A Citizen Agenda to Tame Corporate Power, Reclaim Citizen Sovereignty, and Restore Economic Sanity

The following is based on
David C. Korten, When Corporations Rule the World
(Kumarian Press and Berrett-Koehler Publishers, 1995)

Policies advocated by free market or corporate libertarian ideologues have led to the creation of an economic system out of control. So what can we do? Needless to say, it hasn't been easy to create an economic system able to produce 358 billionaires while keeping another 1.3 billion people living in absolute deprivation. It took long and dedicated effort by legions of economists, lawyers, and politicians on the payrolls of monied interests to design and implement such a system. It required a radical altering of the dominant culture and the restructuring of many important institutions. It will take a similarly committed effort on the part of civil society to design and put in place an economic system supportive of economic justice and environmental sustainability.

To reclaim our economic spaces, we must first reclaim our political spaces from the corporations and other big money interests that control them. This will require far more than incremental or marginal changes. The following are among the obvious, but ambitious measures that must be considered.

Reclaiming Our Economic Spaces. One of the fundamental points on which Adam Smith and Karl Marx agreed is that workers should own their means of production. Though not widely noted, in the small enterprises of Adam Smith's ideal economy the worker was generally also the owner and manager. Furthermore, Smith assumed that enterprises would be locally owned and that their owners would thus be imbedded in a framework of local community values and interests. While Smith believed in the benefits of trade, he considered it logical that most markets would be local because of the costs and uncertainties of trading with foreign lands. He took an especially dim view of large corporations with absentee owners that used their political and market power to extract monopoly profits.

Our present globalized economic system affirms much of the wisdom of Smith's vision. The more economic power becomes highly concentrated and detached from any local interest, the more surely it is used to benefit the power holders at the expense of larger community interests.

If we intend that markets allocate resources efficiently in the public interest, then we must restructure them to fulfill the appropriate conditions-much as Smith defined them. Thus, it will be necessary to break up large concentrations of economic power, re-establish the connection between investment returns and productive activity, create incentives for producers to internalize their costs, and root the ownership of capital locally in people and communities engaged primarily in local production to meet local needs. It will also be necessary to reduce and slow international financial flows, deflate the global pool of extractive capital, and favor long-term over short-term investment.

The needed restructuring is appropriately guided by a vision of a global system of localized economies that reduce the scale of economic activity and link economic decisions to their consequences. Working out the details of an appropriate policy agenda will require our best minds and substantial experimentation. The following are some of the measures that should be considered.

ECONOMIC EQUITY AND SECURITY

Inequality makes it possible for those with economic power to pass the costs of their unsustainable consumption onto the economically weak and encourages extravagant consumption by the few. Economic insecurity creates a significant incentive for individuals to accumulate wealth beyond their real need. Public policies that favor economic equality and assure basic economic security should move us toward sustainability as well. Appropriate measures may include:

INTERNATIONAL REFORMS

A number of reforms are required at the global level to remove important sources of injustice and restrain the power of transnational capital. These include:

This is an admittedly full agenda. And it is surely incomplete. There is no simple fix for a system as badly broken as the one we presently have. This list is illustrative of the types of measures that must be considered. There is need for a vigorous public debate toward building a broadly based political consensus in support of comprehensive citizen agendas for national and international reforms adequate to the task of building just and sustainable societies for the new millennium.