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                                                            the OTHER paper
                                                                  Box 11376
                                                           Eugene, OR 97440
                                                                April, 1996

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                           Who's in charge here?

                            by Wanda Ballentine

     In 1984, at least 10,000 people were killed in the world's worst
     industrial accident at the Union Carbide pesticide plant in
     Bhopal, India. At least 200,000 forgotten victims still suffer the
     effects of this corporate Hiroshima. Justice should have been
     simple -- Union Carbide had ignored design flaws in the plant and
     was clearly culpable. But the $5 billion company thumbed its nose
     at criminal charges, refusing to appear in India's court. The U.S.
     government looked the other way. The corporation settled out of
     court for less than $800 per claimant, sold off product lines to
     avoid boycotts, paid large dividends to shareholders to protect
     assets from the victims, downsized its workforce by 90%, and in
     1994 rang up $379 million in profits and rewarded six top
     executives $4.9 million in pay and bonuses.

     In 1989, the Exxon Valdez dumped 12 million gallons of oil into
     Prince William Sound, causing an estimated $15-20 billion of
     damage. The captain, a known alcoholic, had abandoned the helm at
     a crucial navigation point. Exxon executives admitted knowledge of
     his problem following the accident but denied culpability in
     court, maintaining the event was simply an accident requiring
     clean-up, not criminal fines. The $1 billion clean-up was woefully
     inadequate, while the company fights a $5 billion criminal
     judgment. Exxon is numero 3 of the Fortune 500, the 26th largest
     entity in the world -- bigger than France -- with $107 billion
     after-tax profits.

     Charles Hurwitz of MAXXAM infamy uses junk bond financing and
     savings and loan shenanigans like a corporate Genghis Khan. In
     1977, he looted a New York insurance company; in 1978, he took
     over an oil company; in 1984, he withdrew, for $8 million, an
     attempt to take over Castle-Coke; in 1985, he grabbed Pacific
     Lumber in a high-leverage buy-out; in 1988, it was Kaiser
     Technology; this year he made a play for Kaiser Aluminum.
     Thirty-one different groups have tried to stop him, including the
     U.S. Forest Service, the Department of Labor, the Federal Reserve
     Board, Congress, and state governments. Ballot initiatives and
     multiple lawsuits for gutting pension funds and logging redwoods
     have been used -- none have yet been very successful.

     Corporations are literally getting away with murder. Why and how?

     "Who's in charge here?" was the question at nine seminars on
     "Corporations, Lawyers, Democracy, Justice and the Law" presented
     by the Program on Corporations, Law and Democracy (POCLAD) at the
     1996 Public Interest Environmental Law Conference at the
     University of Oregon last month.

          Should a corporation have the right of free speech?
          Should corporations contribute to political campaigns?
          Should corporations elect officials?
          Should corporations write laws?
          Should corporations dump poisons into our air, water and
          soil?
          Should corporations have greater wealth than many countries?

     The answers are clearly "no." Change "should" to "do," however,
     and the answers are clearly "yes." The reason, according to
     Richard Grossman and Ward Morehouse, POCLAD co-founders, stems
     from industry's assault on laws governing corporations in the late
     19th and early 20th centuries. The most outrageous result was the
     1886 Supreme Court ruling that corporations -- which are legal
     fictions -- are persons with a person's rights and privileges.

     This decision was based on the 14th Amendment, the purpose of
     which was to remedy the status of slaves following the Civil War:
     "All persons born or naturalized in the United States, and subject
     to the jurisdiction thereof, are citizens of the United States and
     of the State wherein they reside. No State shall make or enforce
     any law which shall abridge the privileges or immunities of
     citizens of the United States; nor shall any State deprive any
     person of life, liberty, or property, without due process of law;
     nor deny to any person within its jurisdiction the equal
     protection of the laws."

     That such a bizarre interpretation as corporate personhood could
     be made of this Amendment by no less than the Supreme Court
     testifies to the power and wealth accrued by industry despite
     restrictions in their charters. The boom in railroad, mining, and
     timber industries in the opening of the continent was aided by
     corrupt officials in the rush to riches. Lincoln, to finance the
     Civil War, capitulated to even more corporate demands.

     That this history is not even taught in law schools testifies to
     the power of corporations regarding what will be included in
     textbooks and curricula. "We were just told the corporate system
     is the most efficient way of doing business," said Tom Stephens,
     Chair of the National Lawyers Guild's Toxics Committee.

     What does it mean for corporations to be deemed "persons?" It
     means Bill of Rights protection, such as the 1st Amendment right
     of free speech. The average person exercises his/her right to free
     speech by speaking at a public meeting, writing a letter to the
     editor, calling a talk show, posting on the Internet. Corporate
     "persons" use advertising, paying millions to experts in the
     manipulation of thought and desire via the use of language and
     image. Corporations determine via sponsorship what media programs
     are selected and thus what ideas and values are disseminated to
     every home in America. Now, they're buying the networks. The
     just-enacted Telecommunications Act has already generated radio
     mergers and buyouts worth an average of half-a-billion dollars a
     week according to media watchdog Norman Solomon.

     Prior to the revolution in corporate law, corporate charters,
     granted by States, were very restrictive. Corporations were
     chartered for a specific purpose and for a limited period of time.
     They were to do no more and no less than the specified purpose;
     either was grounds for dissolution. Corporate books and documents
     were open for scrutiny by the state, sometimes even by the public.
     In many states corporations could not own land; they could donate
     neither to political causes nor to charities. When applying for
     renewal of their charter, they had to prove they were acting in
     the public good.

     What a concept.

     But where it once was a privilege, with definite responsibilities,
     to be chartered, states began vying for the "privilege" of having
     a corporation and started giving away the store. Corporations
     chartered in one state may operate in another by obtaining its
     Certificate of Authority. These could apply restrictions, but are
     usually just rubber stamps in the competition to be abused.

     Thus it is, that where small business owners have to pay the full
     costs of doing business, corporations are subsidized by federal,
     state and local taxpayers.

     Thus it is, that while regulations prohibiting environmental
     poisoning have had some wins, corporations can delay or avoid
     implementation through legal tactics -- or just label the fines a
     business cost and write them off.

     Thus it is, that these wealthy and powerful "persons," many with
     assets greater than some nations (fifteen corporations surpass 120
     U.N. nations), can influence every step of the legislative
     process. If they can't satisfactorily shape the dialogue via the
     media, they help write the legislation; if that doesn't work, they
     help write the regulations; finally, they determine
     implementation. If they can`t dilute or revoke laws, they cut
     funding to the enforcing agency. This year, corporations poured
     $775 million into the federal electoral process. In 1972, it was
     $2 million.

     There are good laws on the books, but citizens can't get them
     enforced. Instead, they spend huge amounts of time, money and
     energy fighting corporate pollution and labor inequities,
     destruction of wilderness, and takeover of the political system.
     They fight issue by issue, case by case, on very uneven playing
     fields against these corporate "persons," while new threats
     proliferate.

     Restrictions on corporate activities should be spelled out in
     their charters, as originally intended. Grossman and Morehouse
     advise activists to become experts on corporate charter provisions
     of their state's original and current constitutions. Power over
     corporation originally belonged to the people via their state
     representatives -- what is left of that power? How can it be used?
     How can it be improved?

     POCLAD chapters are springing up across the country, including
     Oregon. If interested, call 508/398-1145, go to
     http://www.poclad.org/, and/or email people@poclad.org.

     From the OTHER paper, April, 1996, pg. 7, POB 11376, Eugene, OR
     97440.
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