Imagine living amongst a race of immortal, super-human creatures with superior
intellect, abilities, resources and power. Further, imagine that these alien
creatures enjoy all the same rights as citizens, but are burdened neither with
the responsibilities that come with citizenship, nor a moral conscience that
would give them some measure of forbearance from using their full power to
their own advantage against us. What would it be like to live in such a world?
It would no doubt be treacherous, fraught with an assortment of possibly life-threatening
dangers.
Yet we needn't imagine it, for we live in such a world today -- right now
-- in the United States of America. All we need do is open our eyes. The alien
beings are technically known as "juristic persons," but they are better known
as corporations.
For all intents and purposes, corporations have the same legal rights as you
or I. While they cannot vote, they can use money to buy votes. They have the
right to free speech (including advertising), they can buy and sell property,
contribute their opinions to the political process (even though they are not
citizens and in some cases are majority foreign owned), conduct business (obviously).
They can own other corporations and sue other "persons" including lowly humans.
However, unlike you or I, they have a different set of priorities. Human beings
are multidimensional, sensitive mortal creatures with an inherent sense fairness
and a variety of motivations for action. On the other hand, corporations are
single minded in their pursuits. In fact, they are required by law to 1) maximize
profits and 2) place the financial interests of their owners above all other competing
interests. They have no conscience to interfere with these goals, and theoretically
need never die.
If you knew a human like this, you most certainly wouldn't trust him, would
probably fear him, and would definitely steer clear of him (if you knew what
was good for you). Technically, he would be considered a sociopath. But most
people rarely think of corporations in this way due to a lack of understanding
of their true nature. Corporations have tremendous PR budgets to manipulate
people - notably children - into thinking of them on their terms.
For more information, check this short clip from the Canadian film The Corporation.
(10 minutes might be a bit long, so just watch the first two. You'll be hooked.)
Listen to Lucy, the corporate consultant, starting around 2:10: "Anywhere
from 20% - 40% of purchases would not have occurred unless the child had nagged
their parents. That is, we found that one quarter of all visits to theme parks
wouldn't have occurred unless a child nagged their parents. Four out of ten
visits to places like Chuck-E-Cheeze would not have occurred. And any parent
would understand that. When I think of Chuck-E-Cheeze - oh my god, it is NOISE!
And there are so many kids. Why would I want to spend 2 hours there? But if
the child nags enough, you're going to go. We saw the same things with movies,
with home videos, with fast food...You can manipulate consumers," she says
cheerfully, "into wanting, and therefore buying your products. It - it's a
game."
Do you like that game? Are you consciously aware of it? How do you feel about
having that game played on you, or worse -- on your kids? Kids are not little
adults. They're minds are not fully developed. And marketers play to those
developmental vulnerabilities.
The consultant continues: "[Kids] are tomorrow's adult consumers. So, start
talking with them now. Build that relationship when they're younger, and you've
got them as an adult. Somebody asked me Lucy, 'is that ethical? You're essentially
manipulating these children.' Well - is it ethical? Yeah, I don't know. But
our role at Initiative is to move products. And if we know that you move products
with a certain creative execution placed in a certain type of media vehicle,
then we've done our job."
The fact that corporations are required to maximize profit at all costs creates
a peculiar characteristic: As part and parcel of maximizing profits, it is
in their interest to externalize as many costs as possible. One result is that
corporations will lie for profit. Is lying illegal? Not if you have a good
enough lawyer, who can help you redefine what the definition of "is" is. But
even more importantly, obeying the law isn't a matter of fear of punishment
or moral obligation with a corporation. As Jim Hightower puts it in his most
recent book, Swim
Against the Tide - Even a Dead Fish Can Go With the Flow, "The corporation
itself has no feelings, no conscience, no heart, no soul, no morality, no shame
- no butt to kick and no body to put it jail." Obeying the law is therefore
a matter of cost/benefit analysis. If the penalty, weighed against the chances
of being caught is less than the cost to comply, it is in the corporation's
interest to break the law. It is simple, logical, calculating and cold. Nothing
personal - just business. This is part of the reason that the
list of corporate criminals is so long.
I say this not to be "mean" or to spite corporations -- nor would it do any
good, since corporations have no feelings. This is simply an explanation of
how these legal fictions are designed - it is embedded in their "corporate
DNA." There is no question of evil or malevolence. Like robots, they follow
orders to the letter - orders that have been programmed by our laws and judicial
system.
Once upon a time, corporations were subordinate to human people and to the
state. State governments granted charters to corporations for specific functions,
and shareholders were liable for the actions of the corporation. Those days
are long gone. The corporate form has now taken over and overwhelmed the society
we live in. It is the dominant institution of our age, overshadowing and even
controlling our government.
Big corporations are purposefully structured to be hierarchical, autocratic,
regimented, secretive, antidemocratic, extractive, exploitative, avaricious,
self-aggrandizing, absentee organizations that are out to grab as much profit
as quickly as possible. Not that their mission is to do intentional harm
(whether by downsizing workers, polluting our air and water, cheating consumers,
crushing competitors, deceiving shareholders, corrupting government, stiffing
communities, or generally running roughshod over society at large). But such
harm is as inevitable as it is prevalent, due to the inherently selfish nature
of these giants. If anyone or anything happens to be standing between top
executives and an extra dime in profit, the "corporate ethic" commands that
the executives bolt for the dime. Tough luck for whoever and whatever gets
caught in the stampede.
The corporate role in the subprime mess
Subprime mortgage originators (corporations) made quick, fleeting bucks by
externalizing hundreds of billions of dollars in costs, which are now coming
due. The originators were not interested in helping people achieve the dream
of home ownership, though we know that many of them told customers they were.
Nor were the originators interested in long-term relationships or future revenue
streams, since they were going to package and sell the mortgages anyway. They
were most interested in one thing: Short term profits.
This point has been made clear numerous times, and one question inevitably
arises: Who is to blame? Was it the companies? The shareholders? The hapless
borrowers themselves? The concept of securitization? The Fed? What I have never
heard questioned is the corporate form itself. But is simply in the nature
of the corporation to do such things. Now that there are greater costs to be
paid - costs that were originally externalized - who can be held responsible?
The salesmen and managers that originated the loans are long gone - they got
laid off. The companies themselves are bankrupt. The "smart" shareholders sold
out long ago to some new suckers who got stuck holding the bag. And now, both
the federal government and the Federal Reserve are bailing the corporations
out that created the mess.
Think we don't have a responsive government? Think again. It is simply that
they respond to their constituency - the corporations. This means it will be
you and I - the lowly humans, the foreclosed homeowners, and the decent taxpayers
- who will be stuck footing the bill, yet AGAIN. The subprime crisis is not
the first mess -- nor will it be the last -- that Corpgov (as George Ure of UrbanSurvival calls
it) has created for us humans to clean up.
Growth is not - or should not be - an end in itself. Growth is a means
to an end. The end is -- or at least should be -- a higher quality of
life for us, the human persons. But somehow, growth has become the
end for corporations, the juristic persons. They're just following their
corporate orders, like robots. But they are using us to achieve their ends.
The tragedy is that most of us also follow along, like robots, even though
this strategy of growth at all costs is now reducing the quality of life
for all of us.
It is time to rethink the role of corporations in our society and reign in
what has become excessive power. In reality, corporations are nothing more
than groups of individuals, bound together by contractual obligations. They
are the ultimate special interest groups.
If you are interested in exploring this idea further and finding out how to
preserve a sane, real life, please sign up to my low
volume email announcement list. I will be discussing these issues further
in the coming weeks and months.
M.A. Nystrom is a private investor and consultant currently living near Boston.
He earned his MBA from the University of Washington with a specialty in International
Marketing. Following his retirement from the US securities industry, he picked
up the hobby of web design, a trade he now plies at his big-picture investment
oriented website www.depression2.tv.
« Opinions expressed at SafeHaven are those of the
individual authors and do not necessarily represent the opinion of SafeHaven
or its management. Articles are available via RSS/XML. Please
visit RSSHelp for instructions. »