National Radio Project

MAKING CONTACT

Transcript: #39-98 It's Called Democracy
September 30, 1998

Program description at http://www.radioproject.org/archive/1998/9839.html

Phillip Babich: Welcome to Making Contact, an international radio program seeking to create connections between people, vital ideas and important information. This week on Making Contact:-

Michael Parenti: The only weapon we have against this plutocracy, which is getting more ruthless, more greedy...is an invention that comes from 2000 years ago. And it's a Greek word; it's called democracy.

Phillip Babich: Corporations pour millions of dollars each year into the coffers of elected officials. Congress has failed so far to pass any meaningful finance reform laws, and big money continues to buy tax breaks, subsidies, and non-regulation, as mega-mergers consolidate power and wealth in fewer and fewer hands. On this program we'll hear from scholar and activist Michael Parenti, about the quest for democracy in the United States. And we'll have a report on the movement to revoke the charter of one of the largest oil companies in the world. I'm Phillip Babich, your host this week on Making Contact.

This past summer, political organizers from around the United States gathered for the Independent Progressive Politics Network summit. Top on the list of priorities was challenging the two-party system. The following is an excerpt from a speech given by Michael Parenti at the conference. Parenti's books include "Dirty Truths" and "Inventing Reality: The Politics of News Media." He begins by comparing politics in Ancient Rome with today's politics in Washington, D.C.

Michael Parenti: I have been studying the Roman republic, and have been struck by how it resembles our own republic...in the sense that it wasn't very democratic, there was a multiplicity of legislatures, a whole elaborate veto system, auspices and everything else, a senate oligarchy that really ran most things. The poor were left out of most things. There was a tremendous gap between the rich and poor. There was a relationship between the great prevalence of wealth with the great prevalence of poverty. Knowing that but wealth and poverty were not just juxtaposed with each other, there's a causal link, and that's been true all through history. That the way you get a small group of people to be very rich is by getting a lot of other people to be very poor. Imposing poverty on them, getting them to work very hard, very long, to create what the Marxist call surplus value, that is, to create more value than they consume. And that value is expropriated by you, the slave owner, by you, the feudal lord, or by you, the private capitalist investor. And you accumulate that. And after a lifetime, your workers are left poor. After a lifetime of working hard, they're left poor, with maybe a little pension, which you're trying to get out of their hands now also. And you have enormous wealth all your life. That's the system.

Nobody believes in surplus value. Nobody talks about it, and all. And in standard economics, wealth is created by exchange, supposedly. You know, I have this and I buy that and I get a little more here, and I can sell that for a little more here. And wealth just comes kind of mysteriously. In fact, wealth is created by natural resources. The value of those natural resources and the labor that then goes into them to create them into exchange value and use value. And that's where you get wealth. And nobody believes that about surplus value. There's only two groups in America who believe that there is surplus value, and that's the Marxists, which I just mentioned, and the capitalists. The capitalists, they do believe in it. They do honestly believe in it. In fact, they do call it something very much like surplus value. They call it added value. And you read the Wall Street Journal, and if you read Fortune Magazine, all the other rags, where they talk to each other. If you want to read radical subversive publications, read the capitalist publications where they're talking to each other. And they will say things like: "a better labor market, a higher added value rate. The dollar you invest in Ohio, you only get back two and a half dollars. But if you invest it in Alabama you will only get three and a half. Invest it in Mexico you can get five. Invest it in Indonesia you can get seven dollars. Wowee! I mean, they know what they're saying. They call that added value, or the value added, by the term.

And 80 percent of the stock in this nation is owned by one percent of the population. It's really not one percent. You know, one percent of the populations is 2.4 million people. You can get up into the one percent by earning $300,000. That's not the very rich. I mean $300,000 are very tidy earnings per year, but that's not very rich. That's not people who own the wealth. It's really a fraction of one percent. It's a fraction that's so stratified, so small, it's about less that a fourth of one percent of the people really own the lion's share of the wealth in this country. Not that quintile, the top quintile that you always see reported by the various public interest groups, the Center for Policy Analysis in Washington. Every few years they come out with the top 20 percent...own so much more. The top 20 percent in the last 20 years have increased their income by $27,000. The spread is now 14 to one. The top 20 percent are not the people who own America. There are people in this room who are in the top 20 percent who would be called "the rich". They're call the rich own. They've increased their income by, what, $27,000 in 20 years? That wouldn't even cover inflation for most of those incomes that those people have. If you make 50,000 a year, you're in the top 20 percent. Certainly 60,000. It's not the top 20 percent. The census bureau doesn't sample the very rich. They can't get 'em, they're so few that they don't show up on samples. It's not the top quintile, the top 20 percent. It's the Morgans and the Mellons and the Murdochs. It's the Huntingtons, the Harrimans, and the Hunts. It's the Rockefellers and the Duponts. They own America and the world and most of the markets and the resources, and they will do anything to keep it that way. And the only thing they want to own now is still more. That's the only thing. There's only one thing that the ruling class is ever wanted, and that's everything.

And the essence of this whole system is the accumulation of capital. The essence of capitalism is not to create jobs. They'll destroy jobs if that helps it. Not to build communities; they'll destroy communities if they can make a profit on it. The essence of that whole system is to make, not a profit, but the largest possible profit you can make. You know, about over 30 years ago...35...40...oh, my how the time goes...37 or 38 years ago there was a young lawyer in Washington, D.C. Nobody knew who the hell he was. He wrote a book about...he wrote a series of articles...he couldn't get them published anywhere...about how unsafe automobiles were. The only publication that would finally publish his articles was a little thing called "Fact Magazine." Fact didn't have any ads, so they would take it. All the other publications had automotive ads, automobile ads. They wouldn't touch it. And so finally in frustration he wrote a book and it became a best seller. It was called "Unsafe at Any Speed." His name was Ralph Nader. Nobody had heard of him, but this "Unsafe at Any Speed" came out and suddenly the Senate held hearings. Could our automobiles be unsafe? No, no, no, how can you come to that conclusion? There's only 50,000 killed a year, that's just something that happens. You know, stuff happens. And there were the hearing, the Ribicoff hearings, and sitting there was Henry Ford III, would it be? I forget. And Ribicoff is talking to him, and finally Henry Ford gets very irritated and annoyed and he says, "Look, Senator." He said something that's a moment of truth, sometimes they just let it out. "Look, Senator, Ford Motor Company is not in the safety business." Now this is very interesting. He said, "We are in the business," and he didn't say "of making cars," because that's not the business they're in, And he didn't say, "of making a profit." He said the correct thing. He said, "We are in the business of making the largest profit we can for our stockholders." And most of their stockholders are in the top quarter of one percent. And he said it, and I said, "Uh." But Ribicoff said, "How could you say that to the TV cameras, to the American people. Here we're talking about human lives." Ribicoff is out there, suddenly got religion about this whole thing.

But Ford was absolutely correct. The capitalists, if you listen to them closely, they sound very Marxist, because they understand their system. Of course, they have a mass line, and they have their own party line. Every so often their party line does come out. Generally they're giving us the mass line, about how we're here to serve you, we do this for you. And if there's some little bit of profit left over, we take that for ourselves. But... The only weapon we have against this plutocracy, which is getting more ruthless, more greedy, more unrestrained ever since the overthrow of communism especially, more determine to discipline its working class by undercutting all human services, by undercutting all wage supports, like unemployment and welfare, by pitting the workers in advanced countries against the workers in poor countries, making both working classes work harder and harder, making all of they work harder and harder for less and less...The only thing we have, the only defense we have against this plutocracy, is an invention that comes from 2000 years ago. And it's a Greek word; it's called democracy.

Democracy is a wonderful invention by the people of history to defend themselves against the power of wealth. That's where it came from. It was their way of trying to defend themselves against wealth. And the only thing we have is popular organization, demonstrations, the building of alternative media, work-site actions including strikes and even sabotage, civil disobedience, and we have electoral strategies. A struggle for office. And democracy is constantly being undermined, most recently by the anti-democratic coups of an international conspiracy. The unconstitutional usurpation of power and national sovereignty by international coteries like GATT, the World Trade Organization, and M.A.I.. Democracy is also undermined by the two-party monopoly.

Phillip Babich: Michael Parenti, speaking at the Independent Progressive Politics Network summit.

Shereen Meraji: You are listening to Making Contact, a production of the National Radio Project. This program can now be heard across the United States and Canada, in Haiti, South Africa, and around the world on Radio for Peace International Short-wave. You can also hear us on the Internet. If you want more information about the subject of this week's program, or you would like to learn how you can get involved with Making Contact, please give us a call. It's toll free. Call 800-529-5736. Call that same phone number for tapes and transcript orders. We also welcome comments and suggestions for future programs.

Phillip Babich: In September, a coalition of 30 public interest organizations filed a petition to revoke the corporate charter of Union Oil of California, more commonly known as UNOCAL. The lengthy petition argues that UNOCAL has proven itself to be a repeat perpetrator of unlawful activities. These include hundred of health occupational and safety violations and human rights abuses abroad. Although the chances of revoking UNOCAL’s charter, which would essentially force the company to divest its business, are slim, this could be a viable strategy to shine a light on corporations with poor track records. Michelle Simon reports:

Michelle Simon: Every state has laws dating back over 200 years that allow state legislatures or the attorney general to revoke a corporate charter for committing unlawful acts. While these laws have been weakened over the years, as corporations become more powerful, these statutes are still on the books. And according to Joshua Karliner of Corporate Watch, UNOCAL is a very appropriate target for this action, with its long list of environmental and human rights violations both in this country and around the world.

Joshua Karliner: UNOCAL is a notorious polluter of the California coast. It's been involved in numerous oil spills and underground storage tank leaks that have poisoned communities and the environment up and down the California coast. It has sold off many of its refineries, and assets which were major polluters in California and other parts of the United States, and thrown a lot of people out of work, when it sold off its assets, and reinvested its capital abroad. It's a globalizer, it's one of these big global corporations that's moving its assets out of the United States, undermining workers rights in that way. And the places that it's investing in are countries like Burma, which are ruled by repressive dictatorships. And UNOCAL right now is under fire for complicity in human rights violations with the Burmese government junta, which is known as SLORC.

Michelle Simon: But UNOCAL spokesperson Barry Lane denies any and all such allegations.

Barry Lane: Number one, there's been no environmental allegations regarding our project in Myanmar. Number two, we have consistently denied, it's been open to scrutiny and study, and absolutely no human rights violations whatsoever associated with out project.

Michelle Simon: Karliner, whose organization is one of 30 that has filed the petition, explains that the idea behind charter revocation is to hold corporations accountable in a way that is sure to get their attention.

Joshua Karliner: Corporations in this country and around the world are increasingly powerful entities. They are often more powerful than the governments where they're operating. And what the corporate charter revocation movement, or effort to begin to revoke some of these corporate charters is saying, is that it doesn't have to be that way. Corporations should, and, in fact, can be held accountable to principles and standards of human rights, environmental justice, and democracy. And by putting the fear of god, if you will, in corporate America, that if they commit egregious crimes, they risk having their charters revoked. We are, in fact, raising the standards of environmental rights, human rights, above the corporate imperative to fatten its bottom line.

Michelle Simon: But UNOCAL’s Barry Lane sees the move as part of a failed political agenda.

Barry Lane: We think that this petition is nothing more than a desperate and futile publicity move on the part of these groups to further their own political agendas. There's no legal basis for the action. They're trying to organize anti-business pressure, we think, and further their own political agenda. These same groups have used the stockholder proposal process repeatedly here at UNOCAL, and every time, the company stockholders have overwhelmingly rejected their proposals for us to dis-invest in Myanmar.

Michelle Simon: Nevertheless, Karliner says the ultimate goal is to make UNOCAL pay for its multiple violations.

Joshua Karliner: What we're calling for is for its assets to be taken and set to a couple of things. One is restoring the environmental damage that the company has caused, providing restitution for those victims of human rights violations, and for helping to...creating some kind of a fund to be able to retrain workers who have lost their jobs as a result of UNOCAL’s actions. And to put people back to work, who've been thrown out of work.

Michelle Simon: The California Attorney General's office says they are currently reviewing the petition and cannot comment further at this time. For "Making Contact," I'm Michelle Simon.

Phillip Babich: To learn more about the movement to revoke UNOCAL’s charter, and what this means for efforts to challenge corporate power, I spoke to Russell Mokhiber. He's the editor of the Washington, D.C. publication Corporate Crime Reporter. He recently co-wrote an article with Robert Wiseman, editor of the Multi-national Monitor, about this development. He begins by talking about how infrequently corporate charters are revoked.

Russell Mokhiber: It was down more often at the turn of the century, when the Populist Movement was at its height. And originally the states created a corporation for a purpose, to build a railroad, to build various public works project. And then the corporation was put out of business. Now, of course, states compete to have the least effective control on corporations, and Delaware is the Las Vegas of corporate chartering. It has the lowest common denominator standards, so most of the big corporations go to Delaware to be chartered. But all states have this authority to strip the corporation of its charter. Very few states act on it. Now citizens are starting to demand that recidivist corporations, corporations that engage in wrongdoing over and over again, be looked at and that the Attorney General invoke charter revocation proceedings.

Phillip Babich: How is it that a corporation is able to charter in other states? Like you mentioned Delaware is a very popular state for corporations to charter in. Companies like MAXXAM is actually based in Houston, or Clorox, which is based in Oakland, California, have their corporate address in Delaware. How does this happen?

Russell Mokhiber: Well, it happens because we have a stagnant, almost dead political and legal culture which allows it to happen. If there were an activist citizen movement, if there was a progressive civic culture, then we wouldn't allow it to happen. We would demand that the states...that we have control over these giant conglomerations of capital, and that we decide what happens, that we decide what a corporation, what kind of business a corporation engages in, what kind of wrongdoing it's allowed to engage in. Whether they're allowed to engage in three acts of wrongdoing and still continue to do business. Whether they're allowed to gobble up other corporations, and still be allowed to grow and grow and grow and move all over the world, and strip workers of their rights all over the world. Or, right now what we're seeing is a mini-citizens' revolt. We're realizing that the regulatory state hasn't worked. That in enforcing the law in occupational safety and health, or on trade regulations, or on environmental laws here and there. They just write it off as the cost of doing business. Even if they engage in criminal wrongdoing and they plead guilty to crimes, corporate crime is crime without shame. They plead guilty to crimes, they pay even a multi-million dollar fine, it's nothing. They write it off a the cost of doing business, and it has no impact. But if we took corporate crime seriously, and if we said, look, if a company engages in wrong doing, if it commits egregious wrongdoing, if it pleads guilty to felonies, then they will be put out of business, they will be stripped of their charters. Then corporations will take that kind of move very seriously. And I think it will have a very beneficial effect on society. Right now, corporate crime and violence inflicts far more harm on society than all street crimes combined. Yet the politicians, all you hear them talk about is street crime.

Phillip Babich: So you think this is an effective tactic, then, for activists and other organizations to take, that is, to challenge the corporate charters?

Russell Mokhiber: Yes, but in reality, it's not going to...the Attorney Generals aren't going to move unless there's a strong Populist movement...that challenges them to move. So this is an attempt to educate the citizenry, to stir the pot, and to get people to thinking about these giant corporations that control out economy and have such a huge impact on our culture and our lives.

Phillip Babich: You know, UNOCAL’s response to the move to try to revoke their charter was that this is simply a part of a political agenda that these activist organizations are trying to promote, and that frankly their stockholders are pretty happy with the way that UNOCAL’s doing business. What's your response to that?

Russell Mokhiber: Well, it is a political move. The only was we're going to curb corporate crime and violence is through active politics. We're not going to curb it by asking the justice department to bring more criminal prosecutions. Number one, they're not going to do it, and number two, they're not going to have an impact. Because the system is set up so the end result is always going to be a slap on the wrist. Even the corporate criminal enforcement of corporations and corporate wrong doing really has more of an impact, of a deterrent impact, than criminal enforcement of street crime. Still, in the end, it's not a very effective tool to curb the power of these giant corporations. For example, the Royal Caribbean Cruise Line. The company pled guilty recently to dumping off the coast of Florida and was fined, I believe, a million dollars. Now, how did this come about? Well, there was one prosecutor in the Justice Department, Environmental Crimes Division, going up against four former attorneys general of the United States, a battery of 10 to 15 lawyers, reams and reams of documents created by paralegals, and stretched the proceedings out over a period of two years.

Finally, this one lawyer in the Justice Department, with a couple of assistants, prevailed and forced the company to plead guilty. That's the kind of resource allocation you see when you get a corporate criminal prosecution. And in the end, the company pays a fine that has no impact, zero impact, on its bottom line. And it takes out more ads with the equivalent of Kathy Lee Gifford on the ship encouraging people to come and cruise the Caribbean. And so it itself has very little impact. Now there's a probationary order, the company has to implement environmental standards, and so forth, so it has some impact. But in reality, the corporate executives look at this and they say we'll let the lawyers take care of the business, the lawyers make a lot of money defending the company, and you have no real impact on how the company conducts business. So, yes, it does have, yes, it's important to criminally prosecute, yes, it's important to build a record against corporations. But we need new tools to control corporations. We have to look at it differently now. Instead of saying that corporations should be regulated here, the law should be enforced there, we have to look at the fundamental creation, the corporation, and say we are responsible for out lives here in the United States. We are responsible for the economy. We decided what the corporation, what kind of business the corporation should engage in. And if it engages in criminal pollution, then it will be put out of business, and we will impose directors and officers who will oversee a company that engages in lawful business.

Phillip Babich: And how would you address an argument that's presented by business leaders often that then the corporation's not going to be as profitable and stockholders are going to run in to find other places to invest their money, and then the corporation's just simply going to go under?

Russell Mokhiber: Well, this petition was filed by Robert Benson, the professor of law at Loyola Law School in Los Angeles. And when I asked him about what happens to the company when you revoke its charter, he said if he were the judge he would put it into receivership, free the assets and make sure the executives don't take assets to Switzerland or something, and then turn the company into a renewable energy corporation. He thinks that a renewal energy corporation would create more jobs, would be less harmful to the environment, and would provide a decent rate of return to shareholders. So, there are ways to run business in a way that's law-abiding and that protects the environment and that gives a decent rate of return to shareholders.

Phillip Babich: We've been speaking with Russell Mokhiber, He's the editor of the Corporate Crime Reporter, in Washington, D.C. Russell, thanks for joining us at "Making Contact,"

Russell Mokhiber: Thanks, Phil.

Phillip Babich: That's it for this edition of Making Contact, a look at challenging corporate power. Thanks for listening. And special thanks this week to Judy Campbell and Susan Celli for providing recorder portions. Shereen Meraji and Michelle Simon helped with production. I'm Phillip Babich.

If you want more information about the subject of this week’s program, call the National Radio Project at 800-529-5736. Call that same phone number for tapes and transcripts or if you’d like to make a comment or a suggestion for future programs.

Making Contact is an independent production funded by individual contributors. We’re committed to providing a forum for voices and opinions not often heard in the mass media. Our national producer is David Barsamian. Phillip Babich is our managing producer. Our senior advisor is Norman Solomon. Shereen Meraji is our production assistant. Peggy Law is our executive director. Our theme music is by the Charlie Hunter Trio. For every one at Making Contact, thanks for listening.