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POSSESSION OF POWER and a good reputation are often uneasy bedfellows. Many formerly respected and powerful institutions of society including FIFA and of course banks have come to have a terrible reputation of late. The assumption, for the corporation especially, is that they are gigantic profit-making machines that steamroll anything in their path in the name of profit. That the logic of profit is all and corporations are sociopaths that pollute and lie, but call these things ‘externalities’.
The corporation, however, has played a role in creating the wealth and employment that gives us easier lives and lifts millions, if not billions out of poverty across the world. It is, after all, very difficult to imagine our lives without Apple Inc. For instance, would you be even reading this article at all on your smartphone or tablet without it? Many would be somewhat at a loss if the McDonalds Corporation, or Marks & Spencer PLC, or Tesco PLC, or Google Inc were to suddenly disappear as a result of not having a legal basis that guaranteed continuing operation.
Understanding corporations and how the operate
So what are we to do with this essential but increasingly debased institution? One solution is to understand them better.
From a legal-historical perspective, the first corporations were partnerships. They were organisations that were granted a status of personhood and were similar to monasteries and universities. Their special status ensured their existence would outlast that of a particular human individual member or partner of it. This status, or license-to-operate could easily be revoked, and often was.
However, during the last 150 years or thereabouts, corporations have evolved away from this relatively benign legal status. In this period, they have gained all sorts of rights while evading all sorts of responsibilities along the way. For example, the privilege of ‘limited liability’ promotes entrepreneurship and further encourages corporations to provide goods and services, but also simultaneously grants the right of unlimited profit to shareholders without liability for various harms caused.
Corporations are now very powerful, even monstrously so, and many have much larger revenue levels than that of states, but seemingly without any of the responsibilities of a state. Corporations have naturally exploited the benefits of their economically and politically powerful positions in line with their own interests. This of course also means that scandals about tax evasion, executive pay, the devaluing of jobs, flexible contracts, redundancy, and environmental damage do not come as a surprise, but are tinged with knowing sadness. We have absorbed the lessons of the logic of profit and limited liability.
What you need to know about the TTIP
The most recent extension of this power comes in the form of an acronym TTIP (Transatlantic Trade and Investment Partnership). The espoused goal of this trade agreement between the United States and the EU is to remove regulatory ‘barriers’ which restrict the potential profits to be made by corporations on both sides of the Atlantic.
This is a laudable entrepreneurial aim perhaps, but some of those ‘barriers’ could include social standards and environmental regulations, such as labour rights, food safety rules, regulations on the use of toxic chemicals, and digital privacy laws. It could even include the barrier of those new banking safeguards introduced to prevent a repeat of the great financial crisis.
If passed, corporations could sue governments for such ‘barriers,’ and even prevent them from erecting safeguards that might not conform to their logic of profit. If this sounds incredible, it has already happened in Australia and Uruguay, where similar agreements have been used by a corporation to sue over plain packaging of cigarettes. This is known as investor-state dispute settlements or ISDS, which would grant corporations legal privileges to sue governments over actions that could lower their profit forecasts and interfere with their investments.
Powerful intervention?
In one respect, and when we remember the origin of its power, the corporation is no different from any group of people: it can be understood as part of a larger social setting. Even such a multifaceted legal form as the corporation cannot be usefully understood as separate from society. Corporations are a fundamental part of it. Recognising this, global and national action for the reform of company law, particularly in terms of the duty to maximise long term value to all stakeholders, is overdue.
At the supranational and financial level when it comes to the too-powerful corporation, intervention is required. Solutions include a tax on non-productive financial transactions called the ‘Tobin Tax’ or the ‘Robin Hood’ Tax. Perhaps corporations should end tax avoidance and evasion? We can do this by shutting the gaping holes in the tax system which corporations headquartered in Luxembourg, Ireland, Holland and Malta such as Apple, Ebay, Facebook and others to pay minimal taxation.
Taking away power has consequences, of course. What would happen to London or Dublin should favourable banking and tax regulations be tightened? These corporations benefit from the roads, hospitals and educated workers that European and American taxpayers fund. How much should they resource them too?
Cui bono?
Other solutions include simplifying accounting rules and obliging corporations to disclose who they employ, where, and with what profit levels. This will help both society and corporations clarify who owns what and who owes what.
Corporations could be held legally responsible for subsidiaries, and no longer able to claim that labour and/or environmental abuse is nothing to do with them. The modern corporation is made by people, but we have created monsters whose powers now far exceed that which were originally envisioned.
The corporation rarely takes a step backward in terms of power. The conversation is left to academia or specialist technocrats behind closed doors in European corridors of power.
Perhaps a simple email to the group of MEPs who represent you asking them who they think benefits from TTIP, and how they will be voting in the plenary session on June 9th will be a rare step backward?
Matthew Wallis comes from Rathmines in Dublin, but left in 2008 to pursue a career in academia. He now teaches and writes in Nottingham Business School on the subjects of organisational behaviour, business ethics and strategy.
TTIP is a Trojan Horse. Burn it before it burns you.
It’s happening already in the negotiations with America already seeking to pressure Europe into slashing its environmental protection legislation. A white paper is being prepared at the moment on rolling back The Habitats Directive. This, along with SEA& EIA directives give European citizens (us) significant rights to participate in the decision making process to ensure the objectives of sustainable development are upheld. Big business wants to take these rights away. Our government are fully behind this .
TTIP is evil; the only beneficiaries are corporations on both sides of the Atlantic. American and European citizens will lose out while corporate interests will gain. Those politicians who vote of TTIP are, in my opinion, not acting in the interests of the citizens they are paid to represent.
There was a word for that; treason.
Can you imagine the possibility a Government having to submit a pre-budget plan to a corporation so their legal eagles can go over it before they implement it….to make sure it doesn’t affect the profits of the company so they can avoid being sued.
We’re sleepwalking into a future that evil capitalists could only dream of. What’s given away can never be gotten back. We’re living in dangerous times, as another commentator pointed out. If we don’t act and move against it, soon it will be too late.
I’d urge people to get in contact with their MEP and demand a straight answer on their stance on TTIP. I’ll also link a Facebook group page, Ireland Against TTIP, as soon as I can. The more people know about this evil monstrosity, the better positioned we, as citizens, will be in to defend ourselves from corporate interests who already run the world and now want to cement their grip of power on it.
This government will write their own death sentence if they agree to TTIP. Will they listen to the people before its too late.
Well said. We are fuked if it passes
If it passes before the general election then the next government needs to do anything and everything it can to take Ireland out of it, even if that takes leaving the EU!
Actually that’s not such a far away description. See the remembrancer in the UK Westminster Parliament and his consideration of all bills on behalf of the city of London Corporation.
We are entering a dangerous time.
Winter is coming.
I certainly won’t be accepting it!
Nor will I, but the real question is; will your MEP accept it? At the end of the day, that’s your voice in Europe, for better or worse.
thing is, you won’t even know about it really.. when a corporation sues us, it will be in a secret, in camera court, so as to stop the public who have been sued from boycotting the company who sued us. it really is incredible that politicians are even entertaining this,
as someone said above, any politician supporting this insanity, shold be locked up and tried for treason, bc thats all this FG crap is…
This is a huge issue. If you think that IW was a corporate scam of a quango. TTIP is the ultimate quango. A quangosauraus. People need to really wake up to this and learn about it. It’s effects will change life as we know it.
This must be stopped at all costs. Any politician who signs up to this dangerous treaty should be charged with treason. This has to be the most evil attack on democracy and the rights of the citizen in our time. Enda Kenny doesn’t have the intelligence or the foresight to realise the harm this will do to the Irish people.
You’re making a mistake. You’re still thinking politicians represent us. They don’t. They’re quickly becoming obsolete in a connected world that encourages openness and transparency. They’re just trying to consolidate power before the public they’re obsolete too. This agreement doesn’t benefit anyone except those currently in control, those who have bought the politicians. Follow the money. The general public from every country looses on this deal. Democracy is dead.
“…before the public realises they’re obsolete too.”
TTIP is a life changer as we know it. This government does not have a mandate to sign any such abhorrent deal. This is far more important than the age of our president and it should be put to the people.
Well said John.
It actually amazes me how little coverage this story gets. This should be headline news everyday until it’s scrapped, as it’s going to effect the very way we live.
The author’s skepticism towards TTIP is well founded but crediting corporations for their role in improving the lives of billions is highly questionable.
Apple, that paragon of free market innovation for instance received crucial financial help from public funding sources when it set up business in the 1970s.
http://www.bloombergview.com/articles/2013-06-19/who-created-the-iphone-apple-or-the-government-
And all the component technologies which make the iPhone possible such as GPS, the lithium ion battery, LCDs, touch screens, voice recognition software etc were developed through state funded research. Indeed the foundation technology of the Internet itself (TCP/IP) was not developed by private enterprise. It was created by the U.S Dept of defense and assorted other U.S government agencies and universities. After decades of research and development in the public sector, the powerful new communications technology was following market dogma handed over to the private sector to be exploited for profit.
In some cases the state’s intellectual property was stolen and taken into the private sector (see Cisco Systems history for example) and they have been profiting massively from it ever since.
Google also quoted by the author received critical funding from the U.S. National Science Foundation, which allowed them to develop the Web Search algorithm on which the corporation rests.
Google, Apple and the other corporations now demonstrate their eternal gratitude by taking extraordinary measures to avoid paying tax and making any contribution to the public/government sector which nurtured them. Google for example use the nifty accountancy trick of paying intellectual property royalties to its own subsidiary to avoid paying tax and used this mechanism in Ireland to avoid paying tax on €8.6 billion in 2012.
http://www.ft.com/intl/cms/s/0/89acc832-31cc-11e3-a16d-00144feab7de.html#axzz3UvvdmEWF
The Irish state is in fact an enthusiastic ally of corporate tax avoidance and had implemented a legal & taxation framework which made us the perfect European launching pad for shifting profits to the global tax havens such as Bermuda and the Dutch Antilles.
So let’s not get too dewy eyed about the role and function of corporations. Nor should we place any faith in the Irish state, which has always largely served the interest of domestic and international capital ,defending the citizens against the threat of TTIP.
100 years from now we will look on the current financial system and how it favors corporations in the same way we look on feudal Europe.
It took the Black Plague to kill of feudal Europe, you really think anything short of that will be allowed kill off our current feudalism? It may not serve us well, but it serves those who matter well, so we can just moan and predict brighter futures while enduring what’s thrown at us gracefully.
Sean Kelly MEP FG is the person working on making this lunacy happen at the EU…
Twitter; @SeanKellyMEP email: sean.kelly@europarl.europa.eu
Be sure to contact him to let him know what you think.
Kiss unions good bye and protesting we will have no rights
Feudalism was replaced by absolutism and mercantilism. Which in turn were (nominally) displaced by liberal constitutional democracy courtesy of the enlightenment. Today we are (and for some time) reverting to neo-absolutism and mercantilism. “As the economic aspect of state absolutism, mercantilism was of necessity a system of state-building, of Big Government, of heavy royal expenditure, of high taxes, of (especially after the late seventeenth century) inflation and deficit finance, of war, imperialism, and the aggrandizing of the nation-state. In short, a politico-economic system very like that of the present day, with the unimportant exception that now large-scale industry rather than mercantile commerce is the main focus of the economy.” Murray Rothbard
Every deal, from a mortgage to an international trade agreement has it’s pro’s and it’s con’s – but there are no pro’s, no endearing qualities to the TTIP. Any politician recommending it should be arrested immediately on suspicion of treason and taking bribes, under no circumstances should this thing be passed.
Surely there must be some pros to freer trade? Cheap TVs maybe?
I met him canvassing in kilkenny before the Euro elections and asked him about it. He said nobody knows what’s in TTIP because it’s not released. I said it was leaked as Diarmuid O Flynn was writing about it. He said “ah don’t mind him, he doesn’t know what he’s on about”
FG are so pro Europe and pro big business the will hand over democracy for the false promise of a few thousand jobs.
Our great leader has accepted it so why don’t we just be obedient, patriotic citizens and do the same. We don’t want to be rabble rousers or the sinister fringe now do we?
And our minister for jobs and enterprise, Mr Bruton actually wrote personally, along with 13 other EU member state ministers to make sure that the EU trade commissioner keeps the ISDS mechanism despite calls from various NGO’s, petitions and business organisations. This is a very bad deal. One sector that is supposed to take the biggest hit is the agricultural industry. This was found in one of the government commissioned reports by Copenhagen economics institute which was supposed to show how beneficial ttip is. Alarm bells should be ringing people.
Future Shock.
Written in 1970, becoming reality.
It’s all over the internet, just not in main stream media. I wonder why?
Sorry, that was meant for Trevor.
Have you ever heard of anyone in support of this who isn’t a treasonous politician or soulless corporate goon? I sure haven’t! The fact that an agreement of such magnitude is being drawn up behind closed doors should be a large red flag. The media are not reporting half enough about this, why?
Enda sure sounds enthusiastic about it here:
https://www.youtube.com/watch?v=0RRj1QY8UZU
What’s that, thousands of jobs you say? I believe you, just don’t mention that they’ll all be of the zero-hour contract variety because this is the type of contract most pleasing to our corporate overlords.
Please add your voice to protest against the catastrophic TTIP agreement https://secure.avaaz.org/en/stop_ttip_uk_loc/?fpla
Done and Shared on Facebook and Twitter!
Signing up for this is madness it will turn every industry into a dunnes stores. Its positively dangerous
Enda has been bought & paid for. He will enthusiastically sign off on this treason, and dismiss us as a ‘baying mob’ indulging in ‘hysteria’…
Here’s the salaries of his staff:
Mark Kennelly Chief of Staff €156,380
Andrew McDowell Special Advisor to the Taoiseach €156,380
Paul O’Brien Special Advisor to the Taoiseach €81,676
Angela Flanagan Special Advisor to the Taoiseach €81,676
Mark O’Doherty Special Advisor to Chief Whip €81,676
Sarah Moran Personal Assistant to the Taoiseach €74,973
Theresa Diskin Personal Assistant to the Taoiseach €67,074
Gerard Deere Personal Assistant to the Taoiseach €65,000
Miriam O’Callaghan Personal Assistant to the Taoiseach €65,186
John Lohan Personal Secretary to the Taoiseach €42,760
AnneMarie Durcan Personal Secretary to the Taoiseach €42,760
Claire Urquhart Personal Secretary to the Chief Whip €46,935
Colum Coomey Personal Assistant to the Chief Whip €47,304
Feargal Purcell Government Press Secretary €115,431
Cathy Madden (on maternity leave) Deputy Government Press Secretary and Head of Government Information Service €93,297
Derek McDowell Deputy Government Press Secretary and Head of Government Information Service €93,297
Joanne Lonergan Assistant Government Press Secretary €87,258
Not sure why you are publishing name of his staff. Most of them are on decent salaries but hard crazy money
tes, but look at how many of them he has.. and look what we get for those combined salaries?
I might’ve missed a few, – like the dude he hired fulltime in Castlebar to ‘improve his image’.
if he can save Enda deBarrel from being Lynched, he’ll be doing well.
Let’s face it, you don’t even need to study up on TTIP, it stands to reason, if Enda and FG are in favour then
How could put government sign up to this?? Surely opposition parties at the very least would be against it for vote winning purposes!! It would be damn near impossible to govern a country with this…this wouldn’t just be selling the country out this would be hanging it!!!
I chuckled as soon as I read the headline! Yes corporations will save us…. ha ha!
The European Parliament are having a vote on it next Wednesday (the 10th). You can email your MEPs to voice your concerns here: https://uplift.ie/ttip-ep-vote/
It sickening how that jenner article has got more media attention than this
We have already seen, from the Irish Water scandal, the level at which our so called representatives are acting on behalf of big business. This will only be a minor inconvenience if TTIP becomes a reality.
Global corporate government , cashless society , more and more erosion of choice and civil liberties .
Eh, what’s the link with cash less society? (he asks with impending dread of blamethejews tinfoilhattery)?
@ Malvolio32;
well coming from someone who can’t grasp the concept of loss of earnings not applying to new companies or products, see below, i’m sure there are a lot of things that get past you in this life.
Don’t worry about this stuff, if it makes your head hurt to learn how it works…
TTIP, with or without ISDS, is the end for democracy. Plutocracy will govern. No government has the right to agree to this without consulting its people first. A referendum is a necessity on this issue.
Just emailed MEP Kelly, no way do we want this evil in our country.
It’s an intriguing argument. To successfully sue the govt because plain cigarrette packaging impacted their profits, wouldn’t the corp also have to demonstrate that the packaging does not have any affect on peoples health? Or how do they demonstrate that the regulations for environment, health etc were unreasonable barriers to trade?
the loss of profit margin is what the population will be sued for, with no regard for health, environment etc..
There’s no question that it impacts their profits. But the only argument I can see for suing is that the restrictions are somehow unjust or unreasonable. Or is everything that is legal in America now legal here too? What’s to stop colt gun corporation selling guns here? National laws presumably.
i’d imagine the business has to exist in the area before a loos of profit can be established… its changes in law which inhibit those profits will be liable if FG get their way…
Then that would restrict developing new technologies. To be fair I’m not that well read up on it, but I’d imagine there are many complicated conditions and exceptions like any treaty, which probably delineate which industries and products do and do not apply. As this is still being negotiated, isnt it possible that these things can be satisfactorily addressed to prevent the negative outcomes people are worried about?
@ Malvolio32;
how can a new business / product show a loss of earnings when it has no previous financial records?
how can a new business show a loss of earnings, due to a change in law that pre dates the existence of that company or product?
am trying to clarify this, but find it hard to identify why your confused?
& there is no way to fix this psychotic law.. secret courts to sue the public, bc they are no longer allowed to harm the public / environment? This is all wrong, with no good intentions…
Guaranteed corporate profits are only just one facet of the debacle called the TTIP and the people will definitely suffer forever (the treaty once signed is irrevocable) under the cosh of this undemocratic and draconian treaty under the lie of so-called free trade – ‘The TTIP (Transatlantic Trade and Investment Partnership) will be an Absolute Disaster for the People of the EU (European Union) and the People of America (USA) in the long-term – We simply have to Vote AGAINST this behind closed doors Transatlantic Trade deal before it is signed up and too late for the People to do anything about it – http://worldinnovationfoundation.blogspot.co.uk/2014/08/the-ttip-transatlantic-trade-and.html
While corporations are soul less money making machines, there’s no doubt that they drive economies. That is the world we live in. What’s needed is strong corporate legislation and enforce it. Within 12 months of the financial crash people were in jail in the USA, and for long jail terms. Corporations are necessary evils unless we want to live along the lines of Somalia. Strong enforced legislation is what is required, something we’ve never had.
Meant to say to keep the balance right
America is a corporation’s playground….You’re not seriously associating a few token heads with strict legislation?
The simplistic view of the world taken by many commenters on this thread is scary to me.
Typically people read one piece and then try and twist it to suit their own agendas. Try looking at things in a broader context, their are at least 2 sides (normally many more) to every argument.
To see only bad (or good) in anything suggests you are not looking at the full picture. And What I’m suggesting is that strong legislation would/will work, you may need to keep going back tightening laws, closing loopholes as companies exploit them but of course they can be controlled and will be as soon as their is enough Global political will, which in my opinion is starting to move that way.
But as usual we want it both ways, the freedom to choose low corporate tax levels and complain about companies use all they can to their advantage.
Tell me, how is it not looking at the broader context?
Why was this “agreement” conducted behind closed doors?
You say that we should have strict legislation, can you give me an example of American strict legislation that applies to corporations? In a country where corporate interests are given the same rights as citizens in a court of law?
Personally, I think you’re the one who’s being naive here.
This, now that it’s out in the open, will be sold the same as “Lisbon for Jobs”. It has nothing to do with citizens, it only benefits corporate interests.
We’re talking about allowing the very worst aspects of American society into Europe.
It is strange that western media have been quite about the TTIP when it is the largest trade deal in world history. As the TTIP is a secretive trade deal behind closed doors also, the media apparently have made it a secret as well That is abnormally strange to say the least.
But there is no doubt that in the UK the NHS in public hands will be over in a relatively short period of time and be destroyed by the TTIP once signed up, as MONOPOLIES cannot exist with the TTIP. The trade treaty makes this clear. So once signed and as it is irrevocable, that will sound the death knell of the NHS. No ifs or buts about it and where our political leaders are being deceitful towards the people in the UK.
This corporate trade treaty and nothing more, will bleed the people and their taxation dry if it can once in place. As an example presently, similar but far smaller trade deals have corporations suing governments (the people’s taxation will pay in the end) for $34,000 million for loss of profit at its baseline.
The treaty is totally immoral.
Politicians are Allowing Corporations to Kill us – The TTIP (Trans-Atlantic Trade and Investment Partnership) is so evil that our political negotiators are now allowing ‘Cancer’ creating carcinogenic crop sprays to be used in the European Union – http://worldinnovationfoundation.blogspot.co.uk/2015/05/politicians-are-allowing-corporations.html
The TTIP (Transatlantic Trade and Investment Partnership) will be an Absolute Disaster for the People of the EU (European Union) and the People of America (USA) in the long-term – We simply have to Vote AGAINST this behind closed doors Transatlantic Trade deal before it is signed up and too late for the People to do anything about it – http://worldinnovationfoundation.blogspot.co.uk/2014/08/the-ttip-transatlantic-trade-and.html
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