[corp-focus] Corporate Power Since 1980

[robert weissman]

Corporate Power Since 1980
Robert Weissman
May 31, 2007

The United States Since 1980 (Cambridge University Press, 2007) is a 
superb short work from Dean Baker of the Center for Economic and Policy 
Research.

In a couple hundred pages, Baker covers enormous territory, reviewing 
the rightward shift in U.S. politics, the sharpening of inequality (and 
underlying causes), U.S. unilateralism in global affairs, and much more. 
He concludes by identifying the U.S. political system's failure to 
address three overriding problems: provision of healthcare to all at an 
affordable cost, the spiking trade deficit, and global warming.

The distressing effects of corporate power and influence is interwoven 
into the narrative of The United States Since 1980, but corporate power 
is not analyzed in its own right.

There will be an opportunity to conduct that kind of analysis at an 
important conference to be held June 8-10 in Washington, DC. "Taming the 
Giant Corporation" will investigate the evolving sources and forms of 
corporate power, and how it can be subordinated to people's control 
(including by displacing corporations altogether from certain segments 
of the economy and society). You can get information on the conference, 
and register, at: <www.tamethecorporation.org>.

What might be the key themes of a book titled, Corporate Power Since 1980?

Some interrelated concepts, not listed in order of importance, would 
include:

1. Corporate political organization. Big business has mobilized itself 
into a dominant political actor, with capacity through its various 
tentacles both to frame the contours of big picture policy debates, and 
to win narrow legislative battles, at all governmental levels. The 
proliferation and strengthening of corporate-backed think tanks, front 
groups, lobbyists, trade associations and more, are all evidence of 
corporations' dramatically increased political power -- in the United 
States and around the globe.

2. Corporate globalization. Big corporations now operate globally, both 
on the production and selling side. They leverage the threat of moving 
production to drive down labor and environmental standards. They and 
their allies have drafted international trade agreements that embed 
their power in law, and impinge on the ability of governments to control 
them. They have also created massive global trade imbalances, which 
threaten the future stability of the global economy. On the seller side, 
they are driving a homogenization of culture on a global scale.

3. Corporate concentration. Wal-Mart was an insignificant blip on the 
retail radar screen in 1980. It now dominates retail markets in the 
United States, with growing power overseas. Big box emulators have 
concentrated sales in retail market after retail market. Antitrust 
concepts in the United States have fallen by the wayside, evidenced 
perhaps most spectacularly in the permitted reunification of the two 
biggest components of the Standard Oil breakup, Exxon and Mobil. In 
sector after sector -- food manufacturing, finance, pharmaceuticals, 
tobacco, aircraft, defense contracting, utilities, energy, insurance, 
hotels, mining, media -- fewer companies are in control.

4. Union busting. The trend is sharpest in the United States, where 
there has been a perilous decline in union membership. The blue-collar 
unionization rate fell from 43.1 percent in 1978 to 19.2 percent in 2005 
-- a drop of well over half. Corporations' vicious anti-unionism, 
offshoring and threats to close plants all contributed to plummeting 
union rates -- and the undermining of wage scales and employment 
conditions for working people. Similar pressures are starting to be felt 
in Europe, though Europe has, so far, largely resisted the degraded 
standards of the United States. Meanwhile, the World Bank actually 
advises countries to cut back on labor rights in order to be more 
competitive.

5. Corporate subcontracting. Brand-name industrial firms increasingly 
don't make what they sell. Instead, they subcontract the work, often on 
a global scale. What might be high-paying jobs turns instead into 
low-income or sweatshop work -- and the identifiable company is able to 
swear off responsibility for how their subcontracted workers are 
treated, or for the pollution or other undesirable aspects of the 
production and services they subcontract. Subcontracting functions as a 
massive escape from accountability.

6. Deregulation. The election of Ronald Reagan gave corporations the 
opportunity to achieve the roll back of environmental, consumer and 
workplace safety regulations -- and they've been rolling back ever 
since, often on a global scale. Equally important has been economic 
deregulation -- removal of U.S. rules governing how finance, 
telecommunications and utility companies can operate, for example. This 
deregulation has facilitated massive consolidation, consumer rip-offs 
and serious threats to economic well-being -- as evidenced by the Enron 
scandal and collapse, which was rooted in deregulation of energy and 
financial markets.

7. Tax manipulation. Concludes Citizens for Tax Justice in a 2004 study: 
"Eighty-two of America’s largest and most profitable corporations paid 
no federal income tax in at least one year during the first three years 
of the George W. Bush administration -- a period when federal corporate 
tax collections fell to their lowest sustained level in six decades." 
Corporate political power has led to lowered tax rates and creation of 
endless tax loopholes and subsidies. And the spectacular rise of 
offshore tax havens has made the tax avoidance business into its own 
industry.

8. Commercialization. Commercialism has become ubiquitous, in ways 
barely imaginable a quarter century ago. Corporate marketers target 
small children in the most devious of ways, and advertising is pervasive 
in schools. A new speciality known as neuromarketing is doing brain 
scans to gain "unprecedented insight into the consumer mind," as one 
neuromarketer put it. "Buzz marketers" are employing people to hawk 
corporations' stuff, but not tell the friends, family and neighbors they 
are pitching. Results of corporate commercialism include an epidemic of 
marketing-related diseases such as obesity (rising now in developing 
countries as well as the United States), more materialistic values at 
the expense of civic ones, and consumption-driven challenges to the 
sustainability of the planet.

9. Financialization. Wall Street and the global finance sector now exert 
an extraordinary grip over the real economy, placing unprecedented 
pressure on producing and service companies, and interfering with the 
ability of countries to manage their economies. Speculation and hot 
money, fueled in equal parts by new technologies and deregulation, give 
Wall Street managers enormous power. Meanwhile, the invention of new 
financial instruments has injected enormous risk into the global economy 
-- easily ignored in good times, and rarely borne by the wealthy in down 
times.

The recent rise of private equity -- an updated version of the 
leveraged-buyout movement of the 1980s -- threatens still further to 
destabilize shared social understandings. Private equity firms now pool 
vast sums from institutional players (such as pension funds), and then 
borrow still more, to buy out publicly traded companies. Hidden from 
public scrutiny, the private equity managers typically then seek to 
squeeze the companies (and especially their workers), before placing 
them back on the market.

10. Enclosing the knowledge commons. The value-added component of making 
things is embedded progressively less in the manufacturing process, and 
more in the development side -- in the knowledge about how to design and 
make the thing. Corporations -- especially in the pharmaceutical, 
software and entertainment industries -- have responded by demanding 
heightened patent and copyright protections, to give them monopoly 
control over information and knowledge -- even though that knowledge is 
typically extracted in significant measure from the public domain. One 
manifestation of this movement is the imposition of a global patent 
standard, leading to skyrocketing drug prices in developing countries.

11. Global environmental and public health treaties. Not every trend has 
seen corporate power deepened. With many problems globalized, citizen 
activists have managed to push successfully for some legally binding 
global solutions, often in issue-specific treaties, including ones to 
address the hazardous waste trade, pesticides and other pollutants, 
tobacco control, and protection of the ozone layer.

12. Popular movements to curtail corporate power. Beyond specific 
advocacy efforts around treaty-making, there have emerged robust 
advocacy and solidarity networks to counter corporate malfeasance, 
influence and demands. From winning improvements in working conditions 
to blocking bad trade deals, from lowering the prices of essential 
medicines to blocking biotech companies' efforts to experiment on humans 
and the environment on a planetary scale, from supporting indigenous 
peoples' rights to blocking destructive dam projects, these networks 
have scored important victories. Relatedly, a series of mass 
mobilizations have occurred to challenge corporate dominance, and 
popular movements have linked up and created growing countervailing 
power in national and international spheres.

But while an historical perspective on Corporate Power Since 1980 does 
not offer an unyielding picture of corporate supremacy, the predominant 
trend is toward dramatically heightened corporate power. Indeed, by far 
the most serious barrier to addressing each of the three overriding 
problems that Dean Baker highlights as challenges for the United States 
-- affordable healthcare for all, the trade deficit, and global warming 
-- is overcoming entrenched corporate practices, privileges and 
prerogatives.


Robert Weissman is editor of the Washington, D.C.-based Multinational 
Monitor, <http://www.multinationalmonitor.org> and director of Essential 
Action <http://www.essentialaction.org>.

(c) Robert Weissman

This article is posted at: 
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