Voices from the Flats – Bob Poe on Corporate Citizenry
The Corporate Citizen – Really?
By Bob Poe
I’m a business guy. I have an undergraduate degree in finance and a master’s degree in business, and I got them in the late 70’s, when there were still relatively few MBA’s running around. I like business, I find it fascinating, I like doing it, I like helping companies be successful. To me business is an endlessly creative experience.
In Alaska, a vital and diversified economy is the key to ours’ and our children’s future here. Our economic growth will come from business. I’m all about helping small and large businesses be successful here in Alaska. The overall benefits businesses yield to the state in terms of jobs and taxes are critical to our economic future. That said the Supreme Court’s recent decision in the Citizens United v. Federal Election Commission case really has me questioning the concept of the corporate citizen.
I’m running for the Democratic nomination for Governor in Alaska. Conventional wisdom says the Court’s decision favors Republicans over Democrats since business decision-makers tend to skew toward the conservative side of politics; I guess as a Democrat I should be personally concerned. But that’s not what’s really bugging me, we’ll work through those campaign fundraising challenges. What is bothering me is the whole direction this concept of attaching individual rights to corporations is taking in our country.
Back in September of 2008, when the American public was told that certain banks, insurance companies, and trading companies were “too big to fail”, I remember wondering aloud, “How did that happen?” Never in my six years of business school did a professor walk us through the “too big to fail” strategy. A fundamental course in a finance degree is an economics course called Money and Banking. The course is about reserve requirements and other regulatory controls placed over banks to assure, as banks leverage their deposits to loans in the community, there are still enough liquid reserves in the bank to meet daily depositor needs. Think back to Jimmy Stewart’s explanation of his savings and loan in “It’s a Wonderful Life”. Obviously, and this has now become clear even in our nation’s capitol, our regulators weren’t regulating.
All of a sudden it became the taxpayer’s responsibility to bail out the big banks and insurance companies. Taxpayers didn’t even get an apology. Now here is where the rub is. Corporations want rights as an individual person when it suits them, and don’t want the personal responsibility when it is inconvenient.
A corporation is treated as an individual for tax purposes since a corporation pays income taxes and the shareholders again pay taxes on the dividend income they receive; hence the oft bemoaned corporate “double taxation”. A corporation can sue and be sued similarly to taking civil court action against another individual. Back in business school all this made pretty good sense to me. But, in the last decade or so corporations began asserting they have First Amendment rights like any person, huh.
Let’s revisit that “too big to fail” strategy. Do any of us think the US taxpayer would be asked to bail out Warren Buffet, Bill Gates, Oprah, or any other billionaire if they had to declare bankruptcy? My bet is we would say, as individuals, they made their investment choices and they have to live with their downside just as they benefit handsomely on the upside. As a business guy I could probably make a plausible argument that the bankruptcy of any of these individuals would have a significant economic impact. But that’s what’s great about America – as an individual you have the freedom to succeed and the freedom to fail.
In his book Unequal Protection – The Rise of Corporate Dominance and the Theft of Human Rights, Thom Hartmann points out the Boston Tea party was actually against landing tea brought into the colonies by the British East India Company, essentially a corporation of the British throne. The crown had given this company specific tax breaks not available to local colonial importers affording the large corporation unfair advantage. He points out during America’s first 100 years, federal and state lawmakers took a wary eye toward the existence of corporations; they had to justify their existence every 30 years. Some states didn’t even allow them access to politicians under penalty of prison. Then in 1886 in the case Santa Clara County v. Southern Pacific Railroad, the Supreme Court concluded corporations did not have personhood, but the court reporter inaccurately represented the decision in the header notes (i.e. a case deciding corporate personhood). Incredibly since then, he argues, courts have upheld as precedent, under stare decisis, corporate rights as an individual that were never actually a precedent.
The above history makes the Supreme’s recent decision in Citizens United v. Federal Election Commission even more amazing because it reverses a decades-long view that corporations could not contribute to candidates or actively spend to affect a political election. What happened to stare decisis here? It is not that corporations are unheard in the political process. Corporations employ the vast majority of lobbyists at the state and federal level. So called “527” groups can mount major political campaigns with few contribution disclosure rules – right now.
This decision is sure to cause real change in the Alaska political process. Alaska Attorney General Daniel Sullivan, at least on first reading, believes corporations will be limited to the $500 per year contribution limit to a candidate, but their opportunities to spend unlimited funds in the category of campaign law called “independent expenditures” is a real game changer.
Recently we have seen independent expenditure battles in Alaska over the Pebble Mine where one of Alaska’s wealthiest residents, Bob Gillam, has contributed individually over $11 million to oppose development of the project. Truth is, there are very few people in Alaska wealthy enough to take on a battle like Mr. Gillam has, it is much more likely a corporation could. Alaska is often a battleground state over issues brought by outside interests. We will no doubt see better funded campaigns around initiatives here due to the Court’s decision – “527” groups have often already played a big role in these types of campaigns.
Perhaps the most chilling aspect of the Court’s ruling is the impact the threat of a corporate-funded independent expenditure campaign may have on the legislature and the Governor. It will be almost impossible for Alaska voters to know whether a politician took a vote, took an action, or signed a bill under the threat of a campaign against them. Threats like these can be made very quietly. And, in light of the very recent taste Veco Corporation left in Alaskans’ mouths; we know the influence corporations, even without their new rights as an individual, can have on the public process.
Maybe it’s time to really ask the question. Are Corporations truly individuals with the same rights of individuals or are they just another form of business organization like the ubiquitous LLC (Limited Liability Company). After all, LLC’s of all sizes are operating all around the country without the double taxation and without the rights as an individual. I for one, even as self-confessed business guy, am starting to really doubt this whole concept of corporate citizen.
Bob Poe has served four Alaska Governors in roles including Commissioner of Administration and Executive Director of Alaska’s largest investment bank AIDEA. He has worked for top international consulting companies including Price Waterhouse and Coopers & Lybrand and has led a variety of Alaska business efforts including attracting the FedEx and UPS cargo hubs to Anchorage, formation of the Alaska Heart Institute and most recently the Pegasus Aircraft Maintenance sale to NANA Development Corporation. He is currently seeking the Democratic nomination for Alaska Governor.
Thank you Mr. Poe, well said and easy to understand (o:
Well said. Why isn’t this obvious to the “fab five” justices?
Cortez—Rather than “fab five”, I think that K-RATS is far more descriptive.
Mr. Poe appears on this weeks Moore Up North talking about this very subject. If you’re in AK you should tune in to KYES channel five today at 4. Or check youtube.com/mooreupnorth later, it should be up today.
It’s funny that Bob Poe uses Bob Gillam as the example of independent expenditures. I thought Poe was anti-Pebble these days, maybe his advisors forgot to remind him this week.
Thank you for this. Being an eastcoaster, there are times when I think that you and AKM are the only intelligent and reasonable voices among the throng, although I know better. Truly, thank you.
better re-read that paragraph, Dave.
Thanks for the reasoned explanation of what the Supreme Court decision means. That should be easily understood by anyone.
And good luck, Mr. Poe, with your bid to be the Democratic nominee for governor. (I’m in Washington state, or you’d likely have my vote.)
Mo-
I re-read it and still think the same thing. I also was at the taping of Moore Up North on thursday and heard Mr. Poe say the same thing. It doesn’t seem to me that he is applauding Bob Gillam for doing so much to fight something that is so important. It seemed like he was pointing out that if someone like Bob Gillam can do it, maybe Northern Dynasty should be able to too. Maybe I am thinking too much of what he said at the TV taping, and it is sort of tainting my view of what he said here. I’ll have to watch it again, maybe I am just remembering it wrong.
But it’s nice that he is “questioning the concept of the corporate citizen.” Doesn’t seem like should be much of a question on the issue.
I never, EVER, called W president, because he did not win election — it was handed to him by five rogue supremes. They should have been impeached. They weren’t. Now five rogue supremes, including that jerk Alito (who, appropos of nothing, went to high school with my sister) have handed corporations rights that should be limited to human beings — you know, those bipedal, large-brained, furless apes. Why shouldn’t corporations have human rights? Well, for starters, should they kill someone (and that is not unheard of), can they be sent to prison? Humans can, and are. I’m an entrepreneur. I’m not anti-business. I’m not anti-taxes. I’m not anti-union. This decision violates fairness, decency, and other “human” qualities.
9 Dave Says: It seemed like he was pointing out that if someone like Bob Gillam can do it, maybe Northern Dynasty should be able to too.
I read it as, though someone personally wealthy like Bob Gillam can do it, how much easier would it be for Northern Dynasty to do it than the average Alaskan?
But I’ll wait for Moore Up North and see what I think after-wards.
Monalisa i read it the same way you did,That soon companies would take over and we the people would lose all around.I am glad to hear some republicans are seeing this also or at least thats what I heard
Another problem with the thinking that gets us too big to fail is the logic that says that, not only are corporations essentially persons, but because they have employees and share holders, those persons needs supercede the rights and needs of individual persons that the corporation has legally wrong.
So that a shareholder rights to have their money protected is greater than say the need of an injured employee for money needed for proper treatment of an injury and loss of income due to the negligence of the employer.
This logic is so twisted and immoral and cruel it is unbelievable that anyone would think that out loud and yet our “justice” system is doing just that.
Excellent post, Mr. Poe…..One of the best that I’ve read on the debate of “corporate citizenry
Bob Poe writes: Corporations want rights as an individual person when it suits them, and don’t want the personal responsibility when it is inconvenient.
That, ladies and gentlemen is the best statement from the post, above. Gets right down to the brass tacks.
This decision and the ones that have been laying the gound work for it aren’t just about elections, it is about reducing the rights of American citizens to the point where they have not rights when are in court or in contractual relations with anything other than other than other human beings.
Corporations, institutions, police, you name it, will all have greater rights than humans.
“….Then they came for the [judges]—and there was no one left to [defend them].”
In actuality “they’ are already murdering judges and their families.
Not very many yet, but Cornyn has issue the threat.
Oops, didn’t proof read.
This decision and the ones that have been laying the ground work for it aren’t just about elections, it is about reducing the rights of American citizens to the point where they have no rights, when they are in court or when they are in contractual relations with anything other than other than other human beings.
Corporations, institutions, police, you name it, will all have greater rights than humans.
“….Then they came for the [judges]—and there was no one left to [defend them].”
In actuality “they’ are already murdering judges and their families.
Not very many yet, but Cornyn has issue a very overt threat.
Bob Poe sounds like a real progressive, so I hope he has a chance to turn AK politics around. Being from NC, it’s hard to judge AK, but the general impression down here is that AK produces some of the worst politicians in the entire US, corrupt, self-serving, etc. However, I know there are good people in AK from reading these blogs, just as I know there are plenty of sycophants in NC.
Even in NC, where we elect Dem governors, many counties are still backwards and the majority of left leaning, progressive and Dem folks live in the larger cities. My major aim is to get a worthy Dem to replace Richard Burr, but it doesn’t look hopeful, since our state Dem party is fairly fractured right now (we probably have more “conservative” Dems than some other states).
The preamble to the Constitution reads “We the People” not “We the Corporations”. That is something the Supreme court seems to have
forgotten.
The Republicans are always screaming about those damn librul judges
legislating from the bench. Isn’t this a perfect example of conservatives
doing exactly that?
DD
As concise as anyone can be on this subject. Well done, Candidate Poe.
On a related vein, does this mean corporations must now pay the individual tax rate to the IRS each year? Seems to me that if corporations have been given legal sentience by the Supreme Court, it stands to reason that they should be taxed like the rest of us.
As if, also.
A very inspiring essay, Mr. Poe! Thank you for speaking to my heart.
The rant on my blog all started because a local organized association of vacation rental companies donated enough money (through the president and vice president of the organization) to local representatives to have a tiny clause inserted into a rule.
When this happened in 2003, it generated possibly hundreds of Ponzi schemes. I am obviously horrified by this, and the reason is because of the carnage i see on a daily basis caused by this avoidable situation. All this just because a couple of people overspent their escrow and didn’t want to get in trouble.
Consider this a microcosm, but, i tell you sadly: The PTB (Powers that Be) are not listening. And the commercial interests that set this all in motion back in 2003 is actually NOW working hard and donating money to the new set of representatives to further their cause. I feel alone, but i can’t stop objecting. In the meantime, vacationers are losing their deposits and owners aren’t getting their checks.
I shudder to think of these shenanigans on the grander scale.
Wow. That was substantive, insightful, and courageous. Yes.
I’m inspired to action on your behalf, Bob Poe. Thank you.
Mr. Poe, thanks for the straight talk, it’s refreshing.
He just got my vote. I’ll caucus for his camp in the primaries.
Thank you Mr. Poe for making this issue clear and concise. Big money is taking over our country and leaving us poor behind. We’ve got a big fight on our plate. Those little sneaky clauses added onto rules are hard to find and hard to understand for the common man. They are intended to take away individual rights and they do just that. CDQ’s for example, given on behalf of the Western Alaska Coastal poor people from the Bering Sea Pollock Fishery. The poor people have no say. A sneaky little clause took away our rights. The Board of Directors are a sham because The Staff is in control playing Big Shot with the People’s Money.
“It will be almost impossible for Alaska voters to know whether a politician took a vote, took an action, or signed a bill under the threat of a campaign against them. Threats like these can be made very quietly.” This is what concerns me ~ that good people lose courage to do what they are elected to do, forced to adjust their decisions/actions after threats are made, so that they can continue to live in safety….. hope I am wrong about that.
Thank you Mr. Poe. Nicely done.
I wonder if we should be limiting this conversation to Corporations. Why should any entity be allowed to influence elections? Currently Corporations funnel funds through special interest groups, political action committees, trade groups, political parties etc… Are we going to change the rules so that Corporations can’t contribute to any of those groups as well?
What would campaigns look like if only registered, eligible to vote individuals had the right to contribute and participate in the campaign-election process? What if we barred lobbyists from the capitol while the legislature was in session? Why should groups outside of Alaska be allowed to involve themselves in Alaskan issues or elections?
I know we can’t stuff the Genie back in the bottle. Money is and will continue to be the driving force behind politics. But let’s do what we can to ensure that the individual Joe and Jane voter’s voice won’t be muted by the sound of the incessant ringing of the cash register.