THE BLOG
05/07/2014 03:41 pm ET | Updated Jul 07, 2014

The Painful Powell Memo

The late U.S. Supreme Court Justice Lewis Powell was a friend of my dad. That made it all the more painful to read the justice's infamous 1971 memo counseling corporate America to challenge the constraints of environmental regulation.

This memo, directed to the U.S. Chamber of Commerce, is reputed to be the inspiration for creation of today's major conservative think tanks. And sure enough, these conservative think tanks have dutifully followed Powell's admonition to carry the water for corporate interests in environmental controversies.

Powell wrote the memo months before actually taking a seat on the Supreme Court where not surprisingly, he was usually receptive to corporate arguments. Anti-regulatory language in the memo is also eerily similar to the negative environmental rhetoric emanating from contemporary Republican lawmakers.

An apprehensive Powell warned that regulation of the business community threatened economic prosperity and individual freedom. He added that rule-making was being used by liberals to turn the United States into a socialist nation, or worse.

Ralph Nader early in his career was unquestionably a pioneer in blowing the whistle on corporate malfeasance, and his aggressiveness alarmed Powell. In his memo, the justice complained about Nader's accusation that a great many corporate executives belonged in prison for defrauding consumers with shoddy products, poisoning food supply with chemical additives, and willfully manipulating unsafe products that kill and maim.

How critical would Powell be today in light of the conduct of such corporate giants as the tobacco industry and General Motors? Would Powell stand fast when all the corporate abuses that Nader exposed more than 40 years ago continue to crop up with unsettling frequency?

One can be dismissive of Powell's concern and overly protective stance regarding the business community. After all, it is doing just fine, as the record high stock market attests.

Powell's memo, however, does raise a fundamental question: Can corporations make a decent profit and still operate in an environmentally sustainable fashion with public health and safety elevated to paramount importance?

The answer is "yes," provided reliance is placed on regulation and not volunteerism to assure there is no corporate overreach. Business executives' first priority is turning a handsome profit. Their salary is not contingent on what happens to public health and environmental quality. A regulatory framework is necessary to curb the excesses that would be bound to occur in its absence. Greed is a powerful instinctive drive. If it is left unchecked by the law of the land, people can end up doing bad things.

Powell warned that strict regulation of the business world would curtail individual freedom. But were free enterprise to be given essentially free rein, individual choice would actually narrow. That is because the diminished public health and environmental quality resulting from the invariable corporate abuse shrinks individuals' lifestyle options.

Since the capitalism that Powell lauded in his memo requires robust economic growth, doesn't the constant challenge to increase productivity invite unsustainable resource exploitation? Not if the economic growth is based on quality rather than quantity, materials are reused or recycled whenever possible, and renewable resources are utilized at a rate that assures uninterrupted regeneration.