Twixt Darkness and That Light: “A Corporatist State or A Government and A Nation of People?”
Citizens Dis-United: Passive Investors, Drone CEOs, and the Corporate Capture of the American Dream, by Robert A.G. Monks.
Who said the following?
“Democratic capitalism is threatened as never before . . . not from without but from within.”
“Government capture [by corporations and CEOs] is the American condition.”
Judicial effort to defend Citizens United v. FEC “borders on the clinically obtuse or borderline deranged.”
“America’s corporations today enjoy an absolute reign. They and they alone have the power to control the rules under which they function. They have the first say on the allocation of public resources and they have exempted themselves from nearly all financial obligations to the nation and its people. This is not a prediction of what’s to come. This is the present state of affairs, the America we live in right now.”
An Occupy Wall Street activist? A libertarian Tea Party member? Someone ‘who just doesn’t understand how corporations and the economy work?’
No, they are the most recent words of Robert Augustus Gardner Monks, who in his eight decades has been CEO of an oil and coal business, a corporate lawyer, a founder of Institutional Shareholder Services, Inc. and several other businesses dealing with corporate governance, a state Chair of the Republican party and Republican candidate for U.S. Senate, an author of several books on corporate governance and shareholder democracy, a member of the Boards of Directors of numerous large corporations, a trustee of retirement systems, and a public servant in the Administrations of Presidents Ronald Reagan and George H.W. Bush.
Now he’s out with a new book, Citizens Dis-United: Passive Investors, Drone CEOs, and the Corporate Capture of the American Dream. It is a clear, reasoned, and passionate call to see the danger, and to act before it’s too late.
This book is compelling and urgent. It reflects a great decency, patriotism, and honesty. Bob Monks tells the truth, even about where he thinks he has been wrong.
Monks has done more, and knows more, about shareholder democracy and corporate governance than just about anyone. Yet the crisis of our democratic capitalism has reached the point where even Monks says that corporate governance is a “myth,” a “chimera at best” and “a fraud at worst.” And what about “shareholder democracy” as a solution to the problem of Citizens United and the corporate capture of our government, elections and culture?
I still believe that in an ideal world, or even a rational one, an empowered and unencumbered electorate is the best remedy to tyranny of any kind, but current circumstances give me no choice but to abandon a position on which I have staked a good portion of my professional life. The atom of ownership is too smashed, and the proxy system through which corporate voting is carried out has been too corrupted to give any hope of a democratic resolution to the multiple ills of corporate governance.
Citizens Dis-United smashes myths: The myth that the growth of corporate profits can be assumed to be always of worth to America or Americans; the myth that corporate spending is “speech” or that republican government can survive Citizens United and the corporate capture of the government’s branches; the myth that anyone or anything is now in place to ensure that corporations function as intended, to serve a public purpose or even to serve the interest of the purported owners, the shareholders.
Monks shows how “America’s CEO’s have staged a corporate coup d’etat.” The CEOs, “not the titular owners of the businesses, decide where and how company resources will be deployed, what laws will be evaded in the pursuit of short-term gain, what offshore havens profits will be stashed in to avoid taxation, and critically, how lavishly the CEOs themselves will be compensated.”
It should go without saying but it needs to be said again, as Monks does, that this is not about “destroying the corporation but taming it and harmonizing its vast power with human values.”
So what to do?
If you’ve read Corporations Are Not People, you know what I think: (1) A national movement for a Constitutional amendment to reverse the power dynamic of Citizens United and Buckley v. Valeo that accelerates the crisis of democratic capitalism and blocks any chance at real reform; (2) campaign finance reform; (3) legal advocacy in the courts to challenge the corporate capture of our judiciary and Constitutional jurisprudence; and (4) a reform of state and federal corporate laws to better ensure accountability and social benefit.
In Citizens Dis-United, Monks does call for overturning Supreme Court decisions such as Citizens United but his primary and admirable focus is his passionate plea to those who own massive amounts of public company shares to step up to their responsibilities. He calls for decisive and prompt action from those who, like himself, have been blessed by the previous success of American democratic capitalism, who know the truth about corporations and who have access to the few remnant levers left that might yet function.
He identifies the foundations, the pension funds, and the great universities that own hundreds of billions of dollars in shares in corporations that are now run amok. He urges “those fortunate and able enough to prosper in our society [to] stop taking the ‘commons’ for granted, and [to] begin committing their time, values, and integrity to the functioning of companies of which they are the owners.”
Finally, Monks writes of shame. That shame, that “great and public transgression . . . to have known vast harm was being done and to have the power, standing, and resources to intervene, and yet to have failed to act. That is a shame not easily overcome, for the individual or for the society that allowed it to happen.”
In one sense, Monks is shaming those with power and standing (the “great and the good,” as Monks calls them, perhaps with tongue in cheek), and he is trying to move them to action. Yet, this should not be misunderstood as mere finger-pointing at others. Indeed, Monks describes this book as an “atonement for my own shame.”
And he should not feel alone there. One challenge of citizenship in a nation dedicated to a government of the people is that our pointing of fingers or blaming of others only goes so far. In the end, every one of us, including those of us who are not among the leaders of foundations, pensions, and universities, are in the same position of knowing that ‘vast harm was being done’, and having something, big or small, to offer to help. Will we?
I do have a couple of notes of reservation about Citizens Dis-United. First, the emphasis on calling for rescue from the Gates Foundation, Warren Buffett, Harvard University and the like is a little reminiscent of Ralph Nader’s brilliant semi-satire “Only the Super-Rich Can Save Us!” We do need an enhancement of responsibility and virtue from those who have riches and power. But we need that from all quarters, and, in my view, any lasting success for the American experiment and human freedom requires engagement of the problem of corporate power at all levels of American society.
My second reservation is not about anything Monks says but about the unfortunate cover. A leader of the conservative Constitution Party once said that Americans “have more to fear from the U.S. Chamber of Commerce than from al qaeda.” Nevertheless, a cover with smoke and fire rising from the Capitol with a wing-tip clad CEO hitting the trigger is a little much. Don’t let the cover dissuade you from turning to the wisdom within.
Monks has accomplished a great deal in this relatively short book. I can’t help thinking that not the least of Monk’s accomplishments in Citizens Dis-United might be a personal reconciliation with his roots. Monks sometimes describes himself as a “traitor to his class,” one who exiled himself in Maine from the Boston Brahmin world in which he was raised. With Citizens Dis-United, though, Monks reminds us of the best traits of that lost world: duty, trusteeship, responsibility; a resistance to placing the acquisition of wealth above virtue and other human aspirations, and a distaste for extravagance; an undying dedication to the commons, and to the commonwealth and republican government; and yes, a sense of shame.
Citizens Dis-United is not perfect. Bob Monks is not perfect. None of us is perfect. But we are human, we are Americans, and we all can do something beyond ourselves to tackle the very real and present danger that Monks describes so well. If you think the times don’t merit dramatic calls for selfless action, read Monks’ book as soon as possible. It’s available here: http://www.amazon.com/dp/1939282101.
You can find out more about Monks and his work here: http://www.ragm.com/