices Byron White, William
Brennan and Thurgood Marshall noted in 1978: "Corporations are
artificial entities created by law for the purpose of furthering
certain economic goals... . The State need not permit its own creation
to consume it."

The people's business

The many constituencies concerned with the consequences of corporate
power are indeed a diverse group, and although this diversity can be a
source of strength, it also makes it difficult to clearly articulate a
vision for the struggle. What principles, then, can unite us?

One abiding faith that almost all of us share is that of citizen
democracy: that citizens should be able to decide how they wish to
live through democratic processes and that big corporations should not
be able to tell citizens how to live their lives and run their
communities. The most effective way to control corporations will be to
restore citizen democracy and to reclaim the once widely accepted
principle that corporations are but creatures of the state, chartered
under the premise that they will serve the public good, and entitled
to only those rights and privileges granted by citizen-controlled
governments. Only by doing so will we be able to create the just and
sustainable economy that we seek, an economy driven by the values of
human life and community and democracy instead of the current suicide
economy driven only by the relentless pursuit of financial profit at
any cost.

Therefore, we must work assiduously to challenge the dominant role of
the corporation in our lives and in our politics. We must reestablish
citizen sovereignty, and we must restore the corporations to their
proper role as the servants of the people, not our masters. This is
the people's business.