Agenda: Complete the historic transition to popular democratic self-rule by limiting the political influence of money and securing the right of all living people, irrespective of financial means, to a meaningful voice in the decisions that shape their lives.
This requires vigorous policy action to break up concentrations of unaccountable corporate power, democratize ownership participation, issue corporate charters only to serve a defined public purpose, reserve the rights of political participation to real people, get big money out of politics, create space for third parties, and bring majority rule to the Senate.
Democracy for the Few
The United States has been ruled by its richest citizens since its founding. Big money calls the shots in elections and Supreme Court rulings consistently equate money with speech and the rights of corporations with the rights of persons.
So long as big money controls the political process, our economic rules and priorities will continue to favor the interests of big money and we will continue to bear the consequences of stagnant wages, wasteful consumption, unaffordable health care, climate chaos, and all the other phantom wealth casino economy ills. To change the rules to favor real wealth living economies, we must replace the plutocracy (one-dollar one-vote rule by big money and big business) we have, with the democracy (one-person one-vote rule by local people and communities) we have long claimed as our defining national ideal.
The Private-Benefit Corporation
The for-profit, private-benefit, limited-liability corporation is big money’s favored institution for aggregating financial power to control the economy and the political system. A corporation is an artificial legal entity created by a government through the act of issuing a charter. In the case of publicly traded or privately held for-profit corporations, under current law, the charter generally grants the holder the privilege of aggregating unlimited financial resources under unified direction to maximize financial return for the pure private-benefit of its owners. This is the pure private-benefit corporation.
Instrument of Imperial Rule
The legal form of the contemporary for-profit, limited-liability corporation of global reach is an invention of imperial kings who contracted out to private entities the work of colonizing and exploiting the resources, labor, and markets of distant peoples beyond the reach and oversight of parliaments. The design, by intent, allowed the virtually unlimited concentration of financial power accountable solely to the monarch and a group of favored private investors. Generations of corporate lawyers have worked diligently since to preserve and expand the legal privileges of private-benefit corporations, narrow their purpose to the single goal of profit making, and shield them from liability for the harms they cause.
The notorious British East India Company chartered in 1600 by the British Crown was the original model. It conducted a thriving drug trade in China that precipitated the Opium War of 1839 and ruled India for many years as if a private estate. The Dutch crown chartered the United East India Company in 1602 and vested it with sovereign powers to conclude treaties and alliances, maintain armed forces, conquer territory, and build forts to establish and enforce a monopoly over Dutch trade in the lands and waters eastward from the southern tip of Africa to the southern tip of South America. These corporations were essentially criminal syndicates officially sanctioned by their home jurisdiction to engage in activities in foreign jurisdictions that would be subject to severe criminal penalties if carried out in their own country.
Through a serious distortion of legal reasoning, a corporate-friendly U.S. Supreme Court has over more than a century issued a series of legally and morally flawed decisions that interpret the rights guaranteed to natural born persons by the Constitution as applying equally to corporations. These decisions belie the reality that corporations are artificial legal entities created when a government issues a charter. The idea that corporations should have the same Constitutional rights as natural born persons, yet enjoy special exemptions from the responsibilities of citizenship and morality expected of natural born persons turns logical, legal, and moral reasoning on its head. To achieve true democracy this legal travesty must be eliminated.
Assault on Democracy and the Market
The for-profit, private-benefit, limited-liability corporation is big money’s favored institution for aggregating financial power to control the economy and the political system. A corporation is an artificial legal entity created by a government through the act of issuing a charter. In the case of publicly traded or privately held for-profit corporations, under current law, the charter generally grants the holder the privilege of aggregating unlimited financial resources under unified direction to maximize financial return for the pure private-benefit of its owners. This is the pure private-benefit corporation.
Unlimited aggregation of financial assets by a private benefit corporation accountable only to absentee owners is an invitation to abuse. As a general rule, the greater the corporation’s size, the greater its financial, market, and political power, the greater its ability to insulate itself from market forces to engage in anti-competitive practices that threaten the rights and interest of others, the greater the need for intrusive public oversight to prevent abuse, and the greater its ability to thwart such oversight.
Public share markets commodify corporate shares, depersonalize the relationship between the corporation and its owners, and encourage short-term speculation over enduring commitment. The perceived legal requirement to manage the corporation in the exclusive short-term financial interest of its shareholders, suppresses the innate human sense of moral responsibility and feeds an individualistic, immoral culture within the corporation and beyond to the society in which it operates.
Linking Privilege and Responsibility
There is no place in a living Earth economy for purely private-purpose corporations devoted solely to the interests of their managers and shareholders to the exclusion of the interests of other stakeholders, including their employees, customers, and the communities in which they do business. Citizens have every right to hold all corporate bodies accountable to larger public interests.
Every business enterprise, irrespective of legal form, should be expected at a minimum to honor the same standards of responsibility and morality as any private individual. Businesses that enjoy the special privileges conveyed by a public charter are properly held to a higher, not a lower, standard. Because a corporate charter is a grant of privilege, not a personal entitlement, there is no legitimate reason for a government to issue such a grant except to serve a public purpose. Every corporate charter should clearly state its defining public purpose and fulfillment of that purpose should be subject to periodic review on threat of dissolution.
Because all corporations are created by public action, all properly function as quasi public bodies accountable to the communities in which they operate and the wealth they produce is properly considered the joint product of all its resource providers, including employees, future generations, government, customers, communities, and suppliers. All have a proper and rightful interest in sharing in the benefits. All living persons properly enjoy certain basic human political and economic rights. A corporation’s workers, managers, and investors all properly enjoy such rights. The corporation itself, however, does not. As a public creation, its role is to honor the rules established by democratically elected governing bodies, not to determine the composition of those bodies or their decisions. This distinction is essential to navigating the transition from a democracy of money to a democracy of persons.
This said, regulation is at best a limited instrument for achieving corporate compliance with acceptable social and environmental standards. Private benefit corporations are notorious for their ability to circumvent rules they find costly or inconvenient. Ultimately, the goal should be to build a commitment to high social and environmental standards into the structure of the enterprise itself through assuring that ownership resides with people who bear the social and environmental consequences of the firm’s decisions.