Candidates in last November's presidential election all promised to bring major change. We continue to wait.

In
this series, I've tried to describe how promises to solve our most
pressing problems run up against the economic and political
institutions that are those problems' primary cause.

I would
hope that, having eliminated the threat of world communism, we can have
an open discussion about the institutions of corporate capitalism.

We
are blessed with the democracy and protections provided by our
Constitution. When it was written, almost all Americans were farmers,
merchants, tradesmen, or slaves. Those who wrote it did not know
concentrated power.

They could not have anticipated the
emergence of the modern corporation in the mid 19th Century. They did
not know that the very capitalism that spawned democracy, individual
freedom, and more prosperity for more people contained internal
dynamics that, over the centuries, would threaten each of these values.

One such dynamic is that at the end of every profitable
transaction, investors must reinvest the profit to gain even more
profit, or consume it and cease to be investors. This expand-or-die
competition produces winners and losers.

Over time, fewer and
fewer winners remain in any industry, and they have more and more
concentrated power, wealth, and capacity to influence everyone else.
They are the largest corporations.

Only about 20% of U.S.
businesses are corporations. They make important contributions to our
lives. They bring us new technologies, develop life-saving drugs, keep
us entertained, and provide jobs to a lot of people.

I have
worked with senior managers and shareholders in large corporations, and
I know them to be decent people who have no particular desire to harm
others. They merely accept the institutional rules as they exist and
play very hard by them.

But those rules give corporations
inherent characteristics that enable them, even compel them, to do
harm. Corporation law separates management from ownership. It shields
owners from liability for a corporation's misdeeds, except to the
extent of the money that the owner has invested.

It requires
directors and managers to act in the "best interest of the
corporation," which is interpreted as maximizing shareholders' wealth.
Investment flows to those companies that can sustain the absolutely
highest rate of profit, whether or not they must harm their community,
employees, small businesses, future generations, and the planet to
produce it. In fact, shareholders can sue management if it does not
pursue such opportunities. Mainstream economists call these injuries
"externalities"-other people's problems.

Corporations enjoy the
protections of the Constitution that its framers only intended to apply
to human beings. This has been used successfully to strike down laws
that limit what corporations spend to influence politics.

Of the
world's 100 largest economies, 53 are corporations. Exxon Mobil is
larger than the economies of 180 nations. They are growing stronger as
states grow weaker. They have replaced the self-organizing market with
the corporate equivalent of central planning.

While their own
individual interests sometimes conflict, they cooperate on issues that
affect their general welfare. They do not and cannot exercise absolute
power, but they can and do shape the economic and political frameworks
within which everyone else has to operate.

Government is focused
on short-term election cycles, corrupted by money, and poorly informed.
It is little match for giant corporations. In 1968, there were fewer
than 1,000 Washington lobbyists. Today, there are about 35,000. Of the
100 largest lobbying efforts between 1998 and 2004, corporations and
their trade associations conducted 92. Corporations own and influence
the media as well, shaping public policy debate.

Attempts to
solve at their roots such critical problems as healthcare, energy
policy, military spending, financial industry regulation, and poverty,
are blocked or warped by the focused power of corporations with vested
interests in conditions remaining the same. Tiptoeing around this
reality produces piecemeal solutions that add large costs, reward those
responsible for the problems, and do not solve them. This would appear
to be the fate of the current healthcare debate.

For those
serious about change, here are a few entirely legal actions that could
begin to make a difference. Governments charter corporations.
Governments could revoke the charters of corporations that do great
harm to the public good. Changes in corporation law could also make
officers, directors, and owners personally liable if their corporations
are grossly negligent.

Corporations did not acquire the same
legal status as people because Congress passed a law or a court made a
decision. In an 1886 Supreme Court case, the Chief Justice remarked
that he thought Southern Pacific Railroad was entitled to 14th
amendment protections. Somehow this became legal precedent. Congress
has the authority to pass legislation that would eliminate this status.

Doing
so would allow placing legal limits on the money that corporations can
spend on elections and lobbying. And Corporations should not be allowed
to use shareholders' money to lobby without the oversight of the
shareholders themselves.

Sharply limiting campaign spending and
publicly funding elections would encourage more serious discussion and
fewer meaningless sound bites and distortions. Closing the revolving
door between the highest positions in government and those in the
largest corporations would make a big difference as well.

To
some, these measures may seem radical. They are merely reforms rooted
in our nation's founding values, and they are modest in comparison to
the changes that Americans must soon contemplate.

The
inevitable escalation of energy prices, the emergence of China and
India as powerful economic competitors, the continuing disappearance of
jobs, and the declining possibility of cheaply financing America with
other people's money will, together, fundamentally change how Americans
live. We must have a conversation about how the pain and opportunity
brought by these changes will be distributed, act effectively in
response to them, or become victims of them.