How did corporations get so powerful?
Go to any city, any town, any rest stop in America and you’re bound to find the same
old shopping centers with the same stores and the same gas stations and the same fast
food as any other city.
How did just a few companies gain monopoly over the entire country?
You know which companies I’m talking about – the Coca Cola’s, the Shell’s, the
Comcasts, you name it.
Hello everyone.
Thought Monkey here.
Today we’ll be exploring how corporations came to be so powerful and have been able
to dominate our shopping centers and politics.
First a little bit of background about what a corporation is.
The word corporation comes from the Latin word corpus which means body of people.
In fact in ancient Roman law, corporate entities were recognized and even given protection
under the law.
Similarly today, by definition a corporation is simply a group of people who have been
authorized by law to act as a single legal entity.
And while most of the time we use the word corporate negatively, corporations are not
innately bad.
They can be bad or good just like people.
However, over the past 100 years corporations have gained certain legal rights that have
allowed them to gain more and more power.
Again – some may use their power responsibly for good, while others recklessly for bad.
Think Google vs. Exxon-Mobile.
Corporations today are super powerful for a number of reasons.
First Corporations are allowed to create Political Action Committees or PACs for short, which
are basically organizations that pool money from members and donate those funds to campaign
for or against candidates, ballot initiatives or legislation.
For example AT&T donated nearly $3 million dollars during the 2016 campaign cycle on
funding the campaigns of possible representatives they believed would put out legislation in
AT&Ts best interest.
Second corporations tend to spend a lot of money on lobbying in Washington in the hopes
of influencing politicians on a particular issue.
For example the oil company Exxon-Mobile has spent over $200 million dollars alone over
the past 20 years on lobbying.
Just in 2008 the company spent over $29 million dollars in an effort to defeat legislation
that addressed climate change.
Not only do corporations donate millions of dollars to the politicians they know will
act in their best interest, or spend hundreds of millions of dollars on expert influencers
to try and get those politicians to sign or block legislation that will help or hurt their
companies, but they also employ many “revolvers” or people who were at one time government
employees that now work for corporations – strengthening the connection between corporations and government
further.
Of the 29 registered lobbyists that work for Exxon-Mobile, 22 of them have at one time
been government employees.
You get the point.
Of course Exxon is just one example out of many – I don’t know why I’m ragging
on Exxon, but I am – if you happen to be the CEO please don’t come after me, I’m
just using you as an example.
Anyways the point is corporations and the government is tightly wound up within each
other.
So how did this happen?
Before the late 1800s, corporations were required to be public service organizations and have
a stated public purpose.
In other words they were a sort of gift from a group of people to serve the public good.
They were tightly controlled and very limited due to widespread public opposition.
In fact a common misconception is that the Boston Tea Party was a protest between the
American Revolutionaries and the King of England, but rather it was a protest by the Americans
against the monopolization of the tea market by the East India Company.
In the mid-1800s, during the Civil War and the Industrial Revolution, there was an explosion
in the growth of corporations and with it came the belief by corporate lawyers, that
they needed more power to operate.
Their goal was to remove certain constraints that had been placed on the corporation.
After the Civil War was fought and the 14th Amendment was passed – which was created
to protect freed slaves and provide them with equal protection under the law – a case
was decided in 1886 between Santa Clara County and the Southern Pacific Railroad which gave
corporations protection under the 14th Amendment declaring them people.
The decision read that, “The defendant Corporations are persons within…the Fourteenth Amendment…which
forbids a State to deny to any person…equal protection of the laws.”
Basically the ruling gave corporations the right to enter into contract with other parties
and sue – just like you and I can do.
While the original intent of passing the 14th Amendment was to protect freed black slaves,
between 1890 and 1910 there were 307 cases brought before the court under it - 288 of
those cases were brought to the court by corporations, while only 9 of them by freed black slaves.
President Lincoln predicted the growth in power of the corporation long before such
a decision was passed by the Supreme Court when he wrote during the Civil War that, “corporations
have been enthroned and an era of corruption in high places will follow… until all wealth
is aggregated in a few hands and the Republic is destroyed.
I feel at this moment more anxiety for the safety of my country than ever before, even
in the midst of war.”
Since 1886, there have been at least 11 more major decisions that have given corporations
additional rights.
The most recent two that have had a huge impact on our past two elections have been:
2010, Citizens United v. FEC which declares the government can’t limit a corporations
political donations.
And 2014, Burwell v. Hobby Lobby that says corporations can assert the religious rights
of their owners.
The point is that corporations used to look very different than they do today.
Their evolution from tightly controlled entities that were meant to serve the public to massive
companies that serve themselves first and have a major influence on the political direction
of this country has been a slow, yet steady process.
Their power has come from the decisions of many court cases which have slowly granted
them more and more power.
The trend is not in the publics favor, rather the corporations.
The question remains, however, what now?
How can the public limit the power of corporate influence in Washington?
The answer seems like it would be pretty simple.
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