In recent years, terms such as globalization, integration, regionalisation, cosmopolitanism, “global village”, supranational etc. are being used very often in everyday language by both scientific intellectuals/scholars and “ordinary” citizens. These terms are simply describing today’s societal, economic and cultural environment in which we live in. The most interesting and the most popular one is the first one mentioned: globalization. In very general and simple words, globalization could be defined as a process through which constraints on flows of commodities, capital, services, people and ideas are being repealed. The result is high level of interdependence in many aspects (most important one is economic aspect). As every other process, from its beginnings, globalization also had/has its starting point and actors. Many would agree that Transnational Corporations (TNCs), especially those American, were, and still are the main “holder” of globalization process. Also, many would agree that the USA is globalization’s point of emergence. TNCs are defined as economic entities/enterprises whose management, capital, wealth and in some cases ownership aren’t entirely situated in one national state (company’s mother land), nor they are transnational, meaning spread out across the globe. For historical description of their character and actions, I will use the term “corporations”.
Corporations have long history, reaching out to 16th and 17th century. “Early” corporations were very different than today’s ones. Back in the day, corporations were mostly (even strictly) economic entities based on the idea of using private financing for public goods purposes, what had been permitted by the state. Today, besides their huge economic impact on global system (regarding share of trade, global market cover, profits, bonuses etc.) they have enormous political role and influence as well. Triggering event that enabled corporations to increase their political influence and involvement happened in the USA in 19th century (specifically, in 1866), when they were granted the same rights as people, in the context of abolitionism and US Constitution (14th Amendment). As Richard Robbins is stating in his Global Problems and the Culture of Capitalism, the Supreme Court of the USA, relying on the mentioned 14th Amendment, ruled that corporations are to become natural persons under the US Constitution. What were/are consequences of that decision? Best answer to that question may be found in Thom Hartmann’s book Unequal Protection: the Rise of Corporate Dominance and the Theft of Human Rights. Hartmann describes “visage” of corporations before 1886 (when only humans had human rights) and after 1886 (when corporations were granted human rights) through several categories, some of which are: politics, business, regulation, war. Regarding politics, before 1886 giving money to political parties or trying to influence the elections were seen as felony, but after 1886 corporations claimed the right of free speech extended to unlimited right to put money into politics. In business field, before 1886 there were laws in states and local communities which were protecting local businesses and entrepreneurs and keeping out companies that were convicted of crimes. After 1886 those kind of laws were abolished, mainly because corporations thought that they were “discriminatory” (this statement could be seen as a sort of manipulation with 14th Amendment which was originally passed to free slaves) to them. Due to the fact they were “extinct”, the law could not protect local businesses from predatory corporations any more. The concept of regulation, which has been interesting since the dawn of economic activity, was also changed. According to Hartmann, before 1886 corporations had to submit to the scrutiny of elected government, but after 1886 corporations claimed the 4th Amendment human right to privacy to keep out state’s inspection agencies (safety, environmental, health…). This may be the beginning of non-transparent and “shadow” corporate activity. Regarding delicate sphere of war (context of the Second World War), prior to WWII there were not permanent military manufacturing companies of relevant size, but as a consequence of WWII military manufactures grew in size and permanent arms production was introduced. Former US president, Dwight Eisenhower, named the whole post WWII military development “the military/industrial complex, and also warned the public about its potential danger. Today, the most important role of mentioned complex and/or its remnants is lobbying in US government and Congress, one of the action that reveals corporations’ power in politics.
Over the decades, corporations had established themselves in politics, especially the American one. Corporations are also known by term “big business”, and where is the big business, there are big interests and there is a big leverage. In the USA, corporations are “winner” side of leverage with politics. How? First, (already mentioned) their lobby power in USA’s political institutions, mainly Congress, is enormous (approximately four lobbyists per one Congressman). Second, their donations through “super PAC(t)s” mechanism in presidential (and other) political campaign basically run the elections and often its result. The issue here are not donations, the issue is lack of donation’s transparency regarding donors, amount of donations and most importantly, the interest (leverage) that are behind them. These may be undermining factors for American democracy. The whole system is literally run by money, not by the Americans. Repercussions of that is the creation of “governance in shadow” or “behind the scene governance” in which big business pulls all the strings.
To conclude this brief review of corporations’ history and their relevance/dominance in today’s modern world I would like to drive your attention to a paradox of American politics (similar can be applied to some other countries as well) which is derived from historic/current facts and are being “tragicomic”. Legendary US president, Abraham Lincoln, on 21st of November in 1864 said: “Corporations have been enthroned and an era of corruption in high places will follow.” First of all, Lincoln’s statement is pretty much correct. But what is paradoxical about it? If you are seeing a bigger picture, you will find the paradox: Lincoln, according to this quote, not a big fan of corporations, “technically” enabled them to become powerful in both politics and economy because his politics and ides were inspiration to abolitionism and giving human rights to (former) slaves, but on the other hand, corporations “used” abolitionism for claiming their rights and status as natural persons. From one prospective (Lincoln’s vision), American society became liberal and democratic, but today, political environment is giving corporations opportunity to “run” the global system. All this is the proof that power is the most superior concept in politics. To answer the question from the topic of this article: although corporations are natural persons, I think more correct answer would be: “corporations rule over humans in a very cunning and secret way.”
Image Source: Bill Plympton