The Thom Hartmann Reader

by Thom Hartmann

  PART VI

  America the Corporatocracy

  FEW MODERN WRITERS HAVE DOCUMENTED THE CORPORATE stranglehold on our lives more convincingly than Thom Hartmann. From the debacle of our privatized health care system in “Medicine for Health, Not for Profit,” to the takeover of our natural resources in “Privatizing the Commons,” to the ruthlessly predatory worldview in “Sociopathic Paychecks,” Hartmann shows how corporate powers have seized control of most of the details of our daily lives, down to the air we breathe and the water we drink. Corporate-funded think tanks and corporate lobbyists have twisted and perverted our democracy. Corporations influence our elections by giving millions of dollars to political candidates (a practice, Hartmann points out, that used to be called bribery). At a time when we have the highest unemployment in decades and safety net programs are struggling, corporate profits in the third quarter of 2010 were $1.6 trillion, the highest on record.

  How did we get here? How did American corporations insinuate themselves into the US Constitution and claim for themselves the rights of human beings? Curious, Hartmann visited the old Vermont State Supreme Court law library and dug up an original copy of the court proceedings from the 1886 US Supreme Court case, Santa Clara County v. Southern Pacific Railroad Company. He discovered that “corporate personhood”—the concept that a corporation has all the rights of a person under the Constitution—was based on a mistaken interpretation of a corrupt court reporter’s notes in the case. “It was like running down a detective mystery,” he said. “That was when the foundations for corporate power were laid in the United States, and they were laid on the basis of a lie.”

  While this erroneous notion has done immeasurable damage to our country, we face an even greater threat from the Citizens United decision, as Hartmann writes in “Wal-Mart Is Not a Person.” This 2010 Supreme Court ruling asserted that because corporations are people, they have First Amendment rights to free speech and may spend unlimited money supporting the politicians and the ballot initiatives of their choice. The consequences, Hartmann writes, will be “the complete transformation of this country from a democracy into a corporate plutocracy.”

  He also investigated “The True Story of the Boston Tea Party,” overturning centuries-old misconceptions and discovering that “that incident in Boston Harbor” was actually a revolutionary protest over a corporate tax break. “It was a real shock to me to discover that the event that kicked over the first domino leading directly to the American Revolution was a direct-action protest against multinational corporate power,” he said. By going back to the beginnings of our nation, Hartmann shows how corporate personhood is incompatible with democracy. Thomas Jefferson and the other Founders were acutely aware of the dangers of unlimited corporate power and worked hard to ensure that a small group of affluent people would never dominate the United States.

  Despite grave setbacks, it’s not too late to protect our public institutions and our commons. There is a growing movement to rescind corporate personhood and amend the Constitution to say that only humans are living people, relegating corporations to their rightful place—as nonliving, nonbreathing entities.* Many communities have passed resolutions saying they will not recognize corporations as persons. We can all join this movement and work to abolish the corporate takeover of our politics and our culture. When you envision a world in which mega-corporations can pollute our air and water with impunity, cut down our forests, dodge taxes, control our media, buy and sell our elected officials, break laws at will, and even kill people without being held accountable, you begin to see that bringing an end to what Hartmann calls “the cancer of corporate personhood” is truly a life-or-death matter. “Rescinding corporate personhood is the first step toward a larger vision of reclaiming and reinvigorating democracy around the world,” he writes.

  It’s always been Hartmann’s deepest aspiration that his audience do more than just passively listen or read—that they become active, awakened, agents of change. That’s why he wraps up each episode of his radio show with the slogan “Activism begins with you, democracy begins with you, get out there, get active! Tag, you’re it!” Many listeners proudly share stories on Hartmann’s blog of how they’ve become involved in local politics or grassroots organizing after listening to his radio program and becoming informed. In book after book, in articles and talks, on television and radio, Thom Hartmann constantly underscores the fact that a better, more sustainable, more equitable world begins with you. No special skills are required; just being a citizen of the United States gives you instant membership and a potent voice in our democracy. The rest is up to you. “Tag, you’re it!”

  The True Story of the Boston Tea Party

  Adapted from Unequal Protection: How Corporations

  Became “People”—and How You Can Fight Back

  ON A COLD NOVEMBER EVENING, ACTIVISTS GATHERED IN A COASTAL town. The corporation had gone too far, and the 2,000 people who’d jammed into the meeting hall were torn as to what to do about it. Unemployment was exploding, and the economic crisis was deepening; corporate crime, governmental corruption spawned by corporate cash, and an ethos of greed were blamed. “Why do we wait?” demanded one at the meeting, a fisherman named George Hewes. “The more we delay, the more strength is acquired” by the company and its puppets in the government. “Now is the time to prove our courage,” he said. Soon the moment came when the crowd decided for direct action and rushed into the streets.

  That is how I tell the story of the Boston Tea Party, now that I have read a first-person account of it. While striving to understand my nation’s struggles against corporations, I came upon a first edition of A Retrospect of the Boston Tea-Party with a Memoir of George R. T. Hewes, a Survivor of the Little Band of Patriots Who Drowned the Tea in Boston Harbour in 1773,1 and I jumped at the chance to buy it. Because the identities of the Boston Tea Party participants were hidden (other than Samuel Adams) and all were sworn to secrecy for the next 50 years, this volume (published 61 years later) is the only first-person account of the event by a participant that exists, so far as I can find. As I read I began to understand the true causes of the American Revolution.

  I learned that the Boston Tea Party resembled in many ways the growing modern-day protests against transnational corporations and the small-town efforts to protect themselves from chain-store retailers and factory farms. The Boston Tea Party’s participants thought of themselves as protesters against the actions of the multinational East India Company.

  Although schoolchildren are usually taught that the American Revolution was a rebellion against “taxation without representation,” akin to modern-day conservative taxpayer revolts, in fact what led to the revolution was rage against a transnational corporation that, by the 1760s, dominated trade from China to India to the Caribbean and controlled nearly all commerce to and from North America, with subsidies and special dispensation from the British Crown.

  Hewes notes: “The [East India] Company received permission to transport tea, free of all duty, from Great Britain to America,” enabling it to wipe out New England–based tea wholesalers and mom-and-pop stores and take over the tea business in all of America. “Hence,” he told his biographer, “it was no longer the small vessels of private merchants, who went to vend tea for their own account in the ports of the colonies, but, on the contrary, ships of an enormous burthen, that transported immense quantities of this commodity … The colonies were now arrived at the decisive moment when they must cast the dye, and determine their course …”

  A pamphlet called The Alarm was circulated through the colonies and signed by the enigmatic “Rusticus.” One issue made clear the feelings of colonial Americans about England’s largest transnational corporation and its behavior around the world:

  Their Conduct in Asia, for some Years past, has given simple Proof, how little they regard the Laws of Nations, the Rights, Liberties, or Lives of Men. They have levied War, excited Rebellions, dethroned lawful Princes, and sacrificed Milli
ons for the Sake of Gain. The Revenues of Mighty Kingdoms have entered their Coffers. And these not being sufficient to glut their Avarice, they have, by the most unparalleled Barbarities, Extortions, and Monopolies, stripped the miserable Inhabitants of their Property, and reduced whole Provinces to Indigence and Ruin. Fifteen hundred Thousands, it is said, perished by Famine in one Year, not because the Earth denied its Fruits; but [because] this Company and their Servants engulfed all the Necessaries of Life, and set them at so high a Rate that the poor could not purchase them.

  After protesters had turned back the company’s ships in Philadelphia and New York, Hewes writes, “In Boston the general voice declared the time was come to face the storm.”

  The citizens of the colonies were preparing to throw off one of the corporations that for almost 200 years had determined nearly every aspect of their lives through its economic and political power. They were planning to destroy the goods of the world’s largest multinational corporation, intimidate its employees, and face down the guns of the government that supported it.

  The Queen’s Corporation

  The East India Company’s influence had always been pervasive in the colonies. Indeed it was not the Puritans but the East India Company that founded America. The Puritans traveled to America on ships owned by the East India Company, which had already established the first colony in North America, at Jamestown, in the company-owned Commonwealth of Virginia, stretching from the Atlantic Ocean to the Mississippi. The commonwealth was named after the “virgin queen,” Elizabeth I, who had chartered the corporation.

  Elizabeth was trying to make England a player in the new global trade sparked by the European “discovery” of the Americas. The wealth that Spain began extracting from the New World caught the attention of the European powers. In many European countries, particularly Holland and France, consortiums were put together to finance ships to sail the seas. In 1580 Queen Elizabeth became the largest shareholder in the Golden Hind, a ship owned by Sir Francis Drake.

  The investment worked out well for Queen Elizabeth. There’s no record of exactly how much she made when Drake paid her share of the Hind’s dividends, but it was undoubtedly vast, since Drake himself and the other minor shareholders all received a 5,000 percent return on their investment. Plus, because the queen placed a maximum loss to the initial investors of their investment amount only, it was a low-risk investment (low-risk for the investors at least; creditors, such as suppliers of provisions for the voyages or wood for the ships, and employees, for example, would be left unpaid if the venture failed, just as in a modern-day corporation). She was endorsing an investment model that led to the modern limited-liability corporation.

  After making a fortune on Drake’s expeditions, Elizabeth started looking for a more permanent arrangement. She authorized a group of 218 London merchants and noblemen to form a corporation. The East India Company was born on December 31, 1600.

  By the 1760s the East India Company’s power had grown massively and globally. This rapid expansion, however, was a mixed blessing, as the company went deep in debt trying to keep ahead of the Dutch trading companies; by 1770 it found itself nearly bankrupt.

  The company turned to a strategy that multinational corporations follow to this day: they lobbied for laws that would make it easy for them to put their small-business competitors out of business.

  Most of the members of the British government and royalty (including the king) were stockholders in the East India Company, so it was easy to get laws passed in its interests. Among the company’s biggest and most vexing problems were American colonial entrepreneurs, who ran their own small ships to bring tea and other goods directly into America without routing them through Britain or through the company. Between 1681 and 1773, a series of laws were passed, granting the company a monopoly on tea sold in the American colonies and exempting it from tea taxes. Thus the company was able to lower its tea prices to undercut those of the local importers and the small teahouses in every town in America. But the colonists were unappreciative of their colonies being used as a profit center for the multinational corporation.

  Boston’s Million-Dollar Tea Party

  And so, Hewes says, on a cold November evening in 1773, the first of the East India Company’s ships of tax-free tea arrived in Boston Harbor. The next morning a pamphlet was widely circulated, calling on patriots to meet at Faneuil Hall to discuss resistance to the East India Company and its tea. “Things thus appeared to be hastening to a disastrous issue,” wrote Hewes. “The people of the country arrived in great numbers, the inhabitants of the town assembled. This assembly, on the 16th of December 1773, was the most numerous ever known, there being more than 2,000 from the country present.”

  The group called for a vote on whether to oppose the landing of the tea. The vote was unanimously affirmative, and it is related by one historian of that scene “that a person disguised after the manner of the Indians, who was in the gallery, shouted at this juncture, the cry of war; and that the meeting dissolved in the twinkling of an eye, and the multitude rushed in a mass to Griffin’s wharf.”

  That night Hewes, blackening his face with coal dust, dressed as an Indian and joined crowds of other men in hacking apart the chests of tea and throwing them into the harbor. In all, the 342 chests of tea—more than 90,000 pounds—thrown overboard that night were enough to make 24 million cups of tea and were valued by the East India Company at 9,659 Pounds Sterling or, in today’s currency, just over $1 million.

  In response the British Parliament immediately passed the Boston Port Act of 1774, stating that the port of Boston would be closed until its citizens reimbursed the East India Company for the tea they had destroyed. The colonists refused. A year and a half later, the colonists would again state their defiance of the East India Company and Great Britain by taking on British troops in an armed conflict at Lexington and Concord (the “shots heard ’round the world”) on April 19, 1775.

  That war—finally triggered by a transnational corporation and its government patrons trying to deny American colonists a fair and competitive local marketplace—would end with independence for the colonies.

  The revolutionaries had put the East India Company in its place with the Boston Tea Party, and that, they thought, was the end of that. Unfortunately, the Boston Tea Party was not the end of that. It was only the beginning of corporate power in America.

  The Birth of the Corporate “Person”

  Fast-forward 225 years.

  The American war over the power of corporations is heating up again. A current struggle centers on the question of whether corporations should be “people” in the eyes of the law.

  In October 2002, Nike appealed a lawsuit against it to the US Supreme Court, asking the Court to rule that Nike’s letters to newspapers about the treatment of its workers in Indonesia and Vietnam are protected by the First Amendment.

  In Pennsylvania several townships recently passed laws banning corporate-owned farms. In response, agribusiness corporations threatened to sue the townships for violation of their civil rights—just as if these corporations were persons.

  Imagine. In today’s America, when a new human is born, the child is instantly protected by the full weight and power of the US Constitution and the Bill of Rights. Similarly, when papers called articles of incorporation are submitted to governments in America (and most other nations of the world), another type of new “person” is brought forth into the nation.

  The new corporate person is instantly endowed with many of the rights and the protections of personhood. It doesn’t breathe or eat, can’t be enslaved, can live forever, doesn’t fear prison, and can’t be executed if found guilty of misdoings. It is not a human but a creation of humans. Nonetheless, the new corporation gets many of the constitutional protections America’s Founders gave humans to protect them against governments or other potential oppressors. How did corporations become persons?

  After the Revolutionary War, Thomas Jefferson proposed a Bill of
Rights with 12 amendments, one of which would “ban commercial monopolies,” forever making it illegal for corporations to own other corporations and to do business in more than one specific product or market. This legislation would forever prevent another oppressive commercial juggernaut like the East India Company from arising again in North America to threaten democracy and oppress the people.

  But Jefferson’s amendment failed, and the corporations fought back. Now those corporations use the club of the amendments that did pass to influence elections and legislation favoring them—in the name of their rights as persons.

  A Historic Goof?

  What most people don’t realize is that this is a recent agreement—and it is based on a historic error. Only since 1886 have the Bill of Rights and the Fourteenth Amendment been applied explicitly to corporations. For 100 years people have believed that the 1886 case Santa Clara County v. Southern Pacific Railroad Company included the statement Corporations are persons. But looking at the actual case documents, I found that this was never stated by the Court, and indeed the chief justice explicitly ruled that matter out of consideration in the case.

  The claim that corporations are persons was added by the court reporter, who wrote the introduction to the decision, called a “head-note.” Headnotes have no legal standing.

  It appears that corporations acquired personhood by persuading a court reporter and a Supreme Court judge to make a notation in the headnote of an unrelated law case. In Everyman’s Constitution legal historian Howard Jay Graham documents scores of previous attempts by Supreme Court Justice Stephen J. Field to influence the legal process to the benefit of his open patrons, the railroad corporations.2 Field, as judge on the Ninth Circuit in California, had repeatedly ruled that corporations were persons under the Fourteenth Amendment, so it doesn’t take much imagination to guess what Field might have suggested court reporter J. C. Bancroft Davis include in the transcript, perhaps even offering the language, which happened to match his own language in previous lower-court cases.