In a piece titled, The Artificiality of Corporations, the Daily Bell notes that the modern corporation is a relatively new Anglo-American invention. I believe the primacy of this artificial construct -the corporation – to our modern political discourse and economic reality backs our argument that rather than ‘Modern Austrian’ as the author calls them, we should name it – the American School, a new official branch of economic theory.
We no longer live in a time of the long process of the fall of the divine right of Kings (from John Locke to Adam Smith to Frédéric Bastiat); nor do we live in a time (as did Menger, Mises and Hayek) when the great Russian and Austrian-Hungarian empires were collapsing and tens of millions of peasants were suddenly free to empower mad men with mad ideologies who had stepped into the post-emperor power vacuum.
We live in our own time of a different sort of world order and reality to those that came before. And yet we have limited ourselves to an ideological and economic framework for a time of emperors who ruled over a world of less than a billion people. You can posit your own theories below as to why we have not moved on.
But if you want to start examining where we are today, it helps to look to the past to see what we as a nation thought previously about certain matters; so here is what Jefferson said on corporations:
Thomas Jefferson apparently had no higher admiration for corporations than central banks. “I hope we shall crush in its birth the aristocracy of our monied corporations which dare already to challenge our government to a trial of strength, and bid defiance to the laws of our country,” Thomas Jefferson wrote in 1816.
Obviously, Jefferson’s opinion expressed above would not find support from the American School today, which would assert instead that the corporation is merely the “free associations of individuals pooling their capital” and that it is, in fact, the evil of government that would seek to challenge the power of corporations – almost the exact opposite of what Jefferson had opined in 1816.
Thomas Jefferson also wrote in 1825 in a private letter to William Branch Giles; something that sounds like what Occupy Wall Street would have been in a pre-American School time:
[The younger generation] having nothing in them of the feelings or principles of ’76, now look to a single and splendid government of an aristocracy, founded on banking institutions, and monied incorporations under the guise and cloak of their favored branches of manufactures, commerce and navigation, riding and ruling over the plundered ploughman and beggared yeomanry.”
Notice that this dynamic is something you continue to see at the competing party conferences – each team has their favored branch of corporation – the Tea Party loves their Military Industrial Complex and want more power and money diverted to these corporations. The Dems want more power and money diverted to the copyright and intellectual property cartels. And the old school Republican want it all diverted to Big Oil and Big Ag. But united they all are in placing the corporation above all else, and presided over by an aristocracy of political families and/or politicians bestowed with an almost divine right, certainly an existence beyond the laws of mere mortals.