Click here to go to the Home Page The Fraud of “Free Trade,” Part II - Solidarity America By John Funiciello, Columnist

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There never was a great cry from the American people for what we now call free trade in a “global economy.”

The only persistent call came from Corporate America, from commodity traders, from banks, from investment houses, from manufacturers (the shrinking base that existed), from everyone who had a stake in the exploitation of natural resources or the production of low-wage workers in other countries.

It was the most powerful economic entities in the nation that called for “free trade” and, over the years, they convinced enough of the people that free trade was a good thing and that, if a worldwide system of free trade were accomplished, all would benefit.

It was the powerful corporations that called for opening up the world to trade on their terms, and those terms included the demands that factories in the developing world (where most of them eventually went for their goods) produce at the lowest possible cost, which meant that workers in those countries would be paid slave wages.  And, in the case of the U.S., the government was manipulated to look the other way, when threats were made to government leaders or bribes were paid to keep production costs at rock bottom.

Corporate America developed such power that it influenced Congress to embrace the “free trade” agreements all around the world.  The U.S. government, in fact, provided subsidies for companies that moved their operations overseas, so there was further incentive to empty the country of its manufacturing and industrial base, along with millions of the best-paying jobs available.

How did corporations get to be so powerful that they outstripped the power of the people in what was once a democratic republic?  The frauds included more than just free trade, such as the continued attack on workers’ rights to a union, the continuing lowering of wages, the evaporation of benefits and pensions, and unpaid-for wars, to name a few…many catastrophes that have been visited upon American workers.  How did they achieve such preeminence that they could perpetrate such massive thefts and frauds?

We were reminded recently how corporations came to rule America as we reflected on the recent death of Richard Grossman, co-founder of the Program on Corporations Law and Democracy (POCLAD), at the age of 68.  Grossman was a man who was long engaged in the struggle to free the people from the overpowering influence of corporations. 

POCLAD is a small group of about a dozen men and women who for two decades slowly and steadily began to make Americans aware of the influence of Corporate America on their lives.  He and the others taught the history of undue corporate influence, stretching back to the beginning of the republic. 

It was not last year’s U.S. Supreme Court decision in the Citizens United case alone that gave corporations the rights of citizenship, but precedent had been set in a progression of decisions and other official actions, but they were given a great boost in 1886, when the Supreme Court ruled in the case of Santa Clara County v. Southern Pacific Railroad, that corporations were natural persons under the law.

According to a pamphlet co-written by Grossman and Frank T. Adams titled, “Taking Care of Business,” Supreme Court Justice William O. Douglas 60 years later wrote of the case, “There was no history, logic or reason given to support that view.”

Even though Santa Clara was a fraudulent ruling, from that time on, corporations were seen as having many of the rights of a citizen, such as access to rights under the Bill of Rights.  In that era, while giving corporations citizen rights, some judges went so far as to rule that trade unions were civil and criminal conspiracies.  American workers found it difficult enough to organize to protect themselves and their families, but this attitude about unions prevailed in legislative halls and the judiciary well into the 20th Century and made organizing even more difficult.

This kind of corporate power was something that the founding fathers feared might happen, if corporations were not held under tight control, so they made sure that the issuance of a charter of incorporation was among the most serious undertakings and they gave the control of those charters to the various state legislatures, which were thought to be closer to the people.

The founders were fearful of the untrammeled power of the budding corporations (they had experienced the great trading companies of the imperial powers) to the extent that Thomas Jefferson early in the country’s history wrote in a letter, “I hope we shall crush in its birth the aristocracy of our moneyed corporations, which dare already to challenge our government to a trial of strength and bid defiance to the laws of our country.”  They gave state legislators the power to issue corporate charters and the power to regulate corporations, to detail what they were allowed to do and what they were prohibited from doing, and the power to revoke the charter and distribute the assets among the shareholders.

Finally though, last year, the U.S. Supreme Court gave corporations what they had been seeking for generations, when the justices ruled that corporations were, indeed, citizens and that their money was speech, under the First Amendment.  The power of corporate money finally overcame the regulatory structures set up by the founders and made America’s headlong plunge toward oligarchy possible.

Richard Grossman sounded the alarm through POCLAD, which set up “conversations” about corporations and democracy around the country in the 1990s…their way of educating participants, believing that small numbers of people could move others, to bring the realization to Americans, in general, that corporations are now in charge.  At the beginning of the republic, Grossman noted, laws and structures were set up to benefit a propertied class, but now, the control has passed to a corporate class, which many call Corporate America.

POCLAD calls for the elimination of “corporate personhood,” which means that the corporation needs to be recognized for what it is, a “legal fiction,” and that no corporation has the rights of a citizen under the U.S. Constitution or the Bill of Rights.  Among other things, the “Occupy” movement addresses this wrong and there are other efforts under way (such as to overturn Citizens United legislatively and constitutionally, to do exactly what Grossman and POCLAD have been working toward for a couple of decades.

In noting his passing, the Community Environmental Legal Defense Fund, for which he worked for a time, said, “While he didn’t believe that many organizations correctly framed the problem that we face - and hence, the solution to that problem - strains of his thinking and strategy continue in the organizations which worked with him. Echoes of it can also be found in the Occupy movement, in addition to other groups. But messaging and bumper stickers were not his work.  Rather, it was his unfailing, uncompromising commitment to uncolonizing our brains (as the first step to figuring our way out of this mess) which will remain his legacy.”

The influence of endless amounts of corporate money has corrupted the political system, the regulatory system (for food, water, air, the environment, and jobs, in general), the education system, and the means by which the people should be informed, such as television, newspapers, mass-marketed magazines, and radio.  That’s what Richard Grossman was trying to say.  It was not just “free trade” that has been the fraud of the corporatist era, but it just may be the lynchpin of corporate control of all of our societal systems.

So pervasive has been the influence of Corporate America that average citizens years ago took to spouting their line for years without thought, and politicians have taken up their cry as if it were their own.  For example, Citizens for Tax Justice (CTJ) recently noted an example of a politician mouthing their creed without thought:  “In October, South Carolina Governor Nikki Haley suggested that gradually repealing the state’s corporate income tax should be a priority for lawmakers in 2012. Haley’s idea was alarming, but hardly surprising: in the past year, governors in Arizona and Florida have proposed similar plans, and lawmakers in a number of other states have moved to enact expensive new corporate tax breaks or reduce the corporate tax rate. Noticeably absent from the policy debates in these states, however, has been any discussion of whether businesses in each of these states are currently paying the corporate income tax to begin with.”

Such is the state of our politics, when no thought is given to reality.  CTJ, in a recent report, noted that scores of corporations paid no state income taxes in one or two of the years 2008-2010.  That reality never dawns on the ideologues who perpetually defend the small minority against the 99 percent (the people).  It’s why, to a great degree, only about half of the electorate votes in any given election.  They feel that their participation, even just to cast a vote once in a while, does not make any difference.  What that small number of corporations failed to pay to states amounted to some $47 billion.  That amount would make a considerable dent in the “holes” in various state budgets.  Yet, Corporate America and their politicians are asking for more “tax relief” and their minions in Congress and the state houses are jumping to comply.

The latest manifestation against the rule of the few is the “Occupy” movement.  A long line of individuals and organizations have preceded them, starting with the union movement, the civil rights movements, the anti-poverty organizations, community groups, and many more.  Most of them have functioned with little money, so it always is a constant struggle to counterbalance the power and wealth of Corporate America. 

The struggle against the plutocrats has been a long one in America, but the sleeping giant is beginning to awaken.  Even if the 1 percent hasn’t noticed, the 99 percent is, indeed, the majority and they will express their will in an intelligent way very soon.  That’s why the Occupy movement will not be going away soon, even if the encampments are attacked and destroyed by mayors and their police.  As most of us have always known, there are more of us than there are of them and justice will prevail.

Click here to read any of the commentaries in this series Columnist, John Funiciello, is a labor organizer and former union organizer. His union work started when he became a local president of The Newspaper Guild in the early 1970s. He was a reporter for 14 years for newspapers in New York State. In addition to labor work, he is organizing family farmers as they struggle to stay on the land under enormous pressure from factory food producers and land developers. Click here to contact Mr. Funiciello.

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Dec 15, 2011 - Issue 452
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