COLLAPSE MIKELA J. MIKAEL 150 years ago, the business corporation was a relative

Question

COLLAPSE

MIKELA J. MIKAEL 150 years ago, the business corporation was a relatively insignificant institution.  Today, it is all-pervasive. Like the Church, the Monarchy, and the Communist Party in other times and places, the corporation is today's dominant institution.  This documentary examines the nature, evolution, impacts, and possible futures of the modern business corporation. Initially, given a narrow legal mandate, what has allowed today's corporation to achieve such extraordinary power and influence over our lives? We begin our inquiry as scandals threaten to trigger a wide debate about the lack of public control over big corporations.

00:50GEORGE BUSH I do think there is an overhang  over the market of distrust. Listen, 95 percent or some percentage, huge percentage of the business community are honest and, uh, reveal all their assets, got compensation programs that are balanced. But there are some bad apples.

01:10MIKELA J. MIKAEL The media debate about the basic operating principles of the corporate world was quickly reduced to a game of "Follow the leader."

01:20UNKNOWN I still happen to think the United States is the greatest place in the world to invest. We have some shakeups that are going on because of a few bad apples.

01:30DAVID WILCOX Some people call me a bad apple,  well I may be bruised, but I still taste sweet. Some people call me a bad apple, but I may be the sweetest apple on the tree…

01:50UNKNOWN These are not just a bunch of bad apples.

01:55UNKNOWN This is just a few bad apples.

UNKNOWN It's not just a few bad apples.

SCOTT MCINNIS We've gotta get rid of the bad apples.  You can start with Tyco.

02:00LOU DOBBS Bad apples.

SCOTT MCINNIS We know all about Worldcom.

02:05UNKNOWN Bad apples.

SCOTT MCINNIS Xerox Corporation.

GRETA VAN SUSTEREN Bad apples.

SCOTT MCINNIS Arthur Anderson.

CHRIS MATTHEWS Bad apples.

SCOTT MCINNIS Enron, obviously.

02:10ARI FLEISCHER Bad apples.

SCOTT MCINNIS Kmart Corporation.

UNKNOWN The fruit cart is getting a little more full.

02:15CHARLES LEWIS I don't think it's just a few apples, unfortunately. I think, this is the worst crisis of confidence in business.

02:20MIKELA J. MIKAEL What's wrong with this picture? Can't we pick a better metaphor, to describe the dominant institution of our time? Through the voices of CEOs, whistleblowers, brokers, gurus and spies, insiders and outsiders, we present the corporation as a paradox. An institution that creates great wealth but causes enormous,  and often, hidden harms.

02:50THE CORPORATION

A DOCUMENTARY BY

MARK ACHBAR

JENNIFER ABBOTT

JOEL BAKAN

03:00SIR MARK MOODY-STUART I see the corporation as part of a jigsaw in society as a whole, which if you remove it, the picture's incomplete. But equally, if it's the only part, it's not going to work.

03:15HANK MCKINNELL A sports team, some of us are blocking and tackling, some of us are running the ball, some of us are throwing the ball. But we all have a common purpose,  which is to succeed as an organization.

03:25JEFFREY S.WIGAND A corporation's like a family unit.  People in a corporation, work together for a common end.

03:35JOE BADARACCO Like the telephone system, it reaches almost everywhere. It's extraordinarily powerful, it's pretty hard to avoid. And it transforms the lives of people, I think, on balance, for the better.

03:50IRA JACKSON The eagle. Soaring, clear eyed, competitive, prepared to strike, but not a vulture. Noble, visionary, majestic, that people can believe in and be inspired by, that creates such a lift, that it soars. I could see that being a good logo for the principled company.

04:15Ira Jackson

Director, Center for Business and Government

Kennedy School, Harvard University

04:20UNKNOWN Okay guys, enough bullshit.

04:25[music]

04:30HOWARD ZINN Corporations are artificial creations. You might say they're monsters, trying to devour as much profits as possible, at anyone's expense.

04:40MICHAEL MOORE I think of a whale, gentle big fish, which could swallow you in an instant.

04:50MARY ZEPERNICK Dr. Frankenstein's creation has overwhelmed and overpowered him, as the corporate form has done with us.

05:00[music]

05:10ROBERT KEYES The word "Corporate," gets attached in  in almost, you know, in a pejorative sense to, and gets married with the word, "Agenda." And one hears a lot about the corporate agenda, as though it is evil, as though it is an agenda which is trying to take over the world.  Personally, I don't use the word "Corporation."  I use the word "Business." I will use the word, use the word, uh, "Company." I'll use the words "Business community." Cause I think that, it is a much fairer representation than zeroing in on just this word "Corporation."

05:50Robert Keyes

President and CEO, Canadian Council for

International Business

WHAT IS A CORPORATION?

05:55UNKNOWN What is a corporation?

06:00JOE BADARACCO It's funny that I've taught in a business school for as long as I have, without ever having been asked so,  so, so pointedly to say what I think a corporation is.

06:10UNKNOW It is one form of business ownership.

JOE BADARACCO It's a group of individuals working together, to serve a variety of objectives, the principal one of which is earning large, growing, sustained, legal returns, for the people who own the business.

06:25Joe Badaracco

Professor of Business Ethics, Harvard Business School

THE ORPORATION IRTH

06:30RAY ANDERSON The modern Corporation has grown out of the industrial age. The industrial age began in 1712, when an Englishman named Thomas Newcomen,  invented a steam driven pump, to pump water out of the English coalmine, so the English coalminers could get at more coal to mine, rather than hauling buckets of water out of the mine It was all about productivity,  more coal per man-hour. That was the dawn of the industrial age. And then it became more steel per man-hour, more textiles per man-hour, more automobiles per man-hour. And today, it's more chips per man-hour, more gizmos per man-hour. The system is basically the same, producing more sophisticated products, today.

07:15Ray Anderson

CEO Interface, world's largest commercial carpet manufacturer

07:20NOAM CHOMSKY The dominant role of corporations  in our lives is essentially a product of the, roughly, the past century. Corporations were originally, associations of people, who were chartered by a state to perform some particular function. Like a group of people want to build a bridge over the Charles River or something like that.

07:40Noam Chomsky

Institute Professor, MIT

07:45MARY ZEPERNICK There were very few chartered corporations in early United States history. And the ones that existed had clear stipulations, in their state issued charters. How long they could operate? The amount of capitalization, what they made or did or maintained, a turnpik, whatever, was in their charter and they didn't do anything else. They didn't own or couldn't own another corporation. Their shareholders were liable. And so on.

08:10Mary Zepernick

Program on Corporations, Law and Democracy

08:15RICHARD GROSSMAN In both law and the culture, the corporation was considered a subordinate entity that was a gift  from the people, in order to serve the public good.

08:25UNKNOWN So you have that history, and we shouldn't be misled by it, it's not as if those were the halcyon days, when all corporations served the public trust,  but there's a lot to learn from that.

08:35Richard Grossman

Co-founder, Program on Corporations, Law and Democracy

08:40MARY ZEPERNICK The Civil War and the Industrial Revolution created enormous growth in corporations. And so there was an explosion of railroads, who got large federal subsidies of land. Banking, heavy manufacturing, and corporate lawyers, a century and a half ago, realized they needed more power to operate  and wanted to remove some of the constraints that had historically been placed on the corporate form.

09:10HOWARD ZINN The 14th Amendment was passed at the end of the Civil War, to give equal rights to black people.  And therefore it said, "No State can deprive any person of life, liberty or property without due process of law." And that was intended to prevent the States from taking away life, liberty or property from black people as they had done, for so much of our history. And what happens, is the corporations come into court and corporation lawyers are very clever. And they say, "Oh, you can't deprive  a person of life, liberty or property. We are a person, a corporation is a person." And Supreme Court goes along with that.

09:50Howard Zinn

Author, A People's History of the United States

09:55MARY ZEPERNICK And what was particularly grotesque about this, was that the 14th amendment was passed to protect newly freed slaves. So for instance, between 1890 and 1910, there were 307 cases brought before the court under the 14th amendment, 288 of these brought by corporations, 19 by African Americans.

Please answer the two question below

The Corporation, how is a corporation different from other forms of business ownership? What are the advantages of incorporation for the owners of business?

The Corporation, in what ways do corporations control our economy, our politics and our minds?  

Explanation / Answer

A corporation is a firm that meets certain legal requirements to be recognized as having a legal existence.Corporations are owned by their stockholders (shareholders).Corporations enjoy most of the rights and responsibilities that an individual possesses; that is, a corporation has the right to enter into contracts, loan and borrow money, sue and be sued, hire employees, own assets and pay taxes. It is often referred to as a "legal person."

Advantages of Incorporation of a Company

Creates a Separate Legal Entity: This states that a company is independent and separate from its members, and the members cannot be held liable for the acts of the company, even when a particular member owns majority of shares.

Can own Separate Property: Since a company is termed as a separate legal entity in the eyes of law, it can hold property in its own name

Capacity to sue and be sued: The company has the capacity of suing a person or being sued by another person in its own name.

A large proportion of a nation's economy falls under Corporate Control.

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