The Commons Exposed

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CommonDreams.org

The Commons Exposed

America, America
God mend thine every flaw
Confirm thy soul in self-control
Thy liberty in law.                    
America the Beautiful, Second Verse
--Katherine Lee Bates

The American founding fathers had the opportunity to design a brand new form of government.  The liberal democracy they developed took the place of a government based on the divine right of kings.   In this new form of government, the people are sovereign.  They rule themselves pursuant to a system of laws adopted by their elected representatives.  This system became admired and subsequently adopted in various forms in most of the developed countries of the world. 

In Common Sense, Thomas Paine argued that government, in whatever form, was a necessary evil because it interfered with personal liberty.   Some government was necessary, however, because human beings "do not invariably obey a uniform conscience."  Without government individual citizens will infringe on each others rights and property.  In order to safeguard people's rights and property, government is needed. 

Said Paine:

"For were the impulses of conscience clear, uniform and irresistibly obeyed, man would need no other lawgiver; but that not being the case, he finds it necessary to surrender up a part of his property to furnish the means for the protection of the rest; and this he is induced to do by the same prudence which in every other case advises him out of two evils to choose the least.  Wherefore, security being the true design and end of government, it unanswerably follows that whatever form thereof appears most likely to ensure it to us, with the least expense and greatest benefit, is preferable to all others."  (Emphasis supplied.) 

The founding fathers therefore sought to design a form of government that provided security for the public while at the same time impinged as little as possible on individual freedom.  They were engaged in a balancing act, trying to design a relatively weak government which infringed to the least extent possible on personal liberty, but still delivered the security which all governments must provide to be effective and sustainable.   

They believed that human beings could govern themselves through a system of laws.  Such laws would put limits on personal behavior and provide state administered punishments for those who violated them.   

An important part of this design is that government cannot pass laws that retroactively make behavior illegal.  Without this provision citizens could be fined and imprisoned for acts they committed in the past which at the time were legal.  This would make their freedom meaningless.  They would never be free to do as they pleased because they would always be afraid that the government would turn on them and pass a law making their past behavior illegal. 

The principle that government is not allowed to pass retroactive laws is embodied in the US Constitution in Article I Section 9.1.3.  No behavior can be punished by passing a law after it has occurred.  The law prohibiting the offensive behavior has to have been in place prior to the behavior for government to be able to punish the offender.  If there is no law against it at the time an offense is committed, then the offender cannot be prosecuted and punished by the government.   

Government achieves its purpose of protecting the environment and other elements of the public interest (collectively, sometimes referred to as the commons) by establishing and enforcing laws and regulations.  These rules do not ensure that the commons will never be abused.  They keep the abuse from becoming excessive.   They contain it.  The liberal democracy's ability to contain harm to the public interest in this manner is based on two assumptions. 

The first assumption is that citizens can govern themselves. The assumption rests on the fact that people are not normally inclined, nor do they have the capacity, to do significant damage to the public interest.  Until their behavior damages the public interest or the rights or property of others, government need not interfere with their freedom. 

The second assumption is that when the governed show the inclination and capacity to harm the public interest, government will be able to protect the commons by stepping in and passing new laws prohibiting this behavior.  These new laws serve to both penalize future offenders as well as deter future violations.  In this way, the damage to the commons is contained and the public interest preserved.   

The key to the success of the liberal democracy is thus in being able to contain abuse of the public interest in a timely manner.  Containment is dependent upon the elected representatives of the people recognizing abuse of the public interest when it occurs and then passing laws to make it stop.  If either the abuse goes unrecognized or, once recognized, elected officials do nothing to make it stop; bad citizens can go right on destroying the public interest without fear of being punished.  

The commons exposed

The liberal democracy therefore leaves the public interest exposed in two ways.  First, it is exposed to the actions of those who do not respect the law or fear its consequences.  Nothing distinguishes the liberal democracy from any other form of government in this regard.  All governments must face the threat posed by the limited number of terrorists and other miscreants who live among us who willingly harm the commons by violating existing law to make their point. 

Terrorism poses a unique problem for liberal democracy because it runs counter to the foundation upon which this system of government is based.  It indicates that man may not be able to govern itself with a system of self-imposed laws.  What good are laws if those that it governs ignore them and are not afraid of being punished for violating them?    

The concern here, however, is not how to deal with terrorism.  The greatest threat to the public interest comes not from those who secretly plot and plan criminal acts of terrorism.  It comes from those that openly and legally despoil our planet, hurt our people and destroy our communities.   This results in much more damage to the public interest every year than has ever been caused by terrorism.   

This destruction is caused not by criminals with bases of operations in remote regions of the world.  It is caused by those who inhabit multi-story glass enclosed towers in our major cities, a limited number of our big corporations.  Their actions take advantage of the second way the commons are exposed in a liberal democracy.     

Liberal democracy is a reactive form of government.  It is impossible for government to foresee all the ways behavior may adversely affect the commons and pass laws prohibiting this behavior in advance.  Instead, government protects the public interest by reacting to abusive behavior and thereafter passing laws that contain it. 

This means that destructive behavior may legally continue up until new laws become effective making it illegal.  This is the second way the liberal democracy leaves the commons exposed.  It leaves them exposed to powerful interests bent on delaying or frustrating the enactment of new laws that would put a stop to their destruction of the public interest.  Here is where the greatest exposure of the public interest exists and the greatest damage to the commons occurs.    

Passing new laws was never meant to be easy.  The founding fathers valued personal freedom and were skeptical of government interfering with that freedom.  They established a system for new laws to be enacted that is demanding.  Elected officials are supposed to have a strong bias towards safeguarding the freedom of the people who elect them.  This bias is reflected in a mindset that only results in new laws being passed when and to the extent circumstances prove it to be necessary.  

In America and many other jurisdictions, this system usually requires the vote of at least a majority of two houses of the legislature and sometimes the signature of the president or other executive officer.  There are many steps along the way to enactment where those opposing new regulation can delay and frustrate the process.   

Experience has shown that the period between the time the abuse is discovered and the time a law can be enacted preventing the abuse from continuing can be a very long time.  Indeed, a new law may never get passed and the abuse sometimes goes on forever. 

The length of time between the discovery of the abuse and the passage of new laws prohibiting it is directly proportional to the political power of those committing the abuse and their willingness to influence, stall and frustrate the legislative process.   

Even when new laws are enacted, too often, it is less than adequate.  It does not stop the harming of the commons.  Instead, it allows it to go in some slightly modified form or merely moves it elsewhere.  Examples of this include regulation that limits carbon emissions from automobiles and laws that restrict the advertisement of tobacco products.   Neither form of regulation has eliminated the abuse.  Each represents a compromise between fully protecting the public interest and allowing big companies to continue making money at the public interests' expense.   

On other occasions a new law may eliminate abusive behavior in one place, only to result in it moving somewhere else.  Even if one government passes a law totally forbidding a behavior that damages the public interest, its neighboring government may not.  When this happens, the abuse in the country which passes the law may move to the one that does not.   

Citizenship

To be successful the liberal democracy therefore needs something more than just laws and regulations.  Its success is dependent upon the "self-control" of the governed to refrain from harming the commons during the period between the time the damage is discovered and the time effective regulation can make it stop.  As written by Kathrine Lee Bates in the second verse of "America the Beautiful" this "self-control" is the soul of America and an essential part of any liberal democracy.  This "self-control" usually goes by another name.  We call it citizenship. 

Citizenship goes beyond just obeying the law.   It involves doing more to safeguard the public interest than the law otherwise requires.  It is voluntary and self-regulatory.  It is a restraint on the pursuit of self-interest that acts to protect the public interest.   

Regardless of whether or not the law protects it, good citizens do not harm the public interest.  Good citizens behave morally and ethically.  They protect the environment and other elements of the public interest even when the law does not require it.  When they realize they are harming these things, they stop-even when stopping runs contrary to their own interests.  They don't wait for the law to make them stop.  They don't lobby to keep the law from making them stop.  They simply stop.  This is part of what makes them good citizens. 

Without citizenship, the public interest is exposed to harm by those who have the capacity and inclination to achieve their own ends at its expense.  When, for whatever reason, citizens do not stop harming the public interest voluntarily and government does not stop it by passing new laws, government does not achieve its purpose.  The entire foundation of the liberal democracy then comes into question.  Maybe human beings cannot govern themselves with a system of self-imposed laws.   

Individual citizens

Protecting the commons from damage by people is relatively easy.  Human beings have little capacity or inclination to destroy the public interest.  The vast majority recognize it's a small world that we live in.  They realize this necessitates that they treat their fellow citizens more or less as they would like to be treated.  Most individuals are also concerned for their reputation and are guided by conscience, morals and a sense of right and wrong.  They know shame.  If they are caught damaging the public interest, they are most likely to stop doing so as soon as it starts to adversely affect their reputation in the community.   

Human beings are also constrained in their ability to harm the commons.  They only act locally.   Although people can do terrible damage to those with whom they have personal contact, their ability to damage the commons beyond the boundaries of their current location is very limited.  Even the terrorists of 9/11 only harmed people and property in three discreet locations.    

Finally, very few, if any, individuals have the capacity on their own to manipulate government.    When government moves to shut down abuse of the commons by an individual, there is little he or she can do to stop it.  This shortens the time between an abuse of the commons occurring and government enacting new rules to contain it.  This limits the exposure of the commons to bad citizens unwilling to stop their anti-social behavior voluntarily. 

Corporate citizens

When the US Constitution was adopted there was very little exposure of the commons to abusive corporate behavior.  Corporations were still in their infancy.  The few corporations which did exist back then usually had either a public or quasi public purpose such as establishing a university, building and operating a turnpike, bridge, canal, etc.  They were small in size and their pre-Industrial Revolution technology gave them little ability to harm the public interest compared to their modern counterparts. 

The limited ability of individuals to have a serious adverse affect on the commons and their tendency to self-regulate made it possible for the founding fathers of the United States to design the liberal democracy the way they did.  Eighteenth century farmers and shopkeepers had little capacity or inclination to harm the public interest.  The corporations of the day posed little greater threat.  A weak form of government could still adequately protect the commons.   

As a consequence, liberal democracies make no special provision for corporations.  They treat them just like any other citizen.  Corporations enjoy the same freedom and the same protections from government intrusion into their affairs as people.  They cannot be prosecuted for violations of laws passed after the offense they have committed.  To be prosecuted, the law prohibiting the harmful behavior must precede the offense.   

This means that the public interest is exposed to corporate behavior the same way as it is to individual behavior.  For the commons to be protected, corporations must also refrain from harming the public interest between the time their behavior is discovered to be harming the commons and the time a new law is enacted restricting their behavior legally.  In other words, corporations must be good citizens as well.  The heart of the problem is that too many of them are not. 

Big corporations are very different from individuals.  They have both the capacity and, in extreme circumstances (e.g. when they have huge amounts of money are invested or their survival is at stake), the inclination to harm the public interest in ways that most human beings cannot even contemplate.   

Although corporations only act through people (their officers, directors and employees), the collective actions of these people often add up to behavior that would not be characterized as human.   The primary reason for this is that the corporation is not designed to have any of the self-regulatory traits that are common in human beings.  There is nothing in their design that encourages moral behavior.  There is nothing that gives them a conscience, makes them feel shame or helps them differentiate between right and wrong.  Indeed, one part of their design discourages moral behavior and encourages the continued destruction of the commons.  It actually encourages poor citizenship. 

Corporate organizational structures also act to diffuse personal responsibility for corporate actions.  When no one can be held accountable, destruction of the public interest is more likely to occur. 

Modern companies also have much greater capacity to harm the commons.  They act through the collective actions of hundreds and sometimes thousands of people working together.  These actions are backed by huge amounts of capital.  Today's companies also have access to modern technologies that were unimaginable when the liberal democracy was first conceived.  These technologies can damage the environment and other elements of the commons in ways that individual people cannot.   

As companies have grown in size, so has their capacity to harm the public interest.  Their capacity to harm is not just local.  It can be regional, national or even global.  A large multi-national company can legally do more harm to the global commons in one afternoon, than the average individual could do in a lifetime. 

Imagine for a moment if the situation were different and the founders had to deal with the governing of today's large corporations.  Would they have designed the same system of government that they came up with more 200 years ago?  Would they have presumed that the governed (now including today's big companies) could largely govern themselves?  Would they have counted on corporations to exhibit the same traits of citizenship as people?  Based on the experience of the last 125 years (and especially the last 30 years), probably not.    

Big corporations are among the most, if not the most, powerful forces in our society.   It's not good enough that they be socially responsible once in a while.  We need them to be good citizens all the time.  For the public interest to be protected, we need all companies to be good citizens.  It's not good enough that some companies are good citizens while others are not. In order to protect the commons, we need to fully understand what drives some companies to be bad citizens and find a way to eliminate it.    

Robert C. Hinkley

Robert C. Hinkley is a former corporate law partner in two of America’s largest law firms.  He is also the originator of the Code for Corporate Citizenship, a 28 word modification in the corporate law to the duty of directors designed to improve corporate behavior.  His recently released book: Time to Change Corporations: Closing the Citizenship Gap, can be purchased through Amazon.com where it is available both in paperback and for Kindle users as well. 

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