Corporatism in American History: February

REAL Democracy History Calendar – February 1-7
(see full calendar at above link)

February 2

1819- Supreme Court declares a corporate charter is a contract in Dartmouth College v. Woodward (17 U.S. 518), protected by the Contracts Clause of the Constitution

The New Hampshire legislature wished to convert the private Dartmouth College into a public university by changing its charter, or license, which had been originally issued by the King of England. The legislature believed that education was too important to be left to private interests; thus, the school needed to become publicly accountable. The Supreme Court sided with the College’s trustees, stating a corporate charter is a contract, not to be altered under the Constitution’s Contracts Clause.

The word “corporation” does not appear in the Constitution. The Court’s decision transformed a corporate charter issued by a government as a mere privilege into a contract that a government cannot alter. The ruling gave corporations standing in the Constitution. Governments had greater difficulty controlling corporations. States began to include specific limitations into charters they granted.

February 3

1924 – Death of Woodrow Wilson, 28th President of the United States

“Since trade ignores national boundaries and the manufacturer insists on having the world as a market, the flag of his nation must follow him, and the doors of the nations which are closed against him must be battered down. Concessions obtained by financiers must be safeguarded by ministers of state, even if the sovereignty of unwilling nations be outraged in the process. Colonies must be obtained or planted, in order that no useful corner of the world may be overlooked or left unused.” Source: http://www.washingtonsblog.com/2014/09/usa-sponsored-terrorism-mid-east-since-least-1948.html

[Note: Wilson asserts the power of corporations and “the market” dictate national policies, including military policies.

February 4

1887 – Formation of the first regulatory agency, the Interstate Commerce Commission (ICC) – a “sheep in wolf’s clothing”

The ICC was designed in response to public demands for fair rates and to prevent rate discrimination by railroad corporations. It and subsequent regulatory agencies, however, were established chiefly to protect corporations from the public.

Prominent RR barons supported the ICC’s creation. Charles F. Adams (later President of the Union Pacific Railroad Co.) stated, “What is desired…is something having a good sound, but quite harmless [purpose], which will impress the popular mind with the idea that a great deal is being done, when, in reality, very little is intended to be done.”

So rather than have the public fundamentally control and define corporate actions via charters and/or create or expand public ownership of basic services, regulatory agencies were established. They have become the major target/distraction of activist opposition to corporate actions.

Corporate anthropologist Jane Anne Morris calls them “Sheep in Wolf’s Clothing.” Her excellent description of the history is at http://www.poclad.org/BWA/1998/BWA_1998_FALL.html

February 6

1950 – Supreme Court decision: United States v. Morton Salt Co., (338 U.S. 632, 650) – corporations are endowed with public attributes

Corporations “are endowed with public attributes. They have a collective impact upon society, from which they derive their privilege as artificial entities.”

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7 thoughts on “Corporatism in American History: February

  1. I would like to see Sanders reverse all of these trends.

    That will be contingent though on him winning tonight and the Presidency.

  2. What initially caught my attention was the quote by Woodrow Wilson:

    “Since trade ignores national boundaries and the manufacturer insists on having the world as a market, the flag of his nation must follow him, and the doors of the nations which are closed against him must be battered down. Concessions obtained by financiers must be safeguarded by ministers of state, even if the sovereignty of unwilling nations be outraged in the process. Colonies must be obtained or planted, in order that no useful corner of the world may be overlooked or left unused.”

    That is a blatant admission that American capitalism requires colonial imperialism. That is to say that neoliberalism is the other side of the coin to neoconservatism.

    • It may be that capitalism requires this to survive altogether.

      This if anything, suggests that maybe it was not meant to live through challenges like global warming and needs to be replaced by some form of socialism.

      Really, it has no solutions to the failure of collective action.

      • I’ve wondered about that many times over the years. What is capitalism? Could capitalism ever be an actual free market?

        I’m not sure why it is assumed that somehow if government got out of the way capitalism would blossom into absolute freedom. The problem is there have always been a ton of powerful capitalists who sought to promote big government, and so apparently they aren’t interested in a free market, assuming it is even possible.

        If the capitalists aren’t interested in free markets, why should the rest of us put our faith that giving the capitalists more power will lead to free markets?

  3. I have become convinced that the problems of crony capitalism are endemic to capitalism.

    When libertarians and conservatives attack the government, they really should be attacking the interests that buy the state for their will.

    The sad thing is that they are immune to these facts. I have noted why the libertarians are so determined to deny global warming. It would represent the death kneel of their ideology.

    • I’ve come to that view about global warming. It is the ultimate challenge to the capitalist faith. There simply is no solution capitalism can offer. The best response I’ve heard a libertarian give is that we simply have to abandon the earth as a lost cause and colonize space. At least, there is honesty in that person’s view that capitalism inevitably will destroy the world as we know it.

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