Challenging the Rights of Global Corporations

Question for Discussion: Can National Governments
limit the power of Global Corporations? Are TNC's
a threat to global demoracy?

Readings: Derber,"One World Under Business" ;
Warren, Meet the Corporation ; Cavanagh, pp. 290-300

Film: Scene from The Distinguished Gentleman (1992) ;
The Corporation: Chapters 21, 3, & 4

What's Good for Global Corporations?

Corporate Globalization Fact Sheet (in-class)
Facts and Statistics about Corporations (in-class)
Corporate Cronies for George W. Bush (in-class)
Corporate Criminals: Fines and Settlements
Paid by Corporations
The Corporate Scandal Sheet ( 2000-2002)
(in-class)
Top 100 Corporate Criminals of the 1990s (in-class)

Challenging the Rights of Global Corporations

Derber: Challenging the Myths of Global Corpocracy
(in-class)
Derber, One World Under Business (in-class)
Cavanaugh, Corporate Structure and Power
(in-class)
Warren, Meet the Corporation (in-class)
Grossman, Taking Care of Business (in-class)
Misunderstanding the Meaning of the Matrix
(in-class)
Brandeis: The Corporation is an Artificial Creation
(in-class)
Corporations and the Struggle for Global Democracy
(in-class)
Monitoring Global Corporations
Challenging the Rights of Corporations (in-class)
The Campaign to end Corporate Personhood
(in-class)
The Struggle for the Democratic Control
of Corporations: An Agenda for Actions (in-class)
Global Corporations and the Concentration of Wealth
Global Corpocracy and Wealth (in-class)
Asserting Democractic Control Over Corporations
(in-class)

Corporations and the Struggle for
Global Democracy

The Campaign to end Corporate Personhood

Global Corporations and the
Concentration of Wealth

Monitoring Global Corporations

Challenging the Rights of Global Corporations

Building a 21st Century Green Economy
2008 Election to Cost more than $5.3 billion
(in-class)
Money Wins Presidency and 9 out of 10 races
(in-class)
OpenSecrets.org: Center for Responsive Politics
What's Good for Global Corporations? (in-class)
Corporations and the Struggle to
treat AIDS(in-class)
Global Corporations and the Concentration
of Wealth (in-class)
Global Corpocracy and Wealth (in-class)
Derber: Challenging the Myths of Global Corpocracy
(in-class)
Derber, One World Under Business (in-class)
Grossman, Taking Care of Business (in-class)
Challenging the Rights of Corporations (in-class)
Brandeis: The Corporation is an Artificial Creation
(in-class)
Warren, Meet the Corporation (in-class)
Cavanaugh, Corporate Structure and Power
(in-class)
Misunderstanding the Meaning of the Matrix
(in-class)
Corporations and the Struggle for Global Democracy
(in-class)
Monitoring Global Corporations
The Campaign to end Corporate Personhood
Taking Power Back and Asserting
Democractic Control Over Corporations
(in-class)

Building a 21st century Green Economy

Knowing the larger problems posed by globalization, our emerging global society, and the larger global environmental crisis, the challenge is to build a 21st century Green Economy. In order to do this, we need to re-imagine and re-build some of our economic and social institutions. This is the larger challenge posed by globalization in the 21st century to communities, states, nations, and our global society. In order to do this, we must understand how our current global economy and economic institutions work against solving these larger problems. Our challenge is to create a "green economy" that protects the environment, reduces poverty, provides economic opportunity for everyone, and protects our democratic societies and democratic rights. So how do we do this?
.........................................Chris H. Lewis, Ph.D.

Corporations and the Struggle
to treat AIDS

Global Treatment Access Center for AIDS
The Moral Calculus of AIDS (2001) (in-class)
Why AIDS Victory could spell Trouble for
Drug Companies (2001) (in-class)
U.S. Firms try to Block Cheap AIDS Drugs (2005)
(in-class)

Whatever the merits and demerits of the drug companies' case in terms of trade rules and intellectual property law, in the end it became untenable to argue that any court should put the commercial interests of pharmaceutical corporations above the fate of the more than 4 million South Africans infected with HIV. In the end, those corporations lost the will to stand between South Africa's infected community and access to the cheapest possible treatments — manufacturers in Brazil, India and Thailand, for example, are able to supply generic versions of the drugs at a fraction of the price charged by the Western pharmaceutical corporations that hold the patents.
Why AIDS Victory could spell Trouble for
Drug Companies (2001) (in-class)

Sometime between today and 2010, the AIDS crisis in Africa will become the moral litmus test of the post-cold war era. That is because rich countries will no longer be able to deny they failed to prevent a plague in Africa not seen since the Black Death of the 14th century....

In May 2000, the five leading companies that produce AIDS drugs – Merck, Hoffmann-La Roche, Bristol-Myers Squibb, Glaxo Wellcome and Boehringer Ingelheim – announced they would make AIDS medicines widely available in the poorest countries at deep discounts. Exact prices were supposed to be settled a few weeks later. But six months later nothing had been done. A year later, the effort has resulted in agreements with only three countries: Uganda, Senegal and Rwanda....Whether or not Merck and Bristol-Myers will lose money when Merck offers Crixivan at $600 a year rather than its usual $6,016 and Bristol-Meyers provides Zerit at $54 a year rather than $3,589 will be very difficult to find out. But what is certain is that many countries will not be able to afford the triple cocktail even at these prices. Also, regardless of this gesture, the two companies have already made an enormous profit off the AIDS plague
.......................... The Moral Calculus of AIDS

AIDS activists campaigning for affordable access to life extending AIDS treatments met today's announcement of a "joint agreement" between UNAIDS and major AIDS drug manufactures with deep skepticism. In exchange for a moderate price reduction, pharmaceutical interests have attached a conditionality that prevents poor nations from exercising WTO-legal means to manufacture generic versions of expensive patented medicines. Activists charge that the prohibition against compulsory licensing ties the hands of poor nations seeking self sufficiency, and imposes a remedy dependant on the generosity of multinational corporations. ACT UP also notes that the price reductions offered by industry will not be sufficient to ensure widespread access in poor countries.
..................... Pharmaceutical AIDS Drug Announcement
Debunked

"The Pharmaceutical kingpins are attempting to prohibit African nations from creating self-sufficient solutions to the AIDS crisis," said SharonAnn Lynch of ACT UP Philadelphia. "The strings attached to this price reduction amount to a noose."

"The price cuts are not deep enough. All but the wealthiest will continue to have no access to life-saving medicine. The only acceptable plan from industry will guarantee affordability through cuts of 95% or more of the prices we pay in the West," said John Bell of ACT UP Philadelphia. "Additionally, drug makers cannot not be allowed to restrict additional means for access, including procurement from generic suppliers who already sell the same life-saving pills for pennies."

Global Corpocracy and the
Concentration of Wealth

Forbes: The World's Richest People
Forbes: The Global 2000 Corporations
Corporate Oligopolies
Facts on the Concentration of Wealth

In 2000, the three top shareholders of Microsoft owned more wealth than do all six hundred million people living in Africa. The three richest people in the world have accumulated more wealth than the combined GDP of the forty-eight poorest countries. The UN reports that 458 global billionaires have acquired a combined wealth equal to that of half of humanity.'2 ( Derber, 48)

Challenging the Rights of Corporations

Grossman: Taking Care of Business

The biggest blow to citizen constitutional authority came in 1886. The US Supreme Court ruled in Santa Clara County v. Southern Pacific Railroad [[118 U.S. 394], that a private corporation was a "natural person" under the US Constitution, sheltered by the 14th Amendment, which requires due process in the criminal prosecution of "persons." Following this ruling, huge, wealthy corporations were allowed to compete on "equal terms" with neighborhood businesses and individuals....

Within just a few decades, appointed judges had redefined the "common good" to mean the corporate use of humans and the Earth for maximum production and profit -- no matter what was manufactured, who was hurt or what was destroyed. Corporations had obtained control over resources, production, commerce, jobs, politicians, judges and the law. Workers, citizens, cities, towns, states and nature were left with fewer and fewer rights that corporations were forced to respect.

Model Brief against Corporate Personhood

Corporations are created by State governments through the chartering process. As such, corporations are subordinate, public entities that cannot usurp the authority that the sovereign people have delegated to the three branches of government. Corporations thus lack the authority to deny people's inalienable rights, including their right to a republican form of government, and public officials lack the authority to empower corporations to deny those rights.

Over the past 150 years, the Judiciary has "found" corporations within the people's documents that establish a frame of governance for this nation, including the United States Constitution. In doing so, Courts have illegitimately bestowed upon corporations immense constitutional powers of the Fourteenth, First, Fourth, and Fifth Amendments, and the expansive powers afforded by the Contracts and Commerce Clauses.

Wielding those constitutional rights and freedoms, corporations regularly and illegitimately deny the people their inalienable rights, including their most fundamental right to a republican form of government. Such denials are beyond the authority of the corporation to exercise.

Such denials are also beyond the authority of the Courts, or any other branches of government, to confer. Accordingly, the constitutional claims asserted by the
[ x- corporation against [ y-government ] must be dismissed because those claims deny the people's rights to life and liberty, and their fundamental right to self-governance.

Taking Power Back and Asserting Democratic Control over Corporations

There is no avoiding the formidable task of overcoming the colonization of our minds, of uprooting what Edward Said has called the "ideological pacification" that has been taking place for decades because large corporations have dominated so many aspects of our lives and communities. [25] As Cornel West has observed, "[t]he sheer power of corporate capital . . . makes it difficult to even imagine what a free and democratic society would look like (or how it would operate) if there were publicly accountable mechanisms that alleviated the vast disparities in resources, wealth, and income owing in part to the vast influence of big business on the U.S. government and its legal institutions." [26]

This colonization is at the heart of the "TINA" (There Is No Alternative) phenomenon, which pervades all aspects of American life. But once people convince each other that there are real alternatives to the present domination by large corporations, then redefining the relationship between the people and our enterprises -- based on the principles of citizen sovereignty and self-governance -- will no longer seem like an impossible dream. And the adoption of model state corporation codes based on these principles, reinforced by a body of legal doctrines, will appear to be logical, and achievable.

But We the People -- and our lawyers -- will have to shift our thinking and our strategizing. We can start by figuring out how to resist corporate harm -- doing in ways which begin to weaken all corporations, and by seizing the offensive to define the conditions under which corporations may exist and function.
..... The Struggle for the Democratic Control
of Corporations: An Agenda

Misunderstanding the meaning
of the Matrix

Behind its fancy special effects, stylish execution and beautiful actors is a movie that addresses an age-old theme found in mystic religions everywhere. Any Buddhist monk, Hindu faqir or Sufi mystic would immediately recognize the underlying theme of this film: we are enslaved by a world of illusion and must wake up and realize the truth.

Everything we see, touch, feel, experience around us is illusion. The world of the senses is a mere shadow of reality, according to Plato's Allegory of the Cave or what Sufis call Alam Al Shehada (witnessed world) as opposed to the Alam Al Ghayib (the absent world) which is where they try to live. Hindus described the world of illusion around us as maya and strove to transcend it

Do we live in the world of the Matrix? Are we enslaved to global corporations and the Financial Markets? Have we given up our individual power and rights to corporations and money? But are corporations real? Is money real? Is the Global Financial Market real? They are only real if we accept their reality? So how do we reclaim our individual and collective rights and power from Global Corporations? What if we refuse to accept the reality and power of these Global Corporations and Financial Markets(Chris Lewis)

Derber: Challenging the Myths of
Global Corpocracy

Derber argues their are Three Dominant Myths about
Globalization:

1. Global "free trade" is a "win-win" situation for
all nations, for both the First and Third World nations.

2. Global "free trade" is not based on the use of power and wealth by the First World to control the terms of
trade for the Third World.

3. Increasing Globalization and global "free trade" leads to increasing democracy throughout the world
............................................................................................

1. Consider the first leg of the stool: the making of a global economy. It has many names, from "free trade" to "economic integration" to apple pie, equivalents in U.S. parlance today. The new common sense states that global economic integration is (1) new, (2) inevitable given the new technology, and (3) one of those rare earthly joys: a win-win situation. (35)

2. Like the idea of trade as apple pie, the mythology of globalization as democracy has become part of the new common sense of the day. But is it true? Is globalization the brave assassin of African dictators or oil-rich sheiks of the old authoritarian world? After the events of September 11, the new spotlight on Middle East politics raises serious doubts. We are painfully aware that unreconstructed oil monarchies that give their increasingly discontented people no vote and hardly any free expression are as much a part of the globalization system as are liberal democracies (49)

3.George W.. Bush seems like a plain-spoken man to most Americans, and he says that globalization is just plain common sense. It's good for the United States, good for the Americas, good for the world, good for democracy, good for hungry people, good for
economic growth, and good for civilization and
peace in an age of terror. But is his common sense right in this case? .... Globalizers always create a set of
cultural values and beliefs by putting the best possible light on what they are doing. The cultural system props up the globalization trinity and creates a third mythology crucial in sustaining the new world order .... Globalization today has softened its self justifying rhetoric. Business leaders, backed by the world's most respected economists, continue to see global markets, commerce, and trade as part of the natural order of things. To refrain from globalization today would be to stand against the laws of economics and nature. But today's globalizers do not tend to read God's mysterious purposes into the misery of the poor. Rather, the new common sense is that globalization is the only viable way to bring the world's poor out of poverty. (54-55)

Consumerism and the mystique of the market have replaced Social Darwinism as the common sense of today's globalization. To challenge it seems to challenge the sovereign right of all the world's peoples to consume burgers at the golden arches or to dream of driving a Mercedes. Those who raise doubts tend to be viewed, at least within the United States, as just as strange as those a century ago who questioned Social Darwinism or the white man's burden. When those outside of the United States, like Islamic fundamentalists in the Middle East, attack the new cultural creed, they tend to be viewed as relics of a doomed pre-modern era. (55-56)

from One World under Business,
by Charles Derber

GLOBALIZATION ENTHRONES THREE INTERTWINED
INSTITUTIONS.:

1 ) THE first are the global financial markets and transnational companies at the heart of the world economy.

2) The second are national governments that are business-oriented regimes linked to each other in economic and military alliances led by the United States.

3) The third are rising "global governments" such as the World Trade Organization, the International Monetary Fund, and the World Bank, also strongly led from the White House.

These three power centers increasingly operate as a system.... [G] lobal power lies in the system itself and the new corporate elites who seek to manage it....This new world system can be called a global corpocracy. By joining the words corporation and democracy, this appellation perfectly evokes a corporate-driven system that celebrates the idea of democracy more than any earlier global order. (59)The corporation is inherently a political creature, and the free market order itself is a government-based system. The idea of free markets, a core tenet of the globalization mystique, obscures the reality that markets are always constructed by governments and can survive only with multiple forms of government intervention and public subsidy. There can be no market without state power establishing, regulating, and militarily defending property and no corporations without state charters and governments managing and stabilizing the economic and social order. And all markets rest on abundant forms of "corporate welfare" involving not just tax breaks and subsidies, but expenditure on education, infrastructure, and research and development without which the economy would collapse. Most important, the government stands as the ultimate guarantor that contracts will be enforced and laws against fraud upheld so that people's trust in the market remains secure." (65)

Globalization is the process of corporations
(and financial markets) uncoupling from the nation-state in a strategy to accumulate astonishing wealth as well as unify the world. It is something different than simply choosing to operate in many different countries, which corporations have always done. And it is also not quite the same thing as divorce, because the corporation remains legally tied to its old partner while in effect marrying a new set of partners." (71)

Uncoupling is a strategy to further corporatize all aspects of life in every nation by freeing companies from responsibility to any particular country. By claiming loyalty to all countries equally, and moving from national monogamy to a kind of global polygamy, corporate uncoupling actually binds nations to corporations in a far deeper way and turns both national government and social life everywhere into an expression of global corporate values. [ Corporate uncoupling ] integrates the world politically as well as economically, begins to build a worldwide business civilization, and is the foundation of the "denationalizing" of sovereignty and the weakening of democratic states. (72)The question then is this: Who can protect the people in either First or Third World nations when their governments are in a race to seduce and please the global giants that bring money and jobs? Many corporations champion self-regulation and "corporate responsibility" initiatives that have brought higher standards to some nations than ever existed in domestic businesses....But such self-policing is not enough. Even when well-intentioned, it leaves it up to the businesses themselves to define responsibility, and it offers outsiders no public means of verifying
information and claims of good business conduct. (76)

Market democracy, our choice as consumers or investors, provides this sense of empowerment. But while it can make us feel good, it is something different than democracy. Market democracy is based on the principle of one dollar, one vote. Real democracy is one
person, one vote. One dollar, one vote, is the logic of the market, but it is the opposite of the equal representation of all citizens that democracy is about. As a sovereign principle, one dollar, one vote, is inherently undemocratic, and it ensures a growing gap
between the rich and poor because it gives the rich far more political representation. (78)

Choosing what brand of sneaker to buy, the kind of vote market democracy offers, is not like electing a president, and it cannot create the accountability of the government to the will of the people. For that to occur, both national government and global government will have to abandon their servile marriage to business and start serving ordinary people. (79)

Cavanaugh,Corporate Structure and Power

"A belief that sovereignty resides in people and gives them an inalienable right to self-governance is the sacred foundation of democracy. Governments are the voluntary creation of the people and therefore subject to their will. Corporations are in turn created when governments issue corporate charters. They are therefore properly subject to the will of the people through their governments." (290) "The IMF, the World Bank, and the World Trade Organization have all been used by these elites to replace democratic decision making in economic affairs with processes dominated by corporate interests." (290)"Governmental bodies at both global and national levels now function as if sovereignty resided in global corporations. Their function is to serve the corporate interest, using their coercive powers to protect corporate property, guarantee corporate profits, break up unions, sell off public assets at give-away prices, stifle . dissent, and make sure that people fulfill their roles as obedient workers and compliant consumers. " (291) "Most depend for their profits and survival on a complex regime of public subsidies, exemptions, and externalized costs, including the indirect subsidies they gain when allowed to pay less than a living wage, maintain sub-standard working conditions, market hazardous products, dump untreated wastes into the environment, and extract natural resources from public lands at below-market prices." (292) "As we have seen, governments have been largely stripped of the powers and tools they once had to regulate the investments of global corporations. Yet regulating corporate investment is essential if people are going to take democratic control of the operations of global corporations and banks. A series of new measures needs to be designed for legislative action, such as "site-here-to-sell-here " policies, the chartering of corporations, restrictions on plant closures, and rules against the patenting of life forms." (293) "As we have seen, the new globalization regimes--for example, the WTO, NAFTA, and the proposed Free Trade Area of the Americas (FTAA) -- are, in effect, the constitutions of the new world order, designed primarily to protect the rights and freedoms of global corporations. A program to dismantle this corporate rule, therefore, would have to include strategies either to terminate altogether or to renegotiate specific components of these agreements, keeping in mind that they themselves contain specific clauses and procedures for abrogation that can be exercised by one or more of the partners." (294)

"By their nature, human-scale enterprises--of small and medium size--will distribute power and ownership far more equitably and democratically than global corporations could possibly do. Lacking a global corporation's ability (or desire) to "buy " politicians, dictate consumer choice, or manipulate the symbols of personal identity through mass advertising, smaller enterprises are intrinsically more likely to be responsive to community interests." (296) "People who live in a place--whether they operate a business or own a home or live on the land--are far more likely to invest well in its maintenance and nurture relationships with their social and environmental context. Ownership adds to their commitment. When businesses are similarly owned by their workers, customers, suppliers, and community members, the owners bear the actual outcomes of their decisions. Accountability is built into the fabric of the economic system; transparency and openness are impossible to avoid." (297) "When ownership and rule making are predominantly rooted in local realities, with community welfare as the primary value, then everything else may fall naturally into place, fairly and effectively balancing the interests of local business enterprises with other community values for the mutual benefit of all. " (298)

"The corporate global economy is actually decapitalizing the human and physical infrastructure needed to support the young and old alike in favor of short-term financial gains, eroding the social contract between generations. To rebuild the social contract--the social and physical infrastructure needed to meet the needs of children, working people, and the elderly--it is essential to restore the concept of community, in part by rebuilding prosperous community economies." (300)

Warren, Meet the Corporation

"Once chartered, corporations are granted a long list of benefits under state and federal law, including the ability to exist forever (there's no expiration date for charters) and the right to influence elections and shape legislation through campaign contributions. Additionally, their shareholders and directors are shielded by limited liability. Meant to encourage investment in business ventures by ensuring that an individual's assets cannot be seized by creditors if a company fails, limited liability also insulates stockholders and directors, in most cases, from personal responsibility for the company's potential debts or even misdeeds."

[Before the Civil War] any firm that sought a corporate charter had to go specifically to the [state] legislature," says Richard Abrams, a history professor at the University of California at Berkeley. To be chartered, corporations had to serve the public good—most often by constructing a road, bridge, canal, or other public-works project. Their tenure was limited, and deviation from their original design was prohibited. They could not own shares in other corporations, lobby elected officials, or give campaign contributions. Those that strayed had their charters revoked. "

"To change that dynamic, Hinkley wants to add a coda to the laws that govern corporate charters that says, yes, corporate directors should be focused on profit but not at the expense of "the environment, human rights, the public health and safety, the welfare of communities . . . [or] the dignity of employees." The essence of capitalism—the profit motive—would remain intact. But corporations would have to serve interests beyond the bottom line. Just as potential profits are already limited by specific laws against, for example, child labor and false advertising, harm to the environment and communities would no longer be an acceptable part of competition.

Under Hinkley's proposed changes to state business laws, pollution would be flatly prohibited—after companies were given 15 years to develop and implement the technology they need to meet that requirement. Any violations after that deadline would be illegal, making large corporations and their directors subject to criminal or civil charges for their misdeeds."

Grossman, Taking Care of Business

"In exchange for the charter, a corporation was obligated to obey all laws, to serve the common good, and to cause no harm. Early state legislators wrote charter laws and actual charters to limit corporate authority, and to ensure that when a corporation caused harm, they could revoke its charter."

"Corporations may have taken our political power but they have not taken our Constitutional sovereignty. Citizens are guaranteed sovereign authority over government officeholders. Every state still has legal authority to grant and to revoke corporate charters. Corporations, large or small, still must obey all laws, serve the common good, and cause no harm.""During the 1840s and 1850s, states revoked charters routinely. In Ohio, Pennsylvania and Mississippi, banks lost charters for frequently "committing serious violations . . . which were likely to leave them in an insolvent or financially unsound condition." In Massachusetts and New York, turnpike corporations lost charters for "not keeping their roads in repair.""Another blow to citizen constitutional authority came in 1886. The Supreme Court ruled in Santa Clara County v. Southern Pacific Railroad that a private corporation was a natural person under the U.S. Constitution, sheltered by the Bill of Rights and the 14th Amendment."Who defines the corporation controls the corporation. We cannot command the modern corporation with laws that require a few days’ notice before the corporation leaves town, or with laws that allow the corporation to spew so many toxic parts per million. If we expect to define the corporation using the charters and putting legislators on our civic leash, we must also challenge prevailing judicial doctrines. We cannot let courts stand in the way of our stopping corporate harm."Legal doctrines are not inevitable or divine. When the liberty and property rights of citizens are at stake," as former Supreme Court Justice Louis D. Brandeis said, "the right of property and the liberty of the individual must be remoulded . . . to meet the changing needs of society. The corporation is an artificial creation, and must not enjoy the protections of the Bill of Rights."