Let Corporations Be (Just) Corporations

Politics has gotten so expensive. It takes a lot of money just to get beat!
--Will Rogers

When Arkansas Governor Bill Clinton implausibly claimed during his 1992 presidential quest that he'd tried marijuana but never inhaled, Johnny Carson quipped that Jerry Brown, Clinton's quirky rival, appeared never to have exhaled. Clinton, of course, went on to win the presidency that year thanks in no small part to the largesse of corporations like Tyson Foods, Archer Daniels Midland and investment banks like Goldman Sachs.

Today Brown -- still without significant personal wealth or corporate backing -- seeks the Democratic nomination for the California governorship. If he gets the nod, his Republican rival may well be billionaire and former eBay chief Meg Whitman, who's already out there mining the trope that skill in helming a business qualifies you run a government. So what if she's never contested an elected office before and didn't even vote until she was 46? Before eBay, she worked at Hasbro, where she played a key role in the success of Mr. Potato Head, and perhaps voters will feel this gives her an edge in understanding California's child-like state legislature.

It might take someone who's inhaled and exhaled a few too many times to truly believe that running an online auction company qualifies one to manage a state with the world's sixth-largest economy and a plethora of crises that go way beyond business and finance. But Whitman has pursued her party's nomination by acting just like a CEO, vowing to fire 40,000 Californians and pledging to spend as much of her own money as necessary toward a $150 million campaign war chest.

Then there's Carly Fiorina. She wants to represent the Republicans in their sexennial bid to replace U.S. Senator Barbara Boxer. Fiorina's campaign slogan: "Carlyfornia Dreamin'!!!" One hopes John Phillips' estate will have the same reaction as Bruce Springsteen and James Taylor did when they refused to let Ronald Reagan and John McCain co-opt their songs in previous elections. (If Carly needs to regroup, she could always petition Showtime to let her use "Carlyfornication.")

Fiorina -- who also has rarely voted; what is it with these people? -- previously ran Silicon Valley giant Hewlett Packard. When an unhappy board of directors forced her out in 2005, she collected in excess of $20 million. John McCain tapped her as his chief economic spokesperson in last year's presidential race until she told the inconvenient truth that neither McCain nor his running mate Sarah Palin was qualified to run a major American corporation. But she, who presided -- with questionable skill -- over a tech company is fit to be a United States Senator? That, as they say in Silicon Valley, does not compute.

Corporations are dictatorships, with everyone ultimately reporting to the CEO. Governments are vast cooperative bodies with legislatures, courts and other institutions without which chief executives can't get much done. Corporations exist primarily, if not solely, to enrich shareholders. Even most conservatives don't argue that government's primary purpose is to make money.

The conceit that "business" equals "sensible," "rigorous," and "lean" does not, to put it kindly, comport with the evidence. Do we really want our government run by the financial wizards and corporate honchos who brought us the current economic meltdown, laughing all the way to their own banks while taking obscene risks with their shareholders' money and their workers' future?

Of course, big money dominates both Democrats and Republicans, while making it next to impossible for third party candidates to gain traction. And this won't change until elections are, at least to some degree, publicly funded.

We can trace the need for reform back to 1886, when the Supreme Court granted corporations the same rights as living persons under the Fourteenth Amendment to the Constitution. Now the Roberts Court is poised to expand on the incredible idea of "personhood" for corporations, giving them more "rights" than ever to influence campaigns. http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2009/09/05/MN7K19INC8.DTL

National campaign finance reform isn't even on the radar these days. But Californians next year will have the opportunity to vote for CFEA (California Fair Elections Act), which provides a test of a public financing option to even the playing field for candidates without the resources of a Whitman or a Fiorina.

This bill won't pass unless activists can raise enough money to wage an effective grass roots campaign. To learn more and get involved, check out this link. http://www.huffingtonpost.com/wendy-block/fixed_b_270123.html

Let's get corporations to stop acting like governments or persons and go back to being just corporations. Then maybe we can all exhale.

Follow Michael Sigman on Twitter: www.twitter.com/majorsongs

Comments

[ignrnthllblly]

Just in the interests of accuracy: unless her contributions came from the womb, I can personally assure you that Meg Whitman played a 0% role in the success of Mr. Potato Head, as I was enthralled with mine before she was born.

[Michael Sigman - Huffpost Blogger]

You're right, of course, that Mr. Potato Head was around long before Ms. Whitman got into the game. But -- credit where credit's due -- she did oversee the increased success of that famous spud while she worked at Hasbro.

[3fingerbrown]

I come in daily close contact with the CEO of the company I work for, and it's far from a dictatorship.

He has a free hand where the day-to-day operations of the staff are concerned, but when it comes to the expensive "big picture" decisions, he must answer to a board of directors. He must know who his supporters on the board are, and who his detractors are--and that equation changes from issue to issue. He often must scale back or amend his proposals to get board support, he must submit the company's annual budget for board scrutiny and approval, he must know at all times where the board votes are, and how to cajole, flatter, horse trade, or play one director against another to get them. And if he's doing a truly lousy job or somehow embarrasses the company, the board can vote him out or force him to resign.

In short, his situation is very much a miniature version of how a mayor or governor must work with a city or state legislature. It seems to me excellent training for someone who wants to be a chief executive of a city or state--at least, better than being a lawyer or doctor or washed-up actor.

Of course, if the CEO is also the principal stockholder or owns the company outright, that's different.

[Michael Sigman - Huffpost Blogger]

There are definitely some cases like the one you describe, but the vast majority of corporations are controlled by CEOs, either because they own a majority of shares or because their boards of directors are in their pockets. They may be more or less benevolent dictatorships, but they are dictatorships nonetheless.

[CarolLee]

You're spot on regarding boards of directors being in the pockets of CEOs. Being a director is often a cushy job with a sizable income for not doing a whole lot. Directors don't want to rock the boat so that they don't lose the gig. Not only that, director candidates are often chosen in large part based on whether their ideologies align with the CEO's. Someone who would be likely to give the CEO a lot of pushback most likely would never end up on the short list of director candidates.

The corporation that I work for pays each of their directors $60,000 per year to attend six meetings. $10,000 for each day worked. Not only that, when a director retires from the board, the corporation pays them $25,000 per year for 20 years. All totaled, this is no chump change (in exchange for a disproportionately small amount of work) and so boards often become nothing more than a group of yes men.

When our CEO decided to uproot the company headquarters and move across the country (coincidentally, to his home state), our board just went right along with it, even though there was no valid reason for the company to move.

[Unrelated side note to Michael: I enjoyed Part II of your article about your dad -- my comments there were belated.]

[Write4U]

I beg to differ.
First: all that you said about the inner workings of a company is true . I have worked for a large company and our CEO was a prince. And as long as he showed increased profits, the board was very happy. The employees even got "bonuses" on occasion.
But, we are not discussing the way an company operates from within or even in competition with another company. That is Free Enterprise.
What we are discussing the fact that companies are meddling in politics and as a company never does anything without considering profit (to keep the investors happy) it must be assumed that there is financial gain in this endeavor. As I mentioned before, any individual is free to support his/her favorite politician, but if this is done by a company with enormous sums of money from corporate funds, then it begins to smell like bribery.
Reminder: the CEO of Enron was well liked. The CEOs of the Banks, Lenders, Insurance companies that had to be bailed out by the taxpayers are all very nice people. But when it comes to Corporations, who have no soul, no conscience, no religion, the only motive is Profit.

[Write4U]

The Supreme Court held that Corporations are the same as persons and are therefore protected by the Second Amendment, particularly as it relates to donating funds to politicians and lobbying.
I have scoured every dictionary and the only definition I can see is that "money is a means of exchange" i.e. value given for value received or "quid pro quo". This is fine in commerce and we hope that each party is satisfied with such an exchange.
However, when it comes to "quid pro quo" with politicians, this presents a whole new picture. I thought that even the "appearance of impropriety" is sufficient to disqualify a politician from voting on a specific issue. What happened to that notion? Corporations giving money to a politician and then have that politician vote favorably to issues invoving the donor corporation, should be prohibited.
Moreover, if a corporation is a "person" under the law, can this corporation vote?? Me thinks NOT.
Corporations should be prohibited from donating to any and all political campaigns. If a CEO or a Board of Directors support a candidate, each can make personal donations, up to the limit.
This vulgar exchange of money for "favors" does not belong in a Democracy. That is the way of Dictatorships. We have seen the results of the current system and it ain't pretty.

[seanparnell]

You clearly don't know what you're talking about.

Corporations cannot donate to federal candidates under current law, and the Supreme Court case in question would not change that. And obviously corporations cannot and do not vote. And I don't think anybody has ever offered the "appearance of impropriety" as a reason to force elected officials to not vote on certain issues. Perhaps you're thinking of judges.

And prohibiting votes on issues affecting donors - really? So if someone gets a contribution from a trial lawyer and then votes against tort reform, that's all the evidence you need to show corruption? It isn't possible that the elected official really believes tort reform isn't such a swell idea, and the trial lawyer contributed to the official's campaign because of that?

Or do you just think it should be illegal for people you disagree with to receive contributions from people you disagree with, but if they're on your side it's all OK?

Sean Parnell
President
Center for Competitive Politics
http://www.campaignfreedom.org

[Write4U]

Corporations cannot give to individual candidates, but must go through a "middle-man".
Oh, of course, these donations are anonymous and no one knows that a corporation has just given 200,000.00 to a PAC. Tell me another story, please. I wonder if Corporate donations to PACs are tax deductible as "expense", just like any person can.
I did say that individual corporate officers could give to a campaign, up to the legal limit. In that respect the system is fair, as it gives no "weight" to any individual donation.
So your argument is moot.
But where do all those millions of dollars that end up in the "coffers" come from?
All these reports of political parties, congress persons and senators receiving hundreds of thousands of dollars from corporations are all untrue? I have never had an extra million laying around to contribute to my "party", because I like their general philosophy of Capitalism. And there's the rub!
I know that Corporations do not vote, but doesn't it say somewhere that all "persons" (criminals excepted) are entitled to register and vote? You are telling me that a corporation is a person protected by the second amendment, yet this person cannot vote? I didn't know that the Law could be so flexible. If a corporation (person) was born in the US, would that not make it a citizen?


Read more at: http://www.huffingtonpost.com/michael-sigman/let-corporations-be-just_b_301240.html?show_comment_id=31885510#comment_31885510

[Write4U]

A last observation.

The Superior Court has held that:
A company is a piece of paper (articles of Incorporation), but has same standing as a Person.
A dollar is a piece of paper (means of exchange), but has same standing as Free Speech.

Thus a company giving money to a campaign is the same as a person exercising free speech.

Where did Websters go wrong, and why have they not yet corrected these definitions as part of our knowledge of Language? Could it be that these tortured interpretations have no linguistic merit?
And if there is no linguistic merit, then how could this become Law?

[TJCole]

We must end the perversion of Corporate "Personhood" it is at the core of our system being more and more corrupted everyday...

It is why their bribe money is considered their "free speech..", we have a system of legalized bribery..!

Once these corrupt corporations of ours got between the people and their representatives our system was doomed as we see every day it getting worse and worse and further and further from what our Founders intended..!

We are no longer a democracy but a bribeocracy...a corporate and bankers corrupt cabal masquerading as a nation..

[SimJack]

Indeed, the right, those with ultra high net worth and the ubercorps are attempting to wage nothing less than economic genocide on the rest of the population.

[blood1]

A link to the actual CA bill would be appreciated...as many times these bills have names similar to what you reference, like CLEAN VOTE, which in fact is a way to "de-register" voters at the polls.

I agree that the cost is exorbinant, but at the national level, legislators will never vote against their own piggy bank. As a recent article in ProPublica noted, these guys receive insane amounts of money that they use for other things besides re-election...and they are not going to kick their cash cow to the curb...Only at the national level, can legislators have access to cash that let them act and spend like a millionaire, but report their "actual" finances that make them look like paupers.

It is a ridiculous sham that they don't want the public to know about...and I lost may magic wand that will resolve this inconvenient truth about national government legislators are bought and paid for like prostitutes for their pimps (special interests - big business enterprised)!

Sad but true!

[AJH]

It's a test measure that use's fee's on lobbyists to provide campaign funds to candidates meeting specific thresholds of support. It's actually a pilot project applying only to the election of the sec of state.

Chaptered copy of the bill is here; It's from the previous legislative session so a current session bill search won't pull it up.
http://www.leginfo.ca.gov/pub/07-08/bill/asm/ab_0551-0600/ab_583_bill_20080930_chaptered.pdf

My initial read is I don't like the measure as it creates a huge advaantage for big party candidates who can start-up fund their campaign with seed money from the party whereas an independent would be much more limited. It's really a reinforce the two party system while giving an advantage to union supported candidates measure. Have to get 7500 $5 dollar donations for example. Easy for a dem power base union supported candidate much harder for a republican power base, probably impossible for an independent having no party financial support to use to get the contributions and also needing to meet a high support total just to get on the ballot as you don't have a primary. Gonna take some careful reading in that regard to figure out.

Still a state is very limited in what it can do not owning the airwaves. I'ld prefer a federal campaign law requiring users of federal airwaves to grant time for campaigning.

[seanparnell]

Bingo.

This taxpayer-funded campaign scheme is perfect for those who have high name recognition and the backing of well-organized interest groups or their party. For everyone else - no, your "average" citizen isn't going to be able to qualify. Same goes for the federal bill that would give millions to candidates for Congress, see here: http://www.campaignfreedom.org/research/detail/fairly-flawed-analysis-of-the-2009-fair-elections-now-act

As for the airtime rules you suggest - who decides who gets airtime? Can you imagine having to provide free air time in Los Angeles to every state rep candidate in the area, plus every member of Congress? It would be wall-to-wall, all campaign ads all the time, meaning no time for actual programming - or most candidates get their ads aired at the 2am time slot.

Running a campaign is expensive because it costs a lot of money to communicate a message to voters. Dishing out millions in taxpayer dollars doesn't change that, nor does giving everybody who qualifies free air time (and who decides who qualifies?).

Sean Parnell
President
Center for Competitive Politics
http://www.campaignfreedom.org