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Corporations and Democracy

“Corporation: An ingenious device for obtaining profit without individual responsibility.” Ambrose Bierce in The Devil’s Dictionary (1911).

Whether or not we agree with Ambrose Bierce’ cynicism, the fact that corporations enjoy privileges not granted to us mere mortals still stands. Whereas you and I as individual business people can be personally sued for liability, as owners of a corporation we cannot, even if the injury stems from our personal decisions.

We are so used to having corporations around that it seems they have always been with us, but it ain’t so. Corporations are a relatively new entity in the scope of history, and originally were created to perform a role that neither individuals nor governments could accomplish.

An initial part of that role was to enable common ownership of property outside of government, such as church buildings and lands. In fact, the oldest corporation in the United States is the Collegiate Reformed Protestant Dutch Church of the City of New York, which was granted a royal charter in 1696 by King William of England.

Originally, corporations were granted charters by government to perform specific functions for a limited period of time, after which they were to dissolve and the profits be distributed to the members. It was a means to raise money by pooling individual capital to accomplish a common purpose.

By the 1600s, corporations were used by governments as a tool to colonize distant territories, one of the major advantages being that countries could gain land without having to spend government money. A corporation might be given monopoly rights on trade in exchange for administering the territory in the name of the King or Queen. The earliest of these was the Dutch East India Company, which was chartered to trade with India and points east.

The longest-running corporation in the world is the Hudson’s Bay Company, still going strong after 330 years. It is best known for its historic role in the fur trade, but today is one of the largest department store companies in Canada.

American colonies were founded by royal corporations such as the Massachusetts Company, and it was a corporation, not England, that was the focus of the Boston Tea Party. A participant of the Boston Tea Party, George Hewes, wrote that it was the semi-monopoly that the British East India Company had in the tea trade that incensed the Americans, not the tax on tea.

According to Hewes it was an issue of a world wide company driving smaller, American companies out of business. “Hence it was no longer the small vessels of private merchants, who went to vend tea of their own account…but, on the contrary, ships of an enormous burthen….”. Sort of a colonial version of Joe’s Building Supply competing with Home Depot.

Some corporations were given the power to wage war in the pursuit of trade; again, the benefit to the parent government being the acquisition of territory without government expense. Military endeavors became too expensive for the companies, however, and this role reverted to the governments. Properly so, I might add.

Corporations were originally given permission from the government to perform a specific task for a specific period of time. They were, and are today, creations of government, but have had their scope of activities broadened and their lifetimes extended into perpetuity.

Most interestingly, in their lifetime they have gone from being creations of our citizen-governments to having virtually the same rights as the citizens themselves, and one heck of a lot more power. Corporations, in fact, are “persons” and have the same constitutional rights as you and I, who are known as “natural persons.”

Like you and I, they have the right to free speech, and since giving money to advance a belief is a form of free speech, they have a major—the major—role in American politics.

The elevation of corporations to “personhood” was first enshrined in an 1886 Supreme Court decision called Southern Pacific Railroad v. Santa Clara County. Whether or not the decision actually granted personhood is in dispute, but the fact is that it is the benchmark case upon which personhood status is built, and is now an accomplished fact.

Today we have a world governed not by nations, but by international trade agreements drafted by international corporations, governed by international corporations, with international trade disputes adjudicated by international corporations. None of these corporations, by the way, was voted into power by you or me.

Our elected representatives have ceded control of our lives and livelihoods in the name of “world trade.” I believe it is time that elected governments resumed control of our destinies. At least you can fire them if you don’t like what they do.

[Information in this article was gleaned from “Ask Mr. Studlyhunk”(I did not make that up); www.orangek8.com, American Rebellions by Thom Hartman quoted on www.yesmagazine.org, and articles in Dinsmore Documentation presents Classics of American Colonal history; www. dinsdoc.com.]

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Senator Jim Elliott Senator Jim Elliott is a State Senator from Trout Creek in his 15th year of legislative service, and is chairman of the Senate Taxation Committee.

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