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    http://www.reclaimdemocracy.org/corporate_accountability/history_corporations_us.html Our Hidden History
    Message 1 of 1 , Jun 4, 2008
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      Our Hidden History                                                                                              of Corporations in the United States
      When American colonists declared independence from England
      in 1776, they also freed themselves from control by English
      corporations that extracted their wealth and dominated trade.
      After fighting a revolution to end this exploitation, our country's
      founders retained a healthy fear of corporate power and wisely
      limited corporations exclusively to a business role.
      Corporations were forbidden from attempting to influence elections,
      public policy, and other realms of civic society.
      Initially, the privilege of incorporation was granted selectively
      to enable activities that benefited the public,
      such as construction of roads or canals.
      Enabling shareholders to profit was seen as a means to that end.
      The states also imposed conditions (some of which remain
      on the books, though unused) like these:
      * Corporate charters (licenses to exist) were granted
      for a limited time and could be revoked promptly for violating laws.
      * Corporations could engage only in activities
      necessary to fulfill their chartered purpose.
      * Corporations could not own stock in other corporations nor own
      any property that was not essential to fulfilling their chartered purpose.
      * Corporations were often terminated
      if they exceeded their authority or caused public harm.
      * Owners and managers were responsible
      for criminal acts committed on the job.
      * Corporations could not make any political or charitable
      contributions nor spend money to influence law-making.
      For 100 years after the American Revolution, legislators
      maintained tight controll of the corporate chartering process.
      Because of widespread public opposition, early legislators
      granted very few corporate charters, and only after debate.
      Citizens governed corporations by detailing operating conditions
      not just in charters but also in state constitutions and state laws.
      Incorporated businesses were prohibited from taking
      any action that legislators did not specifically allow.
      States also limited corporate charters to a set number of years.
      Unless a legislature renewed an expiring charter, the corporation
      was dissolved and its assets were divided among shareholders.
      Citizen authority clauses limited capitalization,
      debts, land holdings, and sometimes, even profits.
      They required a company's accounting books
      to be turned over to a legislature upon request.
      The power of large shareholders was limited by scaled voting,
      so that large and small investors had equal voting rights.
      Interlocking directorates were outlawed.
      Shareholders had the right to remove directors at will.
      In Europe, charters protected directors and stockholders
      from liability for debts and harms caused by their corporations.
      American legislators explicitly rejected this corporate shield.
      The penalty for abuse or misuse of the charter
      was not a plea bargain and a fine,
      but dissolution of the corporation.
      In 1819 the U.S. Supreme Court tried to strip states
      of this sovereign right by overruling a lower court's decision
      that allowed New Hampshire to revoke a charter
      granted to Dartmouth College by King George III.
      The Court claimed that since the charter contained
      no revocation clause, it could not be withdrawn.
      The Supreme Court's attack on state sovereignty outraged citizens.
      Laws were written or re-written and new state constitutional
      amendments passed to circumvent the Dartmouth ruling.
      Over several decades starting in 1844, nineteen (19) states
      amended their constitutions to make corporate charters
      subject to alteration or revocation by their legislatures.
      As late as 1855 it seemed that the Supreme Court
      had gotten the people's message when in Dodge v. Woolsey
      it reaffirmed state's powers over "artificial bodies."
      But the men running corporations pressed on.
      Contests over charter were battles to control labor,
      resources, community rights, and political sovereignty.
      More and more frequently, corporations were abusing
      their charters to become conglomerates and trusts.
      They converted the nation's resources and treasures
      into private fortunes, creating factory systems and company towns.
      Political power began flowing to absentee owners,
      rather than community-rooted enterprises.
      The industrial age forced a nation of farmers to become
      wage earners, and they became fearful of unemployment -
      - a new fear that corporations quickly learned to exploit.
      Company towns arose. and blacklists of labor organizers
      and workers who spoke up for their rights became common.
      When workers began to organize, industrialists
      and bankers hired private armies to keep them in line.
      They bought newspapers to paint businessmen as heroes
      and shape public opinion.
      Corporations bought state legislators, then announced legislators
      were corrupt and said that they used too much of the public's resources
      to scrutinize every charter application and corporate operation.
      Government spending during the Civil War
      brought these corporations fantastic wealth.
      Corporate executives paid "borers" to infest Congress
      and state capitals, bribing elected and appointed officials alike.
      They pried loose an avalanche of government financial largesse.
      During this time, legislators were persuaded to give corporations
      limited liability, decreased citizen authority over them, and
      extended durations of charters.
      Attempts were made to keep strong charter laws in place,
      but with the courts applying legal doctrines that made
      protection of corporations and corporate property
      the center of constitutional law, citizen sovereignty was undermined.
      As corporations grew stronger, government and the courts
      became easier prey.
      They freely reinterpreted the U.S. Constitution
      and transformed common law doctrines.
      One of the most severe blows to citizen authority
      arose out of the 1886 Supreme Court case of
      Santa Clara County v. Southern Pacific Railroad.
      Though the court did not make a ruling on the question of
      "corporate personhood," thanks to misleading notes of a clerk,
      the decision subsequently was used as precedent
      to hold that a corporation was a "natural person."
      From that point on, the 14th Amendment,
      enacted to protect rights of freed slaves, was used routinely
      to grant corporations constitutional "personhood."
      Justices have since struck down hundreds of local, state
      and federal laws enacted to protect people from
      corporate harm based on this illegitimate premise.
      Armed with these "rights," corporations increased control over
      resources, jobs, commerce, politicians, even judges and the law.
      A United States Congressional committee concluded in 1941,
      "The principal instrument of the concentration of economic power
      and wealth has been the corporate charter with unlimited power...."
      Many U.S.-based corporations are now transnational,
      but the corrupted charter remains the legal basis for their existence.
      At ReclaimDemocracy.org, we believe citizens can reassert
      the convictions of our nation's founders who struggled successfully
      to free us from corporate rule in the past.
      These changes must occur
      at the most fundamental level -
      - the U.S. Constitution.
      Thanks to our friends at the Program on Corporations, Law and Democracy (POCLAD) for their permission to use excerpts of their research for this article.
      Please visit our Corporate Personhood page for a huge library of articles exploring this topic more deeply. You might also be interested to read our proposed Constitutional Amendments to revoke illegitimate corporate power, erode the power of money over elections, and establish an affirmative constitutional right to vote. 
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