2005/03/23

The Corporation: the pathological pursuit of profit and power

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http://www.thecorporation.com/

Given the recent conversation on government and business on this blog I thought this documentary would be an excellent topic of discussion.

"Since Rachel Carson's Silent Spring began to expose the abuses of the modern industrial system, there has been a growing awareness that profit at the expense of Earth--of individuals, society, and the environment--is unsustainable. Joel Bakan has performed a valuable service to corporations everywhere by holding up a mirror for them to see their destructive selves as others see them. The clarion call for change is here for all who would listen." -Ray Anderson, CEO of Interface, a multi-billion dollar company.


What this book and documentary does basically comes from the premise that governments have granted corporations “personhood”. From that, what kind of “person” is a coporation? After examination by psychologists Bakan concludes that the entity is fundamentally psychopathic. How is a corporation’s personality psychopathic? Consider the following:

DSM-IV diagnostic criteria for psychopathy that the Corporation fits:

The operational principles of the corporation give it a highly anti-social “personality”:It is self-interested, inherently amoral, callous and deceitful; it breaches social and legal standards to get its way; it does not suffer from guilt, yet it can mimic the human qualities of empathy, caring and altruism.

The first assertion should be obvious, self-interest is what corporations are all about. As a matter of fact, its custodians are legally mandated to maximize profit to the company or face legal action. That is their job, As Sam Gibara, Chairman of Goodyear Tire, explains, “If you really had a free hand, if you really did what you wanted to do that suited your personal thoughts and your personal priorities, you’d act differently.“ the CEO and the Board Of Directors have a single-minded goal to make money for the shareholders, at any expense.

Which brings us to the second assertion, inherently amoral, callous and deceitful. There are too many examples of harm to the workers and society at large to mention here. One prime example of the absolutely disgusting practice of “dead peasant’s insurance”. I could not believe that companies do this. Large corporations will put out life insurance policies on Average Joe Worker, usually without consent, claim it as a tax write off then collect when you die. Think Walmart, Nestle, Proctor & Gamble are good companies? Good corporate “citizens”? They will profit off your death. Your poor family can’t afford a funeral for you because you made slave-wage earnings at Walmart, sorry, the beneficiary is “Walmart”. Wether or not this practice is legal, I can not think of anything more “inherently amoral, callous and deceitful”. I think that ties nicely to the next assertion that the corporate person breaches social and legal standards to get its way. Its way is to externalize any possible cost, to anyone else, regardless of its effect on anything (except profit, of course). You don’t have to look much farther than the EPA to see this coming. The worst offenders are huge corporations that externalize costs onto the environment and the relative fines are miniscule. To them it is just the “cost of doing business” makes perfect sense financially, very poor sense for everyone that has to live within the constraints of our limited environment.

Guilt? Non existent within corporate culture. As I stated before, the top officials are mandated by law to make decisions for the corporation on behalf of the stockholders: profit. To do otherwise is to shirk your corporate responsibility to the company. Yet these same individuals are mostly shielded from prosecution. Enron, anyone?

What is really scary is the public face that corporations put on in order to keep the goodwill of the populace. They spend billions on advertising and PR in order to put you at ease, McDonalds commercials with athletic people working out in them, promoting a healthy lifestyle. Giving money to various charities that give them further tax breaks, etc. These are “good deeds” by corporations to win your trust, if anything actually cost them on the bottom line they would be yanked in a minute.

So what am I saying? Dismantle the corporate form and lets all be communists and work on the collective farms and such? Hardly. I believe in free-enterprise. Reform and regulation is needed. You have been hearing (probably since childhood, if you live in the US) that government regulation is “bad for business”. Anyone who speaks out is a “godless communist”. Corporations have spent billions feeding this to all of us. Do you know by now why that is?


This form of business has risen in the last 150 years to become the dominant form on this planet. There power now rivals that of government, without regulation this power will increase to overshadow the entities that created them, governments. Want to see what will happen to the average person’s quality of life when this happens and as environmental protections disappear and workers die? Just do nothing, and see what happens.

6 Comments:

You're exactly right, D1, and on all accounts.

I find it unbelievable that proponents of total deregulation and abstinence from government control will make this world a better place for humankind.

The only way I can comprehend their claim is by assuming the word "humankind" for them does not in fact include all 6 billion ppl on this planet but only the CEOs, business owners and shareholders, and that the rest is some other weird species on 2 legs which vaguely ressembles a human being.

The last part is indeed a scary prospect for the future. It is pretty obvious that this is already what's happening in the US, i.e. Corporate America rules the country and its gov as much as the gov itself, if not more. While we are nowhere near that level in the EU, there are certainly trends trying to move in that direction.

And of course, the right wingers will claim that very few ppl live in dire poverty in the US (only a few tens of million, you know), and even less actually live in abject poverty, so how can we blame the corporations? What they fail to mention is that those corporations are moving their productions facilities more and more in 3rd world countries and exploit the natives at levels not that far from the industrial revolution days of the 1800s.

But who cares? If they can find slaves out there in some far away place to fill up the factory floor, rake the money back home, then doesn't it make the deal a "success" story of our western nations (and therefore the world, since the rest does not really count)? 

Posted by WhyNot
3/23/2005 05:45:00 pm  
"What they fail to mention is that those corporations are moving their productions facilities more and more in 3rd world countries and exploit the natives at levels not that far from the industrial revolution days of the 1800s."

Well, that makes sense given the cycloptic mandate of profit: corporations are doing exactly what they are designed to be doing. It makes perfect financial sense to produce goods with workers that will work for subsitence and less.

Global social ramifications? Who cares! If those other countries were not impovrished by their lazy populace they would not be in a situation to be exploited anyway. So really we are doing them a favor by exploiting them: teaching them a lesson, Kipling's "White Man's Burden" style.
 

Posted by deviant1
3/23/2005 06:38:00 pm  
Well said Deviant1. "Dead Peasant Insurance" is legal unfortunately. There was a funny little scene in the recent movie Flight of the Phoenix (dumb movie) where after the plane crash in the Mongolian desert, they argue about whether their (oil) company would do a cost/benefit analysis before they decided to begin search and rescue. They decided "yeah they would", and concluded they probably wouldn't be rescued (!)
Oh, and if anyone is wondering why their taxes never seem to be enough to pay for government programs (you know, like medicare), this is why:
Personal taxes on earnings are now two-and-a-half times greater  than personal taxes on investment income (in other words rich people are paying much less than you are), and in addition there are greater and greater numbers of companies paying no taxes at all.  

Posted by Sarah
3/23/2005 06:43:00 pm  
Who does the government actually work for? There are 13000 lobby groups based in Washington. About half of them are there to argue for changes to the tax code, already over 7 million words.

Just imagine a tax system that had no allowable tax deductions. There was a flat rate of tax that all paid. This would reduce the tax code to a small book, and the millions of hours spent doing unproductive work (counting beans and getting deductions for beans) would be wiped out.

With greater transparency and businesses forced to pay tax on profit with no accounting weasel clauses, we might be able to start reshaping attitudes.

People have to see the system as JUST. Offsets, deductions, complex deferrments only help immoral people act immorally in a lawful way.

Bad laws create bad citizens. Sort out the system, and the people can act according to their nature - which is inherently good.

 

Posted by ZenTiger
3/23/2005 09:06:00 pm  
"Bad laws create bad citizens. Sort out the system, and the people can act according to their nature - which is inherently good."

Exactly my point: Reform to corporate law is needed. If it was made unprofitable to pollute, to provide unsafe work environments, etc. Corporations wouldn't do it.
 

Posted by deviant1
3/23/2005 09:33:00 pm  
I suggest a more fundamental reform, rather than fiddling with corporate laws.

Strengthening PRIVATE PROPERTY rights for example, defines a ground level basis for balancing out Corporate Interests. If Private Property rights included the right to enjoy peace and quiet, an airport would have to negotiate an annual payment with the residents to compensate for taking that right away.

Putting weak penalties (ie less than the value of the property destroyed) in place for environmental transgressions by Corporates is the governments way of saying the property owned by the people, and individual property owned by home owners, farmers etc is not actually protected. Government was supposedly created to protect our life, liberty and property.

We have volumes of laws tweaking and adjusting the system, which ultimately get determined by special interest groups. Our source documents, the principles behind the laws, are scant, and don't form a practical basis for holding the Governments typically bad managerial decisions to account.  

Posted by ZenTiger
3/23/2005 10:55:00 pm  

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