The Impact of Corporations on the Commons
Address at the Harvard Divinity School's Theological Opportunities Program,
October 21, 2004
by Mary Zepernick
A California-based group called Friends of the Commons defines the commons as "the vast realms of nature and society that we inherit together and must pass on, undiminished, to our children." And as many Native Americans put it, to the seventh generation.
The "commons" is as old as the Earth itself but the term has come into use again today as a helpful way to think about various aspects of nature and society that are increasingly under assault by giant corporations.
Vast realms of nature and society — Jane Anne Morris, a writer with the Program on Corporations, Law & Democracy, points out that the commons is everything except what we the people choose not to include.
Think about this: everything except what we the people choose not to include. In other words, the commons properly derives from decisions made by us, collectively — which presumes democratic self-governance.
It certainly wasn't a collective decision in the Enclosures of the 15th, 16th & 17th centuries, when the English commons — lands worked "in common" by peasants for centuries — were fenced so that the landed gentry could pursue single crops for profit, like grain or sheep for wool — my 1956 college textbook, A History of Civilization, described them as enterprising and ruthless capitalists!
You may have heard this 17th century protest doggerel: "The law locks up the man or woman who steals the goose from the common. But the greater villain the law lets loose, who steals the common from the goose."
The Enclosures, which someone pointed out is an old-fashioned word for privatization, helped spark the Cromwellian revolution that deposed and beheaded King Charles I in 1642.
Today, privatization refers to turning over to corporations — now considered the "private sector" — aspects of nature and society previously under the jurisdiction of government — the "public sector," with its authority ostensibly rooted in us, the public. The vast realms of nature and society are being increasingly privatized for the primary benefit of the few. However, it's not about good or bad people, good or bad corporations. It's about who governs.
So my thesis, the organizing principle for these remarks, is that the fundamental commons today is We the People's promised authority to govern, the power to make decisions about matters affecting nature and society. There are two historical streams in U.S. history in this regard: one is about the decentralization of power, public decision-making, self-governance — about democracy; the other is about the concentration of power, private decision-making, governance by the few and the corporation as their governing institution.
Philosopher Thomas Berry identified the classical empires, the ecclesiastical institutions, nation-states, and the modern corporation as the world's foremost concentrations of wealth, power and property.
William Quigley, a Loyola University professor of law, in a recent article titled "Catholic Social Thought and the Amorality of Large Corporations: Time to Abolish Corporate Personhood," writes: "It is difficult to suggest that current economic arrangements, dependent as they are on large international corporations, are working for the common good." A masterpiece of understatement!
The fundamental impact of corporations on the commons, therefore, is the theft of our right of self-governance, a usurpation that enables the myriad harms and assaults on nature and society — including, as one writer put it, the culture of childhood.
So what is a corporation? Ambrose Bierce describes it in The Devil's Dictionary as "an ingenious device for obtaining individual profit without individual responsibility." It's called limited liability, a hallmark of the modern corporation, but 'twas not always thus.
During the colonial period, the royal chartered corporations — trading companies like the East India and Hudson Bay Companies — were extensions of the English monarch, institutions not only of commerce but of governance. It was through these corporations and the chartered crown colonies, like Massachusetts Bay and Virginia, that the colonists most directly felt the weight of English control.
So it's logical that once independent from England, the founders put corporations on a short leash, through state-issued charters that defined their purpose, length of capitalization and operation, made shareholders liable for harms done, and prohibited corporations from owning other corporations. Imagine!
For example, the Pennsylvania legislature declared in 1834: "The corporation is just what the incorporating act makes it. It is the creature of the law and may be moulded to any shape and for any purpose that the legislature may deem most conducive for the general good."
The general good, the general welfare, the commons. Of course, this was no golden age of democracy, since rule by the propertied few was well established from the colonial period up to today. However, for the first several generations of US history, property organized in the corporate form was subordinate to the people's representatives — with the few and small corporations that existed considered public, not private, institutions. Charters had teeth and were evoked when violated and the corporation dissolved.
So what happened?
The word corporation wasn't mentioned in the Constitution, but the framers provided well for the protection of property (including slaves, though the term wasn't mentioned). The Supreme Court first "found" the corporation in the Constitution in the Dartmouth College case of 1819. The Court, an unelected, unaccountable and elite body, declared the corporation a private contract under the contracts clause of the Constitution — the beginning of privatizing this public institution meant to be conducive for the general good. Significantly, New Hampshire was attempting to make Dartmouth a public institution, based on the Jeffersonian principle that democracy depends on an educated populace.
The Industrial Revolution and the Civil War brought enormous growth in the number, size and wealth of corporations — and the Civil War amendments expanded the rights of people:
- the 13th Amendment, prohibiting "slavery and involuntary servitude" (workers at the time called the this "glorious labor amendment" and some labor organizers are currently seeking to use it to secure workers' rights to organize and speak freely on the job);
- the 14th Amendment, making "all persons born or naturalized in the United States....citizens" and providing that "no state may provide any person of life, liberty, or property, without due process of law; not deny to any person....the equal protection of its laws";
- the 15th Amendment, stipulating that "the right of citizens of the United States to vote shall not be denied or abridged by the United States of by any State on account of race, color, or previous condition of servitude."
Corporate managers, lawyers & lobbyists, seeing rights conferred on individuals, began inserting into court cases arguments for inclusion of corporations as persons entitled to 14th Amendment due process and equal protection of the laws. They succeeded in 1886, when the Supreme Court in Santa Clara v. Southern Pacific Railroad "found" the corporation in the 14th Amendment — what is known as corporate legal personhood.
Ironically, African-Americans lost their legal personhood ten years later, in the Plessy v. Ferguson ruling that ushered in half a century of segregation in the form of Jim Crow laws.
Subsequently, the Court has "found" the corporation in the Bill of Rights protections of the 1st, 4th & 5th Amendments. Corporate free speech is solidly in the way of meaningful changes in electoral and legislative processes, since Court decisions in the 1970s equated political spending with speech and voided a Massachusetts law prohibiting corporate interference, including funding, in citizen referenda. Meanwhile, workers drop their 1st Amendment rights on corporate property.
Also, the Supreme Court has "found" the corporation in the commerce clause of the Constitution, voiding over 1000 local and state protective laws as being in restraint of trade, and repeatedly ruling against labor organizing and strikes. The U.S. domestic free trade zone in place for over 100 years has provided the model for the unelected, unaccountable and elite bodies, like the WTO and NAFTA, that make and enforce global trade policies. In fact, under Chapter 11 of NAFTA, corporations can sue nation states whose laws protecting their people and the environment violate corporate free trade rights.
Thus cloaked in the Constitution and global trade regime, the corporation has once again become, as in colonial times, not only a commercial or economic institution but a governing institution. The few who wield the constitutional rights of the giant corporation, along with their complicit public officials, decide policies on investment, production, technology and work; foreign and military policy; policies on energy, agriculture, pharmaceuticals, and the environment, including natural resources like water, minerals and forests; policies on social issues like welfare, health care, transportation, education and more. Thanks again to the Supreme Court, corporations can now patent anything alive except for a full birth human being!
Those of us who have spent decades engaging in various single issue defensive struggles look around today and see that in all of these areas, things are worse — conditions have deteriorated for people and Planet.
Let's take transportation, for example, as a case study.
Today the U.S. public transportation system is the worst in the industrialized world. Early in the 20th century there was a well-functioning trolley or rail system service in most cities, running every few minutes, often down the center of the street with automobiles relegated to the sides. In 1922 only one in ten people owned a car. Alfred Sloan, then president of General Motors Corporation, set out to fix that, to create a new market for cars. In order to get rid of electric streetcars and motorize city transportation, he bought up the biggest bus manufacturing and operating companies.
From 1926 to 36, he bought and destroyed the NY rail system. Creating a trend toward smelly and slow buses was a tough sell, but in the mid-1930s, the bus company National City Lines was founded, with a front man named Roy Fitzgerald. Joining the General Motors Corp. behind the scenes were the Standard Oil, Mack Truck, Phillips Petroleum, & Firestone Tire Corporations. Over a couple of decades, National City Lines bought transit properties, fired employees, raised fares and cut back schedules, until it controlled transit systems in over 80 U.S. cities.
After a man named Edwin J. Quimby mass-mailed in 1946 an expose of this plan, the Justice Department charged the GM and National City Lines Corporations and other investors with a criminal anti-trust conspiracy to monopolize transportation. The corporations were found guilty and fined $5000 each! However, for the next 25 years the Justice Department failed to find a way to actually limit General Motors' operation.
Also in the mid 40s, returning soldiers and others were taking advantage of federally insured mortgages to buy homes in the growing suburbs and buying cars. The remaining trolleys were wearing out, so the question for city governments was whether to invest in replacing them, as Japan and other countries did. Most US cities didn't.
The so-called red cars connected scores of communities on 1000 miles of tracks in the L.A. area. Pacific Electric joined forces with Roy Fitzgerald to advocate not replacing what it called an obsolete system, and the California Public Transportation Commission granted Pacific Electric's request to replace the red cars with buses. Noxious fumes? No harmful effects, assured Fitzgerald. Today, the vast majority of L.A. bus riders are low income people traveling to far flung jobs on overcrowded buses with unreliable schedules.
General Motors Corporation mounted ads in the face of growing traffic: Don't honk your horn; raise your voice; ask for more highways & parking places.
Meanwhile, Alfred Sloan created and headed for 20 years the National Highway Users Federation, and the next GM president followed him. The highway lobby became the most powerful in Washington, promising and delivering a "a whole new way of life."
In 1953 GM president Charles Wilson became Eisenhower's Secretary of Defense, pushing highways as a national security necessity. Francis Dupont, whose family money created General Motors, became head of the Federal Highway Commission. 1956 began the largest public works program in history (until Boston's Big Dig) under the Interstate Highway Administration. Freeways were build through the middle of cities, taking our thousands of homes and small businesses, though many people across the country resisted and stopped 17 freeways. People have always resisted and sometimes won.
By the 1970s the Environmental Protection Agency reported that it might be necessary to remove 8 of 10 cars in CA during the worst smog times. The House of Representatives had blocked using highway funds for mass transit, but in 1974 the Senate Anti-Trust Committee allowed some highway trust funds to be used for rapid transit—subways and light rail. However, more money continues to go into highways.
In the past decade the Highway Users Federation has teamed up with the computer industry to automate cars and highways in order to control traffic flow, with a huge percentage of federal funds going to cyber projects.
Thus have corporations not only made transportation policy, but have helped shape urban/suburban demographics, greater reliance on fossil fuel, and resisted pollution control efforts through their legal rights and their lobbying power. For example, in response to a current California plan to regulate global warming emissions from tailpipes, in effect requiring automakers to sell far more fuel-efficient vehicles, a lawsuit from the automobile industry is anticipated, on the grounds that federal fuel economy regulations supersede CA's authority to regulate global warming gases. A New York Times article of August 7 pointed out that for years automakers have relied on "congressional allies to stall efforts to make cars more efficient nationwide."
By and large, the regulatory regime shields property in the corporate form far more than it protects people and the environment. The first regulatory agency was in transportation and is emblematic of these unelected, unaccountable bodies. The Interstate Commerce Commission was created in 1887 to forestall the serious Populist challenge from workers and farmers to the abusive power of railroads. President Cleveland's Attorney General explained to nervous railroad corporation executives that the ICC was to be "a sort of barrier between the railroad corporations and the people." And Charles F. Adams, later president of the Union Pacific Railroad Corporation, wrote about the regulatory solution to the Populist threat: "What is desired is something having a good sound, but quite harmless, which will impress the popular mind with the idea that a great deal is being done, when, in reality, very little is intended to be done."
An environmental lawyer I know points out that the Environmental Protection Agency permits poisons and regulates environmentalists, and the Food & Drug Administration is ineffectual at best in overseeing food and pharmaceutical safety. More often, these and other regulatory agencies do the bidding of giant corporations.
So, whence cometh our help? From the lessons of people's struggles in past generations and from an evolving community-based, rights-based activism abroad in the land.
The Abolitionists didn't demand a Slave Protection Agency. They drove freedom and rights into the Constitution. Women suffragists didn't ask men to treat them a little better. They drove their rights into the Constitution. Civil rights activists weren't content to make Jim Crow and other laws less harsh. They drove civil rights into the Constitution and into state law, and continue to struggle as these rights are repeatedly challenged — and as gay/lesbian organizers are currently trying to do. These were movements that changed the culture in order to support a legal strategy to change the law.
For the past five or six years, rural conservative Pennsylvania townships have put a rights-based analysis and strategy on the ground, claiming the authority to protect their commons. With the help of the Community Environmental Legal Defense Fund (celdf.org), dozens of these townships have banned corporate hog farms and the spreading of toxic sewage sludge on farmland, and two of them have actually revoked corporate constitutional rights to override local decisions protecting health, safety, family farms, and the environment. In the process, these actions have created crises of jurisdiction between local and state governments and the courts, and provided models for communities elsewhere to assert their self-governing rights.
Communities and counties in California have prohibited further incursions from chain restaurants, the planting of genetically engineered crops, and are exploring ordinances revoking corporate constitutional rights in their local jurisdiction.
So if our fundamental commons is self-governance, the most radical (root) question is: Do we really believe we are capable of governing ourselves? Cornel West said that our minds are so colonized that we can scarcely imagine what a real democracy would look like.
Are we by nature doomed to hierarchical power relationships? Or can we throw off the colonization of millennial-old patriarchy? — which is not only a gendered word.
The Massachusetts colonists who revolted against British rule offer an example of valuing self-governance enough to struggle for it. In 1774, the English Parliament retaliated against colonial resistance activities, like the Boston Tea Party, by revoking the colony's charter of 1691. This charter had given the Massachusetts colonists a considerable measure of local decision-making authority: holding town meetings and having a significant voice in naming their fellow colonists who served as court officers and the governor's councilors. These men felt entitled to self-governance — they had experienced something they valued — and they rebelled when it was withdrawn.
Ray Raphael, in The First American Revolution: Before Lexington and Concord (The New Press, New York, 2002), describes how ordinary citizens gathered in taverns and homes to plan what we today would consider a civil disobedience campaign. While the colonial leaders like John Adams were meeting at the Continental Congress in Philadelphia, these extraordinary ordinary people blocked courthouse doors and lined streets, demanding the resignations of British representatives. "Thousands upon thousands of farmers and artisans seized power from every Crown-appointed official in Massachusetts outside of Boston."
According Ray Raphael, this successful rebellion made Lexington and Concord, the "shot heard 'round the world" in the following year, a counter-revolution, with the British seeking to regain control from these upstart colonists who felt entitled to govern themselves.
Who do we think we are anyway? Do we consider ourselves capable of and entitled to self-governance? And if so, are we willing to struggle to achieve it? How we answer these questions determines the fate of the commons — including ourselves and all we hold dear