Loading...
HomeMy WebLinkAbout09-25-2012 ac C3 speaseGoodwin, Heather RECEIVE D SEP 24 201 2 SLO CITY CLER K Agenda Correspondence for 9/25/12 . Thanks . Maeve Xennedy Grime s City Cler k City of San Luis Obisp o 990 Palm Stree t San Luis Obispo, CA 93401-324 9 (805) 781-710 2 From :Marx, Ja nSent:Monday, September 24, 2012 2 :38 P MTo: Grimes, MaeveSubject:FW : Your attention would be appreciated . Agenda correspondence . Ja n From :Karenskollars fmailto :karenskollars@aol .comlSent:Monday, September 24, 2012 2 :33 P MTo: Carter, Andre wCc: Marx, Jan ; Carpenter, Dan ; Smith, Kathy; Ashbaugh, Joh nSubject:Your attention would be appreciated . Mr. Carter, It is important that all natural people agree . Artificial "persons" shall not be able to shirk accountability, for their heinou sactions, in perpetuity . Our forefathers gave us inalienable rights, while corporations were only granted the right to exist fo rthe good of The People .Sincerely,Karen Staub Spease281.787 .6537 . Information from ESET Endpoint Antivirus,version of virus signature database 7512 (20120924) The message was checked by ESET Endpoint Antivirus . http ://www .eset .co m Information from ESET Endpoint Antivirus, version of virus signature database 7512 (20120924 ) From:Grimes, Maev e Sent :Monday, September 24, 2012 2 :47 P M To :Goodwin, Heathe r Subject :FW: Your attention would be appreciated . Attachments :24 September 2012 .doc ; Corporations and the Public Interest .mh t AGENDA CORRESPONDENC E Date II 35 112.Item# ('-5 . 1 24 September 201 2 Andrew Carte r City of San Luis Obispo Council Membe r Dear Councilman Carter , I spoke to you and the other council members recently because I felt the need t o address the history of corporations . Your vote against placing a non-binding resolutio n on the SLO City Council agenda caused me deep concern . You voiced the logica l concern that if you acted to support natural persons over contrived persons it would set a precedent . How many times has The SLO City Council been asked to support a non - binding resolution intended to endorse an amendment to The US Constitution ? However, the other reasoning I heard expressed at the city council meeting (4 September 2012) caused me deep trepidation, "If The SLO City Council acts to suppor t the cause codified by Move to Amend, then "liberal" members of our community migh t use that city council action to their advantage ." That logic caused me to question whethe r our locally elected representatives truly understand that they are elected to represent th e needs of all The People who live and/or work in our community . That reasoning raised the logical issue about whether our elected representatives actually believe that the y represent a certain class of "persons" or if holding public office simply provides a n opportunity for elected officials to sustain or pursue their own personal agenda . Corporations cannot be considered artificial "persons" with constitutional right s that overpower and overshadow the rights of human beings because, by nature, publicl y held corporations are "greed machines" who have no conscience . Therefore,I respectfully request that you support the non-binding resolution proposed by Move t o Amend or another similar resolution developed by city staff, which sets down the fac t that corporations are not "persons" for the reasons discussed below . I shared my understanding that historically a Royal Charter or an act o f government was necessary to grant "limited" corporate charters for a specific purpos e and corporations were mandated to operate in the public interest . I also expressed m y concern that the original intent of "limited liability corporations" has been perverted . An imbalance now exists, and the balance of power must be restored before the tru e democracy, which our forefathers envisioned, shall be able to flourish ."The primary purpose of the corporate form is to insulate a certain class ofpeople from responsibility for actions taken on their behalf. "See "Corporations and the Public Interest"Jonathan Rowe Copyright ©1995, 1997 by Context Institute . Our founding fathers never envisioned corporations in their current form . Therefore, our founding fathers were unable to curtail the unbridled power and influenc e that many modem day corporations now wield . "The founders tried to craft a politica l structure that kept institutional power in check They left out the corporation because i t didn't exist in its present form; and the need today is to repair this omission in th e original scheme . "See "Corporations and the Public Interest"Jonathan Rowe Copyrigh t ©1995, 1997 by Context Institute . Another speaker, who addressed the council on this topic, demonstrated th e imbalance visually . Carol Rowsemitt narrated while a "human" and a "person" presente d an informative and entertaining example of how political power has been unfairly skewe d in favor of powerful corporate interests who are now given "unlimited charters" t o operate in perpetuity ."Ifcorporations are to be treated as persons under the fourteent h amendment, then they should have the burdens of actual persons as well, including tha t of mortality. Nothing would do more for our commerce than to clear the decks regularl y and let a whole new generation of entrepreneurs rise to the top ."See "Corporations and the Public Interest"Jonathan Rowe Copyright ©1995, 1997 by Context Institute . "Individual responsibility is one of the bedrock principles of common law . To dilute this principle was an extraordinary step, one that was conceivable only for a mission that presumably served the public good . In other words, there was a direct link between the exemption from individual responsibility for corporate investors (and late r officers), and the public good that the corporation was chartered to carry out . "See "Corporations and the Public Interest"Jonathan Rowe Copyright ©1995, 1997 b y Context Institute . "This legal tradition carried over to the American colonies . It gave rise to th e corporate charters that the state legislatures bestowed one by one, and only for specifi c undertakings . (Think of Amtrak as a rough modern-day equivalent, including th e subsidy.) This was the form of corporation the framers of the Constitution ha d experienced. It was totally a state matter, and nothing for the new federal Congress t o worry about."See "Corporations and the Public Interest"Jonathan Rowe Copyrigh t ©1995, 1997 by Context Institute . History provides context "Much as it might cause free market fundamentalists t o squirm, the original corporations were actually regulatory agencies, such as guilds, o r local governments such as townships . (In New England, when you drive from one tow n into another you pass a sign that announces the year in which the town you are entering was "incorporated')"See "Corporations and the Public Interest"Jonathan Rowe Copyright ©1995, 1997 by Context Institute . History helps reveal how self-serving corporations, who shirk personal and socia l responsibility, overpowered our free market system ."The important point is that the fre e incorporation laws tore up the original bargain that was the basis of the corporate form . Corporations no longer had to serve the public . They could do anything they wanted Bu t they still enjoyed the extraordinary exemption from individual responsibility that they had obtained historically only because they would serve the public ."See "Corporations and the Public Interest"Jonathan Rowe Copyright ©1995, 1997 by Context Institute . My overwhelming concerns are, "How can our community achieve progress tha t serves the needs of its members now, and throughout the 21 st century, and how will ou r community maintain the rights of its People in perpetuity?" My experience reveals that publicly held corporations are able to easily shirk their fiduciary duties, especially whe n they collaborate with government agencies/entities, and my experience demonstrates that unconscionable corporations are able to actively oppress The People (customers) the y were established to serve . It gets even weirder. The modern corporation actually can be incapable of commitment to a community or any other realm of concern that might diminish its profits . Individual entrepreneurs, including the owners of small and family-held corporations , can express their conscience through their enterprise . They can choose to make less money for the sake of a larger good.See "Corporations and the Public Interest " Jonathan Rowe Copyright ©1995, 1997 by Context Institute . The publicly-held corporation, by contrast, generally cannot. Officers are subjec t to shareholder suits if they do not put shareholders – i .e. profits – first . The corporatio n becomes a greed machine, an engine of acquisition that is not subject to the urgings o f individual conscience and responsibility .See "Corporations and the Public Interest " Jonathan Rowe Copyright ©1995, 1997 by Context Institute . Free market fundamentalists such as Professor Milton Friedman argue that it i s wrong in principle to distract the corporation with any such extraneous concerns a s conscience or the need to help the society survive . For the corporation to pursue any goa l besides the maximization of monetary profit, he says, would disrupt the cosmic marke t scheme.See "Corporations and the Public Interest"Jonathan Rowe Copyright ©1995 , 1997 by Context Institute . If that's true, it means the largest and most powerful 'persons" in America ar e exempt from any standards of individual responsibility and from any obligation to help solve problems in voluntary and nongovernmental ways .See "Corporations and the Public Interest"Jonathan Rowe Copyright ©1995, 1997 by Context Institute . It's time to rethink the bargain . If individual responsibility is to be the guidin g principle of social policy, a first priority needs to be to do away with this built-i n exemption for the most powerful 'Persons ."See "Corporations and the Public Interest " Jonathan Rowe Copyright ©1995, 1997 by Context Institute . I feel compelled to share my conviction that we must all work together to create positive change, which sustains and supports the needs of all The People in ou r community . I believe that the members of our community understand and appreciat e how blessed we are to live here . I also know that many natural persons in our communit y are willing to dedicate their resources and efforts to create a more sustainable an d compassionate community . I understand that we still have many issues to addres s together before our community can be the model community that others want to emulate . I certainly hope that our conmiunity can count on your cooperation and your support i n pursuit of Our common San Luis Obispo County goals now, and in the future . Sincerely , Karen Staub Speas e 370 Acero Plac e Arroyo Grande, CA 9342 0 281 .787 .653 7 281 .787 .661 9 805 .473 .223 5 cc : Mayor Jan Howell Mar x Vice Mayor Dan Carpente r Council Member Kathy Smit h Council Member John Ashbaugh Goodwin, Heathe r From : Sent : Subject : Saved by Windows Internet Explorer 9 Monday, September 24, 2012 2 :15 P M Corporations and the Public Interes t Context Institut e Whole-system pathways to a thriving futur e [][Search] Foundation Stone s •What Time Is It ? •Tools For The Journ e ▪About Context Institute ▪Who We Ar e ▪Stay Connecte d ▪Context Institute's Histor y ▪The Story Of The CI Log o ▪Contact •About In Contex t •Back Issue Listin t •Terms of Us e •Privacy Policy •Copyright Polic y •Header Images Home / About In Context / Business On A Small Plane tCorporations and the Public Interes t A look at how the originally purpose behind corporate charters has been los t By Jonathan Row e One of the articles in Business On A Small Planet (IC#41 ) Originally published in Summer 1995 on page 2 6 Copyright (c)1 995,1 997 by Context Institut e When people talk about "the market" they usually confuse two totally different things . One is the enterprise economy of small-scale business . The other is the corporate economy of hulking bureaucrati c institutions. Most of us love markets in the former sense . We love farmers' markets, flea markets, New York-style stree t fairs, and classified ads . When we go to Washington, DC, we generally don't eat in government cafeterias . We head over to the neat little restaurants in DuPont Circle or Adams Morgan — a "market" experience . When I was in Warsaw not long after the fall of the communist regime, the new outdoor markets really did feel like seedlings breaking through the concrete . These are the kinds of markets the founders of the United States had in mind when they drafted th e Constitution . The corporation in its modern form did not exist when the basic concepts of our economi c and political structures were wrought . The founders omitted it from the elegant scheme of checks an d balances by which they hoped to hold institutional power under control . (Jefferson was particularly war y of the dangers of centralized economic power .) Individual enterprises are also the kind Adam Smith thought he was writing about — the ghost tha t inhabits economic theory . Adam Smith didn't take sprawling corporate agglomerations of capital int o account when he worked out his notion of a benign mechanism that harmonizes the activities o f individuals pursuing their own entrepreneurial ends . Little wonder, then, that the corporation has come to dominate both our economics and our politics . It wasn't part of the legal and conceptual framework that was supposed to govern these . The term "market " has become a mythological gloss for a legal invention that has overrun the society that bore it . Business and Community Life Enterprise has a social dimension that economists are trained to overlook. It determines much of the flow of social interaction in daily life . Jane Jacobs got at this in The Death and Life of American Cities – th e way, for example, that street-level enterprise promotes pedestrian traffic, which in turn deters crime . Such enterprise also can promote a kind of informal safety net . I have a close friend, for example, whose father owned a pharmacy on the declining Main Street in a smal l city in upstate New York . He was always involved in improvement and clean-up campaigns, took grea t pride in his Christmas decorations . His business was strangled slowly by the discount chains in th e shopping centers that sprang up outside of town . I think too of the Regal Coffee Shop on Eighth Avenue near 23rd Street in Manhattan . In the morning, th e Regal serves as an all-purpose social center for the troubled souls in the neighborhood . The waitresses talk with them, humor them, make them feel included . The kindly Greek woman who owns the shop with he r husband, is as much a mother as a manager . By contrast, at the McDonald's a few blocks away I've see n the manager kick these same people out . Or else they sit there staring into space, alone and forlorn. The corporatized version of the market has done much to undermine this social dimension of enterprise . When McDonald's supplants the Regal, part of the informal safety net frays . When the shopping mall s replace Main Street, and when multinational enterprise replaces local, it frays yet more . In the town I grew up in, the merchants knew the kids and often their parents too . We knew we wer e watched, and generally acted accordingly . At the malls, kids don't have that feeling . They float in a virtua l reality of market culture that is totally detached from any process of community life . The Steel Baron s Drive through what is now the "Rust Belt" in Western Pennsylvania, West Virginia and Ohio . Many of th e steel towns there bear the monuments of first generation entrepreneurs who had roots in their localities . Libraries, schools, community centers, hospitals, museums – all bear the names of the entrepreneurs wh o contributed generously from their earnings . Paternalistic? Probably . But at least there was a sense o f individual connection and responsibility that provided glue for a community and enabled it to function . I don't want to romanticize those early steel barons . They tended to occupy the big houses up on the hill , out of reach of the smoke and soot, and this was symbolic . But at least they had a redeeming side that i s almost totally lacking in the footloose and rootless corporate enterprise of today . This social role for enterprise, a residue of pre-market society, acted as a necessary ballast and brake to th e market. The dispersal of this ballast – including the physical setting of enterprise, the old Main Streets – has helped bring about the growing social chaos . 3 Passing the Buck s Market ideology today conveniently sweeps these distinctions under the rug . At a very basic level, it ha s become a form of cosmological buck-passing that blames abstract "market forces" for the behavior o f individuals . The corporation is the institutionalized form of this shirking of responsibility . The primary purpose of the corporate form is to insulate a certain class of people from responsibility for actions take n on their behalf. When I was a law student in Philadelphia, I was hired by the owner of a small local radio station to loo k into the original corporate charters of the Penn Central Railroad (originally the Pennsylvania Railroad). The Penn Central was in the process of ending its passenger service, and the man who hired me wondere d if the railroad didn't have a legal duty of some kind to continue it . What I found truly surprised me . Th e charter spelled out clearly that the corporation had an obligation to serve the public by providin g passenger service . That was the condition for the privilege of operating in the corporate form, and also fo r the generous grants of land it received from the legislature . Origin of the Corporatio n This was true of the early corporations generally . Their charters asserted that they existed first an d foremost to serve the public . That was their reason for being . In fact, the first corporations in the Anglo-American tradition had nothing to do with profits . Much as it might cause free market fundamentalists to squirm, the original corporations were actually regulator y agencies, such as guilds, or local governments such as townships . (In New England, when you drive fro m one town into another you pass a sign that announces the year in which the town you are entering wa s "incorporated .") Later, the British Crown adapted the corporate form to what we would call today a "public-privat e partnership ." The Queen wanted to lay claim to the New World, but such ventures required huge amounts of capital, and were risky in the extreme . To amass the capital, there was a need to insulate investors fro m responsibility for the undertaking, beyond the amount of their investment . Thus the "joint stock company " was born . Individual responsibility is one of the bedrock principles of common law . To dilute this principle was a n extraordinary step, one that was conceivable only for a mission that presumably served the public good . In other words, there was a direct link between the exemption from individual responsibility for corporat e investors (and later officers), and the public good that the corporation was chartered to carry out . This legal tradition carried over to the American colonies . It gave rise to the corporate charters that th e state legislatures bestowed one by one, and only for specific undertakings . (Think of Amtrak as a roug h 4 modern-day equivalent, including the subsidy .) This was the form of corporation the framers of th e Constitution had experienced . It was totally a state matter, and nothing for the new federal Congress t o worry about. Predictably, there was a lot of patronage and corruption in the granting of charters, which in effect were private monopolies . There also were boondoggles of the first order, the railroad land grants being a prime example . By the middle years of the 19th century, the nation's commerce was bursting at the seams . What historian s now call "Jacksonian Democracy" gave political expression to these impulses – the resentment of specia l privilege and the explosive growth of commerce . Corporations became a prime target of political attack ; not to curtail or abolish them, or to reinforce the original bargain, but rather to extend the privileges o f incorporation to everyone . Up close, this Jacksonian Democracy could look a lot like an S&L convention in the '8os . One afte r another, the state legislatures enacted "free incorporation laws," which democratized the corporate form . No longer did legislatures have to charter corporations by special act . No longer were corporations limite d to specific activities that served the public . Now anyone could form one, to do anything they wished . Market ideology said that simply seeking gain would, under the dispensation of the Invisible Hand, serv e the public good . Thus US Steel and Standard Oil and the like were born on a wave of what might be called today "libera l permissiveness ." Several decades later, the Supreme Court completed the coup by declaring, with littl e basis in law or history, that the Fourteenth Amendment applied equally to corporations, making the m legal "persons" with all the Constitutional rights and privileges of human beings . The important point is that the free incorporation laws tore up the original bargain that was the basis o f the corporate form . Corporations no longer had to serve the public. They could do anything they wanted . But they still enjoyed the extraordinary exemption from individual responsibility that they had obtaine d historically only because they would serve the public . Then, the Supreme Court decision had the truly ironic effect of turning all human citizens, white as well a s black, into second class citizens . Corporations enjoy all the Constitutional protections of human beings , plus exemptions from responsibility that humans don't enjoy . Plus, of course, they can live forever, whic h humans can't do either. Profit Machine s It gets even weirder . The modern corporation actually can be incapable of commitment to a community o r any other realm of concern that might diminish its profits . Individual entrepreneurs, including the owner s s of small and family-held corporations, can express their conscience through their enterprise . They ca n choose to make less money for the sake of a larger good . The publicly-held corporation, by contrast, generally cannot . Officers are subject to shareholder suits i f they do not put shareholders — i .e . profits — first . The corporation becomes a greed machine, an engine o f acquisition that is not subject to the urgings of individual conscience and responsibility. Free market fundamentalists such as Professor Milton Friedman argue that it is wrong in principle t o distract the corporation with any such extraneous concerns as conscience or the need to help the societ y survive . For the corporation to pursue any goal besides the maximization of monetary profit, he says , would disrupt the cosmic market scheme . If that's true, it means the largest and most powerful "persons" in America are exempt from any standard s of individual responsibility and from any obligation to help solve problems in voluntary an d nongovernmental ways . It's time to rethink the bargain . If individual responsibility is to be the guiding principle of social policy,a first priority needs to be to do away with this built-in exemption for the most powerful "persons ." Here ar e some ways we could do that : Individual Responsibility :Executives of large publicly-held corporations should not be able to hid e behind the corporate veil . They should be held personally responsible for their actions, and for action s taken in their behalf, to the same extent you or I would be . In France, for example, managers are held to such a standard . A French court recently fined an executive of Disneyland Paris over 8,000 francs (roughly $i000)for a dress code that was found to violate the rights of its workers . Three Strikes and You're Out :Corporations should be treated exactly the same as everyone else when they break the law . A corporation convicted of three major felonies should get in effect a life sentence, an d be out of business . There should also be a corporate death penalty for crimes that would bring this penalt y upon an individual . Three Score and Ten : If corporations are to be treated as persons under the Fourteenth Amendment , then they should have the burdens of actual persons as well, including that of mortality . Nothing would do more for our commerce than to clear the decks regularly and let a whole new generation of entrepreneur s rise to the top . If pro athletes played forever, then a Michael Jordan or a Magic Johnson might never hav e had a chance . The same is true in business . Each generation should give way to the next . Empowerment :This has become a Washington mantra ; but the politicians are talking only about a shopping mall version, the ability to make buying choices between the products the corporate econom y chooses to offer . The greater need is to empower individuals and communities to hold corporation s accountable for their actions . An example is customer and community representation on corporate boards . At the same time we need to empower individuals in the political process by curbing the influence o f corporations . At the very least, corporations should have to disclose all political donations ; this woul d 6 empower customers to make informed decisions in the market regarding the companies whose politica l activities they want to support . Such proposals are radical only in the way the Founding Fathers themselves were radical . The founders tried to craft a political structure that kept institutional power in check . They left out the corporatio n because it didn't exist in its present form ; and the need today is to repair this omission in the origina l scheme . A reporter once asked Gandhi what he thought of Western Civilization . "It would be a wonderful idea," Gandhi replied . We could say the same about the concept of individual responsibility as it applies to the economy . It would be a wonderful idea . With some changes in the state-created structure called th e corporation, we could begin to make it real . Jonathan Rowe is program director of Redefining Progress, based in San Francisco, co-author wit h Edgar Cahn ofTime Dollars,Rodale,1992,and a contributing editor at the Washington Monthly . Corporate Charter s The pamphlet Taking Care of Business : Citizenship and the Charter of Incorporation,by Richar d Grossman and Frank Adams, looks at how corporations can be returned to their original purposes – acting in the public interest . It can be ordered from Charter Ink, Box 8o6, Cambridge, MA 02140 .Contact Richard Grossman at the same address for updates on related activities in your area . • Facebook •Twitte r •Emai l Stay Connecte d Sign up for CI News with the form below and get updates and the inside story . It's the best way t o stay connected . First Name *[] Email Address *[] [Subscribe Now] * Required field . 7 Our privacy policy keeps your email address safe & secure . For help go to the Stay Connected page. Use the buttons below to follow us via Facebook, Twitter and RSS . Recent Post s •Taking Einstein Seriousl y •New : The Core Challenge Of Our Time s •Celebrating 33 years ... and a new beginning •Welcome to the new CI Website ! IN CONTEXT Copyright ©1979 -2012 by Context Institut e Please Support This Work Comment I Contact I Privacy 1 Terns of Use 8