Policy to Establish the Separation of the Corporatocracy and the State

Nicole_C_Scott · November 13, 2024, 1:10pm

Proposal for a Policy to Establish the Separation of the Corporatocracy and the State

Executive Summary

This policy proposal addresses the critical issue of corporatocracy in the United States, where corporate entities exert undue influence over governance, often at the expense of public interest and constitutional rights. It advocates for a structured separation of corporate power from state functions, drawing parallels to the principle of separation of church and state. The proposal outlines:

Historical Context: A review of how corporate power has evolved from entities designed for public benefit to powerful entities with significant political sway.
Legal Framework: An examination of current legal statuses, particularly highlighting the implications of the Citizens United decision, and proposes new legal pathways to ensure corporate accountability.
Recommendations for Reform: Legislative measures to redefine corporate rights and responsibilities, enhance liability for rights violations, limit political influence through campaign finance reform, and ensure corporate governance aligns with democratic values.
Implementation: Strategies for phased implementation, enforcement, and ongoing review of the proposed measures to adapt to changing societal and technological landscapes.

The overarching goal is to realign corporate activities with the constitutional principles of America, ensuring that corporations serve the public interest while enjoying the privileges they are granted.

Historical Context

Origins of Corporate Power

Colonial and Early American Periods: In colonial America, corporations were typically formed by charters granted by the British Crown or colonial legislatures for specific public purposes like building roads, bridges, or educational institutions. These corporations were not the sprawling entities we see today but were more akin to public-private partnerships with a clear public benefit mandate.
Post-Revolutionary Corporate Charters: Following independence, state legislatures in the U.S. granted charters to corporations, often for infrastructure like canals, turnpikes, and later railroads. These charters came with conditions, including expiration dates, specific purposes, and the authority for the state to dissolve the corporation if it abused its privileges or failed to serve the public interest. This reflected a view of corporations as instruments for public good, under strict state control.
Judicial Decisions and Legislative Changes: Over time, states began to liberalize corporate laws, allowing for general incorporation without the need for specific legislative approval, which reduced state oversight. This shift was partly influenced by cases like Dartmouth College v. Woodward (1819), where the Supreme Court ruled that corporate charters were contracts protected under the Contracts Clause, limiting state control over corporations once chartered[^1^].

Evolution to Corporate Personhood

Santa Clara County v. Southern Pacific Railroad (1886): Although the court did not explicitly rule on corporate personhood, a headnote added by the court reporter stated that corporations were persons under the Fourteenth Amendment. This headnote was later cited as precedent, significantly expanding corporate rights and protections originally intended for individuals[^2^].
Development of Corporate Rights: Over the years, through various judicial interpretations, corporations gained rights like free speech (First Amendment), protection against search and seizure (Fourth Amendment), and equal protection (Fourteenth Amendment), which were originally designed for citizens, fundamentally changing the legal landscape.

The Rise of Corporatocracy

Industrialization and Growth: The late 19th and 20th centuries saw massive industrial growth, with corporations becoming central to economic life. This period also saw the rise of trusts and monopolies, leading to legislation like the Sherman Antitrust Act (1890) to curb corporate overreach, but corporate influence continued to grow[^3^].
Political Influence: Corporations began to exert significant influence through lobbying, campaign contributions, and revolving doors between corporate and government positions. This was particularly pronounced in the post-world war two era with the growth of multinational corporations[^4^].
Regulatory Capture: As corporations grew, so did their ability to influence or even capture regulatory agencies, leading to policies that favored corporate interests, sometimes at the expense of public welfare or competition.
Corporate Psychopathy Analogy: The documentary “The Corporation,” based on Joel Bakan’s book, offers an insightful perspective on corporate behavior by arguing that if corporations were individuals, they would exhibit traits akin to psychopathy due to their singular focus on profit maximization for shareholders at the expense of other considerations like ethics, societal welfare, or environmental impact[^6^].

Legal Precedents and Current Status

Citizens United v. FEC (2010)

Background: This case challenged provisions of the McCain-Feingold Act, which limited electioneering communications by corporations and unions.
Decision: The Supreme Court, in a 5-4 decision, ruled that these limitations violated the First Amendment right to free speech. The court held that political spending is a form of protected speech under the First Amendment, and thus, corporate funding of independent political broadcasts in candidate elections could not be limited[^5^].
Impact:
Political Influence: This decision effectively opened the floodgates for corporate money in politics, leading to the creation of Super PACs that could raise and spend unlimited amounts to influence elections, as long as they did not coordinate directly with candidates or parties.
Criticism and Debate: Critics argue that this equates to buying political influence, potentially undermining democratic equality by allowing wealth to equate to political power. Supporters see it as upholding free speech rights, arguing that corporations, like individuals, should have the right to express their views on political matters.

Liability for Violations of Law and Harm

Inherent Contradiction

The doctrine of corporate personhood, which grants corporations legal rights akin to those of individuals, poses a paradox when it comes to liability. While corporations enjoy protections like freedom of speech, they often do not bear personal liability in the same way individuals do. This discrepancy has led to debates about fairness and accountability.

Criminal Liability

Traditionally, corporations can be held criminally liable under the doctrine of respondeat superior, where the corporation is responsible for the actions of its agents if those actions are within the scope of their employment and benefit the corporation. However, this principle often does not extend to holding corporate officers or shareholders personally liable unless their direct involvement in criminal activity can be proven.

Recommendations:

Piercing the Corporate Veil: Propose conditions under which the corporate veil could be pierced more readily, making officers personally liable for corporate misdeeds.
Enhanced Penalties: For corporations found guilty of violating laws, especially when these violations infringe on public rights or safety, penalties could include not just fines but also loss of certain corporate privileges or rights, including asset forfeiture, and the dissolving of the corporate conglomerate similar to the way the state dissolved charters when they were made for the common good.
Addressing Corporate Psychopathy: Inspired by discussions in “The Corporation,” this proposal suggests that the legal framework should evolve to counteract the inherent profit-driven psychopathy of corporations. By mandating a broader responsibility framework, corporations would be compelled to balance profit motives with ethical considerations and public welfare[^6^].

Collusion with Government

Revolving Door Phenomenon

The movement of personnel between roles as regulators in government and executive positions in the industries they once regulated exemplifies a significant conflict of interest. This practice can lead to regulatory environments that favor corporate interests over public welfare.

Legislative Solutions:

Cooling-off Periods: Enforce longer or more stringent cooling-off periods for government officials before they can take up positions in industries they previously regulated.
Transparency and Accountability: Require detailed public disclosures of past governmental roles by corporate officials and vice versa to highlight potential conflicts.

Misappropriation of Tax Dollars

Bailouts and Corporate Welfare: When corporations engage in risky or unethical behavior leading to financial instability, the government often steps in with bailouts or subsidies, effectively using public funds to mitigate private sector failures.

Policy Proposals:

Taxpayer Protection Clauses: Implement clauses in corporate charters or federal funding agreements that prevent bailouts unless certain conditions of good governance, ethical business practices, and financial prudence are met.
Public Benefit Test: Any financial assistance to corporations should pass a rigorous public benefit test, ensuring that the public gets value in return for their tax dollars.

Bill of Rights Violations Examples

Privacy Rights in the Digital Age

Surveillance and Data Collection: Many technology companies collect vast amounts of personal data. In collaboration with government agencies, this data can be used for surveillance under programs like PRISM or partnerships with law enforcement, significantly infringing on the Fourth Amendment right against unreasonable searches and seizures.
NSA and Corporate Data Sharing: Post-9/11, agreements between tech firms and agencies like the NSA allowed for data sharing which many argue went beyond legal privacy protections without proper warrants or probable cause.

Freedom of Speech and Media Control

Content Moderation and Censorship: Social media platforms, acting as modern-day public squares, have the power to moderate content. When influenced by government requests or when aligning with government narratives, this can lead to suppression of speech, thereby infringing on First Amendment rights.
Net Neutrality: The control over internet service provision by a few corporations can influence what content is accessible or prioritized, indirectly affecting freedom of speech when these providers align with or are pressured by government policies.

Right to Assembly and Association

Surveillance at Protests: Companies providing facial recognition technology or surveillance equipment might collaborate with local police or federal agencies to monitor and potentially inhibit the right to peaceably assemble, especially if this technology is used without proper judicial oversight.

Legal Safeguards

Corporate Accountability for Rights Violations

Direct Legal Actions

Civil Suits: Establish or enhance legal frameworks allowing individuals or groups to sue corporations for rights violations directly. This could involve:
Expanding standing to sue for rights violations, particularly when corporations act with state-like authority or in concert with government actions.
Creating mechanisms similar to the Alien Tort Statute for domestic rights abuses, allowing for corporate liability in civil rights infringements.

Regulatory Oversight

Independent Watchdogs: Propose partnerships with independent bodies such as CorpWatch, or the empowerment of existing agencies like the Federal Trade Commission (FTC) or the Department of Justice (DOJ) to not only enforce privacy and competition laws but also monitor for First Amendment violations by corporations.
Transparency Requirements: Corporations could be mandated to report on how they handle government requests related to user data or content, promoting transparency that might deter inappropriate collaborations.

Anti-Trust and Anti-Monopoly Regulations

Strengthening Anti-Trust Laws:
Broader Definition of Monopoly Power: Reform anti-trust laws to consider data control, access to platforms, and digital dominance as criteria for monopolistic behavior.
Preventive Measures: Introduce preemptive regulations that prevent mergers or acquisitions that could lead to excessive control over markets or media, thereby preserving competition and pluralism in speech.
Government Accountability for Corporate Coercion:
Restrictions on Government: Implement laws that restrict government from pressuring corporations into actions that infringe on rights, with clear penalties for officials found to engage in such coercion.
Whistleblower Protections: Enhance protections for whistleblowers within corporations or government who expose rights violations, ensuring they can bring issues to light without fear of retaliation.
Public Interest Standards:
Corporate Governance: Require corporations, especially those with significant public interaction or government contracts, to adhere to public interest standards that include respecting civil liberties.
Charters and Licenses: Tying corporate charters or operational licenses to the respect of fundamental rights, with revocation as a potential consequence for chronic violations.

Implementation and Enforcement

Policy Implementation

Develop clear, actionable guidelines for what constitutes a rights violation by a corporation, particularly in ambiguous areas like digital privacy or content moderation.
Establish or appoint ombudsmen or commissioners specifically tasked with civil liberties in the corporate sector.

Enforcement

Empower regulatory bodies with the authority to investigate and impose sanctions or recommend legal actions against corporations infringing on rights.
Create a legal presumption against corporations in cases where there’s clear collusion with the government to violate rights, shifting the burden of proof onto the corporation.

Policy Framework

Clarify Corporate Rights and Responsibilities: Use historical context to argue that corporate rights were not meant to be absolute but balanced with responsibilities towards society.

Enhance Accountability Mechanisms:

Develop a modern equivalent to the old practice where states could revoke corporate charters. This could be through federal oversight bodies with the power to dismantle corporations that repeatedly flout laws or ethics.
Reform Corporate Governance: Suggest changes like mandatory ethical audits, stakeholder governance models where more voices than just shareholders are considered, or even the introduction of a ‘corporate death penalty’ for egregious violations.
Public Engagement and Transparency: Encourage policies that open up corporate governance to public scrutiny, especially when corporations engage in political activities.

Legislative Package for Corporate Accountability and Bill of Rights Adherence

Establishment of Corporate Rights and Responsibilities Act

Rights Clarification: Clearly define what rights corporations can claim under the law, with explicit exclusions or modifications where corporate rights might conflict with human rights or public welfare.
Responsibilities Charter:
Corporations would be required to adhere to a Bill of Corporate Responsibilities, explicitly listing their duties to respect and uphold constitutional rights. This could include:
Privacy Protections: Ensuring data handling practices respect Fourth Amendment rights.
Freedom of Expression: Commitment to not unduly censor or bias content unless it clearly violates other legal standards (like defamation or incitement to violence).
Non-Discrimination: Upholding principles of equal protection under the law, preventing corporate policies that could be discriminatory.

Corporate Liability and Enforcement Mechanism

Legal Pathways for Citizens:
Citizen Suits: Allow individuals to bring lawsuits against corporations for rights violations with the possibility of treble damages or punitive measures to deter corporate misconduct.
Public Interest Litigation: Support for public interest attorneys or groups to file suits on behalf of affected individuals or the public interest.
Corporate Liability Framework:
Legislation could redefine corporate liability to include personal accountability for executives in cases of systematic rights violations, especially when these are known or foreseeable outcomes of corporate policy or negligence.
Regulatory Enforcement:
New Regulatory Body: Propose an independent agency, like a “Corporate Accountability Commission,” focused solely on monitoring corporate compliance with constitutional rights, with the power to:
Conduct audits and investigations.
Issue compliance orders.
Recommend criminal prosecutions or civil penalties.

Incentivization Through Corporate Governance Reform

Incentive Programs:
Tax Incentives: Corporations that demonstrate consistent respect for constitutional rights could qualify for tax benefits or reduced regulatory burdens in other areas of their operation.
Certification and Public Recognition: Establish a “Rights-Respecting Corporation” certification that can be used in marketing, similar to fair trade certifications, providing a competitive edge.
Corporate Governance Requirements:
Ethics Committees: Mandate the establishment of ethics boards within corporations that include external experts on civil rights, focusing specifically on compliance with the Bill of Rights.
Public Reporting: Require annual reports on how corporations are meeting their responsibilities towards constitutional rights, similar to financial or environmental reporting.

Public-Private Partnership Guidelines

Guidelines for Collaboration:
Transparency: Any partnership or contract between a corporation and government must include transparency measures on how the collaboration affects or could potentially affect civil liberties.
Third-Party Oversight: Involve neutral third parties in significant public-private partnerships where rights might be at risk, ensuring adherence to constitutional standards.

Amendments to Existing Laws

Anti-Trust and Media Laws:
Amendments to strengthen protections against monopolistic practices that could lead to control over information or media, thus safeguarding free speech.
Specific clauses to prevent any corporation from having undue influence over the political process or media content.
Data Protection and Privacy Laws:
Enhance current laws like the Privacy Act or proposed reforms to give individuals more control over their data, aligning with privacy rights.

Educational and Cultural Shift

Public Education: Campaigns to educate the public and corporate leaders about the importance of constitutional rights in business practices.
Corporate Culture: Encourage a cultural shift within corporations towards viewing the respect for constitutional rights not as regulatory compliance but as an integral part of corporate citizenship and social responsibility.

Implementation Strategy

Phased Implementation: Roll out these changes over time to allow corporations to adapt, with stricter enforcement phases as businesses adjust to new standards.

Review and Adjustment: Establish a legislative review process where the effectiveness of these laws is assessed periodically, with the ability to make adjustments based on evolving technology, societal needs, and corporate behavior.

This legislative package would aim to embed respect for constitutional rights into the DNA of corporate operations, making it a fundamental aspect of how business is conducted, rather than an afterthought or mere compliance checkbox. By linking corporate privileges and benefits to rights-respecting behavior, the policy would create a market-driven incentive for corporations to align with democratic values.

Distinguishing from ESG Criteria

Core Differences:

Purpose and Origin:
ESG Framework: Often originates from investor or global financial guidelines, aiming to factor in environmental, social, and governance issues into investment decisions, sometimes criticized for being leveraged by large investors to push specific agendas.
Proposed Framework: This legislative package is designed by and for the public interest, focusing explicitly on constitutional rights, democratic integrity, and corporate accountability to the state and its citizens, not just investors.
Voluntary vs. Mandatory:
ESG: Typically voluntary, where companies can choose to report on these metrics, and compliance can sometimes be superficial or strategic rather than substantive.
Proposed Legislative Approach: Mandatory adherence with enforceable standards, where non-compliance results in legal consequences, not just market or investor relations pressures.

Key Points to Emphasize in the Proposal:

Sovereignty and Democracy: Unlike ESG, which can sometimes be seen as external pressure from global financial elites, this framework aims to protect and enhance national sovereignty by ensuring that corporate power does not overshadow democratic processes or constitutional rights.
Non-Coercive Nature: While ESG might be used to coerce companies into aligning with specific global or corporate agendas, this proposal is about aligning corporate entities with the legal and ethical framework of the nation, ensuring they serve the public interest as originally intended by corporate charters.
Public Benefit Over Profit: This approach prioritizes public welfare and rights over purely financial outcomes. It’s about ensuring that corporations do not leverage their economic power to bypass or bend the constitutional obligations that individuals must follow.
Corporate Responsibility as a Legal Standard: Make clear that this framework isn’t about voluntary good citizenship but about setting a legal standard for corporate behavior, where rights and responsibilities are clearly defined and enforced by law.
Avoidance of Political Agendas: The focus is on legal and constitutional compliance, not on advancing any particular environmental or social policy that might be tied to partisan or external agendas. The aim is to protect freedoms and rights as enshrined in the Constitution, not to dictate corporate policy in line with any specific political movement.
Citizen Empowerment: Whereas ESG might sometimes be criticized for being a tool of the elite, this framework empowers citizens through legal recourse and transparency, making corporations answerable to the populace they serve rather than just to shareholders or global institutions.
Realigning Corporate Behavior: Drawing from the insights of “The Corporation,” this policy aims to realign corporate behavior away from the psychopathic tendencies identified in the documentary, focusing instead on constitutional adherence and public interest[^6^].

By drawing these distinctions, the policies espoused should reassure stakeholders that the intent is to reinforce democratic values and constitutional protections, not to introduce another layer of possibly biased or externally driven corporate governance criteria.

Focus:
ESG: Broadly encompasses a wide range of issues from environmental impact to employee relations, but can be vague or flexible in what it prioritizes.
Constitutional Rights Framework: Specifically targets the upholding of constitutional rights, ensuring that corporate activities do not infringe upon or undermine these foundational legal protections.
Accountability and Transparency:
Proposed Framework: Accountability to the public and government, with transparency mechanisms designed to ensure real-world adherence to constitutional principles, not just corporate image management.

Key Points to Emphasize in the Proposal:

Sovereignty and Democracy: Unlike ESG, which can sometimes be seen as external pressure from global financial elites, this framework aims to protect and enhance national sovereignty by ensuring that corporate power does not overshadow democratic processes or constitutional rights.
Non-Coercive Nature: While ESG might be used to coerce companies into aligning with specific global or corporate agendas, this proposal is about aligning corporate entities with the legal and ethical framework of the nation, ensuring they serve the public interest as originally intended by corporate charters.
Public Benefit Over Profit: This approach prioritizes public welfare and rights over purely financial outcomes. It’s about ensuring that corporations do not leverage their economic power to bypass or bend the constitutional obligations that individuals must follow.
Corporate Responsibility as a Legal Standard: Make clear that this framework isn’t about voluntary good citizenship but about setting a legal standard for corporate behavior, where rights and responsibilities are clearly defined and enforced by law.
Avoidance of Political Agendas: The focus is on legal and constitutional compliance, not on advancing any particular environmental or social policy that might be tied to partisan or external agendas. The aim is to protect freedoms and rights as enshrined in the Constitution, not to dictate corporate policy in line with any specific political movement.
Citizen Empowerment: Whereas ESG might sometimes be criticized for being a tool of the elite, this framework empowers citizens through legal recourse and transparency, making corporations answerable to the populace they serve rather than just to shareholders or global institutions.
Realigning Corporate Behavior: Drawing from the insights of “The Corporation,” this policy aims to realign corporate behavior away from the psychopathic tendencies identified in the documentary, focusing instead on constitutional adherence and public interest[^6^].

By drawing these distinctions, the policies espoused should reassure stakeholders that the intent is to reinforce democratic values and constitutional protections, not to introduce another layer of possibly biased or externally driven corporate governance criteria.

Conclusion

The unchecked expansion of corporate influence has led to a scenario where the very principles of democratic governance and individual rights are at risk. This proposal aims not just to curb corporate overreach but to redefine the relationship between corporations and the state in a manner that respects the foundational principles of the U.S. Constitution. By establishing clear legal, ethical, and governance frameworks, we can foster an environment where corporate entities contribute positively to society without undermining the democratic fabric or the rights of citizens. This initiative calls for a return to the original intent of corporate charters: to serve the public good under strict oversight, ensuring that as they grow in size and influence, their responsibilities grow correspondingly.

This proposal, through its comprehensive approach, seeks to address the complex interplay between corporate power and democratic governance, aiming to restore balance and ensure that corporations operate within a framework that respects and upholds the constitutional rights and public interest of the United States.

Appendices

Resources and Further Reading:

Books:
“The Corporation: The Pathological Pursuit of Profit and Power” by Joel Bakan - A critical analysis of corporate behavior and its impact on society.
“Corporations Are Not People: Reclaiming Democracy from Big Money and Global Corporations” by Jeffrey D. Clements - Discusses the legal history and consequences of corporate personhood.
Articles:
“The Corporate Takeover of U.S. Democracy” by Ralph Nader - An opinion piece on how corporate power undermines democracy.
“How Corporate Lobbying is Distorting US Democracy” by Lee Drutman - Explores the mechanics of corporate influence in policy-making.
Laws and Legal Precedents:
Sherman Antitrust Act (1890) - Aimed at preventing monopolies and trusts to protect competition.
Dartmouth College v. Woodward (1819) - Established that corporate charters are contracts protected by the Constitution.
Santa Clara County v. Southern Pacific Railroad (1886) - Introduced the concept of corporate personhood through a court reporter’s headnote.
Citizens United v. FEC (2010) - Ruled that political spending is a form of protected speech under the First Amendment.
Reports:
Congressional Research Service Reports on Corporate Taxation and Governance - Provides insight into current laws and proposed reforms.
Transparency International Reports on Corporate Influence in Politics - Investigates the global issue of corporate influence in government.
Websites:
CorpWatch - An independent watchdog dedicated to exposing corporate malfeasance.
OpenSecrets.org - Tracks money in U.S. politics, offering data on lobbying and campaign contributions.
Academic Journals:
Journal of Law, Economics, and Organization - Publishes research on corporate governance and law.
The American Journal of Political Science - Often features articles on the impact of corporate money in politics.

Footnotes:

[^1^] Bakken, G. M., & Farrington, B. (2003). The American West: A Concise History. Oxford University Press. (For colonial and early American corporate history)

[^2^] Clements, J. D. (2012). Corporations Are Not People: Reclaiming Democracy from Big Money and Global Corporations. Berrett-Koehler Publishers. (For insights on corporate personhood and its effects on democracy)

[^3^] Drutman, L. (2015). “How Corporate Lobbying is Distorting US Democracy,” The Atlantic.

[^4^] Nader, R. (2014). “The Corporate Takeover of U.S. Democracy,” The Huffington Post.

[^5^] Supreme Court Cases:

Dartmouth College v. Woodward, 17 U.S. 518 (1819)
Santa Clara County v. Southern Pacific Railroad, 118 U.S. 394 (1886)
Citizens United v. Federal Election Commission, 558 U.S. 310 (2010)

[^6^] Bakan, J. (2004). The Corporation: The Pathological Pursuit of Profit and Power. Free Press.

EthanHowardMfrr · November 16, 2024, 3:54pm

Thanks for the response, this is a great post! You definitely got my vote. This forum needs an advancement mechanism. Merges and proposals are only stacking up, without actually merging or becoming ‘officially supported’ by the forum. The Forum deserves major change to allow for an advancement of popular better worded policy proposals.

Other than my ‘article’ as you commented on;

This discussion topic highlights the over-expansion of certain business:

This proposal highlights just how corrupt legislative definitions have got:

These proposals help to highlight the corruption in Congress, in light of pay, terms, apportionment, vacancies, and lobbying:

Direct violations of the 1st Amendment:

Health related regulation:

Agrarian related proposals:

Without some sort of mass collaboration, these policy proposals will fall through. Some of these proposals, coming from you and I, would never gain support without a Continental Convention/Federal Ultimatum.

This forum needs to allow policies to merge, author collaboration, and perhaps a forum ‘General Assembly’.

I’ve also had some conversations about it, but have yet to make/see a proposal that supports the dismantlement/deconcentration of Government agencies from the Federal District. Government agencies should adhere to decade long checks, to recharter or dismantle useless government centralization. The Federal DIstrict is also an issue on it’s own-when talking about ‘Corporatocracy’.

ScottH · November 17, 2024, 6:22pm

As always, so brilliant! You and Ethan should be writing policy for Trump! After reading this, I hope you won’t read my “enforce anti-trust laws” proposal. Compared to your and Ethan’s insight, thinking and writing, my proposals seem like they’re written by a three year old.

EthanHowardMfrr · November 19, 2024, 2:22pm

No, no. All our voices have great power.

Don’t stoke my ego too much now. I feel as if he current admin will acknowledge issues, but will be unable to make the real solves it needs.

Nor would an individual like me with little public experience be able to work with public support.