The Moral of the Story: Care

The U.S. Supreme Court says a corporation is a person, or at least must be treated like one when it comes to most constitutional protections. These protections include the right to speak and the right to act in the political arena--giving campaign contributions, lobbying, and advocating its agenda.

Now, if a corporation is in fact a person, with full constitutional rights, then it should act like a moral human person. And what is the fundamental basis of morality? Caring about others.

So, a corporation, to act like a moral human person, is going to have to care about others, not just about its own bottom line. It is going to have to care about its human compatriots.

But the vast majority of major corporations don't give a damn about their fellow persons. As such, they are immoral--or amoral--to the core.

We say, if you are not a human person, and you can't act like a moral human person, then you should be stripped of your constitutional protections. No right to speak, no Fifth Amendment rights, no right to participate in the political arena. You just produce your products and go home.

It also makes sense to revisit the legal protections that facilitate corporate immorality or amorality, particularly the corporation's defining characteristic--limited liability for shareholders. Shareholders, the owners of a corporation, invest a certain amount of money in a company. Under the rules of limited liability, no matter how much harm the company does, or how much it owes creditors, shareholders cannot be required to pay more than the amount they already put in.

Lawrence Mitchell, a professor of law at George Washington University, believes that limited liability for shareholders leads shareholders--and therefore corporations--not to care. If your liability is limited, you won't care as much as if your liability is full. "We call stockholders owners," Mitchell said recently. "You can hardly be considered an owner if you don't care, if you don't act like it's your property. Limited liability encourages stockholders not to care."

Mitchell, who has written a book, Corporate Irresponsibility: America's Newest Export (Yale University Press, 2001), says that in the absence of limited liability, the corporation can always buy insurance. "Insurance internalizes the cost of the risk," Mitchell said. "The corporation has to pay based on the insurance company's assessment of the risk, rather than some creditor getting stuck holding the bag if the corporation fails."

So, yes, Mitchell would strip corporations of their limited liability protection. Let the chips fall where they may.

Admittedly, these ideas don't appear likely to be implemented soon. But there may be interim concepts to get us closer. A first step would be to take away constitutional protections and limited liability from the worst-acting corporations.

To determine whether a corporation is acting morally, we propose that Congress legislate a Corporate Character Commission (CCC). This would be a 10-person panel, with members chosen from the human person community. Ideal candidates would be ethicists, philosophers, corporate criminologists and the like. The CCC would check on the criminal records, recidivism rates, acts of immorality, and other wrongdoing of the largest corporations.

There is a precedent for this kind of review at the federal level. The Federal Communications Commission reviews the character of applicants for federal broadcast licenses. The FCC does not do a very good job of it, obviously. General Electric, for example, routinely gets renewed despite its recidivist record. [Ed. note: In the last two decades, the FCC and Congress have removed almost all requirements that license holders operate in the public interest. There is literally no way to lose a license any longer, except if an individual owner receives a felony drug conviction.]

But just because the FCC can't do it right, doesn't mean the CCC couldn't do it right.

Now, you are probably saying to yourself, yeah, right. Hell will freeze over first before Congress creates such a Commission. Maybe. Maybe not.

The CCC would be a modest step to a future where the corporations are subservient to moral human beings, where caring for others takes precedence over the bottom line, where you and I matter more than Enron and Boeing.

Russell Mokhiber is editor of the Washington, D.C.-based Corporate Crime Reporter. Robert Weissman is editor of the Washington, D.C.-based Multinational Monitor. To subscribe to weekly corp-focus e-mail service, send an e-mail message to listproc@essential.org with the following all in one line: subscribe corp-focus 'your name' (no period).

(c) Russell Mokhiber and Robert Weissman