Labor: Take the Offensive

Organized labor won an important victory in California this past June 2 when the unions surprised the oddsmakers and got out the vote to beat Proposition 226 by a margin of 53.5 to 46.5 percent. Now the unions and other progressive populists need to take the offensive with initiatives to curb the power of multinational corporations that are carrying on the crusade to disempower working people.

Proposition 226 on the California primary election ballot, engineered by California Gov. Pete Wilson and cronies of House Speaker Newt Gingrich, was designed to defund organized labor's political operations (See "Unions Forced Back into the Streets," 6/98 Progressive Populist).

The "paycheck protection initiative," as it was styled by its right-wing supporters, started with a huge 50-point lead in the polls. After all, who was against payroll protection? The right wingers planned to use their great victory in California as a springboard to defunding unions across the country, state by state. This is a Republican priority because in many areas of the country the unions are the backbone of the Democratic Party -- at least in those areas of the country where the Democratic Party still has a backbone.

If the Republicans could make it practically impossible for the unions to raise money for political purposes, the Democrats would have little recourse but to follow the lead of President Bill Clinton into the embrace of the corporate lobbyists. That would finalize the transformation of the Democratic Party into the moderate wing of the GOP. Unions would watch helplessly as a business-dominated Congress passed more union-busting laws.

The threat roused labor, and not just the California Labor Federation. Workers from around the country were sent to California to fight Proposition 226. They spent an estimated $20 million getting the word out that the proposition not only would take money away from union "bosses," but it would take away the workers' political voice and harm public education, reduce patients' rights, weaken Medicare and worsen the flow of manufacturing jobs overseas. They noted that charities also would have to comply with the paperwork if they used any of their members' dues for political activity.

Union supporters not only closed the 50-point gap in the polls, and turned around union members who originally supported by measure by a two-to-one margin, but they also helped their candidate for governor, Lt. Gov. Gray Davis, win the Democratic primary against conservative half-billionaire Al Checchi, who spent $40 million of his own money, and centrist U.S. Rep. Jane Harman, who spent $16 million on the race. Davis spent a relatively thrifty $12 million in a state where there was practically no "free media" coverage.

Early on the right-wing backers of Proposition 226 boasted that they would raise more than $10 million but, perhaps overconfident, they mustered only an estimated $4 million. The unions forced the neutrality of many California businessmen after the unions gathered enough signatures to put a counter-initiative on the ballot to restrict corporate political spending and tax breaks. The labor federation agreed not to file the petition as long as business did not actively aid Wilson. With a few exceptions, big businesses stayed on the sidelines.

In the wake of the election, Prop 226 backers said they planned to try it again in the 2000 election. "I have bad news for the unions," said Wilson, who has presidential aspirations that year. "This is going to go on. This was Round 1."

He's not joking. The unionbusters have the money and they have no respect for the right of workers to organize and be represented. But turnabout is fair play. The only thing big business respects -- other than money in the bank -- is the ability of unions to put people on a picket line or at the polls on election day. Now is the time for unions to put those people to work promoting legislation to make corporations more accountable to workers and the community.

Thomas Jefferson, like most of the Founding Fathers, had a strong distrust of corporations. "I hope we shall crush in its birth the aristocracy of our monied corporations which dare already to challenge our government to a trial by strength, and bid defiance to the laws of our country," he said upon leaving office in 1809.

Corporations are designed to allow the sale of stock and limit liability of shareholders. Until the late 1800s these legal fictions were sparingly created by state legislatures for specific purposes, were kept under tight reins and their charters were revoked when they strayed. Then the Supreme Court, in a leap of judgment, declared in 1886 that corporations were natural persons, entitled to civil rights under the 14th Amendment. Ironically, while the freed slaves, whom the amendment was enacted to help, were disenfranchised and subjected to segregation laws in the 1890s the liberated corporations consolidated their power over the United States economy and politics.

In the past century the corporations have gotten the courts to embellish their constitutional protections to the point that tobacco companies argue that they cannot be prohibited from advertising, biotech companies say they cannot be forced to label products that are genetically altered and utilities cannot be forced to give their customers notice of independent consumer groups.

Russell Mokhiber and Robert Weissman, in their Corporate Focus column on page 11, argue for a change in the law to deny corporations First Amendment protections. We would not stop there. We propose a constitutional amendment that simply clarifies that corporations are not considered natural persons.

As long as corporations are authorized to do business in a state, they should be expected to recognize their obligations to workers as the stakeholders in the corporation and the community in which they they operate, as well as those who have purchased shares in the corporation.

German law requires that employees be represented on corporate boards. The German autoworkers union is allocated nine of the 20 seats on the newly merged Daimler/Chrysler board of directors. It has volunteered one seat to the United Auto Workers. We think that United States law should emulate this model, which has served German industry well.

The federal government also should either give back to the states the right to regulate corporations or it should take seriously those obligations.

The Program on Corporations, Law and Democracy has been active in urging citizens to urge their state legislatures to use their "reserved power" to revoke the charters of errant corporations chartered in their state, and to demand that the state attorney general or other responsible official revoke the permission of errant "foreign" corporations (that is, chartered in other states) to do business in their state.

For more information, contact Richard Grossman at POCLAD, PO Box 806, Cambridge, MA 02140; phone: 508-487-3151. Others active in the movement to rein in corporations are the Alliance For Democracy, PO Box 683, Lincoln, MA 01773; phone 617-259-9395; email peoplesall@aol.com; and Paul Cienfuegos, Democracy Unlimited, PO Box 27, Arcata, CA 95518; phone (707) 822-2242; email cienfuegos@igc.org.

Of course any effort to get a handle on corporations requires us to repudiate the Multinational Agreement on Investments, which is being drafted in Paris by the Organization for Economic Cooperation and Development, a group of wealthy nations, to give multinational corporations an international Bill of Rights.

Capitalism needs a conscience. The corporation has none as long as it exists solely to make a profit for shareholders and is unaccountable to the people. -- Jim Cullen

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