VERY LARGE CORPORATIONS (VLCS)
“Through size, corporations, once merely an efficient tool employed by individuals in the conduct of private business have become an institution-an institution which has brought such concentration of economic power that so-called private corporations are sometimes able to dominate the state. The typical business corporation of the last century, owned by a small group of individuals, managed by their owners, and limited in size by their private wealth, is being supplanted by huge concerns in which the lives of tens or hundreds of thousands of employees and the property of tens of hundreds of thousands of investors are subjected, through the corporate mechanism, to the control of a few men. Ownership has been separated from control; and this separation has removed many of the checks which formerly operated to curb the misuse of wealth and power. And, as ownership of the shares is becoming continually more dispersed, the power which formerly accompanied ownership is becoming increasingly concentrated in the hands of a few… [and] coincident with the growth of these giant corporations, there has occurred a marked concentration of individual wealth; and that the resulting disparity in incomes is a major cause of the existing depression.”
Dissent, Liggett Co. v. Lee, 288 U.S. 517 (1933), at 565-67. Justice Louis Brandeis
To me, Brandeis identifies the critical element missing in the current debates regarding our political system, the economy and the environment. While economists wax wroth over which theory of financial exchange is real, and conservatives and liberals are engaged in a fight to the death over whether government is the problem or the solution, the institutions that so troubled Brandeis, have continued their implacable legislative and judicial march to increased wealth and power until now they stand on the verge of acquiring all the rights of an individual with a few of the duties.
For all extents and purposes there has ceased to be a distinction between very large corporations (VLCS) and nations except that in many cases the VLCS have greater economic and political power than many if not most countries, as well as greater control over their dependents (worker’s and customers) than most countries have over their citizens.
With the impending collapse of liberal democracies under the influence of these institutions (VLCS) and the social and economic impacts of climate, religious and ideological pressures, I can foresee a time in the not to distant future where in some cases the fiction of Democracy will be done away with and the VLCS will reign again as did the British East India Company in India.
We should not forget that to a great extent it was these types of commercial companies (like the British East India Company), with much less economic and political power than they have today [no one thought they were individuals] who created colonial America. Also, remember the nation-state that we are familiar with originated primarily at the end of the Middle Ages as a commercial enterprise based upon the exploitation of land and managed by a small group of self-perpetuating individuals. Liberal Democracy was an idea borrowed from city-states not nation-states.
I believe that in the long run Liberal Democracy cannot survive without reform of current corporate structure.
Among the first reforms I would recommend is the requirement that all corporations engaged in interstate commerce obtain a federal as well as a state charter. This would tend to eliminate the current race to the bottom that characterizes the current process of organizing in the state with the least restrictive state and taking advantage of the Commerce Clause in the Constitution to trump those States wishing for greater protections for their citizens.
Since VLCS are so large, powerful and ubiquitous today, the federal government is the only entity large and powerful enough to confront them. And, yes I understand that they will attempt to buy the Feds to secure regulation to their liking, they will be stripped of their immunity from scrutiny that they enjoy by the “race to the bottom” system we operate under today.
In addition, all foreign corporations who engage in interstate commerce would have to also obtain a federal charter.