by Ralph Nader
The real danger, the decentralists believed, in the awakening of the people, was the demagogues (they would name Senator Huey Long or Dr. Townsend) preying on the lower middle classes by promising them the moon and offering simple solutions. If the demagogue comes to power, knowing he has no easy solution, he will turn, in Agar’s indictment, to
the Lords and Masters . . . and make a deal. The demagogue stays in office and keeps the people quiet. The Lords and Masters stay in power and run the economic system just the way they always wanted to run it. The corporate state is monopoly-capitalism made safe. One of the first steps is to destroy all labor unions. Then the plain man is fobbed off with subsistence wages, patriotism, and a uniform. If he is still restive, it is not hard to fling him some racial minority on whom to work off his spleen. The Jews do very nicely. In America the Negroes might also serve.18
Presently, in ways the decentralists could never have conceived or believed possible, the “Lords and Masters” did not need street revolts led by fascistic demagogues, who ask the Lords to join together in a mutually beneficial collaboration. During the collapse of 2008–2009, the “Lords and Masters” simply sent their A-Team from Wall Street to save themselves by becoming the government, led by former Goldman Sachs chief Henry Paulson, the secretary of the Treasury. Referring to the one-way, unlawful rescue extravaganzas under George W. Bush, Mr. Paulson stunningly admitted to the Washington Post that he “didn’t have the authorities” but someone had to do it.19
It is remarkable how deeply and concretely these earlier defenders of prudence and tradition kept abreast of the new perils of the corporate supremacists. The Depression years of the thirties made many thinkers and doers get down to fundamentals, whether they were in the social sciences, humanities, or the arts or organizing actions in communities. They thought more boldly, spoke out more candidly, confronted the realities of power, and, even when they were dealing with abstract principles, sought to ground their thoughts in the real world where people live and work. The agrarian decentralists did not indulge in pussy-footing or the other verbal cadences of avoidance when it came to fingering the perverse structures of the political economy and naming how they were responsible for exploitation, greed, repression, and dispossession. But then they did not have to go to their offices every day to work in rarified, screen-filled environments, being well-paid by grants from economic interests, vested ideologues, or foundations. The decentralists and agrarians had relatives and friends in serious states of impoverishment and insecurity, and if they did not, they saw these avoidable, wretched conditions all around them. It was hard to live a lie. Unemployment was as high as 25 percent to 45 percent, depending on the area.
Even with Their Limitations, the Agrarians Had a Keen Eye for the Dangers of the Corporations
They had their limitations when it came to directly discussing race. African-Americans were not given much attention, other than to be included in their denunciations of all sharecropping. Property ownership begat freedom, but also tenancy and other forms of what they considered servitude.
Women were also not given specific attention in their rendition of “life, liberty and the pursuit of happiness.” They wrote about “the people” generally. But one chapter in Who Owns America?, titled “The Emancipated Woman,” by Vassar College professor Mary Shattuck Fisher, minced no words right from the beginning: “To call the modern American woman free is as false as to call modern America a democracy, and for the same reasons. She is not living in a world whose values are based on a sense of the worth of human beings, or one characterized by equality before the law and equality of opportunity. That is why she is not free, however ‘emancipated.’ It is also the reason why America is not a democracy.”20 Professor Fisher was not at all wowed by the increasing number of women in the workplace, seeing them as entering the same rat race that men are gripped by, though they were coming in at a lower wage rate and also had to shoulder the “double burden of maternity and employment.” These women, she added, “do not suspect that the present development of productive forces could provide the groundwork for more security and more happiness if only it were operated on democratic principles. They are too bitterly deprived, too much concerned with keeping alive to care to understand such matters.”21
She was one tough feminist, excoriating her gender, post-1920 (the year when the Nineteenth Amendment gave women the right to vote), for failing to use their vote effectively, because “like their male relatives, [they] are ignorant, bewildered, helpless or indifferent in the face of concealed minorities, of machine government and political corruption. . . . Women have not even attempted to turn things upside down, as it was once feared they would do. . . . They are coming to feel that it is of no use to vote.”22
Troy J. Cauley, an economist and author of the acclaimed book Agrarianism: A Program for Farmers (1935), questioned the program advanced by the philosophy called “technocracy,” which foresaw a future in which there would be a redistribution of property from the few to the many, or even abundance with less work for all, powered by increasing automation. None of those schemes, he asserted, offered any “method for redistributing property among the people.” He went even deeper: “If there is to be a stable and permanent foundation for a redistribution of income, the foundation must be a general diffusion of property ownership, that is, a general diffusion of the control of the sources of income.”23
Cauley wanted to achieve this diffusion through a democracy, which he believed had a greater chance of rapid advancement than a “country controlled by a dictatorship either communist or fascist,” which would not achieve or want such decentralization in any event. Though like most reformers, who shun the path of dictating the exact steps to be taken to effect a change, he and his colleagues offered no specific steps to get to the goal of distributing property, which today may be called a “variety of capital assets,” among the people. Further, he insisted on the need for a society that enhances spiritual and “other non-material wants.” He knew where it must all start. “For in the last analysis, community life and family life have much the same essential bases.”24
The decentralists were not alone in not knowing how to get to their secure and free society—an unanswered question that still haunts today’s advocates of just change. Nevertheless, these writers and scholars, coming off the destitutions of the most prolonged economic collapse and massive unemployment in American history, known as the Great Depression, have much to teach us during these times known, so far, as the Great Recession. Their writings shame the thinness of the conservative/liberal appraisals of the contemporary contours of power and control. They were much freer of taboos. They liberated themselves from the latent self-censorship that in our era has for years precluded fresh thought about even modest power-shifting possibilities and civic motivations. (These include simple mechanisms, such as checkoffs and organized refunds for new consumer and labor advocacy groups, which could work prudently and increasingly to shift some balance of power away from the plutocrats and oligarchs who desiccate our national pretensions.) They also had a clear-eyed focus on the grip of the giant corporations over our political economy, whose antagonism to our sense of individual and community freedom and fair access to justice (courts and agencies) is so palpable today. Most outstanding was their persistent questioning as to why the artificial entity that is the “joint-stock company” should have ever achieved equality with human beings under our Constitution, a document that starts with “We the people” and never mentions the words “corporation” or “company” or proclaims “We the corporation.”
Now and Then: How Much Less Clear-Eyed Today’s Reformers Are
Ironically, compared to their time, there is now an overwhelmingly larger production of printed, documentary, and Internet video materials conveying what abuses of all kinds are doing to people and their institutions. There are more freely accessible, theoretical, empirical, statistical, and mathematical materials purporting to demonstrate one economic, political
, or philosophical position after another, many contesting the current arrangements of power. Why aren’t they stimulating change?
This generation is growing up in the greatest golden age of exposés and muckraking in American history. Yet these revelations and declarations seem to have less and less follow-up, less effect on legislators, major party candidates, regulators, prosecutors, and educators. Some attribute this lack of action to overload—“injustice fatigue”—but that’s an immature excuse. A better explanation is that the misuses of power and the rampant commercialization and bureaucratization of almost everything have weakened our democratic institutions. They have eroded our civic sense of community and marginalized our little-reported, modest countervailing powers, such as any activity by trade unions and family farms’ groups. While information is the currency of democracy, there has been little carry-forward of this plethora of information to mobilization. To put it in historical context, I do not believe that the consumer, environmental, and labor reforms of the sixties and early seventies could have happened in this decade. Even worse, the struggle now is to thwart rollbacks and repeals of the accomplishments of that period of popular progress.
Since those days of progress, there has been a shift in the type of political representatives in Washington, who are now nearly all dialing ferociously for the same commercial dollars; there has been the gerrymandering out of even two-party competition, the placement of many business executives in government posts, and the strengthening of mass corporate lobbying, from AstroTurf to Capitol Hill. All these factors have made some contributions to this decline. It matters little that Congress is now live on C-SPAN everywhere, given these shifts. Also among changes not to be discounted is the business leverage, which comes from the multinational corporations’ ability to move jobs and operations abroad and the use of that mobility to sustain their power-grabbing ways in the United States.
There is something else to ponder. Reformist agendas document the need for change and make recommendations that touch on the described or depicted symptoms. Except for the work of a few people like Professor Lawrence Goodwyn (The Populist Moment) or Richard Grossman and Ward Morehouse, who reintroduced the forgotten corporate history of chartering, personhood, and the actions of the populists, the decentralists, and agrarians, today’s avalanche of materials does not reach the core of the recidivist power structures. Moreover, as has already been examined, the two-party duopoly (or tyranny) has successfully excluded third parties, which have tried to challenge the two major parties over these issues. Through a growing variety of ballot access obstacles’ harassment of petitioners; baseless, exhausting litigation during election years; “top two” primary laws; and exclusion from televised debates—all propped up by a winner-take-all system cum the atavistic electoral college—the electoral doors are closed to basic challenges.
Updating the Vision of the Thirties Decentralizers
Reading through Who Owns America? and related outcries from the thirties provides an enlightening contrast to what one finds in the statist assertions expressed by the various spokespeople for “isms.” And such a reading should stimulate the LC toward convergence even more.
Merely updating these “conservative” constructs on property, ownership, control, corporate privileges and immunities, and government regulation can help to clarify deliberations between LibCons. The expansion of property owned but not controlled by the people has moved into the trillions of dollars through such means as worker pensions, enormous government transfers of taxpayer-funded research and development (e.g., intellectual property), the corporatization of public works and, of course, the public lands, public airwaves, and Internet. Yet, year after year, political campaigns by the two parties totally ignore this critical invasion of the commons.
Corporate privileges and immunities have also rapidly expanded in degree and in kind. Corporate welfare is immensely more varied, larger, and bipartisan. Corporations have devised, with their corporate lawyers, significant escapes from accountability. They have moved from having limited liability for their shareholders to ever more limited liability for the corporate entity itself, and now onto practical immunities for the top executives and directors. The Price Anderson Act limits the liability and insurability of atomic power plant utilities to a fraction of the potential damages accidents at these facilities would entail by shifting the financial burdens of disasters to the state (i.e., to taxpayers). Federal loan guarantees insure corporate capitalism. The awarding of defense industry corporation contracts carries special sovereign immunities with them. And, equally insidious, the shredding of tort law and the constant employment of one-sided, fine-print vendor contracts are collapsing two major pillars of our law while narrowing popular access to remedial justice and deterrence.
These seismic transitions proliferate outside public consciousness, business and law school educations, and, of course, the political electoral arenas. The immunity wave that has led to the replacement of responsibility and accountability is almost never discussed—a veritable, gigantic, quiet taboo. A corollary shield from criminal law for corporate malefactors is created by the fact that tiny government enforcement budgets have led routinely to plea bargains that permit modest settlements but no admission of guilt. No-fault government, no-fault giant corporations, and no-choice elections have become institutionalized against basic challenges by the people.
Meanwhile, government regulations have also been overtaken by the phenomenon of “regulatory capture,” as studiously pointed out by conservative economist George Stigler decades ago, though now put through with far greater sophistication and legislative assistance in favor of the regulatees and their insistent lobbyists and law firms. Making sure federal cops on the corporate crime beats have stripped budgets is another systemic strategy used by companies these days to keep their activities from scrutiny. The corporate crime wave, with its costs and corruption of government, reaches new intensities every decade, as there is more to take from the public purse.
The Financial Meltdown as a Fine Illustration of Corporate Impunity
That there is a broader immunity breakthrough was pointed out in August 2012 in the New York Times by writer Jesse Eisinger. Even when the protagonists of deregulation, in this case the financial firms that lobbied to repeal Glass-Steagall and led to wild financial risk taking and disasters for our economy during Wall Street’s self-inflicted collapse, and even when its principal promoters, such as Sanford Weill, the grand consolidator of Citigroup, regret what they did, thereby (to a degree) admitting their responsibility for the disasters, there are no authoritative calls for significant legal, occupational, or social sanctions against them.
Far from it. Here is Jesse Eisinger’s lament, titled “As Banking Titans Reflect on Errors, Few Pay Any Price”:
As every frustrated American knows, no major banking executive has gone to prison or has been fined any significant amount in the aftermath of the financial crisis.
But what’s astonishing is that Wall Street bankers seem not to have paid any social cost either. They sit on corporate and nonprofit boards and attend functions and galas. They remain top Wall Street executives, or even serve as regulators. The nation’s prominent op-ed pages, talk shows and conferences seek their opinions. If you are rich, you must be intelligent. Your views must be worthwhile, never mind the track record.
The embrace of Mr. Weill sets a new standard for reputation rehabilitation. . . . Mr. Weill’s only unambiguous success was to make himself enormously rich.
After recounting the serial collapse of the Citigroup Worldwide empire and its numerous scandals and violations of the law during the past generation, Mr. Eisinger asks, “What’s a guy gotta do around here to lose a little credibility?”25
Former secretary of the Treasury under Clinton and shortly thereafter co-chair of Citigroup, Robert Rubin should be asking the same question. He profited immensely from the Citigroup mess—the company lost billions in the 2008 meltdown and had to be rescued by the gove
rnment afterward—and was proven wrong, but he still rides high, appearing right after the crisis in November 2008 in a photograph with a select group of invited advisors, next to the just-elected President Barack Obama. It was Rubin who lobbied from his government post in 1999 to repeal Glass-Steagall. A year later he opposed a bill to regulate burgeoning trading in riskier derivatives, one of the newly allowed results of the repeal whereby investment banking and commercial banking could be mixed, a process that erupted and eventually led to the spectacular speculative bust. It was Rubin, knowing the repeal of Glass-Steagall was imminent, who resigned his Treasury post and rushed to make $40 million in a few weeks, advising Citigroup in the fall of 1999. It was co-chair Rubin whose strategies helped steer the ship of Citigroup onto the rocks while he himself was still making big money.
He has not yet recanted from the gigantic folly of his concoctions. He is still sought after for interviews, except about his role as an escape artist, and invited to give advice to potentates and politicians. Rubin experiences no shunning and is on the social circuit in New York and Washington, DC. Nassim Taleb, author of the super-bestseller The Black Swan and financial scholar, says of Mr. Rubin that “nobody on this planet represents more vividly the scam of the banking industry.”26 As Jesse Eisinger said: “What’s a guy gotta do around here to lose a little credibility?”
The Good Old Days When Corporate Criminals Actually Went to Jail
These two cases, and the many like them, are telltale signs of the rapid decay of any kinds of restraining or punitive sanctions being given to those who perpetrate serious corporate misdeeds, a decay made more visible when today’s situation is compared to what happened in the previous bank collapse of the savings and loans twenty years ago, when hundreds of bank officials went to jail.
