The Corporation: The Pathological Pursuit of Profit and Power

Today, we take the Limited Liability Corporation for granted. However, it is relatively new in history. It gives stockholders a limited risk with unlimited reward. They just risk the money they invest. Their rewards are potentially endless. With partnerships and other previous organizations, people had much more at risk. 

The corporation was created as a means to democratize investment. However, it also allowed for democratization of bamboozlement. The book was written shortly after the fall of Enron, so that is high on the author's mind. 

In the US, Corporations are legally required to seek the best interest of shareholders. Social good can only be an "afterthought" to this. It can often be justified as something that helps improve the standing of the corporation and leads to more profits.

Ironically attempts to control and regulate corporations often lead to their greater entrenchment. Heavy regulations are difficult for small corporations to manage. Thus there is a quest to consolidate and grow to larger sizes, creating larger more impersonal corporations. On one side, corporations are amorphous organisms that people can seek to extract benefit from. On the other side, they are given "personhood" for legal purposes. Are they human or not?

A key part that the author misses is that government and unions have many of the same problems as corporations. Both serve their own best interests, not the interests of society as a whole. They are only in conflict with corporations to the extent that their interests are different. Any benefit they provide to society is only incidental. Private schools were criticized. Are they best to educate our kids?  But are unions and government any better? They all have similar problems.

Some of the criticisms seem quite dated. A drug company that lobbied for protection of lawsuits for mercury in vaccines was criticized. Why should they have protection for something that leads to autism? Alas, the autism link has been thoroughly debunked. The corporate interest was in the best interest of society, while the "public" interest was negative. The book closed with a "victory" over a corporation in Cochabamba, Bolivia. The corporation had raised water rates in order to modernize and improve water service in the city. The people complained and the water company was deprivatized. Today, water service remains erratic, with many of the poor paying more than the rich and only having water for a few hours a day. Is this the type of victory we want to see? The corporation was providing a needed improvement, but it came with a cost. There are no simple solutions for problems with corporations.