The words are not those of Mary Shelley describing
some Gothic creature or H.G. Wells imagining a mutant future. Rather
they belong to Chief Justice John Marshall, delivering the Supreme
Court's opinion in the case of Dartmouth College v. Woodward (1819)
and outlining the essential properties of the corporation. Whether
this immortal being also has an immortal soul -- or any kind of soul
at all -- is a central question raised by "Colossus," Jack Beatty's
stimulating anthology charting the rise of the corporation and its
impact on America.
Neither hagiography nor indictment, "Colossus
" (Broadway, 506 pages, $30) has the feel of a college seminar led by
an intellectually agile instructor. It is organized roughly
chronologically, following the development of the American corporation
from its early days as the royally chartered vehicle for the
settlement and exploitation of the New World to its current place at
the pinnacle of global commerce. "Today the corporation gathers up
millions across the globe in a hurricane of creative destruction," Mr.
Beatty writes in his preface, "of which it is at once vortex and
plaything, sweeping and swept along."
Well before the founding of the Republic, the
corporation not only shaped the economic development of America but
also wove its political and social fabric. In the 1600s, it was the
Virginia Company that authorized the first general assembly for the
new colony it was chartered to develop. In the 1700s, corporations
began to replace partnerships as the basic organizational unit of
American commerce. By the late 1800s, resentment of the railroads and
Big Oil gave rise to the same suspicions of size and power that
animate today's Microsoft antitrust saga.
From the beginning, capitalism posed challenges to
the new society being constructed by the land's early settlers. In an
essay from "Creating the Commonwealth" (1995), historian Stephen Innes
cites the early success of the Massachusetts Bay Colony, success
founded on the religious values of its Calvinist founders:
"Industriousness and frugality brought wealth, which in turn brought
temptation and worldliness, something we might dub the 'Protestant
Dilemma.'"
One of the most harrowing chapters of the book,
excerpted from James B. Hedges's "The Browns of Providence
Plantations" (1952), analyzes the ledger from a single 1764 voyage of
the slave-trading ship Sally, owned by a prominent merchant family.
Even the Browns themselves -- who went on to provide the land for the
Rhode Island university that bears their name -- ended up appalled at
the toll in death and misery. All, that is, except brother John, later
a congressman, who "could see no reason why the humane spirit of the
time should be permitted to limit the freedom of the merchant to
augment his capital in any way that he might choose."
The struggle between returns to investors and
responsibility to the broader society is played out again and again in
"Colossus." Sometimes, as in the role of the railroads tying the young
country together in the 1800s, the two forces coincide. More often,
they clash -- sometimes literally, as in Mr. Beatty's own account of
the bloody Homestead Strike of 1892, when Pinkerton men clashed with
steel workers at a Carnegie mill outside Pittsburgh.
Eventually, the realization that the untrammeled
pursuit of profits risked a backlash led to the rise of the modern
concepts of public relations and image advertising. An essay by the
late University of California at Davis historian Roland Marchand
examines the advertising strategy of AT&T, which transformed a hated
and feared monopoly into a respected (if not quite beloved) symbol of
a united nation. Using the mantra of "universal service" and
humanizing the company with the images of dedicated linemen and
helpful operators, the company managed to hold at bay for decades the
calls for its dismantling. It had gained a soul, as one company PR
executive of the 1930s put it, by clothing itself in "the radiant
raiment of ... a service ideology."
"Colossus" is lightest on the era in which
corporate capitalism faced its biggest crisis: the Great Depression.
Perhaps wisely, Mr. Beatty doesn't attempt to cover in a few pages a
subject that could itself fill a bookshelf; instead, he offers an
excerpt from John Steinbeck's "The Grapes of Wrath" about the eviction
of tenant farmers. Corporate power "is something more than men,"
writes Steinbeck. "It's the monster. Men made it, but they can't
control it."
As the book moves into the postwar era, fiction and
journalism play a more significant role. A lengthy excerpt from Joseph
Heller's "Something Happened" (1974) captures the rhythm and paranoia
of office politics: "In the office in which I work," it begins, "there
are five people of whom I am afraid. Each of these five people is
afraid of four people (excluding overlaps), for a total of 20, and
each of these twenty people is afraid of six people, making a total of
one hundred and twenty people who are feared by at least one person."
The wave of corporate restructuring in the 1980s is represented by
Susan Faludi's Pulitzer Prize-winning account in this newspaper of the
human toll of the Safeway Stores leveraged buyout.
At the end of the day, Mr. Beatty's anthology
provides ample evidence that corporations are only as moral or
immoral, as responsible or irresponsible, as the people who run them
and the forces that shape them. For better or worse, we have met the
Colossus -- and it is us.
Mr.
Jaroslovsky is the managing editor of The Wall Street
Journal Online.
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