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Mainstream, Vol XLVIII, No 42, October 9, 2010

Corporate Culpable Crimes

Thursday 14 October 2010, by Shyam Chand

In case of Santa Clara County versus Southern Pacific Railroad, Justice Morrison Remick Waite of the US Supreme Court, without hearing the argument pronounced that

The court does not wish to hear the argument on the question of whether the provision in the Fourteenth Amendment to the Constitution, which forbids a State to deny to any person within its jurisdiction the equal protection of the laws, applies to these corporations. We are all of the opinion that it does.

Summary record of the Court’s findings reported that

The defendant Corporations are persons within the intent of the clause in section I of the Fourteen Amendment to the Constitution of the United States, which forbids a State to deny to any person within its jurisdiction the equal protection of the laws.

A corporation is owned by its shareholders like a slave without any right of a person. If property gives recognition to rights, rights vest in property and not in person. But the above two-sentence assertion by a single judge changed the history of the world by elevating the corporations to the status of persons under the law and prepared the way for global corporate rule.

In his book The Post-Corporate World, Dr David C. Korten, formerly of Harvard Business School, writes;

Corporations now enjoy unlimited life; virtual freedom of movement anywhere on the globe; control of the mass media; the ability to amass legions of lawyers and public relations specialists in support of their cause; and freedom from liability for the misdeeds of wholly owned subsidiaries. They also enjoy the presumed right to amass property and financial resources without limit; engage in any legal activity; bring liability suits against private citizens or civic organizations that challenge them; make contributions to individual candidates, political parties, and political action committees and deduct those contributions from taxable income as business expenses; withhold potentially damaging information from customers; and avoid restrictions on the advertising of harmful but legal products in the name of commercial free speech. Although their owners hold the ultimate decision making power and the corporation is obliged to manage its affairs for the sole benefit of its owners, those owners bear more accountability for corporate misdeeds or liability beyond the loss of value of their shares. Step-by – step, largely through judge-made law, corporations have become far more powerful than ever intended by the people and governments that created them.

In his book, The Emperor’s Nightingale, Robert Monks, a corporate executive and a staunch Republican who held high office in the Reagan and Bush Administrations, writes:

Corporations are not people; they have no conscience. Although corporate acts are carried out by individuals, even individuals with high moral standards often find themselves caught up in a corporate action that is beyond their control-or even, in some cases, their knowledge.

Sir James Goldsmith, a billionaire and specialist in the buyout of timber companies and pillage of their forest assets wrote The Trap and started funding environmental groups before his death to prevent ‘environmental and social devastation brought by the global economy’.

George Soros, the world’s most famous financial speculator wrote The Capitalist Threat and startled the world by denouncing corporate capitalism as a threat to open society.

Under the garb of liberalisation, privatisation and globalisation MNCs enter foreign markets. Klaus Sehwab and Claude Smadja, founder President and Managing Director of the World Economic Forum, have made the following points:

• Globalisation is causing severe economic dislocation and social instability.

• Although conventional wisdom says that technological change and increases in productivity translate into more jobs and higher wages, in the last few years technology has eliminated more jobs than it has created.

• Globalisation leads to “winner-take-all situations; those who come out on top win big, and the losers even bigger”.

• “Globalisation tends to deal in the fate of the corporations from the fate of its employees.” Higher profits no longer mean more job security at better wages.
They warn that ‘unless serious corrective action is not taken soon, the backlash could turn into open political revolt that could destabilise the Western democracies’.

LIBERALISATION, privatisation and globalisation (LPG) have created ‘haves’ and ‘have nots’. This LPG without the social security net would prove to be Liquefied Petroleum Gas and a spark would ignite and burn down the entire democratic edifice.

Sam Walton, founder of the Wal-Mart, died in 1992 as the richest man in America. Bill Quinn’s book How Wal-Mart is Destroying America is filled with data and anecdotes. ‘Discount stores in small towns and rural areas, each big enough to freeze out competition.....and finally there is the ruthless, predatory Sam, who stalks competitors—in any size, shape or form-and finds sport in blasting them from the sky like so many quail.’

The corporate sector has depleted or destroyed all kinds of capital—natural, human, social and institutional. Stripping mining forests and mineral deposits was their first target in developing countries. Dumping hazardous wastes and marketing chemicals they turn fertile lands and water bodies into zones of death. The Banquet Mining Corporation in its quest for gold has destroyed mountains and rivers in the Philippines where people find difficult to grow rice; they go to the other side of the mountain for drinking water and bathing. Cyanide used by the Corporation kills their coastal fish and coral reefs.

Bhopal is the greatest industrial disaster and a ghastly tragedy against humanity. It is like chemical warfare. Oil-spill in the Mexican Gulf is destroying marine life. These are only a few of the Corporate Culpable Crimes. The list of deaths and destructions tell a coup story.

The best CEO of corporations is one who eliminates more jobs, and fattens his purse. A large corporate CEO earns annually over three hundred times the earning of an average worker. The total assets of the world’s five hundred billionaires are roughly equal to the combined annual income of the poorest half of humanity. Dick Grasso of the New York Stock Exchange, who resigned in 2003, carried a pay packet of $ 140 million per annum, the income of average 5200 Americans for one year.

The Dole Company of the USA owns the majority of the high quality land in the southern islands of the Philippines. Farm labour has been replaced there by fossil fuel-grizzling machines. Jobless and destitute peasants migrate to cities where job competition drives wages down and rents up.

Chiquita, Dole and Del Monte of the US produce two-thirds of bananas on large plantations in Latin America. They bribe both the parties—the Republicans and Democrats—and through the WTO ousted from Europe bananas produced by the small Caribbean farmers.

As far as institutional capital is concerned, corporations undermine the necessary functions and credibility of the governments and democratic governance. As they pay out millions in campaign contribution to win public subsidies, bailout and tax exemptions, they pose a great threat to democratic institutions of the country they enter in.

As a matter of business principle they do not like democracy. They prefer autocrats and tyranny. It is easy, safe and secret to bribe one person at the top instead of bribing so many on the way. MNCs are like Sirens. When Odysseus set out on a journey, Circe warned him of the danger and advised him to bind himself to the mast with rope to save himself from Siren who sang the enchanting song: ‘My way is natural, right, inevitable. The pain will soon be over and from here there is no return.’

The author is a former Minister of Haryana.

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