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COMMENTS ON CORPORATIONS & LABOR
By George Draffan

The Public Information Network provides information and research support to citizens and public interest groups working on economic, environmental, and human rights issues. All of these issues usually involve some element of corporate activity or corporate power. Because of this, itís helpful to review some history, to understand how corporations have come to dominate economic and political life.

William Faulkner said history isn't dead; itís not even past. And this is one of the values of history -- to realize that what we are going through is not new -- that the names and faces have changed a little, but that people in the past have had the same problems, and that they struggle, just as we do, with corporate and government corruption and indifference.

THE PRIVATIZATION OF THE COMMONS
AND THE INDUSTRIALIZATION OF THE PEOPLE

Two of the most profound changes in the recent past -- say, the last 400 years -- have been the privatization of the commons and the industrial revolution.

One example of privatization is the enclosure of the commons in Britain. Beginning about 1600, the British "enclosure" period redefined land as property, made land a transferable commodity, evicted the commoners from the ancient commons --turning people into landless laborers which were also a commodity, in the process creating a dispossessed proletariat and bands of beggars, and transferring political power from the commonwealth to a wealthy elite. In the 1649-1660 revolution the landowners came to power and passed 4,000 Private Acts of Enclosure on seven million acres. In 1845 a General Enclosure Act was passed which privatized another seven million acres.

We often feel as though we live in a New World, that the division of society into nobles and commoners, and landlords and peasants, is an ancient, or at least a European, phenomena. But a very similar process of privatization has gone on in the New World. When Europeans arrived, America was a commons. The land was seized from its inhabitants, human and non-human alike, by sword and disease and sheer numbers. Many of the American colonies themselves were set up as corporations, with the land, and the political power to control it, granted by the Crown to favored companies in return for a share of the fruits of that land. As many as two-thirds of the colonists in early America were indentured servants. Later, in the 19th century, the settlement and preemption and homestead laws were passed, supposedly for the opening of the public lands to the public -- to small landowners. But under these public lands laws, most of the land passed to corporations: timber and mining and railroad and real estate speculators -- until today, most Americans own at best the land upon which their house sits, and most people are heavily in debt for that.

Alongside this process of the loss of the commons was the industrial revolution. Without land, and with the development of economic activities which required expensive and complicated technology, most people became employees. What are the implications of a nation of employees, of a world of employees? What are the effects on individual freedom, on the local marketplace, on the environment, on community autonomy, on political decision-making, on civil rights?

CORPORATE PERSONHOOD MEANS LIMITED LIABILITY

As economic and social life changes, so must political and legal structures. With billion-dollar accumulations of capital, and with dangerous technology killing workers and citizens, the limited liability corporation becomes an absolute necessity:

In the 1880s, with more than 200,000 railroad construction workers, more than 2,000 railroad workers were being killed, and 30,000 injured, every year. Were these the bad old days of primitive technology and callous industry?

In 1990, 46,000 people were killed in auto accidents.

And today, 100,000 people die every year from toxins and other workplace hazards, and 5.5 million people are injured, and 3.3 million people are hospitalized, and 390,000 people contract new cases of occupational disease. Workplace carcinogens are estimated to cause between 23 and 38 percent of all cancer deaths each year.

Consumers pay the price, too: 28,000 people die and 130,000 people are seriously injured each year by using dangerous products.

Who would, who could, take responsibility for that?! But it takes some acrobatic leaps of logic, and it takes a stunning denial of ethics, to construct a society built upon the institutional foundation of the limited liability corporation.

In 1882, in the San Mateo County v. Southern Pacific Railroad "Railroad Tax Case", U.S. Ninth Circuit Court Judge Lorenzo Sawyer declared corporations to be like people -- they shall not be deprived of their property without due process of law. That may sound reasonable to you.

But try this one: In 1886 the U.S. Supreme Court went further, declaring that corporations were actual, natural persons protected under the due process clause of the 14th Amendment of the Constitution, which was passed to guarantee the rights of the emancipated slaves. Sixty years later, Justice William O. Douglas stated that "there was no history, logic or reason given to support that view [that corporations are persons]." Yet it is today the conventional wisdom: we call corporations "they" and recognize their rights.

What did these corporate "personhood" decisions mean? Among other things, it meant that communities no longer had the legal authority to determine what could happen within their jurisdictions.

In 1886, the U.S. Supreme Court struck down the state "Granger" laws regulating the rates railroads could charge farmers, by ruling that interstate commerce could only be regulated by the federal government. In that year alone, the Court struck down 230 state laws passed to regulate corporations.

CORPORATE PERSONHOOD MEANS THAT CIVIL
LIBERTIES ARE EXTENDED TO CORPORATIONS:

"... of the Fourteenth Amendment cases brought before the Supreme Court between 1890 and 1910, nineteen dealt with the Negro, 288 dealt with corporations."

Corporate rights have been carried to the point where there are no limits; corporations have come to be "super-persons" with more rights than real people:

Advertising becomes "free speech" protected under the 1st Amendment. Actually, itís more than free -- itís tax-deductible, just like corporate lobbying expenses, and toxic waste clean-up, and lawyersí fees for criminal trials.

In 1879, federal courts "limit[ed] the federal power of control over the railroad land grants while also severely restricting state remedies against the ultra vires acts of corporations" -- in other words, the corporate actions that go beyond the powers actually granted to corporations by the states, by the sovereign people. This Orton decision was another case involving the Southern Pacific Railroad and Ninth Circuit Court Judge Lorenzo Sawyer, a railroad shareholding judge. The Orton ruling led to the violent eviction of settlers from railroad grant land; in the Mussel Slough battle near Visalia, California, in May 1880, five settlers and two railroad agents were killed.

Society was not blind to the growing size and power of corporations, or to the dangers posed by the domination of economic and political life. In 1890 and 1914 the Sherman and Clayton anti-trust acts were passed, supposedly to outlaw monopoly in the marketplace.

WHAT DOES ANTI-TRUST LAW MEAN FOR CORPORATIONS?

In 1895 the Supreme Court upheld a monopoly of 98 percent of the countryís sugar production on the grounds that the Sherman Act applied only to commerce, and not to production.

In 1920 the Court found U.S. Steel to be a legal ("good") monopoly as defined by the "rule of reason" it concocted in earlier decisions involving the tobacco industry and Standard Oil.

In 1922 agricultural seller cooperatives were exempted from anti-trust laws.

In 1948 the Reed-Bulwinkle Act legalized price-fixing by rail, water, or motor carrier "rate bureaus."

In 1953, the Supreme Court declared that baseball was exempt from anti-trust laws.

In 1966 the Bank Merger Act allowed anti-competitive mergers among banks if they are "outweighed by the convenience and needs of the community to be served."

In 1969 the Newspaper Preservation Act exempted newspapers from anti-trust law. With the media monopoly, we now have felonious corporations like General Electric owning television stations, in clear violation of the spirit and letter of FCC law.

So anti-trust law hasnít done much to control or even discourage monopoly.

What does anti-trust mean for workers?

In 1895 the Supreme Court said the Sherman Antitrust Act could be used against interstate labor strikes (in this case, a national railway strike in 1894) because strikes were a restraint of trade.

In the 1910s, anti-trust laws (which were enacted to control corporate monopolies) were used to control workers who tried to protect themselves from monopolies. Thousands of union organizers and foreigners were arrested as "criminal syndicalists." Hundreds were deported or sent to prison. In 1918, after simultaneous raids on 48 of their union halls, the government crushed the Industrial Workers of the World. The five-month trial of 101 Wobblies produced a 44,000 page transcript, but no evidence of the sabotage they were charged with -- yet the Wobblies got prison sentences of up to 20 years, and their fines totaled $2.5 million. In 1919-1920, U.S. Attorney General A. Mitchell Palmer, using the Deportation Act of 1918, again raided activists and foreigners. Ten thousand people were arrested in 70 cities. Eventually nearly three quarters of the 1,500 deportation orders were canceled by the Dept. of Labor. Even Palmerís assistant, J. Edgar Hoover, agreed that the raids were unconstitutional.

To underscore the fact that these laws werenít being used to protect the public from bomb-throwing foreign anarchists, remember that in 1918 the Supreme Court also struck down the Keating-Owen Child Labor Law that had just been passed, which prohibited interstate commerce of goods produced with child labor, again on the grounds that the anti-trust law applied only to commerce, to the transportation of goods, and not to production.

And to underscore the reality that repression and misuse of the law is still with us, think about the ethics and the effectiveness of suing labor organizers under the RICO racketeering laws.

CORPORATE DOMINANCE TODAY

Corporate dominance reveals itself in a global economy where local markets and local products have disappeared, where you no longer know the origins and true costs of the products you consume, where feedback from consumer and worker and citizen is increasingly slow and abstract, when it exists at all

Corporate dominance reveals itself when "free trade" agreements (passed despite protests by citizens and labor in all the countries involved) pit workers against each other, and undermine community and even national standards of health and safety.

Corporate dominance creates a justifiably and rapidly growing insecurity around wages and retirement. In the past a reasonably intelligent and healthy person could move to a new city, pick up an entry-level job, get an apartment or even a house, and make a decent living. You can't do that now. The minimum wage is lower than itís ever been in real terms, and millions of reasonably intelligent and healthy people have become homeless -- the modern worldís "roving bands of beggars."

Corporate dominance is supported by government indifference, and acquiescence, and participation in budget politics, in corporate welfare subsidies, and in anti-union activities.

RESEARCH, EDUCATION AND ACTION

Itís a sad story, often met with cynicism and other forms of paralysis. Yet 95 percent of Americans still believe that U.S. corporations should have more than one purpose. A poll of few months ago showed that everyone still believes corporations owe something to their workers and to the communities in which they operate, and that corporations should sometimes sacrifice some profit for the sake of making things better for their workers and communities. How can we, as citizen and labor activists, contribute to the movement to make this happen? I think it involves a creative combination of research, education, and action.

Research includes piercing the corporate veil. Much of the information we need to expose and challenge corporate power is public information: who are the shareholders? Do they include our own pension funds? Do they include public institutions that are susceptible to pressure? What are a corporationís subsidiaries? Is the corporation hiding behind a shell game of spin-offs and bankruptcies? What is a corporationís record on the environment and on worker health and safety? This information is often hidden from public view, but there are many ways to obtain and distribute it. We need to learn what those are, so that we can educate ourselves and others.

Education includes giving ourselves a broad perspective of the legal and political changes we as a people have gone through, and in recognizing our own inalienable economic and political rights. Education of ourselves and of the general public requires that we become aware of the mechanisms of corporate power: subsidies in the form of taxes, and wage concessions, and impacts to workersí and citizenís health, and government collusion, and revolving doors.

And action, which is the purpose of research and education, and without which research becomes academic and education becomes an exercise in frustration -- having an opinion, but not making a difference.

The Public Information Network offers workshops to support grassroots citizen and labor strategies, so that we can continue to regain and defend our rights to a clean environment, to a safe workplace, and to communities and jobs with justice.

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Speech at the 1996 Annual Meeting of Jobs With Justice
Seattle, Washington, June 29, 1996

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