Sunday, May 26, 2013

Corporations and Clueless Libertarians

“Corporate governance is incompatible with people’s ability to create sustainable democratic communities” – Thomas Linzey

I’ve always been mystified by libertarians who support corporations, say, Wal-Mart. Perhaps they think corporations are free market. They’re not. They are the exact opposite of the free market.

Perhaps some of the problem is what H.L. Mencken noticed: when people are allowed to do what they want, usually they imitate each other. Libertarians, who should know better, imitate pseudo “free market” theorists even when the evidence contradicts their divorced-from-reality economic explanations.

Corporations have the status of legal persons, which is preposterous (“preposterous” literally means to have your head where your butt is). Corporations are not alive, they are not conscious, and they most certainly are not people. They should not have the rights of people, as they do now, by law. Under a true free market they wouldn’t, but since we don’t have the free market they are legally the exact same thing as a human being. This isn’t a good thing. It is a very bad thing.

The purpose of a corporation is to concentrate wealth at the expense of everyone else. One of the main ways they do this is to use the power of the government to drive its competition out of business, no matter how miniscule and powerless they are. The Founding Fathers, clearly seeing the danger of corporations, kept them under firm legal control. If the government created corporations, they reasoned, they can kill them.

And that is exactly what happened when corporations abused and exploited their privileges (not rights, because again, corporations are not people and should have no rights). Their charters were pulled and they ceased to exist. They got the death penalty.

Unfortunately, things have changed much for the worse since the days of Thomas Jefferson and Benjamin Franklin. Nowadays corporations by law are effectively immortal. The people who run them die but the corporation lives on, collecting and concentrating wealth, abusing and exploiting the powerless.

Jefferson, who was the smartest and most prescient of the Founding Fathers, so clearly understood the abuses corporations engaged in he wanted to put a clause in the Constitution forbidding monopolies. He wrote of the dangers of “the moneyed interests.” Unfortunately he failed in his attempt.

Jefferson, the other Founding Fathers and indeed nearly every American had very unpleasant experiences with corporations, specifically the East India Company. Contrary to the common belief, the Boston Tea Party was not about tax hikes. It was about tax cuts – for the East India Company (they even got a tax rebate of millions of pounds from the King) so that this world-wide corporation could drive out of business its tiny American competitors.

The East India Company was at that time the largest and most powerful transnational corporation in the world.

When presidents from Reagan to Bush have cut taxes for “the rich” those tax cuts are mostly for corporations – which is one of the things that caused the War of Independence. (The fact most of the tax cuts went to corporations is one of the mains reasons why “trickle-down” economics didn’t work).

Does tax cuts for the extremely wealthy and tax rebates for them sound familiar today? “Stimulus packages,” anyone? (They certainly can’t work when the money from those tax cuts, rebates and “stimulus packages” are sent off-shore to create jobs in China and not the U.S.)

The wealth of corporations is not shared with the mass of people. Since corporations are not free market, and have such enormous legal power, they want to eliminate their competition. Which they have been able to do through the force and fraud of "the law" (sic). Without competition, workers’ wages will not be forced up, no matter how productive they are (the GDP of the United States has doubled since 1980, and the average wage has not only not gone up, it has declined). Corporations want to, and can, pay poverty wages – and they do.

Although corporations are immortal they have no souls. That’s pretty creepy, isn’t it? Sounds like they’re…what? Monsters? Vampires? Whatever they are, they have no conscience.

As an example of the soullessness – and the enormous power of corporations – Oprah Winfrey was once sued by cattle producers for making disparaging comments about, of all things, hamburgers.

For the Supreme Court to rule that legally one person has the same power as a multibillion-dollar corporation is bizarre, to say the least. This is what the Supreme Court started to rule, starting in the 1880s - and their rulings are getting more and more bizarre. Recently it ruled that to limit corporations spending hundreds of millions of dollars to elect politicians is to limit their free speech. In other words, they ruled that one person sending $100 to a politician is the same thing as a multinational corporation sending them one million dollars. That's insanity.

(By the way, lobbying was always illegal since to buy a politiican's vote was bribery and punished by prison. Not anymore!)

The United States does not have the free market anymore. We don’t have free international trade, either. We have managed trade by corporations, and it’s not going to enrich the U.S. and or any of the countries we trade with. It’s going to enrich even further the one percent in the U.S. who own 40 percent of the wealth (Chris Hedges called what they do "...the ruthless cannibalizing of the country by corporate capitalism").

When corporations pay a dollar a day to exploited child-slave labor in Burma, that child’s standard of living isn’t going to go up until they are on par with someone in the United States, contrary to the delusions of “free market” theorists (who, by the way, don’t understand economics). Nor will these exploited and oppressed people ever become free. Why? Because they are being crushed by their State, and those child slaves are not going to suddenly revolt, rise up and throw off their oppressors.

In fact, none of those Asian countries will ever be free, just the way Africa will never be free. They will be exploited and oppressed by their own governments in collusion with corporations, but free? It’s not going to happen.

Corporations don’t want those exploited and imprisoned children to be free or their wages to go up. It would mean less profit for corporations. In fact, if wages in Burma or any other country did go up, corporations would move their operations to the lowest-wage country they could find. And if the government of that country happened to be tyrannical, that’s just fine with corporations.

Child-slave labor, child prostitutes, pollution, poverty, starvation, death, destruction of the environment…corporations look the other way. To them, the only thing that matters is profit. They’re worse than the Ferengi, who look like saints compared to the transgressions of the worst corporations.

The largest corporations in the world are more financially powerful than many countries. They can push these countries around with the carrot of moving jobs there, and the stick of pulling them out. Then we have to consider corporations enriching tyrants and dictators to keep the countries “stable,” i.e. keep the populace enslaved and impoverished through the coercion of the military and the police.

It might be better if we called such corporations Lords of Poverty and Death. 

Corporations should have their legal status as persons removed. They should be called what they are – “artificial entities.” And when those in charge of corporations break the laws, they should serve some hard time. These days, nothing happens to these people no matter what they do.

The United States is turning into a feudal society – a extremely small number of people who have gained control of the government (which they use to enrich themselves and corporations), a very small middle class, and a huge mass of impoverished people hypnotized by the bread and circuses of today – cable television and sports. And for all practical purposes, our modern-day Coliseum is Washington D.C.

I call enormous corporations Cosmodemonic Transnational Megacorporations. They are not your friend and they do not have your best interests at heart. In point of fact they are your enemy. They have profit at heart, and they put it above all – above your life, your health, your liberty, your property, your happiness and well-being.

I am reminded of the Tyrell Corporation in the movie Blade Runner. It was not just an international corporation; it was an interstellar one. And what did this corporation do? Create artificial humans called Replicants to do dangerous and dirty off-world work. And Replicants, not surprisingly, weren’t considered human (one police officer called them “skinjobs”), they had no rights whatsoever and could be killed at will. This is essentially how these transnational megacorporations treat people when they can get away with it.

(Incidentally, the leader of the Replicants, Roy Batty, hunted down and killed - by putting out his eyes - Eldon Tyrell, who ran Tyrell Corporation - and whom Roy calls "the god of biomechanics." This is humiliation followed by revenge.

Libertarians who unwittingly support transnational corporations are cutting their own throats. Usually, it takes about five years for a person to change their mind when he’s faced with the facts. Cognitive dissonance does hurt. But sooner or later, for the smarter ones, they’ll realize the truth and take that razor from their necks.

The dumber, unfortunately, never will. They’ll continue to cheer Wal-Mart – and corporations in general – no matter what it does.


DJF said...

One the non-free market privileges that the corporate owners have received from the government is Limited Liability. This allows the stockowners who are the collective owners of the corporation to limit their liability to only the cost of the stock they have bought.

However if you limit the liability of the stockowners then this automatically transfers the liability to others, either to those who are owed or to a third party like taxpayers or others who have no direct connection to the corporation. If the corporation that the stockowners own creates more debts then its worth, the owners can walk away and only lose the cost of the stock that they bought. But this does not mean that the debt is gone, someone must bear the cost, so the very idea of limited liability is wrong, it does not limit the liability, it just transfers it to someone else.

When this is pointed out to the corporate libertarian you usually get two responses

1st. They will claim that any privilege that exists from government granted limited liability is minor and can even be replaced with contracts between individuals so it is no big deal and should be ignored. The response to that is if limited liability is such a small thing then we can get rid of it immediately.

This brings up the second response, that the removal of government granted limited liability would destroy the free market and that anyone who suggests such a thing is against freedom. The response to that is that if government granted limited liability is so important that the free market would suffer major negative effects then this is an even bigger reason to revoke it because it has obviously distorted the free market to the point that it endangers it.

Anonymous said...

Two considerations about the "god" of capitalism:

1. At maturation monopoly is the inevitable result.

2. Without usury, it cannot exist.

There is an alternative with a poorly chosen name, but it is the most "Free Market" oriented and equitable system ever considered - "Distributivism."

Look it up.