Breaking the frame Giving corporations a soul BY LANCE TAPLEY

For all of Governor Baldacci’s conservatism, his Democratic Party (apparently) is on record in favor of radically changing the ground rules for Maine corporations. (Corporate reformers report that) last May the Democratic State Convention passed a platform plank, without dissent, urging corporations be stripped of their long-established rights as "persons." (The qualifications exist in this paragraph because a spokesman for the party, after repeated requests over several days, was unable to confirm or deny that such a plank exists or even put his hands on a copy of the platform.)

This plank was an expression of a budding corporate-reform movement in the state and the country. The Maine Legislature this session may find itself debating such issues as corporate personhood, the environmental and human-rights responsibilities of corporations, and whether they should be prohibited from contributing to initiative and referendum campaigns. The local energy on these issues comes from an as-yet-nameless group of progressive activists who think corporations too heavily frame the political discussion in Maine — and too heavily dominate American society.

A straightforward mechanism for reform exists because corporations, ironically, are somewhat socialistic. They are creatures of government. They need a state charter to exist. But the chief standard a corporation must meet under the law is essentially financial — or, to be precise, fiduciary. The corporation must satisfy the trust on the part of stockholders who invest money in it that it will work for their profit.

In fact, profitmaking corporations legally exist only to make a profit. They do not have, so to speak, a soul. If a corporation neglects profitmaking because of too much of an inclination to do good, stockholders can sue it. In practice, of course, some corporations care for the environment, their communities, and their employees because caring individuals own or manage them. But they are not required to care for these things, and critics argue that most big ones don’t.

Despite their absence of a soul, in several decisions over more than a century the United States Supreme Court has breathed artificial personhood into corporations, giving them almost equivalent legal status to a real person — creating, corporate critics say, a legal Frankenstein monster.

Like regular, human citizens, they have First Amendment rights to freedom of speech — which they exercise by the millions and millions of dollars. They have Fourteenth Amendment rights to equal protection under the law — which Wal-Mart exercises when it goes into a community demanding to be treated like any other merchant, though its mere presence may destroy many other merchants in town. The Supreme Court has recently given corporations the right to patent life forms, which as Ralph Nader notes may eventually lead to legal Frankenstein monsters creating real Frankenstein monsters.

Portland’s Green Representative John Eder and Portland’s Democratic Representative Ben Dudley have each thrown a "title" of a corporate-reform bill into the legislative hopper, and there may be more in the 2000-plus bills now being written.

Some reformers would like to do something to move along the idea of legally de-personalizing corporations. Another possibility is a bill to limit corporate contributions in elections and, especially, initiative and referendum campaigns.

The most talked-about option is a bill to add words to the corporate purpose as it is formulated in Maine law. A corporation wouldn’t be allowed to make money at the expense of, for example, "the environment, human rights, public health, and safety of the community in which the corporation operates and the dignity of the corporation’s employees."

That language comes from An Act to Amend the Maine Business Corporation Act, which Eder pushed unsuccessfully in the last legislature. And the language originally comes from the Code for Corporate Citizenship pushed nationally by sometimes Brooklin, Maine, resident Robert Hinckley, a former big-time corporate lawyer. The idea is to inject some soul into the corporate law. Several other state legislatures have taken up corporate-reform bills using Hinckley’s ideas.

Current corporate-reform discussions in Maine are also taking up the question of how to make corporate-board directors "responsible for their impacts," according to David Kubiak, an unsuccessful Green Party State Senate candidate from Kennebunkport. He is attempting to organize citizens around the state on these issues.

Eder’s bill specifically targeted directors, allowing them to be sued for destructive corporate impacts on the public. Nationally, corporate director responsibility has been in the news. Recently, WorldCom and Enron former directors were forced to pay from their personal wealth to compensate stockholders for alleged company financial wrongdoing.

A group that Kubiak put together met in Augusta on January 5 to begin work on corporate reform; it will meet again January 27. Much needs to be decided. "This whole thing is in flux," Kubiak says.

Among those present January 5 was Randall Parr of Owls Head, the man who apparently persuaded the Democratic Party’s state convention to endorse the statement that "corporations may not claim they are ‘persons’ or ‘people’ under the US Constitution and obtain constitutional rights thereby."

But it is one thing to have a plank in the Democratic platform and another to have the Legislature transform this sentiment into a law or a memorial to Congress, even when Democrats control both houses. Democratic officeholders as a group always turn out to be more conservative than rank-and-file Democrats.

Like most people, their surroundings heavily control their conceptual framework. Who surrounds them under the State House dome?

Corporate lobbyists.

Lance Tapley can be reached at ltapley@prexar.com