Introduction
After watching The Corporation and Inside Job I was left trying to answer one glaring question: “how did they get away with this?” Now I know this is a rather ambiguous question – who was getting away with what? Was it the corporation & organization at large, the CEO’s & employees, or the government? What were they getting away with exactly? Did the illegal activities, victimization, or moral corruption bother me most? I suppose the uncomfortable reality is that this is all applicable to the question at hand.
The purpose of this documentary analysis is to provide a concrete answer to this question of ‘big business’. This will develop an understanding as to how the ‘average person’ is so easily manipulated and targeted by the unforgiving profit seekers described in both documentaries. A compare and contrast analysis of both documentaries will be conducted. Information will be pulled from the two documentaries while being supported by content from additional references.
The Corporation (2004) offers a detailed overview of corporate power across the globe. From Monsanto to International Business Machines (IBM), this documentary suggests that corporations are only after one thing: profit. The corporate agenda is unstoppable with little regard for its impact; this means that extensive harm to people and the environment is, ultimately, inevitable.
Inside Job (2010) paints a similar picture to The Corporation, however, focuses specifically on financial corporate greed. This documentary describes the Financial Crisis of 2008 and the aftershocks of deregulation. It also addresses how CEO’s, the government, and academics intersect; this conflict of interest is morally concerning and must be challenged in order to salvage the credibility of the financial sector.
Going forward, ‘big business’ organizations will be referred to as corporations. This includes both consumer companies discussed in The Corporation and financial institutions, such as banks, under review in the Inside Job.
Although The Corporation and Inside Job offer different perspectives, it is in their similarities that themes have been developed; three prominent themes have been pulled from both documentaries and will form the structure of this analysis. Firstly, each corporation and its associated members have an unfortunate ability to generate extreme profit while at the same time producing tremendous harm in its wake (The Corporation, 2004). Secondly, corporations encourage deregulation and privatization; removing government control furthers corporate power. Thirdly, corporations have influence over most social institutions; for instance, academia and the criminal justice system.
Extreme Profit & Extreme Harm
Adam Smith has famously suggested that people are self-interested (Friedrichs – Ch. 8, 2010). Yet, as outlined by the 14th Amendment, corporations also have legal rights as a person (The Corporation, 2004). Therefore, based off of Adam Smith’s theory, corporations too would be considered self-interested (provided people and persons are synonymous – for the purpose of this analysis they are). In a society that promotes capitalist ideals, self-interest comes in the form of “monetary success” (Friedrichs – Ch. 8, 2010, p. 239). As such, for humans and corporations alike, the goal is to make money – to survive and thrive. The concern, however, is that corporations lack the moral conscious that individualistic human beings have (The Corporation, 2004); therefore, money will always be the goal and no sense of moral obligation can, or will, interfere with their motive.
For example, The Corporation (2004) describes how making a profit will always be prioritized over public interest; sweatshops, synthetic chemicals, or the use of antibiotics in dairy cows are all examples of tactics to maximize profits, while at the same time extensively exploiting people and the environment. Similarly, Inside Job (2010) thoroughly explains how financial institutions would sell a security to the ‘average citizen’ while at the same time betting on their likelihood of failure; these institutions manipulated buyers without disclosing their intentions. A such, they were solely interested in making money on their clients while neglecting their fiduciary duty. The aftermath, which pinnacled as a Financial Crisis, was disastrous, and the individuals who suffered where those financially exploited by the ‘trusting’ financial institution ‘looking out for their best interest’ (Friedrichs – Ch. 1, 2010).
Economic gain produces harm, however, it is not the direct intention of these corporations (Friedrichs – Ch. 1, 2010). Rather, it is the consequence of having little or no moral conscious. Although it is the umbrella corporation producing harm, it is important to consider the corporate official working in the interest of the corporation itself (Friedrichs – Ch. 3, 2010). These individuals work collectively to maximize profit on behalf of the company. It is my understanding that this is the key distinction between ‘average people’ and those individuals working for a corporation. The corporation is a self-interested entity and involved individuals will disregard their own moral code in the interest of the corporation – as described above. When removed from their corporate responsibilities, however, they regain a sense of moral obligation – similar to you and I. Simply put: individuals have a moral consciousness but corporations, and those involved, do not (The Corporation, 2004; Inside Job, 2010).
Deregulation & Privatization
A common theme between both documentaries is the corporate desire to privatize and deregulate – to remove government influence and control. The Corporation (2004) speaks to this in the form of tax breaks, environmental deregulation, Food and Drug Administration (FDA) laws, and global exportation. For example, environmental laws inhibit certain company practices which interfere with maximizing profits; for instance, cruise ship illegal waste dumping (The Corporation, 2004). These companies “weigh the cost and benefits” (Friedrichs – Ch. 8, 2010, p. 233) of legal disposal practices to see if it is economically worthwhile; otherwise, paying fines may, in reality, be the more profitable option. One way or another, corporations push for deregulation to a) save money and b) avoid fines for not following laws put in place.
Think Durkheim’s rational choice theory; what is profitable to a corporation; they must assess the likelihood of getting caught for not following regulations (Friedrichs – Ch. 8, 2010). Is it more difficult to “cut corners to save money” (p. 65) when regulations are in place? Probably, but as asked in The Corporation (2004), “is obeying the law cost effective?” Essentially, deregulation allows corporations to maximize their profit without violating regulations, yet, it is a likely rational choice to continue to violate regulations and pay the fines if it proves to be more profitable to the company.
Inside Job (2010) explores privatization, which similar to deregulation, removes government control by going from public to private. A specific example from the documentary was Iceland’s ‘prosperity to privatization’ phenomena; banks, which were once federally controlled, became privatized; American owned banks collapsed at the end of 2008 and as such, unemployment rates tripled throughout Iceland (Inside Job, 2010). This begs the question: was this collapse preventable if banks remained a public entity in Iceland?
Perhaps privatization is not a ‘crime’, yet, comes in the shape of corporate violence; although the harm to Iceland was indirect, harm was still done (Friedrichs – Ch. 3, 2010). Many people worked together in the interest of profit, within these privatized entities, to ensure economic success for the corporation. As addressed in Inside Job (2010), no one was protected except the banks themselves.
Advantage Throughout Institutions
Corporate power and economic prosperity enable corporations to influence most, if not all, public institutions (Friedrichs – Ch. 3, 2010). Again, as self-interested individuals, acting alone, we are not immune to the temptations of money (Friedrichs – Ch. 8, 2010). For instance, Inside Job (2010) uses academics as one example; research is funded or academics are paid (or sponsored) to conduct research that produces favorable results for the corporation without disclosure of financial support within the bonds of the research. While this is considered unethical to many, it is ‘allowed’ within most institutions, including Harvard University (Inside Job, 2010). This has been confirmed by Friedrichs (2010) who has described universities to be corporate criminals in themselves; by accepting financial support, corporations gain access to “[dictate] the terms for the research” (p. 92). This type of conflict of interest suggests that corporations have power and advantage beyond their ‘scope’ to direct and taint research to their advantage.
Another mentioned example of advantage is the infrequent prosecution of white collar offenders in the criminal justice system; in this case, individuals working within the corporations under review (Friedrichs – Ch. 2, 2010). This was highlighted in The Corporation (2004), particularly in the way of responsibility; when regulations are violated corporations are likely to pay fines yet corporate officials rarely face personal charges. Similarly, after the Financial Crisis of 2008, corporations in the banking sector were bailed out by the American government (700 billion dollars, in fact) and yet, faced no criminal charges in light of the corporate officials’ contribution to the extensive financial harm they had caused (Inside Job, 2010).
Perhaps the special sensitivity hypothesis explains some of the advantage corporate officials have in the criminal justice system (Gottschalk & Gunnesdal, 2018). Due to the status of white collar criminals, they are less likely to receive ‘fair’ punishment and sentencing because of their alleged inability to ‘cope’ within the justice system – like jail (Gottschalk & Gunnesdal, 2018). Although I see this as discriminatory, white collar criminals are not usually “labeled as deviant” (Friedrichs – Ch. 3, 2010, p. 336), and as such, “can influence the implementation and administration of the law” (Sutherland, 1940, p.7).
Conclusion
The three themes above, taken together, explain how corporate power is unavoidable. Today, corporations have a monopoly over small businesses – whether that be banks, clothing manufacturers, food producers etc. (Friedrichs – Ch. 3, 2010). This is because they are extremely powerful and very difficult to avoid (The Corporation, 2004). As previously described, they have a likely tendency to engage in morally wrong and illegal acts in the interest of profit. Furthermore, corporations push deregulation and privatization to remove government influence as a means to increase economic success within their organization. While having an influence in government, corporations also have an upward advantage within academia and the criminal justice system.
My initial question was “how did they get away with this?” Moreover, “how do they get away with this?” Throughout this analysis, the answer has become clear: obdurate corporations have no moral conscious and have the government, academia, and criminal justice system on their side. Powerful corporations are not held responsible for their profit-seeking motives – if anything, the institutions meant to protect the ‘average citizen’ appear to be in favor of this motive. I suppose the question should now be “how are we going to stop them?”
08.02.2019