When FDR and LBJ passed laws which maximized equality by providing protections such as Social Security, the right to unionize, and medicare, corporations only saw added costs for doing business. While America helped rebuild the world after WWII, these costs were ‘acceptable’ since there was little competition from other nations. This barely acceptable situation became less so in the ’60s after the creation of the EPA and the passage of the Clean Air and Clean Water Acts. Eventually, corporate acceptance of all this higher overhead which helped equalize, protect and empower citizens, became a concern as Europe and Japan became economically competitive.
In response, the corporate attack on the laws of equality began. In 1971, Lewis Powell, a partner for over a quarter of a century at Hunton, Williams, Gay, Powell and Gibson, wrote a plan to start replacing representative governance with corporate governance and to increase inequality: The Powell Memo. Powell stated:
[The] American economic system is under broad [government] attack.
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Business must learn the lesson … that political power is necessary; that such power must be assiduously cultivated; and that when necessary, it must be used aggressively and with determination—without embarrassment and without the reluctance which has been so characteristic of American business. … Strength lies in organization, in careful long-range planning and implementation, in consistency of action over an indefinite period of years, in the scale of financing available only through joint effort, and in the political power available only through united action and national organizations.
Powell wrote this memo for his friend Eugene Sydnor, Jr., the Director of the U.S. Chamber of Commerce. The CofC then spread the memo to corporations across the nation. President Nixon nominated Lewis Powell as an associate justice on the Supreme Court a few months after he released the memo and the Senate then confirmed him.
The counter attack proposed in the Powell Memo not only included increasing corporations’ presence in the nation’s capital, it also included changes in their business model. Decades of implementing this attack has not only allowed the corporate takeover of our national and state governments, it has ravaged our economy and reversed most of the laws that had expanded equality.
Implementing the Powell plan resulted in changes to the bankruptcy laws to put corporations in charge of the process. This happened under the Carter administration. The Clinton Administration and Congress cancelled the Glass-Steagall Act. The Reagan administration extended the 401K savings plan to all employees, not just executives. The actions of Reagan laid the foundation for elimination of corporate-paid pensions and put retirement in the hands of Wall $treet.
In the workplace, corporations removed unions, reduced benefits, and replaced workers by shipping jobs overseas. They also saw the opportunity to steal wages of millions of workers for the massive benefit of a few executives. As worker productivity increased, wages stagnated but executive salaries and bonuses accelerated. Income and wealth inequality grew and is now at record levels.
To hide this wage theft, corporations made credit more and more obtainable. Credit cards and refinancing of equity growth in home values kept the middle class content as their wealth slowly fell under increasing debt. The interest on this debt went to corporations – creating more income inequality as workers borrowed their stolen wages and enriched the ONE%.
In addition to wage theft for productivity gains, corporations have fought to keep the minimum wage stagnant. They would prefer no minimum wage at all. This increased the income inequality gap further as inflation devalued the worker’s dollars and the ONE% invested in capital that grew faster than inflation.
Working through ALEC, the American Legislative Exchange Council, corporations have increased inequality for minorities and/or the poor. We have new voter ID requirements and fewer opportunities to vote early, especially in minority and/or poor communities. After all corporations want to make sure those who suffer from their abuses have less ability to vote their legislators out of office.
Also through ALEC, corporations have increased inequality for women. We have far fewer clinics for women’s health issues and more laws affecting women’s health choices while there are no new laws affecting men’s health choices.
One of the favorite tools of the corporate plan to replace representative governance with corporate governance is privatization of public institutions. Combine this with excessive corporate school tax breaks and you shift the cost of higher education to the students – another ball and chain of debt for the 99%. While students must borrow trillions for higher education and corporations avoid school taxes, public colleges and universities alter their business model to substitute personal gain for quality education. Much like the huge corporate wage gap, higher education now enriches the university presidents and board members while impoverishing the staff and faculty. So, students take on enormous debt and most higher education employees see little income growth – inequality between the 99% and the ONE% grows.
One of the tools citizens have is the internet. But corporate intrusion/governance is trying to take that over. Instead of upgrading the nation’s internet infrastructure to world standards and provide better service for all Americans, corporations want to create a fast lane for the wealthy and only upgrade it for those who can afford excessive payments for that upgrade.
A lot has happened since 1971 to increase inequality in America and those changes are accelerating with two recent decisions by SCOTUS: Citizens United in 2010 and McCutcheon in 2014. These decisions allow corporations and extremely wealthy individuals to flood untold amounts of “Koch Kash*†into our political process and maximize inequality in all its forms.
Add to those US Supreme Court decisions the new Pacific and Atlantic trade agreements, written and negotiated by corporations, and national governments are further disemboweled. Finalizing these agreements will cripple governments, lessen their ability to protect and empower citizens, and promote inequalities created by corporations and billionaires.
As corporate intrusion/governance grows, privatization is annihilating all that is Public. Protecting and empowering citizens by the government stops and inequality grows as the Private replaces the Public.
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The foundation of the Powell Memo and the Koch Brothers 1980 Libertarian Manifesto includes a belief in inequality. This belief in inequality includes a hierarchy for human life. It puts God at the top, as the senior authority figure, with white males next to dominate all others. At the bottom are poor, minority, women (especially black).
The concept of the rugged self-made individual, which has been proven false, also bolsters this belief in inequality. Direct causation, where the individual has direct control of his success as long as he learned the moral purity provided by self-discipline, is the basis for the self-made man. The individual should just foresee and plan around any circumstance that could reduce his chance of success. If he lacks the moral self-discipline to achieve success, then he deserves his unequal situation. This false idea of the self-made individual ignores many factors which affect equality of opportunity and are beyond the control of the individual: time of birth, parents of birth, place of birth, relatives, friends of parents and relatives, teachers, preachers, etc.
These external, uncontrollable, factors are referred to as systemic causation which are demonstrated by the butterfly effect, from Chaos Theory, and the scientific process of evolution. Both show that adding, subtracting, or modifying input factors produces changes in outputs. Whether it’s a collision with a giant asteroid, exposure to radioactive emissions, a divorce of parents, the birth of a sibling, moving to a new location, having parents that follow the strict-father or the nurturing family model, attending a well-funded or poor public school, exposure to toxins in the air or water, refusing vaccinations, preventing background checks for gun ownership, turning public K-12 into pipelines to prison, losing everything to an “act of God” or climate destruction, corporate and billionaire ownership of the government, pathetic regulation of dirty energy, food, and drug producers, sending our children into war for corporate benefit, etc, life changes from that point on and there is little you can do to keep it from happening.
*Koch Kash pays those who steal our freedoms – It’s any corporate or billionaire monies used to buy our state and federal governments and enact freedom robbing laws.
Andy Hailey