In big business and high finance, the standards for acceptable behavior are surprisingly unrefined
- “Fat cats” vs. “the little guy”
- Rights aren’t commodities
- Circumstantial, and opportunistic
If corporations are people in the strict legal sense they should be held to the same standards for personal integrity and civility we expect of actual people.
We have not yet reached that point that comes in every presidential campaign cycle when one or another candidate is lured into defending the interests of big business: the right of corporations to navigate legal and regulatory standards according to their financial interests; to advocate those interests by “recruiting” legislators and regulators to endorse the business’s causes; and to protect their political interests using free-speech principles. With two or three candidates offering past corporate experience among their credentials, that moment is sure to arrive before long. Anyone who stands beside big business will be accused of opposing “the little guy.”
The critical development four years ago occurred when a candidate tried to articulate the notion that “corporations are people” in the strict Constitutional sense – a point that’s arguably true but impossible to defend once the opponent accused him of taking the side of “fat cats” versus “the little guy.”
I am normally indifferent to swipes against corporations’ Constitutional rights. It’s plain that corporations have legal standing. They have the right to speak and associate freely, etc., and they are liable for taxes, susceptible to legal penalties, just as individuals are.
But, the reason corporations lose public sympathy in such arguments is that all businesses are assumed to be wealthy, and that they use their wealth to take advantage of average individuals. There is nothing reasonable about this assumption, but it’s effective.
Generally, I don’t view rights as limited commodities that can be negated for one party when another invokes them. Besides, rights are not allocated according to merit: we cannot deny them to one side because we feel another side is more deserving of our pity.
Still, if corporations are people in the strict legal sense then they should be held to the same high standards for personal integrity we expect of actual people. That’s because in this strange technological era, entities that are human and/or legally defined, actual or artificial, permanent, temporary, and transitional, are able to function and have effect as if they are human.
For example, the legal entity known as General Electric spent much of this past September arguing for the U.S. Congress to reauthorize the U.S. Export-Import Bank — a federally chartered financial institution that for decades has guaranteed export-credit financing of large capital projects that U.S. businesses undertake offshore. If the foreign buyer should default on its contract, the ExIm Bank would insure the contractor’s investment against loss.
ExIm financing had been a staple of federal budgets for decades, untouched by cost-saving crusaders because it was believed to support job-creation (for “the little guy”) at large manufacturers in defense, aviation, power, and engineering sectors. But, doubts have simmered over ExIm’s necessity in a world of private capital, and the appropriateness of U.S. taxpayers providing cheap financing for private-sector interests. The House of Representatives failed to re-authorize the ExIm Bank on July 1 — and that threw the legal entity that is GE into a very human, and spiteful mood.
Over the course of three weeks, GE issued public statements announcing plans to relocate manufacturing jobs from Maine, New York, Texas, South Carolina, and Wisconsin to locations in Canada, Europe, and China, places where it could get the low-cost financing rates it demanded. Time and again, GE made clear that it was taking its business elsewhere because the U.S. Congress would not provide it with affordable credit. It made it clear that the workers losing employment should blame the U.S. Congress for their injury, because a company like GE could not compete in the global market without financial assistance.
Except, the connection between the overseas job creation and ExIm Bank reauthorization was merely circumstantial – and opportunistic by GE. Some of the offshore projects had been announced last year, in fact.
In a federal budget deal reached in late October, the ExIm Bank was reauthorized, ensuring that GE (and other exporting entities) will again have federal assistance to finance their projects. That changes nothing, according to GE – which will proceed with its offshore investments and job transfers.
Take note: the tantrum that GE pitched in September was merely that: an ugly scene by a big global conglomerate, letting out some frustration, and getting its way. Corporations are just like people, and as with spoiled children or spiteful ex-friends, should be regarded appropriately.