Noam Chomsky: The US corporate takeover


January 21, 2010, will go down as a dark day in the history of US democracy, and its decline.

On that day, the US Supreme Court ruled that the government may not ban corporations from political spending on elections. The decision heralds even further corporate takeover of the US political system.

The far-reaching decision overturns a century of precedents restricting corporate contributions to federal campaigns. Now, corporate managers can in effect buy elections directly, bypassing more complex indirect means.

It is well-known that corporate contributions can tip the balance in elections, hence driving policy. The court has just handed much more power to the small sector of the population that dominates the economy.

Corporations had already been granted First Amendment rights — meaning a constitutional guarantee of free speech. This has been interpreted as the right to support political candidates.

In the early 20th century, legal theorists and courts implemented the court's 1886 decision that corporations — "collectivist legal entities" — have the same rights as persons of flesh and blood.

This decision was sharply condemned by the vanishing breed of conservatives. Christopher Tiedeman described the principle as "a menace to the liberty of the individual, and to the stability of the American states as popular governments".

In later years, corporate rights were expanded far beyond those of persons, notably by the mislabeled "free trade agreements".

Under agreements, such as the North American Free Trade Agreement, if General Motors establishes a plant in Mexico, it can demand to be treated just like a Mexican business ("national treatment") — quite unlike a Mexican of flesh and blood who might seek "national treatment" in New York, or even minimal human rights.

A century ago, former US president Woodrow Wilson, then an academic, described a US in which "comparatively small groups of men", corporate managers, "wield a power and control over the wealth and the business operations of the country". These small groups of men would become "rivals of the government itself."

In reality, these "small groups" increasingly have become government's masters. The Supreme Court gives them even greater scope.

The decision came three days after the election of Republican candidate Scott Brown to replace the late Democrat senator Edward Kennedy as the representative from Massachusetts.

Brown's election was depicted as a "populist upsurge" against the liberal elitists who run the government. The voting data reveal a rather different story.

High turnouts in the wealthy suburbs, and low ones in largely Democratic urban areas, helped elect Brown.

A Wall Street Journal/NBC poll reported: "Fifty-five percent of Republican voters said they were 'very interested' in the election, compared with 38 percent of Democrats."

So the results were indeed an uprising against Obama's policies. For the wealthy, he was not doing enough to enrich them further, while for the poorer sectors, he was doing too much along those lines.

The popular anger is quite understandable, given that the banks are thriving, thanks to tax-payer funded bailouts, while unemployment has risen to 10%.

In manufacturing, one in six people out of work — a level comparable to the Great Depression.

With the increasing financialisation of the economy and the hollowing out of productive industry, prospects are bleak for recovering the kinds of jobs that were lost.

It is true that Obama's healthcare program was a factor in the Massachusetts election. The headlines are correct when they report that the public is turning against the program.

The poll figures explain why: the bill does not go far enough.

The WSJ/NBC poll found that a majority of voters disapprove of the handling of healthcare by both the Republicans and Obama.

These figures align with recent nationwide polls. The public option was favored by 56% of those polled, and the Medicare buy-in at age 55 by 64% — both programs that have been abandoned.

Eighty-five percent believe the government should have the right to negotiate drug prices, as in other countries. Obama has guaranteed the big pharmaceutical corporations that he would not pursue that option.

Large majorities favour cost-cutting. US per capita costs for health care are about twice those of other industrial countries and health outcomes are at the low end.

But cost-cutting cannot be seriously undertaken when largesse is showered on the drug companies and health care is in the hands of virtually unregulated private insurers — a costly system peculiar to the US.

The Supreme Court decision raises significant new barriers to overcoming the serious health care crisis, as well as addressing critical issues such as the looming environmental and energy crises.

The gap between public opinion and public policy looms larger. And the damage to US democracy can hardly be overestimated.

[Abridged from Noam Chomsky is Institute Professor and Professor of Linguistics (Emeritus) at the Massachusetts Institute of Technology and the author of dozens of books on US foreign policy.]