Make Corporations Full Citizens

After the American Century #207

In American law the idea developed that corporations ought to be considered individuals – or persons. This idea makes a certain sense if narrowly interpreted. For example, a corporation, like a person, can be governed by the same laws regarding contracts. The corporate “person” could also be sued for liable. But in a revolutionary ruling last week, the United States Supreme Court decided that corporations also have the right to free speech and are protected by the Bill of Rights. The Court might have ruled far more narrowly but instead went out of its way to declare that corporations may advertise freely and directly in political campaigns. (Logically, the Court should also have given corporations the right to vote in elections, but perhaps it is saving that decision for another time.)

In the interest of making corporations into better fellow citizens, here are specific proposals to help them achieve a fuller humanity, since that is what the Court clearly desires.

1. Slavery being outlawed by the Constitution, it therefore should be illegal for one corporation to own another corporation. Holding companies clearly are a modern form of slavery that must be eliminated.

2. Hostile corporate takeovers must henceforth be regarded as acts of aggression that are punishable as crimes. A hostile takeover of a corporation must be considered a form of kidnapping, in some cases followed by murder, and punished accordingly.

3. Corporations that close down should be subjected to the same laws of taxation as the estates of deceased individuals. As it is now, companies can more resources around, closing down one company and opening a new one as often as they wish, without being subject to the taxation (and in effect the audit) imposed on a human being’s estate.

4. Since human beings are not immortal, it seems only fair that corporations be declared legally dead every 60 years (this being the maximum length of most person’s adult life). This death could be followed immediately be corporate rebirth, but only after paying the estate taxes.

5. Corporations should be punished for murder in the same way that people are. If they want to be considered persons, then they cannot pick and choose which legal obligations they want to assume. At present, when a corporation pollutes the air or water and as a matter of statistical certainty, makes some people ill and causes others to die, the “normal” practice is to fine them and to force them to pay compensation to the victims. This is not right, as it allows a wealthy “person” to substitute a cash payment for imprisonment. Real people cannot do that, why should corporations be allowed to get off? The people who give themselves those big corporate bonuses and stock options must also now be held criminally liable for the corporation’s behavior if they accept the payments.

6. The old idea of the corporation included the provision that people who invested in them had limited liability. That is, they could lose only the money originally invested, but had no personal responsibility in case the corporation ran up huge debts. In the nineteenth century, when corporations first were becoming a common way of organizing a business, many ordinary people protested. It seemed unfair that an ordinary grocer or carpenter was fully liable for his actions, while a vast corporation that owned many grocery stores or built many houses had limited liability. Clearly, now that the Court in its infinite wisdom has ruled by a vote of 5-4 that corporations have political rights, it follows that they can no longer claim limited liability. If they want to claim the rights of people, then they muse assume the obligations of people. Alternately, one would have to extend the same right of “limited liability” to all Americans, not just corporate Americans.

Now that the Court has ordered us to welcome corporations into full membership in political and civil society, the essential thing is to make sure that they take on ALL the obligations of citizenship.

2000-2010: The Flat Decade

After the American Century

This time of year one takes stock, and that usually means reconsidering the last 12 months. But as we reach 2010, I think also of the last decade in America.

It was not a good decade. The United States in 2000 was rapidly paying off its national debt. Its economy had created millions of new jobs in the 1990s. Trust in the banking system was high. The nation was basically at peace.

Ten years later none of this is true. It has been a flat decade, with little to show for itself. The national debt is growing rapidly. Almost no new jobs have been created, on aggregate, since 2000. The Dow Jones Industrial Average is now about where it was in 2000, after gyrating uncomfortably up and down, and people rightly are suspicious of bankers. Worst of all, the United States has spent huge amounts of money on dubious wars in Afghanistan and Iraq. And hanging over the whole decade like the pall of smoke rising from the fallen World Trade Center is the specter of terrorism.

There are bright spots, the most noteworthy being the election of President Obama. But even that success is tempered by the realization that the Congress lacks a sense of national purpose and has tremendous difficulty rising above the level of petty in-fighting and party squabbles. It compares poorly with the Congress of 1933, when Roosevelt passed a wide range of important legislation. In 2009 a comprehensive health bill has almost been completed, but we await final negotiations between the Senate and the House to find out just how good or bad the final result will be.

2009 was also the year when when attempts to reign in rampant CO2 and global warming went off the rails at the Copenhagen Summit. It was the end of a decade of often mindless growth in the developing world, which seems intent on making every industrial mistake that the West pioneered decades ago: smog, lead poisoning, urban congestion, the "car culture," and, of course, my clever readers can complete this list. Should we really celebrate the fact that China's growth rate was roughly 9% per year during this decade, and that it now buys several million more automobiles than the US every year?

But hope springs eternal, as indeed it must, and here are some wishes for 2010. That the global birth rate falls rapidly toward sustainable replacement of the existing population. That consumers discover contentment with environmentally safe products and high-mileage cars. That voters insist on more and better mass transit. That bankers act more responsibly and stop giving themselves huge and undeserved bonuses. (OK the last one is probably an absurd wish). That the US economy embraces solar and wind energy, even if Congress spinelessly does little to encourage it. That the need for any foreign military in Iraq really does wind down. And that confrontations between Christians and Muslims become less common, as dialogue and mutual respect replace demagoguery and fear.

Human beings could accomplish all of these things, starting in 2010. In theory, I could also lose some weight in 2010 but my past history suggests that even this will prove a hard New York's resolution to hang on to. So, modestly, let us hope that we all do a little better.

Copenhagen's Chinese Christmas Present

After the American Century Posting 204


As more insider accounts of the Copenhagen Summit come in, the Chinese emerge as the chief villains, a strong word, but not strong enough in this case. A piece in The Guardian reveals how the Chinese sabotaged attempts at a final consensus.

In the future, clearly, one cannot hold talks and hope that all the great powers agree. Giving every important power a veto right or the chance to undermine an agreement is just silly. Instead, the world will have to find another way to work toward relieving global warming. The summit model is not working, and perhaps can never work.

Here are some interlinked suggestions:

1. Create a system that ranks countries into four groups, depending on to what degree they are working toward global warming.

2. Tell consumers worldwide where each nation ranks, so that they can choose intelligently and buy products based on how much a nation is in compliance with UN goals. Under such a system, China would get a D rating, of course, and the US would perhaps as well. I would hope that consumers would be more willing to buy from nations that are trying to solve the problem of global warming rather from those that are making matters worse.

3. Allow companies to be rated as well, so that an environmentally responsible company can get a higher ranking than the nation where they are located.

4. Cities of more than 300,000 people would also be able to apply for and achieve ratings, so that if Seattle or Munich or Oslo or Rio wanted to they could achieve a rating higher than that within their home nation.

5. Give aid for conversion to clean energy technologies only to those Third World Nations where the military budget is less than 2% of GNP. It is absurd to pour money into a nation that is investing in arms and airplanes rather than solar panels, wind mills, and the like. Many poor nations are not focusing their own resources on the problem, and if this is the case, why should anyone else?

6. Give annual awards to successful projects (actually completed, not just proposals) that both improve the quality of life and reduce global warming. Make the awards as glamorous as the Nobel Prizes or the Academy Awards. Governments whose nations are in the A category would also be put in the limelight at these events and part of the ceremony would be to welcome any new members of the "A" club and to congratulate those who had moved up a category. Nations in the D category would not be allowed to have an official speaker or presenter at the awards, but they would be welcome to attend.

7. Instead of the trading system that most nations now have or want, where all free trade is considered to be a good thing, no matter what is traded, nations would be encouraged to revise their import taxes or other tax codes to favor products whose production and use had the least environmental impact. This sort of taxation would recognize that it costs more to manufacture in an environmentally responsible way. I do not suggest that the taxes be punitive, but rather that they be a restructuring of current VAT, and that they be applied to c. 100 goods that are particularly important in this area, notably automobiles, air conditioners, stoves, televisions, and so forth.

As these proposals suggest, we can no longer wait around for the nations of this earth to become unanimous. China blocked the deal this time, but it could be someone else the next time. Instead, turn loose the power of consumers and introduce something that the Chinese can understand: SHAME. They may think they have emerged as a great power, but the Chinese have lost face. Their government has not behaved in an honorable way.

Fiasco in Copenhagen: The Winners and the Losers

After the American Century Posting 203

The Climate Summit has been an enormous disappointment to just about everyone I know. But such failures are not merely misunderstandings. Some people want them to happen, because it was to their advantage that no meaningful agreement be reached.

Who benefits when there are no real controls on carbon emissions? Nations that produce oil, gas, and coal. This turns out to be Russia Venezuela, Nigeria, and of course the Middle Eastern oil states. Norway gets high marks for taking a stand for CO2 controls, but then, the Norwegians are a moral and democratic people who produce 99% of their electricity from hydro. One can certainly not say all three things about any of the other oil producing states.

Other beneficiaries are all those who doubt the reality of global warming, notably a large contingent of the Republican Party. Sarah Palin is presumably also delighted. But has Palin asked herself why she is siding with the Chinese government on this issue?

China surely regards itself as a winner at this summit. It refused to budge at all on what it sees as its right to increase CO2 emissions by at least 40%. It is investing in solar power and windmills, and building lots of atomic plants, but being efficient is not yet on its agenda. China also got to throw its weight around and show it could not be forced to do anything it did not want to do, such as allowing inspectors in to see just exactly how much CO2 it is producing. (I wonder if before long we will have some sort of remote sensing devices that might remove this particular objection.)

The opposition to the current Danish government also is a potential winner in this fiasco, as the Danish Prime Minister earned low marks for his behavior. With the two political blocs in a virtual dead heat, this magnificent display of diplomatic ineptitude might tip the balance. One can only hope.

Curiously, I think President Obama emerged as a bit of a winner too, in the sense that for the first time he brought the US into an active discussion of global warning and looked for ways to create a compromise. He was hampered, however, by the scientific stupidly of the Republican Party, which seems genuinely challenged by such things as the theory of evolution, physics, modern biological research, and of course global warming itself. But then, these are the sort of people who, in the State legislature of Indiana, passed a law saying that Pi should not be 3.1417. That clearly is a silly number, and so they decreed that Pi should instead be 3.2. Indiana's pilots and civil engineers did not take note, fortunately. Fools with that sort of self assurance are a genuine menace.

Strange bedfellows are these "winners": Danish socialists, Middle Eastern dictators, Hugo Chavez, the American Republican Party, the Russian oil interests, the Nigerians, the Chinese oligarchy. A wonderful bunch, really. Perhaps they should hold their own summit and see if they have other shared interests. I would love to see Sarah Palin "paling around" with the Russians.

As for the losers, that would be everyone else, particularly low lying nations, most of Africa, the Arctic regions. Quite possibly nations will disappear beneath the waves and millions of people might die because of this failed summit. But no one will be called to account.

So let us blame 2009, a rotten year for many people, and hope that 2010 will be a year that does not benefit anyone who "won" in Copenhagen.

Copenhagen Climate Crunch and Danish Democratic Style

After the American Century posting #202

It appears that the Danish attempt to formulate a text for the Climate Conference has been rejected. What is going on?

If you have been trying to follow the Copenhagen Climate talks, the proceedings may seem puzzling. Literally for days the delegates waited for a text to discuss. It was being prepared by the Danish hosts, they were told. Yet, in fact, the delegates had themselves prepared documents for discussion, which the Danish leaders wanted to ignore. Stalemate. Inaction. Secret discussions behind closed doors. Frustration among the delegates, who felt that the Danish leadership was ignoring them, with feelings running especially high among the African and Third World nations.

Unfortunately for the rest of the world, the Danes do not understoand or practice democracy in the same way as most other countries. In the Anglo-Saxon world and its former colonies, for example, the person who chairs a meeting should attempt to remain neutral, give all parties an equal chance to speak, and attempt to steer the meeting toward a vote, where there will be winners and losers, but where there will also be a majority decision.

In contrast, Danish leaders who chair a meeting attempt to impose their will on the group, even if it appears to be an open discussion. They want to steer the meeting not merely toward a vote but to a consensus where the outcome of the vote is obvious to all before it is taken. For those steeped in the English or American parliamentary traditions, or something like them, the Danish way of chairing a meeting seems undemocratic, secretive, irritating, high-handed, and counter-productive. To put this another way, most meetings in the Anglo-Saxon world abide by Roberts Rules of Order. Danish meetings, in my 25 years of experience, absolutely do not abide by any such rules.

In the Danish Parliament (Folketing) the coalition in power seeks to impose its decisions on the nation, often with surprisingly little public discussion. The real discussion goes on in private, in party caucuses and in coalition partner meetings. All members of a party are expected to vote the same way. When they emerge from behind their closed doors, they have all their votes lined up and they proceed to ram through the desired law with what I call "symbolic discussion." The result is already known beforehand.

I am not a delegate at the world climate talks, but from the outside it certainly looks as though the Danish leadership, steeped in its own ways of doing business, is trying to make the rest of the world play by Danish rules. And the rest of the world is not buying it. China in particular made it clear they were not going to dance to a Danish imposed tune.

To put this another way, the Danish leadership arrogated to itself too many roles. It wanted to be the host, the chair of the meeting, and also the chief negotiator. They wanted to wear too many hats, and acted according to a democratic model that others are not accustomed to. One could see this last night. The Danish Prime Minister had invited hundreds of wold leaders to a gala evening, to see the Royal Ballet and take some expensive refreshments. But the Prime Minister could not play his role there as host, because he was at the conference all evening, in his roles as chair and negotiator.

The talks are now in their final two days. One hopes that the very real Danish talent for finding compromises (albeit usually behind closed doors) saves the summit meeting from failure. If China and the United States are willing to act together (a very big If), then a historic compromise may emerge. But one thing seems certain. The Danes cannot expect to impose their text on the rest of the world.

Will we get a binding agreement? Will its standards be at least as high as those agreed upon in Kyoto? In other words, will it really make a difference in slowing down global warming? At this moment, it is hard to tell.

One thing we do know for certain: these world leaders came separately in their private jets.

University IT: Technological Catch 22

After the American Century Posting #201

Once I was in a supermarket checkout line when a particular jar of jam just would not scan and its code was unrecognizable when the clerk put the numbers in by hand. Result? He refused to sell me the jam. He could not sell something that did not exist in the system. The jam was right there, and we all know roughly what such things cost. But I could not buy it, or rather, he could not sell it. These (il)logical impasses have a name: Catch-22, from the novel of the same name. Following the rules, you end up paralyzed, unable to change the situation.

Something similar has happened today, as a result of my university's decision to upgrade (well, change) the email system. The result is that I will no longer be able to get emails at home, unless (and here's the catch) I upgrade my home computer to MS Office 2008+. This will cost me money and time.

Ideally my employer should reimburse such an expense. However, the Danish government has passed a new tax law, to whit: anyone who gets a portable computer, new software or email support from an employer must pay $600 in tax, every year. Besides, even if the law suddenly were overturned, my employer has no money for such things. Indeed, it has never even provided me with a flat screen much less an entirely new computer in the office! My screen was one of the first televisions, and was left behind by retreating Germans after World War II.

So, should I bite the bullet and pay for a home upgrade? Not so fast. If I do that, then my antiquarian office machine will be running 2004 software and my home machine will be five years ahead of it. In my experience, constantly shifting between two systems causes corrupted files, loss of data, and occasional freeze-ups. Besides, that 2008 MS-system for Mac has lousy reviews.

Nevertheless, to minimize problems, should I upgrade both home and office machines, at my own expense? That is actually not allowed. The university may not have any money, but it reserves the right to control what software gets into the campus system. In short, even if I wanted to spend lots of my own money, there apparently is no solution.

So, my emails are paralyzed, never to arrive in my home in-basket, a bit like that jar of jam, which remains forever in the supermarket checkout. I must give up the delights of reading emails from students and administrators in the evenings and weekends, just like I gave up that jam.

I suppose that giving it up helped me to lose just a tiny bit of weight. Come to think of it, getting no campus emails may slim down my working hours. And when I am at conferences and on research trips, no need to look at the frantic last minute requests from anyone on campus, because I just won't be hearing from them. They will be stuck in check-out.

But as for you, loyal friends and readers, I can always be reached at my non-campus email address. And that, actually, is the solution. Forget IT on campus, get yourself a free account with Google or HotMail or Yahoo or wherever. That was also the only solution in Catch-22, Joseph Heller's novel. Get out of the clutches of the system. Make your own jam.

Military Spending and Global Warming

After the American Century Posting # 200

The climate conference has now reached the crucial stage, where money must be pledged by the rich nations to help the poorer nations develop without excessive CO2 emissions. The EU has put $10.6 billion on the table, offering it over a three year period. They have made the most generous pledge so far, which amounts to $3.53 billion per year. The amount needed is far greater and a subject of discussion.

To put these figures into perspective, consider what the world is spending on armaments: $1.4 trillion every year. Without even doing the math in detail, you can see that the nations of this world are spending more than 100 times as much on weapons as they are willing to spend on global warming. Time to get the priorities right.

The two biggest CO2 polluters, the United States and China, also have the world's two largest military budgets. The US is by far the largest, at $602 billion, while China "only" spends $84.9 billion.

Some of the "poor" nations who want to be paid for curbing their CO2 growth are also spending large sums on arms. The United States spends about 4% of its gross national product on its Defense Department, far too much in my view, but a smaller percentage than some others. Angola uses 5.7%, Armenia 6.5%, Macedonia 6%. Saudi Arabia uses 10% of its budget for the military, which is about $38 billion.

In the next week, when the discussion of global warming focuses largely on money, keep these figures in mind. I suggest that no "poor" nation that spends more than 2% of its GNP on the military should be given any funds to help with global warming. And I suggest that no nation spending more than 3% of its GNP on the military should be taken seriously when it says it cannot afford to pay more to solve this problem.

This posting is #200 on After the American Century

Obama's Nobel Prize Address: The Just War & The Four Freedoms

After the American Century Posting # 199

President Obama has given a major speech on the occasion of receiving the Nobel Prize. He began by admitting quite frankly that he was at the beginning of his international labor and rather a surprise winner of the prize. He then confronted what many see as a contradiction: that he is currently the commander in chief of the American armed forces which are engaged in two wars.

To his credit, he did not mention George Bush. It would have been fair enough to blame him for the unnecessary invasion of Iraq, at the least. Rather, Obama made the case for just war, when diplomacy fails, and provided a summary of his foreign policy, linking it to Woodrow Wilson, John F. Kennedy, and Martin Luther King. In doing so, he specifically rejected the "realist" approach to foreign policy, which tends to be embraced by Republicans more than Democrats.

One aspect of this speech will be striking to most Europeans. Obama spoke several times of evil, a word that one might more expect to hear from George Bush. In Oslo, Obama declared: "Evil does exist in the world. A non-violent movement could not have halted Hitler's armies. " and later said: "We make mistakes, and fall victim to the temptations of pride, and power, and sometimes evil. Even those of us with the best of intentions will at times fail to right the wrongs before us." This is not far from the language of the Lord's Prayer. Such language is not unusual from an American politician. But "evil" is seldom heard in mainstream European politics, which are far less religious in tone.

Part of the explanation for this difference is structural. In Denmark, the Queen always ends her yearly speech on New Year's eve with the same words: "God protect Denmark." This is the ordinary language of a European monarch, but it is less common for the European politicians to ask for the Lord's protection. The American president, however, must play both roles.

However, Obama does not merely mention "evil" in passing, in a formulaic way. The core of his argument that war is necessary and unavoidable is rooted in the belief that some men are beyond the reach of reason or diplomacy. While he referred to Ghandi and King and clearly admires their idealism, ultimately Obama presented himself as hard-headed idealist. He is closing down the prisons at Guantanamo Bay. He promises to ophold the Geneve Conventions and to the honor Human Rights. But he also sees a world where wars and conflicts remain unavoidable.

He does not see the same world as George W. Bush, however. Obama sees the greatest hope for peace in international cooperation, in standing together against regimes that oppress their own people, that seek to acquire nuclear weapons, or that threaten other states. His foreign policy is one of enlightened self-interest that echoed President Franklin Roosevelt's Four Freedoms. In his speech, Obama argued that freedom of speech, freedom of religion, freedom from fear, and freedom from want when achieved in any nation ultimately enhance the security of its neighbors and by extension the rest of humanity. He may not have mentioned Roosevelt by name, but by employing his language, Obama aligned himself with core values that guided American foreign policy before the Cold War, and made them appear equally useful today.

Global Warming NOT the Only Problem with Fossil Fuels

After the American Century

During the next three weeks we will hear a great deal about the problem of global warming. I do believe that global warming is taking place, that the actions of human beings contribute to it, and that it lies within our power to do somethning about it. But put aside that entire discussion for a moment, and consider what other reasons there might be to cut back on burning fossil fuels.

Not all countries produce oil, coal, and/or natural gas. Advanced industrial nations that lack supplies are not coincidentally in the forefront of finding alternatives. Germany has virtually no oil or natural gas, and its more accessible coal has already been mined. Therefore Germany finds it highly interesting to develop wind turbines and solar power, and indeed has been one of the leading countries in both sectors for years. France, in much the same energy situation, has more nuclear power than any other nation. More than 80% of its electricity comes from nuclear plants. Sweden has no oil, and it relies on nuclear power and hydroelectric dams.

In contrast, countries like the United States and Britain which have oil fields and coal mines have been far slower to develop alternative energies. One can take this argument further, and say that within the US, places without fossil fuels like New England, New York, Oregon, and Washington are far more supportive of wind and solar energy than are states with coal fields. Montana, Illinois, Wyoming, and West Virginia together supply 55% of US coal production, and they are not supporting the shift to alternatives. One finds the same resistence to change in the biggest oil producting states, Texas, Alaska, and Lousiana.

Without going into arguments about global warming, it seems obvious that the current energy regime favors fossil fuel exporting regions and in effect imposes a tax on those who import oil, gas, and coal. Half a century ago the cost of these energy sources was so low as to be almost a negligable part of the total cost of production. This is no longer so. Fuel prices, over the long term, have risen and can only continue to rise as demand increases. Already in Russia, more than 20% of the gross national product (GNP), comes from oil and gas exports; in Nigeria 35%; in Venezuela 27%; and so on for all the major oil producers.

It is always a good idea to "follow the money." Most of the world's powerful economies - the US, Germany, France, Italy, Spain, South Korea, Japan, Australia, China, and India - are all net importers of oil and gas. The United States imports almost 12 million barrels of oil every day. Japan imports a bit less than half that. China imports "only" 2.9 million barrels a day, but this figure is rocketing higher, as its citizens now buy more cars every month than consumers in the US. The major industrial nations need alternatives, and in the next two decades they will probably develop them.

There is one other argument in favor of a shift to alternative energies. Quite simply, the world's reserves of oil, coal, and gas are not infinite. Why keep paying a premium to use someone else's well, when it is drying up?