The Corporate Century

From Union Carbide in Bhopal to Exxon in Prince William Sound, evidence that corporations have forgotten their charter to serve the greater good has blossomed in the last half of the 20th century.

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As we move to the end of the millennium, it is important to remind ourselves that this has been the century of the corporation, where for-profit, largely unaccountable organizations with unlimited life, size and power took control of the economy and of the political economy — largely to the detriment of the individual consumer, worker, neighbor, and citizen.

Let us again remind ourselves that corporations were the creation of the citizenry. (Thanks here to Richard Grossman of the Project on Corporations Law and Democracy for resurrecting and teaching us a history we would have collectively forgotten.)

In the beginning, we the citizenry created the corporation to do the public’s work — build a canal or a road — and then go out of business.

We asked people with money to build the canal or road. If anything went wrong, the liability of these people with money — shareholders, we call them — would be limited to the amount of money they invested and no more. This limited liability corporation is the bedrock of the market economy. The markets would deflate like a punctured balloon if corporations were stripped of limited liability for shareholders.

And what do we, the citizenry, get in return for this generous public grant of limited liability? Originally, we told the corporation what to do. You are to deliver the goods and then go out of business. And then let humans live our lives.

But corporations gained power, broke through democratic controls, and now roam around the world inflicting unspeakable damage on the earth.

Let us count the ways: price-fixing, chemical explosions, mercury poisoning, oil spills, destruction of public transportation systems.

Need concrete examples? These are five of the most egregious of the century:

  • No. 5: Archer Daniels Midland (ADM) and price-fixing

    In October 1996, Archer Daniels Midland (ADM), the good people who bring you National Public Radio, pled guilty and paid a $100 million criminal fine — at the time, the largest criminal antitrust fine ever — for its role in conspiracies to fix prices to eliminate competition and allocate sales in the lysine and citric acid markets worldwide.

  • No. 4: Union Carbide and Bhopal

    In 1984, a Union Carbide pesticide factory in Bhopal, India released 90,000 pounds of the chemical methyl isocyanate. The resulting toxic cloud killed several thousand people and injured hundreds of thousands.

  • No. 3: Chisso Corporation and Minamata

    Minamata, Japan was home to Chisso Corporation, a petrochemical company and maker of plastics. In the 1950s, fish began floating dead in Minamata Bay, cats began committing suicide, and children were getting rare forms of brain cancer. Thousands were injured. The company had been dumping mercury into the bay.

  • No. 2: Exxon Corporation and Valdez oil spill

    Ten years ago, the Exxon Valdez hit a reef in Prince William Sound Alaska and spilled 11 million gallons of crude oil onto 1,500 miles of Alaskan shoreline, killing birds and fish, and destroying the way of life of thousands of fishermen and Native Americans.

  • No. 1: General Motors and the destruction of inner-city rail

    Seventy years ago, clean, quiet and efficient inner city rail systems dotted the US landscape. They were eliminated in the 1930s to make way for dirty and noisy gasoline-powered automobiles and buses. The inner-city rail systems were destroyed by those very companies that would most benefit from destruction of inner city rail — oil, tire and automobile companies, led by General Motors.

    By 1949, GM had helped destroy 100 electric systems in New York, Philadelphia, Baltimore, St. Louis, Oakland, Salt Lake City, Los Angeles and elsewhere.

    In 1949, a federal grand jury in Chicago indicted and a jury convicted GM, Standard Oil of California and Firestone, among others, of criminally conspiring to replace electric transportation with gas- and diesel-powered buses and to monopolize the sale of buses and related products to transportation companies around the country.

    GM and the other convicted companies were fined $5,000 each.

These are not unusual examples. Books have been written documenting the ongoing destruction. The question remains — how do we put a stop to it?

And the answer seems clear to us — reassert public control over what was originally a public institution.

The ideas on how to reassert such control are the subject of debate and conflict, in Seattle and around the world. But it seems clear to us that as the 20th century was the century of the corporation, the 21st promises to be the century where flesh-and-blood human beings reassert sovereignty over their lives, their markets and their democracy.

Russell Mokhiber is editor of the Corporate Crime Reporter. Robert Weissman is editor of the Multinational Monitor. They are co-authors of “Corporate Predators: The Hunt for MegaProfits and the Attack on Democracy.”

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