Are Corporations a Threat to Democracy?

[Evil_Maniac From Mars]

I love how when a thread is opened in the Backroom you can usually predict the viewpoints of other members. The turns that debate takes when the rare deviation from expected thought occurs are also very interesting, as are the fluctuations in how vocal the left is versus how vocal the right is every quarter.

EDIT: Many people have said their general opinions on corporations, but few have actually stated outright why or why not they are threats to democracy specifically. Thoughts?

[rvg]

Too big to fail = Too big to exist.

amen to that. Chop-chop-chop.

[Beskar]

I would argue Worker Councils and certain types of Cooperative's are the changes that need to occur in the economy. It is socialist ideas such as these which are the best.

Also, just to make this clear, Socialist doesn't mean = nationalised. These Worker Councils and Cooperatives can operative privately/independently.

[Beskar]

Sorry, I meant no offense, I just saw this remark;

I was hinting towards something different, the comment was a tongue in cheek reference, nothing major.

However, there are some problems with economics of scale which is highly dependent on technology and geographical factors. The same is in politics too, as when nations became too big, they began to crumble.

[Husar]

EDIT: Many people have said their general opinions on corporations, but few have actually stated outright why or why not they are threats to democracy specifically. Thoughts?

Well, I ignored that on purpose because it's a difficult question, some corporations might be a danger to democracies, others may not, I don't hate corporations per se as long as I get the impression that they're somewhat fair all around, but then that rarely happens without government intervention, partly because the huge mass of people will do anything to please the corporations even if they say otherwise. In an ideal world people would just refuse jobs where they aren't paid enough, not gonna happen though with 4 million unemployed craving to get a job...

There needs to be a balance in most things, too much corporation and not enough government is just as bad as no corporation and lots of government. The market often regulates itself but the market is also often stupid, that's where clever people want the government to step in, after all the point of a government is to keep the people happy and regulate things from the top.

[Beskar]

I have no problems with small independent ventures and being honest, I doubt anyone really does. I do believe a that a few of the fundamentals should be definitely be nationalised/publicly owned. This includes water, energy and infrastructure and once this is done, they configure the prices at a level which would make them self-sufficient.

[a completely inoffensive name]

Democracy is just a system of government where the decisions of the government is decided either directly or indirectly through chosen representatives by the will and consent of the people being governed.

Since nowadays all "democracies" are indirect with representatives of some sort, I will talk about that.

Yes, corporations are a threat to democracy, just as the people themselves are a threat to democracy through a self destructive tyranny of the majority that eventually leads to a class struggle of some kind.

The threat from corporations comes from the idea of corporate personhood which is a double bladed sword. On one hand you would not wish for corporations to have no legal protections, the economy would never take off under such a system. However, the downside is when the idea that a corporation can legally lobby government just like any individual citizen begins to shift the attention of the government officials from the needs of the people to the needs of big business.

This is evident just by comparing the lobbying strength of some of the worlds biggest companies like Microsoft which makes more money every year then most countries even. That's a lot of lobbying from companies drowning out the common man, especially under the guideline in the U.S. right now determined by the Supreme Court in some cases I am blanking out on right now where they held that essentially "money=free speech". Obviously, under this guideline any company is going to have more free speech so to speak then the average citizen, or many of them combined even. When this happens you cannot say it is Democracy since it is no longer the will of the people through votes that is deciding the direction and policies of the government of government but business who give enough money to politicians for them to win a now hollow election through pandering and massive advertisements.

Is this how it is in the U.S.? Obviously not, because no matter what, the politicians are still chosen by the people which preserves a connection between a politicians and his/her constituents and prevents a total override from corporations from being able to turn the country back into the Gilded Age, such a drastic decrease in the standard of living for peoples lives will get everyone angry and politicians will need to actually work for them (or at least pretend to) to make sure everybody is not thrown overboard so to speak. But nevertheless, when the people are happy and content and the economy is doing well and everyone is distracted by their bread and circuses, are the politicians maintaining the will of the people?

That being said, I just wanted to say the point of people being able to choose who they buy from has no impact at all. Nowadays, companies rarely work toward just making sure only themselves are gaining from manipulated regulation, but instead work together to form extremely large "automaker lobbyists" and "oil lobbyists" so that any such regulation lets all of them make off with lots more profit. Since the goal of a company is to make profit, corporations by now (over the course of 100+ years) realize that it is not a zero sum game where in order to make more they need to win over more customers from their competitor through better marketing/products etc..., they can see that what makes everyone another $100,000,000 is great because now they can take this extra profit to their share holders which will drive up the stock price in the market which will make all the CEO's lots of money, and the billions and millions spent on competing for a better product is now cut down to the hundreds of thousands of dollars to pay key legislators to push forward the regulation.

[Idaho]

Is this how it is in the U.S.? Obviously not, because no matter what, the politicians are still chosen by the people which preserves a connection between a politicians and his/her constituents and prevents a total override from corporations from being able to turn the country back into the Gilded Age, such a drastic decrease in the standard of living for peoples lives will get everyone angry and politicians will need to actually work for them (or at least pretend to) to make sure everybody is not thrown overboard so to speak. But nevertheless, when the people are happy and content and the economy is doing well and everyone is distracted by their bread and circuses, are the politicians maintaining the will of the people?

Throw in a full stop now and again would you?

Your politicians aren't chosen by the people. Your politicians are picked from a well vetted and controlled shortlist. Those who can secure corporate backing are are the only ones allowed on the two big tickets.

[Jolt]

Throw in a full stop now and again would you?

Your politicians aren't chosen by the people. Your politicians are picked from a well vetted and controlled shortlist. Those who can secure corporate backing are are the only ones allowed on the two big tickets.

Indeed. If you have a major candidate who doesn't support the corporations, then he simply isn't funded by the corporations and innevitably will never rule. Thus we can say that corporations have in fact usurped popular power.

[Fisherking]

While corporations may pose some threat, I think that our own representative legislation bodies usually pose a greater risk to our freedoms and liberties...

Some times they really could read what it is they are voting on...

[Evil_Maniac From Mars]

In my opinion corporations may well be a threat, but no more than politicians, the civil service, the government, and even [or perhaps especially] the electorate itself.

[a completely inoffensive name]

Throw in a full stop now and again would you?

Your politicians aren't chosen by the people. Your politicians are picked from a well vetted and controlled shortlist. Those who can secure corporate backing are are the only ones allowed on the two big tickets.

Yes that was my point. The corporations have an overwhelming influence over who are voted upon but the fact that people are the ones voting nevertheless, means that corporations can only go so far in their abuse since a population which is unhappy is a population that is unlikely to vote Mr. 5 term Senator from having a 6th term. A politician wont sacrifice his/her job for the corporations because they know that by appeasing the population with some good ole populist lecturing toward corporate CEO's (how many of you came here on private jets instead of coach...you should accept being paid a dollar a year to help your company...etc) they can get more money through lobbyists in the long run by keeping their job then by helping the corporations fully achieve their attempt to turn 2009 America into 1889 America.

[Idaho]

In democratic terms, corporate control of the shortlist of US presidents is much like the Communist Party control of the shortlist of candidates in the old USSR.

[Beskar]

In democratic terms, corporate control of the shortlist of US presidents is much like the Communist Party control of the shortlist of candidates in the old USSR.

And the shortlist of candidates for the Europe Union.

[Evil_Maniac From Mars]

In democratic terms, corporate control of the shortlist of US presidents is much like the Communist Party control of the shortlist of candidates in the old USSR.

That's really a bit much. Take a look and freedom and democracy indexes comparing the USA to the USSR. Then again, they're probably controlled by evil corporations too, right?

[Idaho]

That's really a bit much. Take a look and freedom and democracy indexes comparing the USA to the USSR. Then again, they're probably controlled by evil corporations too, right?

That's only because the right to freely exercise capital power has wrongly been labelled as 'democracy'. In this sense China is a democracy. You can go and make millions there just don't expect to have any political power. In many ways the west is coming to the same situation, but from the other side. Power is increasingly centralised, political institutions increasingly pointless.

In fact other than the odd comment about human rights, the west doesn't really give a toss about Chinese democracy any more than it's own.

[Evil_Maniac From Mars]

Personal economic freedom is an important part of liberal democracy, as those who eliminate economic freedom tend to rule autocratically. However, it is not the only part, nor is it confused with or substituted for other democratic freedoms by the agencies that carry out these surveys.

For example:

Top 25 Countries by Economic Freedom. Try to find China.

Spoiler Alert, click show to read: 

1 Hong Kong
2 Singapore
3 Australia
4 Ireland
5 New Zealand
6 United States
7 Canada
8 Denmark
9 Switzerland
10 United Kingdom
11 Chile
12 Netherlands
13 Estonia
14 Iceland
15 Luxembourg
16 Bahrain
17 Finland
18 Mauritius
19 Japan
20 Belgium
21 Macau
22 Barbados
23 Austria
24 Cyprus
25 Germany

Democracy Index (2008)

1 Sweden
2 Norway
3 Iceland
4 Netherlands
5 Denmark
6 Finland
7 New Zealand
8 Switzerland
9 Luxembourg
10 Australia
11 Canada
12 Ireland
13 Germany
14 Austria
15 Spain
16 Malta
17 Japan
18 United States
19 Czech Republic
20 Belgium
21 United Kingdom
22 Greece
23 Uruguay
24 France
25 Portugal

You will notice that while they do not match, the United States, for example, is still rated as both economically free and a democracy. Nobody denies that other rights are important, but you can have economic freedom and be a democracy. In fact, it is integral.

[Beskar]

You will notice that while they do not match, the United States, for example, is still rated as both economically free and a democracy. Nobody denies that other rights are important, but you can have economic freedom and be a democracy. In fact, it is integral.

Not really. Also, at what basis is something classed as democratic? It ends up getting distorted due to peoples opinions of what is democracy and rights.

However, while you argue it is "integral" why are some of the most social economics in Europe topping the list?

Also, what is classified as economically free? Is it free to construct monopolies and cartels, or is it freedom from monopolies and cartels?

[Evil_Maniac From Mars]

Not really. Also, at what basis is something classed as democratic? It ends up getting distorted due to peoples opinions of what is democracy and rights.

The definition of liberal democracy is relatively straightforward.

However, while you argue it is "integral" why are some of the most social economics in Europe topping the list?

You will find that they also have amounts of economic freedom. However, the freedom of the citizen within the democracy is integral to economic freedom. If I can't start my own business and manage it, then how am I free? Almost every country below the fiftieth position on the Index of Economic Freedom is undemocratic and/or very corrupt. Sweden and Norway average at about the fifteenth position when democracy and economic freedom are both taken into account.

The truth is that the vast majority of democracies are economically free or relatively so.

Also, what is classified as economically free? Is it free to construct monopolies and cartels, or is it freedom from monopolies and cartels?

Monopolies are not part of the free market, but they should be prevented by the free market wherever possible. The creation of monopolies is another topic.

[a completely inoffensive name]

Monopolies are not part of the free market, but they should be prevented by the free market wherever possible.

You are delusional.

[Evil_Maniac From Mars]

You are delusional.

Hardly. My position can be summarized as: monopolies are not good, therefore competition is good, therefore the more competition the better, therefore a properly conducted free market which emphasizes competition. Delusional? I think not.

[Husar]

Monopolies are not part of the free market, but they should be prevented by the free market wherever possible. The creation of monopolies is another topic.

The free market does not prevent monopolies, the government does.

That's not to say I'm against the free market but it's not the cure for everything.

[Evil_Maniac From Mars]

The free market does not prevent monopolies, the government does.

Incorrect, as the government often implements monopolies. Monopolies are not prevented specifically by the free market or government, but they can be prevented by a properly implemented free market or by properly implemented government rules, or both. It depends what is preferred.

[Beskar]

Incorrect, as the government often implements monopolies. Monopolies are not prevented specifically by the free market or government, but they can be prevented by a properly implemented free market or by properly implemented government rules, or both. It depends what is preferred.

Well, it if wasn't for the US and EU courts, I doubt the Market would stop Microsoft.

[a completely inoffensive name]

The free market does not prevent monopolies, the government does.

That's not to say I'm against the free market but it's not the cure for everything.

Incorrect, as the government often implements monopolies. Monopolies are not prevented specifically by the free market or government, but they can be prevented by a properly implemented free market or by properly implemented government rules, or both. It depends what is preferred.

You both are right (and wrong). The government can prevent/remove monopolies such as when it broke up Standard oil and AT&T, it can also create monopolies through corporate lobbying manipulating the system and altering regulation (such as how the Sherman Anti Trust Act actually crushed more unions then monopolies until alterations later in the early 20th century). The free market does not prevent monopolies, the entire Gilded Age shows us that, so it is probably for all of our best interests to make sure the government is doing its job right instead of distrusting it.

[Beskar]

You both are right (and wrong). The government can prevent/remove monopolies such as when it broke up Standard oil and AT&T, it can also create monopolies through corporate lobbying manipulating the system and altering regulation (such as how the Sherman Anti Trust Act actually crushed more unions then monopolies until alterations later in the early 20th century). The free market does not prevent monopolies, the entire Gilded Age shows us that, so it is probably for all of our best interests to make sure the government is doing its job right instead of distrusting it.

Exactly hitting the nail on the head. You need regulation, you need to make sure they don't become too powerful so have that much control.

The free-market also caused the credit crunch, the free-market caused the great depression and the 21st century depression (the one we are in). The companies served only themselves and as they destroyed the world around us, we had to pay billions to try to stop us from returning to the Dark Ages.

Only thing free the free market does is allow those with power freedom to do what ever they want, the power to ignore law, the power to exploit, the power to abuse, the power to destroy what is good for profit. Freedom to fuel and fund war in Africa sot hey can sell their goods, Freedom for off-shore slave labour camps for the latest Nike trainer, Freedom for corruption.

[Evil_Maniac From Mars]

The free-market also caused the credit crunch, the free-market caused the great depression and the 21st century depression (the one we are in). The companies served only themselves and as they destroyed the world around us, we had to pay billions to try to stop us from returning to the Dark Ages.

With all due respect, that is garbage. Nonetheless, that is a discussion for another threat, not this one.

[Beskar]

With all due respect, that is garbage. Nonetheless, that is a discussion for another threat, not this one.

No it isn't, it is funny that all the regulated banks in Europe were fine, while the loosely regulated ones based in places like America and the UK just crumbled into dust.

It is the lack of control and due care of the corperations which cause chaos and massive politicisation which brought about the worst dictators in modern history.

[jabarto]

competition is good, therefore the more competition the better

This isn't always the case, and I don't know why people keep deifying competition as some magic fix-all. To cite an example from my field of expertise (healthcare), competition does NOT necessarily translate to lower-cost, higer-quality products. It can just as often translate to the corporations cutting their services and spending more on advertising. And why not? It's easier to just cut corners and spend a pittance to convicne the unwashed masses that all is well than it is to actually improve their product.

[a completely inoffensive name]

Only thing free the free market does is allow those with power freedom to do what ever they want, the power to ignore law, the power to exploit, the power to abuse, the power to destroy what is good for profit. Freedom to fuel and fund war in Africa sot hey can sell their goods, Freedom for off-shore slave labour camps for the latest Nike trainer, Freedom for corruption.

I think you might be making the corporations out to be more malicious then they really are.

I think it is important for everyone to know that corporations cannot be personified as "good" or "evil" as we do for individuals in our daily lives. The goal for a company is to make more money. The means to make money is of no concern to them, if they could get more money by manipulating some regulation in their favor they would do it, and if they could make billions of dollars by giving millions of toys to children they would immediately do that as well (sadly this is not the case for the reason I will explain in just a moment). So to classify them as "evil" or "bad" does not really help or apply since ultimately they are amoral in their quest for more money, it just so happens that the way to get more money is from my first example above then the latter. People when it comes to the free market are amoral just as well, they (for the most part) won't go to the product that costs $1.50 more then the competitor just because they gave lots of toys out to needy children, they got their own children to feed and bills to pay with a limited budget, does that make them "bad" people? No of course not. Take this however you want, whether it makes it seem that capitalism is a terrible plague of an economic system upon mankind for this lack of morals (which I can't really argue against, if we are talking about capitalism in its purest form) or whether it enlightens you that there really is no grand conspiracy to keep all of us down, there is just incentives that all of us follow and that any economic situation can be solved if we just know the incentives perpetuating a problem and fix them.

I would like to finish by saying that in regards to the housing collapse we have experienced in America, that it was indeed caused by the free market, but what does that really mean? Congress in the early 90's deregulated the home loaning market in regards to high risk loans, this caused the free market to create a bubble that recently collapsed. People like to start pointing the finger at the banks for doing such a thing, but lets look at all participants of this bubble:
1. The banks did make irresponsible loans, but they just followed the new incentive for more profits.
2. The people applied for these irresponsible loans that were impossible to pay off, but they just followed the new incentive for a higher standard of living, including a nice house in a nice suburban neighborhood that exemplifies the American dream.

Well lets blame Congress for starting this in the first place! Well....all Congress did was follow the incentive in trying to make the economy better and grow so they can keep their jobs.

In my eyes, when we say the "free market made all these problems for us" it is important to see the free market is not just corporations, but all of us consumers and ultimately government as well. So how about we just forget blame and realize that at some point we let an incentive somewhere undermine the market and made it instable and get our government to fix it so we can move on with our lives and get the economy rolling again.

I know this is all probably off topic, but I felt like saying it.