Are corporations threatening our democracies?

Corporations threaten democracy

Dear Ecademists,

Exactly four years ago Kai Ryssdal has published on Marketplace a podcast from Charles Handy that corporations threaten democracy!

Handy mentioned in his podcast:

I have one plea.

Could you please do what is necessary to restore our faith in the corporations of business, a faith that has been so damaged in recent years?

The tall towers that house our corporations are the new palaces of our day, the places where real power resides, but those towers are full of paradoxes.

Made of glass, you can't see inside.

They're pillars of our democracy, but they are run as totalitarian states.

Their names are reduced to a set of initials.

Their leaders are unknown to those outside.

They are accountable, for the most part, to other institutions that sit in similarly anonymous towers.

To the average person, they are foreign entities shrouded in mystery.

It is no wonder that we look at them with suspicion, touched with envy.

I thought that this fourth anniversary of Charles Handy's speech is important, particularly as we still don't know, after almost one year since March 11, 2011, how many local Japanese officials are still on TEPCO's payroll?

What do you think?

Are Corporations threatening our democracies?

Please feel free to comment!

Have a great and happy new week!

Best,

- Lucas

Join The Swiss Business Club - Join the GuanXi Game Club - Join the Risk Consulting Club - And Join Doing Business Virtually!

Lucas Wyrsch

lucas_wyrsch

Are corporations threatening our democracies?

Japan's government on Wednesday approved a 1 trillion yen bailout for TEPCO Japan's government on Wednesday approved a 1 trillion yen ($12.55 billion) bailout for the operator of the disaster-hit Fukushima nuclear plant, putting the massive utility under temporary state control as it continues to deal with the colossal damages. The move, which had been widely expected, will prevent the Tokyo Electric Power Co. (known as Tepco) from collapsing. It will provide public funds so the company can decommission the stricken reactors, pay compensation to tens of thousands who fled as the radiation spread and provide electricity to its 45 million customers. But the bailout also gives the government a majority share of the once-monopolistic Japanese company, a change that will formally take place following Tepco's annual shareholders meeting in June, according to the Kyodo news agency. Tepco will be forced to follow a restructuring plan that includes electricity rate increases, changes in management, and 3.3 trillion yen ($41.4 billion) in cost-cutting over the next decade. "Without the state funds, [Tepco] cannot provide a stable supply of electricity and pay for compensation and decommissioning costs," said Japanese industry minister Yukio Edano, who approved the takeover plan. Tepco fell into financial crisis last year following a triple meltdown at the northeastern Fukushima Daiichi plant, where primary and back-up cooling systems were knocked out by a 9.0-magnitude earthquake and an ensuing tsunami. The company, much-criticized for its safety oversights at the plant, will need decades to decommission the now-stabilized reactors, and trillions of yen for cleanup. The government, policy experts say, could use its control over Tepco to spearhead changes to Japan's traditional system of electricity distribution, long dominated by regional monopolies that impose prices that are among the world's highest. Japan could use its power to open the electricity grid to competitors — something Edano has advocated. Edano had also threatened to allow Tepco to collapse if it didn't agree to a management overhaul. Tepco has already selected a new government-approved chairman, Kazuhiko Shimokobe, a bankruptcy lawyer and corporate restructuring specialist. Shimokobe recently oversaw the Nuclear Damage Liability Facilitation Fund, a public body that was created to help Tepco pay compensation to nuclear evacuees. Tepco remains the sole provider of electricity for a large swath of eastern Japan, including Tokyo. The utility, based on its government-submitted recovery plan, wants to restart seven idled reactors at its Kashiwazaki Kariwa nuclear plant, on Japan's western coastline. In the aftermath of the nuclear disaster, however, members of Japan's public — and many local officials — have pushed fiercely against atomic power. Their opposition has quickly turned Japan into an essentially non-nuclear nation. Mandatory, every-13-months checkups for reactors have turned into open-ended shutdowns, as authorities in Tokyo find themselves unable to win local approval for the restarts. Last weekend, Japan brought its final operating reactor offline, completely removing nuclear power from the circuit for the first time in more than four decades. In addition to the seven-unit plant in western Japan and the six-unit Fukushima Daiichi facility, Tepco also operates four-unit Fukushima Daini, which was shut down immediately after the disaster.

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Jeff Mowatt

jeffmowatt-232748

Are corporations threatening our democracies?

When Corporations Rule The World, a book by David Korten came at a time when corporations already ruled the world. Korton founded People-Centered Development and now publishes Yes! Magazine advocating localised sustainable development.

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Jeff Mowatt

jeffmowatt-232748

Are corporations threatening our democracies?

"They try to kill the messenger", said an American Senator speaking out about the division of wealth in Two Americas. He was talking about the division between the very wealthy and the rest of us, long before the Occupy movement He's now facing trial and possible imprisonment for using his presidential campaign funds to cover up an extramarital affairs. His good looks seem to have been both his appeal and his undoing. He was breaking rank and the mudslingers were looking for a flaw. What Edwards was saying was reflected in my own experience of trying to publicise a fast for economic rights and how we were subsequently treated. .

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Michael Heaney

michaelheaney-53285

Are corporations threatening our democracies?

On an individual basis, no. It is salutary to note just how few major corporations survive in the long term. Many once proud global brands and household names disappear in a matter of months - either they are swallowed up by another corporation, purchased and dismembered by wealth funds or just run out of steam. If the US government had not conjured up the money to bail them out even General Motors would be just a footnote of history. If the UK government had not done the same for the big UK banks their hundreds of years of prudent banking would be just a memory. As it is they are emasculated and withering away as they are asset stripped by sovereign wealth funds and friends in high places who can cherry pick the things of value and leave the dross and the debts behind for the taxpayers to absorb. Every dog has his day - and the current pack are no more immune to mortality than their predecessors. Just a quick glance at todays news headlines tell the story clearly Apple's market value hits $600 billion. US Electronics retailer BEST BUY chief executive resigns after poor Company performance US Aluminium giant ALCOA profits decline SONY doubles annual loss forecast HTC shares fall as first quarter profit tumbles 70% UK shop failures cost 10,000 jobs in first quarter World stock markets slip on growth fears However proud and profitable they may seem today - most of todays giants will grow old and diminish and die. The world's wealth is concentrated in fewer and fewer hands - but even a 30 or 40 year run in power and billions carefully stashed away in secret bank accounts did not save the Egyptian or Libyan dictators. The fish rots from the head - and so those leading lights who think they are invulnerable may find themself penniless in just a matter of moments. The speed and frequency of the collapses are accelerating. And which ones are now going to be successful in their claim that they are too big to fail? The general public tired of that sleight of hand pretty quickly.

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Richard J Francis

richardfrancis1-363696

Are corporations threatening our democracies?

Just as we are numb to media pictures of bloated starving black children's swollen bellies, we are increasingly resigned to increasing propaganda and short-sighted profiteering from 1-2% controlling the interests and lives of the 98-99%. The whole credit crunch started due to the above (largely employing modelling mathematicians and 'financial engineers' who were no longer being employed on the military projects Danielle described). It's a complex gravy train - even bypassing the Governments of whole countries on occasions. We can all point and discuss - but who has the power to unpick it?

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John Paul

johnpaul-94865

Are corporations threatening our democracies?

Lucas, my earlier response was slightly generalistic. I think it is genuinely difficult to say yes or no to your question. Over the last 18 years or so, I've worked in some large businesses within my profession with good reputations in terms of design standards and general ethos. Those firms do employ individuals capable of promoting and upholding those standards through their own individual abilities - so the relationship between 'corporation' and 'individual' is symbiotic, not separate. That said we have heard alot recently within the general business world about some large companies that do flaunt their strength through scale in various arenas. I think each business has to be considered on a case by case basis and that the realisation that sustainability in all its forms is now very important and something I think that will encourage more working together, rather than against - which is only a good thing as it will make each business less hermetic. In terms of diminishing or advancing democracy, I'd say that it is every individuals responsibility to contribute to society through work of some form, so choosing where and how you do that is a part of the relationship between individual and company and wouldn't seem to diminish democracy. Choosing not to may do, as it sets up an antagonism between individuals outside of a 'system', be it small or large businesses - for the want of a better term with those within. Most corporations are not the monolithic entities that they are perceived to be and individuals do make positive change within organisations - but you do have to take part.

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Lucas Wyrsch

lucas_wyrsch

Are corporations threatening our democracies?

Dear John, Danielle and Jeff, Thank you so much for your interesting comments and for sharing! Sorry for my late reply! What I notice in all of your comments is a negative sentiment towards corporations! Is it that the War for Talent that Corporations have fought against older, experienced employees made such a negative impact on corporations and do you think that the War for Talent is over, that we need a peace treaty and a sustainable Peace for Talent to help corporations create a better reputation? I wish you all a happy and wonderful Easter holiday! Best, Lucas

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John Paul

johnpaul-94865

Are corporations threatening our democracies?

Of course, why do you need to ask?

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Danielle de Valera

daniellede-valera-668759

Are corporations threatening our democracies?

Corporations have actually gone past the threatening stage, in my opinion, Lucas. In spite of Eisenhower's abdication speech in which he warned the US against falling into the hands of the military complex, it went that way anyway. Wars make a lot of money for a lot of people. The grain industry in the US are so powerful they got the food pyramid reorganised so that people actually believe that wholesale consumption grains is good for them (How many grians did the original hunter/fisher/gatherers eat? Our DNA hasn't changed since then.) The list goes on and on. And it's not just the US, it's all western countries. Frankly, I don't see what can be done about it at high levels; the only actions left are the grass roots actions of an idealistic few.

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Jeff Mowatt

jeffmowatt-232748

Are corporations threatening our democracies?

Yes Lucas, in that corporations are the embodiment of capitalism. In the white paper for P-CED it is reasoned that by trumping people, this trumps democracy. In law the corporation is considered a person, typically an unscrupulous person: 12. Positing numbers as real entities, and basing economics on that unproved and unprovable hypothesis, risks disposing of real entities (human beings) in favor of imaginary entities (numbers.) The only variable needed for that to happen is unscrupulous human beings. 13. Human-based - that is, people-centered - economics is the only valid measure of economics. 14. Manipulation of numbers, represented by currency/money, allows writing "new" money as needed. There is no tangible asset, or anchor. There are only numbers, managed by whomever might maneuver into position to do so. Economics came to be based on numbers, rather than real human beings. 15. On that basis, capitalism trumped people and therefore trumped democracy. Democracy is about people, who since Descartes are considered necessarily real, rather than numbers which are not necessarily real. An imaginary construct, numbers, rule a real construct, people. That arrangement allows for disposal of real human beings, in the name of the imaginary construct. http://www.p-ced.com/1/about/background/

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