Consent of the Governed
The reign of corporations and the fight for democracy

As de Tocqueville predicted, the industrial aristocrats have prevailed in America. They have garnered enormous power over the past 150 years through the inexorable development of the modern corporation. Having achieved extensive control over so many facets of our lives -- from food and clothing production to information, transportation, and other necessities -- corporate institutions have become more powerful than the sovereign people who originally granted them existence.

As late as 1840, state legislators closely supervised the operation of corporations, allowing them to be created only for very specific public benefits, such as the building of a highway or a canal. Corporations were subject to a variety of limitations: a finite period of existence, limits to the amount of property they could own, and prohibitions against one corporation owning another. After a period of time deemed sufficient for investors to recoup a fair profit, the assets of a business would often revert to public ownership. In some states, it was even a felony for a corporation to donate to a political campaign.

But in the headlong rush into the Industrial Age, legislators and the courts stripped away almost all of those limitations. By the 1860s, most states had granted owners limited liability, waiving virtually all personal accountability for an institution's cumulative actions. In 1886, without comment, the United States Supreme Court ruled for corporate owners in Santa Clara County v. Southern Pacific Railroad, allowing corporations to be considered "persons," thereby opening the door to free speech and other civil rights under the Bill of Rights; and by the early 1890s, states had largely eliminated restrictions on corporations owning each other. By 1904, 318 corporations owned forty percent of all manufacturing assets. Corporate owners were replacing de Tocqueville's "equality of conditions" with what one writer of the time, W. J. Ghent, called "the new feudalism... characterized by a class dependence rather than by a personal dependence."

Throughout the twentieth century, federal courts have granted U.S. corporations additional rights that once applied only to human beings -- including those of "due process" and "equal protection." Corporations, in turn, have used those rights to thwart democratic efforts to check their growth and influence.
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