New Civilization News: The Corporation    
 The Corporation6 comments
picture 4 Oct 2005 @ 01:33, by Flemming Funch

I finally saw the movie The Corporation. I mentioned it previously here. It is a documentary about, well, corporations. Very well researched, about the history of the concept of the corporation, and about how (badly) corporations often end up behaving, following quite naturally from their foundation, from what they're defined as. In brief, a corporation is a legal person, but a person with often huge amounts of resources, and no need to answer to the same standards as regular humans. The obligation of the people who run a corporation is to make large and increasing amounts of money for the people who own it. They might be nice enough people on their own, but their job is simply to acquire as large profits as possible. It is quite harmonious with that aim to use child slave labor in foreign countries, or to let foreign armies eliminate protesters who object to the environmental record of their factories. Maybe not right, maybe not moral, but a corporation has no conscience. It luckily has some people running it, who sometimes have a conscience. But in itself it doesn't. So, if we evaluate a typical multi-national corporation as if it were a person, it would fit every criterion for being a psychopath. It can continously get away with all sorts of irresponsible and destructive behavior. Yes, it might get fined, somebody might get fired, somebody might even go to jail, but those are just expenses and minor inconveniences. The corporation itself typically goes on. Unless it somehow fails to make profits.

Another enlightening aspect is the economic concept of externality. It is basically when a business makes a decision that causes costs (or possibly benefits) to be incurred outside that particular organization. You make it somebody else's problem, essentially. For example, a corporation might cause heavy wear and tear on certain public roads, but might let the local city government bear the costs of that. Or it might pollute, and let somebody else worry about that. Or it might let some army clear the way for its oil business, or remove people who were standing in the way of their business. Externalities can be great for a company's bottom line, making great profits, but at high costs elsewhere. So that when we add up the total accounting, it is anything but a beneficial and profitable activity. I.e. it causes much more damange or uses many more resources than what good comes out of it.

It doesn't have to be that way. The movie provided some bright spots, although not all that many. Business leaders might start thinking differently, and some do. Thinking about how to run a sustainable business, where what they do actually is beneficial, also when we count the external influences.

Interestingly I saw the movie in a local business college. One of the professors had persuaded the school to purchase the movie, so she could show it to students. Which obviously would be rather controversial, as that's a place where students are taught to do exactly the kinds of things the movie warns against. But change starts by being conscious of what is going on, of course. And, most likely, corporations will change to the degree that somebody figures out a way for it to be profitable to be sustainable and ethical.

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4 Oct 2005 @ 14:06 by ming : Corporation
The thing is that Corporations rise from some particular laws, maybe seeming innocent at first, but which open the whole can of worms. It could very well be different, if the ground rules were set a little differently. Of course it can be a good thing that groups of people can engage in a venture together, and act in a unified manner. Which was the original form of a corporation. A group of people engaging in a project for the common good, with a very specific target, and disbanding when the project is finished. Like, building a dam or a a bridge.

Or, if a corporation truly were judged as an individual person, everything would be different too. You do something sufficiently illegal, you go to jail, and your operation is shut down. The corporation current escapes that because it usually will just be some individual employees who get held responsible, and they go to jail, and the corporation maybe gets an insignificant fine. It is kind of like if I shoot somebody, and the gun and the bullet get judged and destroyed, and a get a bill for the damage, and then I grab another gun and shoot somebody else. Which is essentially what a sufficiently large corporation can do.

Or, if I as an individual released 50,000 tons of dangerous chemicals into the atmosphere, somebody would lock me away rather quickly. If a corporation truly were treated as one person, it should be the same. It is no excuse that it is a large corporation. If we were playing fair, it should have the footprint of one person, just as it has the legal right of one person.

Corporations get out of a lot of tight spots because they make money. If they make lots of money for some influential people, who flow some of that money to their local community, and into the pockets of politicians, then they buy a get-out-of-jail-free card. In an entirely different way than a real person possibly could. Because they "keep the economic wheels turning". If we take away that blanket cover, it would be very different.

Big corporations can be powerful machines driven forcefully towards particular aims, within particular boundaries. The aims and the boundaries are in principle defined in the laws that allow corporations to exist. If those laws put in stone that a corporation has to be sustainable and beneficial, all corporations would just have to adjust to that. Doesn't really change business as such. Just different pieces to play with.

The thing to change in our minds is that it is in any way acceptable to externalize costs and damage. The accounting needs to add up. The whole accounting. If you cause a trillion dollars worth of damage, billed to somebody else, in order to make a hundred billion dollars for yourself - that's very bad economy. The only reason everybody doesn't look at it that way is that the external costs are accounted for badly. Or they're accounted for as the costs of removing/stealing something, as opposed to the replacement costs. Or as the likely fines for damage caused, as opposed to the actual costs of fixing it.

All of it can change, if enough people want it to, of course. Laws can change. And corporations are in the hands of their customers, whatever it might seem. If some corporations play by more sustainable and beneficial rules, and we know that, we're free to buy their products, and ignore the products from criminal corporations that have ripped off the value from the commons in the first place. They can only go on for so long without customers.  

4 Oct 2005 @ 14:21 by ming : Free market
Siawash, what I mostly have against capitalism is that it generally isn't a free market. What I would want would be a free market where people can make their own choices, economic or otherwise, without corporations or governments creating monopolies that enforce certain choices, just because they make a few people a lot of money. Corporations running the show, in collusion with governments, is basically the definition of fascism. Which isn't much different from communism, other than in who calls the shots. It is a top-down thing, the few controlling the many. I'd rather see a free and democratic society, with a free market. I'll drop by your blog and see what is going on.  

4 Oct 2005 @ 15:29 by ming : Double-speak
Part of the problem is that words are used to say roughly the opposite of what they mean. Freedom, liberalization. The freedom we're talking about in trade liberalization and free movement of capital is the freedom of multi-national corporations, to not have to pay much attention to governments or to what people actually want in any particular area. It is the freedom to maximize profits across the borders and boundaries that otherwise separate people. And the freedom to force populations to go along with it, no matter what their local customs or laws are.  

4 Oct 2005 @ 15:36 by ming : Information
Siavash, yes, I think what is the bright spot is the potential for the availablity of information. If we're informed and aware enough, things will change. Because, no matter how much power any particular organization has, it still all flows from the individual choices we make, and the collective effect of those individual choices. And most people aren't dumb or mean. If they have good information, if they're aware of what is going on, they will choose accordingly. And that's the basic of a free economy and a free society. Many people making many informed decisions.

That's where I have the highest degree of hope. Our ability to access information is increasing rapidly. There's a bit too much of it, but it is very likely that tools appear along the way that will allow us to better understand what we're looking at. It is not possible to keep us in the dark forever.

And, yes, the power to change what a corporation is, and what its boundaries are, is still with the governments. They can change the laws, and even the most powerful corporations have to go along. OK, unfortunately, most governments have submitted themselves to some trade agreements that limit their ability to regulate corporations, but there's for sure still ways.

And, again, governments will have to go along, if enough people start thinking differently about things, and they demand changes.  

6 Oct 2005 @ 20:31 by Hanae @ : Don't Be Evil
" matter how much power any particular organization has, it still all flows from the individual choices we make, and the collective effect of those individual choices we make, and the collective effect of those individual choices. And most people aren't dumb or mean."
---4 Oct 2005 @ 15:36 by ming : Information

True, people aren't dumb or mean - no one in their right mind would condone what they perceive as truly "evil." [i.e. That which is regarded as morally bad, intrinsically corrupt, wantonly destructive, inhumane, or wicked. In most cultures, the word is used to describe acts, thoughts, and ideas which are thought to (either directly or causally) bring about withering and death —the opposite of life ]

No, "evil" is a slow seduction. It's a gradual slipping, blindness, turning away, and following the path of least resistance. It's a morning-after "how did we (I, corporations, our world, the planet, etc...) get this way?" not a gleeful, villainous "bwah-ha-ha!"

(How did Hitler's Germany got the way it got?)

"Our ability to access information is increasing rapidly. There's a bit too much of it, but it is very likely that tools appear along the way that will allow us to better understand what we're looking at."
---4 Oct 2005 @ 15:36 by ming : Information

To that regards, "Don't Be Evil" just so happens to be the informal corporate {link:'t_Be_Evil|motto for Google}:

"There has been significant criticism of companies that promote their corporate social responsibility, since many economists and business leaders believe that a corporation's first duty is to maximize shareholder value. This point of view holds that corporate social responsibility is either cynical and empty self-promotion (if the company's social responsibility claims are false), or detrimental to shareholder value (if the claims are true). Google claims a third position, that a ‘Don't Be Evil’ culture is a prerequisite to building shareholder value in the long term for a company that requires public trust to achieve its mission."

Apparently, every Google engineer is encouraged to spend 20 percent (20%) of their work time on projects that interest them. Sometimes one of these ends up as Google services.

"Our ability to access information is increasing rapidly."
---4 Oct 2005 @ 15:36 by ming : Information

Still, I find it significant that some of the most innovative and wide and far reaching progresses in this area, in so far as the internet is concerned, have essentially been the result of the centralized, and sometimes very private and confidential, activity of, yet once again, a multinational corporation, like Google, rather than the manifestation of something more open and less centralized, like the collaborative efforts of, say, some kind of world wide web grass root intelligence.  

1 May 2016 @ 22:47 by Buffy @ : zqKpVduugvJojfNuQsxD
There are certainly a whole lot of particulars like that to take into consaderition. That could be a great level to convey up. I provide the thoughts above as normal inspiration but clearly there are questions like the one you bring up where crucial thing shall be working in honest good faith. I don?t know if finest practices have emerged round issues like that, but I am certain that your job is clearly recognized as a good game. Both boys and girls feel the affect of just a second’s pleasure, for the remainder of their lives.  

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