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In the Public Interest
The Distinction Between Corporations and Real People
By Ralph Nader, Washington, DC
In its celebrated cover story eighteen months ago, Business Week magazine asked "Too much corporate power?" and answered yes in several detailed pages. It then delivered an editorial which urged that corporations "get out of politics." Last month, the giant British Petroleum Company (BP), having acquired the American oil companies Amoco and Atlantic Richfield, announced that it would do just that!
Starting April 1, BP's chief executive, Lord John Browne, said that the company would halt all political contributions from corporate funds "anywhere in the world." In his remarkable speech, which was almost unnoticed in the U.S., Lord Browne based his decision on the belief that corporations "must be particularly careful about the political process, not because it is unimportant—quite the reverse—but because the legitimacy of that process is crucial both for society and for us as a company working in that society."
BP gave $1.1 million to the two major parties during the 2000 elections in the U.S., where it receives about half its income. Even though BP executives and employees are still able to contribute to political candidates, the decision taking this oil firm out of the political campaign rat race is quite significant, nonetheless. It allows a framework for providing additional reasons as to why BP did the right thing and stimulates a long ignored distinction between the artificial entities, which are corporations, and real people.
Corporations do not vote. Only real people vote and only real people should be able to participate in elections and campaigns. Our Supreme Court, however, decreed in the 1880s that corporations are "persons" for constitutional purposes, and subsequent court decisions protect these "artificial" persons’ rights to contribute to referenda battles or to candidates indirectly. A 90-year-old federal law prohibits corporations—and, later, unions—from contributing directly to candidates for federal office. At the state level, some states allow companies to contribute directly to candidates.
The idea that real people and giant corporations have equal rights under our Constitution makes a mockery out of the principle of "equal justice under the law." Not being humans, corporations can be in a thousand places at once, anywhere in the world, and can create their own holding companies (parents) for evasive maneuvers. They can lob off responsibilities on far-flung subsidiaries, diffuse or hide behavior that stymies law enforcement and tax collectors, and pay their executives while going into temporary bankruptcy to get rid of most of their creditors' claims, shareholders' equity, and the claims of injured people or those under union contracts for their workers.
Corporations can hold patent ownership on the genetic inheritance of the world, including human genes. Under existing law, they someday could genetically engineer and own humanoids, so long as they were sufficiently subpar in intelligence to avoid the laws against slavery. And they can dissolve (i.e., disappear)—as did the coal mine companies that hollowed out the ground under many homes (which then sank) in Pennsylvania and West Virginia—and have their assets re-emerge in other corporate entities.
Once a public discussion begins on how corporations are treated differently and preferentially under our laws, as compared with real human beings, the examples of these double standards would proliferate into every nook and cranny of our society and demonstrate how they affect, cheat, deprive, harm and control people’s lives.
In that same Business Week issue, the magazine polled the American people. Seventy-two percent of those polled said that corporations have too much control over their lives. If freedom is participation in power, as the ancient Roman orator Cicero defined it so well over 2,000 years ago, it is time for the American people to engage each other in conversations about what to do about such control—both for themselves, their freedom and their democracy.
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