Read Part I, Part II, Part III, Part IV, Part V, and Part VI.
It is bad enough that the U.S. makes vacuous claims to a democratic form of government, as described in Part IV. But even a democratic form of government does not equate to a democratic society, and most Americans participate in democratic decision making only once every 2-4 years, at most, i.e. during elections. Compare that with their daily interaction with corporations, businesses and financial institutions where they have no decision making power at all. These institutions make no claim to be democratic and would ironically object that it is their democratic right not to be. That is how our ”democracy” works (or not).
Of course, these undemocratic institutions assure that the government will be also be undemocratic, unless one accepts the oxymoron that wealth buys more access to democracy. As absurd as this formulation may be, it is nevertheless widely believed and accepted in the U.S., even by the Supreme Court, as shown by its 2010 Citizens United v. Federal Election Commission decision.
All concentration of wealth and power is necessarily undemocratic and even anti-democratic. This leaves the poor and disenfranchised – disproportionately Black, Indigenous and Hispanic – as little more than landless serfs, to borrow a feudal term.
In previous installments of this series of articles, we discussed a variety of measures and proposals that redistribute power and wealth to create a more egalitarian society, thus empowering those who are currently disenfranchised. This installment will address the existing institutions in which power and wealth are concentrated, and what kind of changes are needed.
Corporations began as formal bodies of individuals (usually wealthy) pooling their resources for a particular purpose, to be dissolved upon completion of the purpose. This is still an important part of their function, with the exception that “successful” corporations never complete their purpose, but simply move on to other purposes.
The problem with corporations is precisely that they concentrate wealth, which is inimical to an egalitarian society. Even if the investors in the corporation are of modest means, the pooled resources give the corporation an advantage over individuals –sometimes an unfair advantage. To the extent that corporations are justified at all, they need to be circumscribed and supervised very carefully to assure that they serve a community function that cannot be served by better means. Highly regulated monopolistic corporations commonly include utilities like water, electricity, natural gas, and “land line” telephone services.
In some places, however, and especially in other countries, such utilities are entirely government operated, placing the supervision in the public domain. These are often the “better means” that can be a more suitable alternative to private corporations. In fact, such government services can be an improvement over competitive systems by ending the confusing and often deceptive practices of marketplace corporations, as well.
Nonetheless, corporations, and especially small corporations, can be a good alternative in proscribed situations where groups of individuals want to work together for a common purpose that is not predatory in nature and which would be difficult or less effective without a corporate structure. A lot of small nonprofits fall into this category, but well-regulated for-profit organizations can potentially also provide good and responsible service, especially if the shareholders are from the same community. The Green Bay Packers professional football team might be one example.
Unfortunately, this is not at all the way most corporations are conceived and run today. They are allowed to run rampant and to inordinately influence government and public policy. Through those means they have gained rights that they should never have. Thankfully, this does not (yet) include the right to vote, but they often have an oversize influence on elections, nonetheless. Even before the Citizens United Supreme Court decision, the largest corporations or groupings of corporations into common interests invested lavishly in powerful lobbying organizations that pushed for legislative advantages for their industry, often to the disadvantage of consumers of their products and their less endowed competition. That is still the case, with arguably greater impunity.
Part of the problem is that corporations are legally considered to have many of the rights and much of the status of a “legal person”. We must enact a constitutional amendment affirming that the rights outlined in the Bill of Rights are human rights and do not apply in any way to corporations. Similarly, corporations must have no permanent, constitutionally protected rights, though they may have such powers or immunities as are explicitly granted to them by legislative actions at either the federal or the state level. These powers or immunities may be modified or removed by later action of the same legislative bodies. Otherwise, they are defined by the provisions of the contractual relations forming the corporation. Corporations are or should be no more than a contractual relationship between the members. In no case can their powers or immunities override the constitutionally protected rights of human beings.
Corporations must not be permitted to donate to political parties or candidates, or to campaign for propositions or referenda, or to pay signature takers, all of which will be publicly financed, as part of the campaign procedure described in Part IV of this series of articles.
Mergers and market domination by multi-billion-dollar corporations have also created monopolistic practices in many sectors of the economy, prejudicing the smaller competitors. Current antitrust regulation and enforcement is inadequate. Additional legislation and enforcement is required, giving more power and resources to autonomous regulating agencies, with more public oversight. If some industries cannot be run efficiently or effectively in a competitive environment, they should be publicly owned and operated. Perhaps social media will be a candidate for such treatment.
Regulating agencies must be given the means and power to regulate effectively, and must not be composed of representatives or former personnel of the businesses they are regulating, and regulators must be prohibited from accepting positions in those businesses after they resign or retire. Likewise, careers as regulators must be prohibited to former employees of the companies being regulated.
Banking must also be made to prioritize the needs of its users rather than its owners. An accessible public banking alternative must be made available to all the population in all US territory, providing all basic banking services, at minimum. Such banking facilities are common in other countries, and serve to provide basic and universal banking services. It is commonplace to find such banking services as an adjunct to post offices, which can serve both functions. The existence of public banking facilities cannot help but influence the practices of private banks, so as to make them more oriented to public service.
The Great Recession of 2008 demonstrated that financial institutions have become too consolidated, too powerful and too unregulated. No institution should be “too big to fail”. The regulations that provided stability, reliability and confidence in financial institutions in the past must be reconstituted, or provisions that serve much the same purpose, with more rigorous constraints. The deregulation that became the demise of the Savings and Loan Associations needs to return in some form, and other financial transactions must similarly be kept separate from each other. Home mortgages must remain with the original lender and not be sold to another institution, nor combined with other investments to create new securities. Derivatives are too speculative and volatile to continue, and should not be allowed. Perhaps an SEC fee on all trades in securities, based on the size of the transaction, might be one of several tools to bring such abuses to heel. In addition, U.S. corporations have been avoiding or evading payment of their taxes by banking abroad or locating their charters offshore. Their size, power and influence have allowed them to get away with robbing the American people in this manner. This must end, and they must be cut down to size.
The public also needs a powerful voice in regulation. A cabinet level Department of Consumer Protection and Advocacy is needed in order to give consumers the priority that they deserve and to assure strict standards in the marketplace. The Secretary of Consumer P&A must be a person with an impeccable record of consumer advocacy and must not be recruited from a career that would be in conflict with a consumer advocacy mandate. S/he will be charged with responding to consumer concerns, maintaining open communication with consumers, defending against fraud and deception in consumer products and services, and will advocate for consumer interests in all products and services in the US, including, for example, an end to all unsolicited telephone mass marketing calls. The office will review all products and services offered in the U.S., and be staffed and funded in order to meet the requirements of the office.
Finally, it is past time to restore critical and aging infrastructure, including ecosystems, so that the US economy can function with optimal safety and efficiency, as well as preserve and enhance the quality of life everywhere in the US. We must invest in our present and our future.
In forthcoming installments we will look at how environment protection, expansion of free public education, empowerment of labor, a rethinking of immigration policy and curbing of corporate journalism can advance the remaking our society. Then we will address the problem of policing.
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Paul Larudee | Radio Free (2020-07-30T16:30:18+00:00) An Economic Order by and for the People. Retrieved from https://www.radiofree.org/2020/07/30/an-economic-order-by-and-for-the-people/
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