Big Business Linked to Priveleged Class
The papers are heavy these days with reports of corporate crimes and other derelictions. Members of Congress in public and in private are more and more troubled with the unchecked power of corporations to ravage the political, economic and environmental rights of citizens.
Even some who call themselves conservatives are troubled by the growing gap between the theory and practice of large corporations. In a recent discussion I had with Ronald Reagan, he said that at gatherings with business leaders he often has told them his doubts as to whether they really believe in the free enterprise system. Reagan was particularly disturbed by the active rush of corporations to Washington for federal subsidies, guarantees and other special privileges that were undermining the competitive market system.
HISTORICALLY, BUSINESS norms such as competition, assumption of risks and respect for others’ property were frequently violated. In recent years, however, these violations either have become endemic, institutionalized or even legalized.
Note the following happenings of the past several days: 1. In lock-step fashion, led by U.S. Steel, the industry’s price pacer, steel companies earlier this month announced price increases of $20 a ton, effective the first of October.
Armco Steel suddenly delayed its increase, declaring that “lack of support of the Oct. 1 date” by some of its industry brethren made postponement necessary. This move was embarrassing to the steel industry since it highlighted the inverted practice of steel companies raising their prices to meet their competition.
2. For years, General Electric has been dumping the toxic chemical, PCB, into the Hudson River and poisoning the fish as well as the water. A New York State hearing officer concluded earlier this year that GE had violated state environmental laws and was about to assess penalties when the state’s Department of Environmental Conservation settled the case. GE agreed to pay $3 million for partial cleanup (instead of $27 million originally sought in penalty and cleanup funds), to reduce discharges, and to stop using PCB by next year.
THIS LESSON in corporate law enforcement is’ typical: do what you don’t have to do until you get caught. Then agree to discontinue the practice, don’t agree to any of the charged violations, and avoid any penalties. When a company reaches a certain size, it becomes too big to be prosecuted in the courts.
3. The no-fault, no-risk penchant is spreading through industry. The lineup for loan guarantees and bailouts by Congress is lengthening.
A CONSORTIUM of companies, headed by Bechtel, even persuaded President Ford to ask Congress for the jackpot — open up the uranium enrichment business to them under a “keep the profits but toss the losses to Washington” formula.
As these and many other episodes show, the consumers and taxpayers need to organize and obtain not just better representation in government but also direct rights and remedies vis-à-vis the corporate offenders in court and in the marketplace.
For a platform of proposals along these lines, send a self-addressed envelope to P.O. Box 19404, Washington, D.C. 20036.