CORPORATE PREDATORS:The Hunt for Mega-Profits and the Attack on Democracy.
Common Courage Press.
Two complementary recent books analyze the corrosive toll that excessive corporate powers have taken on democracy. One book contains dozens of snippets chronicling recurring incidents of corporate abuse. The other is a college professor’s take on how we got here and what is to be done.
Corporate Predators serves up five dozen pithy vignettes of corporate crime and arrogance. These three-page dispatches have the feel, smell, and tempo of fresh newsprint. You may recall reading some of these better-known incidents in your local paper. But the authors sweep up the shattered pieces left behind after the daily news breaks, placing them in a context that is absent from the dailies. Namely, this book argues that these repeated episodes of corporate shenanigans do not occur in isolation. They form a pattern.
Because Corporate Predators covers a lot of ground yet can be read in a couple sittings, corporate threads begin to crisscross as the authors tighten the dragnet. A vignette about the New England Journal of Medicine’s failure to disclose a writer’s funding conflicts pulls back from that incident to show a history of such problems. Texas A&M researcher Stephen Safe editorialized in the Journal against “chemophobic” attempts to link breast cancer to environmental estrogens, for example, without disclosing that a fifth of his funding came from the Chemical Manufacturers Association. Sandra Steingraber was in Austin, Texas promoting her book linking cancer to pollution when she was broadsided by a scathing Journal review. The Journal never mentioned that the reviewer was the top toxicologist at chemical giant W.R. Grace.
Similar threads surface seventy pages later, when the authors recount a little-known irony about a character from the bestselling book A Civil Action (who did not make it into the movie screenplay). The book tells the true story of a lawsuit filed by the families of children who developed leukemia after chemicals dumped by W.R. Grace contaminated their water supply. “The only lesson that corporations understand is money,” the book quotes Harvard Law Professor Charles Nesson, a lawyer for the families. “That is their blood.”
Corporate Predators then catches Nesson in the act of corporate bloodsucking. Nesson submitted a brief on behalf of a drug company in a landmark 1993 U.S. Supreme Court case, involving a woman’s claim that the morning sickness drug Bendectin caused a birth defect in her baby. The Supremes used the case, Daubert v. Merrell Dow, to transfer important evidence-weighing authority from juries to trial judges. After the Daubert decision, Nesson led seminars instructing judges about their new evidence-filtering powers. But Nesson himself excluded evidence from these judges. He failed to tell them that the Civil Justice Reform Group, organized by defense lawyers at sixty of the nation’s largest corporations, underwrote the seminars to the tune of $300,000.
In the spirit of better disclosure, this reviewer acknowledges links to the authors of Corporate Predators. Veteran corporate crime chroniclers Russell Mokhiber and Robert Weissman are Ralph Nader protégés who respectively bang out the Corporate Crime Reporter and Multinational Monitor magazine, where this reviewer once worked. This reviewer also attended a number of tiny demonstrations that Mokhiber organized in Washington, D.C., to protest such corporate abuses as:
Global mining interests selling Papua New Guinea downriver; andPopulist Texas radio commentator Jim Hightower getting fired after he used ABC’s own radio waves to condemn Disney’s assimilation of that company.
In another apparent bias, this review seems to pander to Texas news angles. But this state does cast a long shadow in the underworld of Corporate Predators. Californians may truly believe, for example, that the recent showdown with Pacific Lumber over America’s last big stand of privately owned redwoods is a Golden State morality tale. In fact, it was a mere backdrop for a showdown between two Texans. Charles Hurwitz, the C.E.O. of Houston-based Maxxam Corporation, considered himself the owner of Pacific Lumber and the Headwater redwoods. David Chain, a twenty-four-year-old Earth First!er, journeyed from Austin to the Headwaters to make a last stand among those redwoods. The protestors interfered with Hurwitz’s plan to sell the redwoods for a king’s ransom, and one of his chainsaw-wielding loggers killed Chain, by dropping one of the trees he sought to save on top of him.
Corporate Predators’ brief treatment of this tragedy is revealing, because the authors find room to ask a question few news accounts broached. Why weren’t Pacific Lumber, its executives, or the logger charged with involuntary manslaughter? Drunk drivers face this charge when they run people down, even though their deadly recklessness lacks deadly intent. Fraternities and universities have faced manslaughter charges for tolerating hazing activities that kill frat boys. And Earth First! even videotaped Pacific Lumber’s lumberjack threatening to kill the protestors, shortly before he killed Chain.
Similarly, the authors characterize the mega-merger of Citibank and Travelers insurance company as an act of “uncivil corporate disobedience” that breaks a Depression-era law prohibiting banks, stock brokerages and insurance companies from owning each other’s stock.
Corporate Predators is a good little read. The vignettes in this book show a pattern of corporations running amok, usurping the rights of citizens while eschewing attendant responsibilities. The book’s main deficiency is that it leaves readers hungry for answers to fundamental questions that the book raises without attempting to answer. These questions include:
How did corporations acquire so much power?What is to be done to establish democratic controls?
These are the essential questions tackled by Boston College sociology professor Charles Derber in Corporation Nation. Much of Corporation Nation retraces this nation’s love-hate relationship with corporations. This history demonstrates that Americans have not always given corporations such a long leash — and that we need not do so today. This is important, because Derber detects an ahistorical corporate brainwashing in his college students — as well as in people old enough to know better. This brainwashing allows us to hear about a corporate logger dropping a tree on a tree-hugger without even thinking about punishing the perpetrators. Derber likens this “corporate mystique” to the “feminine mystique” that prevented fifties housewives from questioning their lot.
We fall into the corporate mystique when we:
Create and exaggerate “natural” distinctions between the private and public sectors, on the one hand; andFail to distinguish between human rights and corporate rights, on the other hand.
America’s founders were almost as leery of concentrating power in corporate hands as they were about concentrating power in the hands of government officials. The first corporations were chartered by government for limited time periods to serve specific public needs (e.g., build a road or canal). The government could revoke their charters at any moment. Like NATO in the Balkans, today’s corporations lack an exit strategy, and are prone to inflicting the very profit-driven collateral damages chronicled in Corporate Predators (such as massive layoffs, unionbusting, price fixing, government bribery, ecological degradation, and cavorting with dictators).
Key to the mutation of corporations is the legal doctrine that grants “legal personhood” to corporations. In 1886, the Supreme Court ruled that corporations are entitled to the Fourteenth Amendment guarantee that no state “shall deprive any person of life, liberty, or property, without due process of law.” This decision freed corporations from the shackles of democratic control by granting them a constitutional protection that had been created to protect real people — freed slaves. Wielding corporate legal “personhood,” the railroad robber barons of the Gilded Age used corporate trusts to amass unprecedented powers in American society. That turn of that century has parallels to the merger binge of the current one; Derber likens today’s emerging telecommunications networks to the railroad empires of a century ago.
The Great Depression stripped the last gilt from the Gilded Age. Franklin Roosevelt’s administration successfully checked corporate power through government regulation, while unions flourished. Forty years later, economist Milton Friedman launched an attack on these checks, and argued that profit maximization is “the one and only social responsibility of business.” Since Ronald Reagan took office, government officials have put Friedman’s ideas into practice by dismantling those of FDR. Derber follows this useful history with a call for new checks on corporate powers. For inspiration he looks not to Roosevelt’s technocrats, but to the ordinary grassroots prairie populists who founded the People’s Party in 1892, in an unsuccessful challenge to Gilded Age corporate plundering.
Yet Derber also criticizes the prairie populists for being too anti-corporate. What he advocates is a fuzzy concept of “positive populism.” Throughout much of Derber’s discussion of this concept, readers may find themselves wondering if he contracted some “corporate mystique” from his students. Here and there he hints that positive populism might benefit from corporate codes of responsible conduct or employee stock ownership programs. Moments later, however, he acknowledges that the corporations that have embraced these fads (e.g., Exxon, Lockheed, and Levi Strauss) are hardly heading where he wants to go.
Derber’s most concrete “positive populist” proposal is to create a new charter for all corporations worth $1 billion or more. This charter would “express a clear vision of the corporation’s public purposes, reserve for citizens all powers not expressly
delegated to corporations, and establish not just corporate responsibility but real accountability.” These big corporations would face the loss of their charters if they failed to respect the environment, create secure employment, or nurture local communities.
How would such a radical transformation occur? Derber is not sure. But he pins his hopes on the convergence of certain populist strains within four movements:
A new labor movement;Community groups that fight for such things as safe streets, living wages, better schools and affordable housing;Non-elitist environmentalists; andPopulist multiculturalists, who eschew isolated identity politics to fashion an economy and democracy that will serve everyone.
In relatively short order, Corporation Nation tells how large corporations came to pose extraordinary challenges to democracy at the close of the twentieth century, and Corporate Predators documents numerous examples of such corporate challenges in action. Neither book, however, really explains how to get out of this rut.
In the end, maybe Derber can’t have it both ways. He hopes a new form of homespun prairie populist will arise in the twenty-first century to clip the predatory wings of corporations. If this is the game plan, then the solution will not come from writers of books.
Andrew Wheat, formerly an editor at Multinational Monitor, is the research director at Austin-based Texans for Public Justice, a non-profit focusing on corporate responsibility and money in Texas politics.