The Role of Corporate Regulation

Democratic governments are responsible for ensuring the lives, liberties and well-being of all their citizens. To meet this responsibility, democratic governments have to regulate commerce. It’s no surprise that corporations disapprove of such regulation. It’s an infringement on their freedom, and a responsibility they don’t share. As they see it, the government’s chief responsibility is to ensure that their needs are met. “The business of government is business,” they might say.*

That’s why the current President of the U.S. Chamber of Commerce, Thomas Donohue, has declared war against policies proposed by democratically-inclined politicians. Mr. Donohue has proclaimed that

“…the chamber will seek to punish candidates who target business interests with their rhetoric or policy proposals, including congressional and state-level candidates.

"I'm concerned about anti-corporate and populist rhetoric from candidates for the presidency, members of Congress and the media," he said. "It suggests to us that we have to demonstrate who it is in this society that creates jobs, wealth and benefits -- and who it is that eats them."

What are his concerns? If you read his speech at the website of the U.S. Chamber of Commerce, you see that his concerns are

• unions
• trial lawyers
• taxes
• health, pension, and entitlement costs
• rules and mandates
• government regulators
• government-sponsored health insurance
• Social Security….. [without] more realistic cost-of-living benefit increases and the inclusion of a personal investment component.

In brief, Mr. Donohue is calling “anti-corporate” anything that represents a restraint or obligation for corporations.

But restraints and obligations have to be imposed, for the common good of all members of the community. While it's true that corporations create jobs, wealth and benefits, they also present challenges to democratic governments. For example, corporations are powerful sources of political money and influence. Also, when restraints and obligations have not been imposed upon them, corporations have too often endangered the lives, liberties, and well-being of citizens. The intention of regulating corporations is not to be “anti-corporate”. The intention is to be “pro-community”, whether at the local, state, national or international level. For, just as there must be “checks and balances” in the political system to maintain a democracy, there must also be “checks and balances” in the economic system to maintain a democracy.

*This quotation is often attributed to President Calvin Coolidge, but several resources indicate that this is not exactly what he said.