Robert Reich, Supercapitalism

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How do you perceive there to be a paradox between capitalism and democracy?  

We used to believe that capitalism and democracy fit hand in glove, that you couldn't have one without the other. Indeed, for decades after the Second World War, the United States thought of itself as exemplifying democratic, with a small d, capitalism, in contrast to Soviet communism. Indeed, our foreign policy is still to some extent based on the notion that if we can spread capitalism we will also automatically spread democracy. But that's not necessarily the case.

You write that corporate income tax should be abolished because taxation entails representation. What is the danger of viewing a corporation as a citizen?

Corporations are not citizens. Only people are citizens. Corporations are pieces of paper. They are contractual agreements. The anthropomorphic fallacy that corporations are people has led to some bizarre public policies. For example, federal prosecutors occasionally indict corporations for criminal behavior. Witness Arthur Andersen, the accounting firm that allegedly helped Enron. A criminal indictment was issued against Arthur Andersen. The result was that a lot of Andersen's senior partners got new jobs as the firm disappeared, but many of the lower-level employees who were completely innocent lost their jobs and bore most of the burden.

Nevertheless, it seems to be an increasing trend to view corporations as citizens; it's even a term, "the corporate citizen."  When did it first strike you that corporations were being viewed more as individuals?

Well, under the law, corporations have been viewed as people or citizens for many years. That's bad enough, but over the past 10 years or so, with increasing vehemence, public policy and public discussion have assumed the reality of corporate citizenship. It is a distraction from the harder work of devising laws and rules that should determine what corporations do for the public, in addition to maximizing shareholder returns and offering good deals. For example, if we want to combat global warming, it's silly to expect that corporations on their own volition will sacrifice shareholder returns or good deals for the sake of becoming more "green." They will become greener only to the extent it helps the bottom line through positive public relations or because it helps the company get ready for what it may believe to be legislation coming down the pike requiring it to reduce CO2 emissions.

Does supercapitalism feed on apathy on the part of citizens?  

I think it is not apathy so much as cynicism. Many people look at democracy these days and, according to the polls, they feel democracy is just for the biggest guys, including Wall Street and the biggest corporations. This is very different from what the public told pollsters who asked similar questions in the 1950s and '60s. Then, the vast majority of Americans felt that the democratic process worked for citizens and that the government did the right thing most of the time. Today, cynicism prevails and, of course, cynicism has a devastating, self-perpetuating quality, because the more cynical people are, the less willing they are to roll up their sleeves and do something about the problem.

It seems that in your view, a large-scale social movement would be needed to restore democracy.

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