The widening corporate scandals and needed corporate reforms

Ralph Nader

When state legislators early in the 19th century began granting more charters that brought corporations into existence, the unmistakable understanding by the lawmakers was that those artificial entities were to be the peoples’ servants, not their masters.

Today’s giant global corporations, chartered in the United States, are rampagingly out of control as their bosses vastly enrich themselves and exert the immense political and economic power as masters over workers, consumers, small taxpayers, investors and voters.

The Enron era of corporate crime, fraud, and abuse has taken these plunders to new levels of financial devastations for those innocents caught in the web of greed and deception. With almost daily mainstream media covering these outrages, what one official aptly described as a pattern he called “lying, cheating and stealing,” there has been little real action by President Bush and Congress. There has been lots of high dudgeon and denunciations from officialdom. Words are used as substitutes for deeds. People want action. At the onset, they want to make these corporate bosses pay back their illgotten billions to the laid off workers and pensioners. They want to see these corporate crooks convicted and sent to jail. Americans, regardless of their political differences, are close to unanimous in wanting to see justice done.

What is becoming increasingly clear from the White House, the SEC, the Justice Department and the Congress is that the necessary law-and-order investigations and prosecutions, with the necessary budget enlargements, will not be forthcoming. Until, that is, the American people, the defrauded and the laid off and worried onlookers together, mobilize into action. Marches, rallies, informed demands to the White House (202-456-1111) and the members of Congress (202-224-3121), meetings back home, with their Congressional representatives, their governors and state Attorneys General and securities regulators, must be some of the “rolling thunder” activity that will produce results – penal, compensatory, deterrent and restructuring results.

Millions of Americans – workers, investors and pension recipients – trusting their company executives and their auditors, relying on their stock brokers’ asserted expertise and truthfulness, have lost six trillion dollars so far. That is real money – their money. It is time for the action call – fundamental corporate reform – to ring again and again throughout the land. We want millions of Americans to work with us and other groups to show these giant company bosses what responsibility, accountability, restitution and just verdicts must be placed upon them – the recently resigned, their replacements, and their successors in the future.

There must be no more weak laws, infrequently enforced by politically repressed, understaffed agencies. A comprehensive, modern corporate reform law needs to be passed for publicly-held companies at the federal and state levels with a span of provisions. These should range from greater timely disclosures, a variety of serious criminal and civil sanctions, debarment from bidding for government procurement of goods and services and flat out prohibitions of conflicts of interests, corporate loans to insiders and the growing vogue of renouncing U.S. corporate citizenship as a device for avoiding U.S. taxes while retaining all the benefits (The Bermuda Corporate tax escapees).

Any comprehensive corporate reforms must:

1. Authorize and fund the proper governmental authorities to impose law and order on the corporate crime and fraud and their perpetrators;
2. Empower shareholders at long last who own the company to prevent and control these abuses by their hired managers within a democratic election and governance structure;
3. Establish a national commission on corporate power and its impact on our political economy, starting with a mandate to recommend the reconstitution of the corporate charters awarded by the fifty states to assure subordination and accountability by these artificial entities to the real people;
4. Facilitate the private civil justice access to the courts by aggrieved parties through the removal of numerous obstacles to having their full day in court that corporate lobbyists have pushed into statutes over the years.

We wish to hear from the people whose savings, jobs, hopes and dreams have been destroyed by these corporate outlaws, and who want to see justice done. Citizen Works and other citizen groups stand ready to network this nationwide drive for corporate reform so that once again these corporations, no matter how large, will become the servants not the masters of the people – as our founding fathers and some of our greatest Presidents and jurists in our past envisioned expected.

We can help you and we need your help – without which these corporate bosses will not be brought to justice and without which what Fortune Magazine recently called their “lies, arrogance and betrayal” will spread and fester. You can phone Citizenworks now at 202-265-6164, or write Citizen Works at P.O. Box 18478, Washington, DC 20036, or visit the web site at www.citizenworks.org. Your support and involvement are essential.