Good News Everyone: Corporations Are Doing Great

The economic recovery isn't going so well for Americans.  The unemployment rate is still over nine percent and hiring is actually slowing down again.  Home foreclosures are still occurring at an alarmingly high rate.  Regular people are not doing well.  In short, as the Wall Street Journal notes: "Across a wide range of measures—employment growth, unemployment levels, bank lending, economic output, income growth, home prices and household expectations for financial well-being—the economy's improvement since the recession's end in June 2009 has been the worst, or one of the worst, since the government started tracking these trends after World War II."

In contrast--stark, ugly contrast--corporations are doing great.  Corporate profits are at an all-time high.  Corporations are holding onto a record amount of cash, around $2 trillion.  The GDP is higher now than it was pre-recession, but virtually all increased income was captured as profits by corporations.  Stocks are the highest they've been since the recession began.  Taxes on the wealthiest Americans are at all-time lows.  The Wall Street Journal astutely noted that there is a "dichotomy between corporate performance and the overall health of the economy."

It is time to stop babying corporate America and the ultra-wealthy, and to stop pretending that their successes or failures equate to general success and failure of everyday Americans.  They are not in the business of creating jobs, protecting the environment, or generally improving economy and the lives of regular Americans.  They are in the business of making profits, and that does not necessarily, or even regularly, translate to better lives for regular people.  Our 30 year experiment in supply-side, trickle down economics should now come to an end.

So what sorts of things should we be doing to take our economy back from corporations?  The first is to skew the tension between the pure profit motive and social responsibility way towards the latter.

Greens believe the legal structure of the corporation is obsolete. At present, corporations are designed solely to generate profit. This legal imperative -- profit above all else -- is damaging our country and our planet in countless ways. We must change the legal design of corporations so that they generate profits, but not at the expense of the environment, human rights, public health, workers, or the communities in which the corporation operates.

The practical solution is "federal chartering of corporations that includes comprehensive, strict and enforceable social responsibility requirements."

Second is for our economy to focus more locally:  "Greens support decentralization, and call for a community-based economics whose aim is local prosperity and self-sufficiency."

The overall idea is to shift power from corporations to people, from national or international to local.  This is a more sustainable way to run an economy.  I also really appreciate the focus on self-sufficiency.  One of the important purposes of self-sufficiency is to be able to help other people.  In our civic lives, we are self-sufficient as individuals and families so that we are stable and comfortable, to be sure, but also so that we can help our neighbors and create a self-sufficient community.  Greens care about self-sufficiency and community welfare because they are tied together.  And large, unwieldy corporations play virtually no part in that scheme.

The current painfully slow recovery for average Americans while corporate America and the wealthiest thrive is further evidence that it is time to reevaluate our economic structure.  It is time to demand social responsibility from corporations and time to stop pretending that that "trickle-down" economics is sound policy.