Fifteen years ago, University of British Columbia law professor Joel Bakan came out with a book and movie titled – The Corporation: The Pathological Pursuit of Profit and Power.
That book and movie embedded in the American mind the idea of a corporation as a psychopath.
Bakan analyzed the corporation the way a psychiatrist would analyze a patient.
He found its character to be pathologically self-interested.
Callous unconcern for the feelings of others – check.
Reckless disregard for the safety of others – check.
Deceitfulness – check.
Incapacity to admit guilt – check.
Failure to conform to social norms with respect to lawful behaviors – check.
In response to the book and movie and to the social movements around the world that rose up to challenge corporate power, corporations moved away from denial toward acceptance and reform.
Call it the new corporation movement.
And now, Bakan is out with a new book and movie titled – The New Corporation: How “Good” Corporations Are Bad for Democracy.
On April 19, 2019, the Business Roundtable, led by JPMorgan Chase’s Jamie Dimon and composed of more than two hundred of America’s top CEOs, announced that the purpose of publicly traded corporations would be to serve the interests not only of shareholders but also of workers, communities, and the environment.
“The declaration capped a two-decade-long trend of corporations claiming to be different, to have changed into caring and conscientious actors – ready to lead the way in solving society’s problems,” Bakan writes in his new book. “I call it the new corporation movement.”
Dimon is a leader of the new corporation movement. He’ll take a knee in front of a Chase branch bank in New York for Black Lives Matter and then applaud President Trump’s tax cut bill.
Same for Klaus Schwab, the driving force behind the World Economic Forum in Davos, Switzerland. He’s all for corporations being sustainable and inclusive. But when he introduced President Trump at Davos, Schwab said this:
“Mr. President, on behalf of the business leaders here in the room, let me particularly congratulate you for the historic tax reform passed that greatly reduces the tax burden of U.S. companies, providing a tremendous boost to the global economy.”
“Put very simply, the corporations are saying – we can take care of social good, we can take care of the environment,” Bakan told Corporate Crime Reporter in an interview last week. “We are pivoting to a position that enables us to do that. The hidden statement, the quid pro quo is therefore, the government shouldn’t.”
“The difference between corporations and governments is that governments are at least putatively democratic.”
“People say to me – Joel, they are just trying to be good. That second part of the equation isn’t there. They are not saying – we don’t like democracy. They are just saying – we want to be good. And what is wrong with that? Isn’t it better if they are better?”
“My answer – yes of course. In the abstract, it is better if they are better, if they are not trying to be better in order to push back democracy. But when you look at everything they do as well as what they say, it is very clear that that equation is operating. They are becoming good in order to take over from government.”
“And then they are saying – we are good now. We can run schools and water systems. You don’t need to tax us to pay for those things. And we can run them for profit. And we can regulate ourselves. We don’t need independent, well funded agencies to enforce regulatory standards created by democratic institutions. We can just do it ourselves.”
“It’s a full out assault on democratic governments. And it’s being done under the cover of good intentions.”
At Davos, Bakan runs into Richard Edelman, the public relations CEO.
During the film, Edelman tells Bakan – “I’m not much of a believer in political citizenship. I believe in the power of the marketplace.”
“Edelman connects the two pieces of the equation,” Bakan says. “Corporations are good actors now so we don’t need democratic governments anymore.”
“That’s astonishing. That’s Richard Edelman. He is seen as one of the good guys of capitalism. He is one of the most influential people in the world. He is a king in Davos.”
“Edelman says – ‘I’m not much of a believer in political citizenship.’”
“That’s the same thing as saying – I’m not much of a believer in democracy. And to me that captured the attitude of these folks. It underlines why good corporations are bad for democracy.”
In your first film, you labeled the corporation a psychopath. And they called you after that film and said – come speak to us. And they gave you interviews at Davos.
“The typical hubris of the big business world was – yes, we were a psychopath, but we can fix that,” Bakan said. “We can look back on some of our behavior and say – yes, we did some bad things. ITT helped Pinochet in a coup in Chile. And the Exxon Valdez spilled oil all over the place. We laid off a bunch of people in the 1980s and 1990s. We took the Chainsaw Al approach. We put on our red suspenders and went around slashing and burning in order to create profit for our shareholders without any concern or worry. And politicians like Thatcher and Reagan encouraged this. We were in a moment of time where greed was good, where the captains of greed were seen as the right people and if we just pursued this approach, that what was good for General Motors and big business was going to end up as good for America.”
“We were some bad actors. We were not doing things in a right and good way. All of these people are in the streets now calling us out for it. The whole neoliberal system is being questioned. We are going to be good now. Yes, call us a psychopath. Tell us we were what we were. Say as strongly as loudly and as intensely as you possibly can, because we know we did wrong.”
“It’s almost like a spouse after being caught cheating. I was horrible. I was a monster. I betrayed you. I am so sorry. But I will be good now. And I will be right. But please don’t hold back. Tell me how bad I was because that is going to help me be better.”