The Corporate Danger: Plutonomy

October 28, 2009

All over Washington, from the Congress to the White House, the smart money is betting that this autumn the Supreme Court will give corporations the same right to spend in federal elections as has any person. Free spending, five justices will say, is the same as free speech and to limit spending is therefore unconstitutional.  If some corporations have more money than most real persons and they therefore get more speech, that is simply life in a free country.

The implication is this: Floods of corporate dollars are about to be authorized for political advertisements and campaigns favoring—most likely—all those candidates who oppose health care reform, favor bail outs for banks (but not for householders), and war as the primary stabilizer of jobs and income.

A corporation is to be treated as if it were a real person.  But a creature of paper is not a real person. It can be amoral without reservation if amorality leads to profit. It can use false advertising to sell cars—or war in Iraq—if these lead to profits. Blackwater can rationalize shooting civilians in Baghdad if the enterprise leads to profits.  Private contractors can justify supervising torture at Abu Ghraib if torture is profitable. CIGNA and Humana—even though they are in the health care business—are bound by stockholders to profit more by caring less. Corporations may cut down rain forests or destroy coral reefs whether or not such destruction is good or bad for the future of civilization. All this is the very definition of amorality.

Real persons care about their children’s education, their health, and their discipline. Real persons are interested in standards of decency, the rule of law, restraint on obscenity, encouragement for the arts. Real persons require dance and music, holidays, celebrations, security from poverty and assistance in the face of the tragedies of life. Corporations are required, by contrast and by definition, to recognize such tragedies primarily—and sometimes exclusively—as targets of opportunity.

Exxon Mobil last year reported profits of $45 billion. Now the high court is expected to rule that Exxon will have the same right to influence elections as does any real person. Will any democratic candidate who favors a carbon tax be able to withstand an avalanche of contrary propaganda from corporate oil? What about the swing states? Will Senator Majority Leader Harry Reid of Nevada who now favors a public option in health care be reelected in 2010 in the face of unlimited pharmaceutical advertising?

CIGNA Inc., a health insurer, reported over a billion in revenues in 2007 and a net income of over $263 million. What is to keep these profits from being used to elect candidates all across the country who will roll back health care reform? If the Supreme Court unleashes the tsunami, who will have the millions to push back?

In 2005 Citigroup investment advisors urged the very rich to get on the bandwagon for plutocracy. The top 10% of American population, they wrote enthusiastically, are going to continue to get richer while the remainder of the country gets poorer. But that’s OK. Those who invest in Baluga caviars and private jets will still lead the economy to prosperity. This is “Plutonomy,” they said, giving plutocracy a happier name. And “Plutonomy,” said Citigroup, is the wave of America’s future.

Now the Supreme Court is likely to make those who revel in the luxury of Plutonomy even more able than ever to control our federal elections.  If they do, they will swing the great ocean liner of American politics even more in the direction of aristocracy and oligarchy and away from egalitarian democracy. The shift will not have been accidental. It has been explicit in the conservative campaign of the last 30 years led by the ideology, or one might say, the idolatry of the free market. Now the Court will subject elections to that same free market and put democracy on sale.

The day will come when Americans will have to respond to all this, to revive their own story of the law to serve the common good and not only the corporate good, and who see community not as a sea of snakes but as a gathering of humble passengers in the same life boat needing all of us, not only the rich, to survive. The true American story is not that power comes from corporations, or paper charters authorizing amorality, or excess, or greed. All political power ultimately comes from the people. Wall Street should take caution. What the people giveth, the people may some day take away.