Milton Friedman, America’s defender of free markets, said that “the social responsibility of business is to increase profits”. American Multinational Corporations follow this principle to the detriment of America. But why are they permitted to move jobs overseas, and why are they permitted to transfer American ingenuity overseas, ingenuity that if kept here in America, would outcompete other nations and provide ample jobs to all Americans? The answer lies with our system of law.
A relatively immature concept of American democracy is the idea of the U.S. corporation as a citizen with all the rights of a person born or naturalized. As the legal concept was born prior to the birth of multinational corporations, it fails to adequately address the conflicting goals of MNCs and the country. With the initial premise of corporations as citizens, subsequent court rulings have further cemented MNC rights above those of American citizens.
America’s concept of citizenship implies a nationalistic loyalty to the collective citizenry of this country, ultimately giving one’s life in battle if called. Our test for naturalization of immigrants is an oath committing one’s self to this loyalty. We have a term of residency in which for five years, a person wishing to pledge allegiance to our country lives among other Americans before making this commitment.
And yet, the cost of establishing a U.S. corporation, with all the legal rights given to immigrants who have pledged their lives, is the cost of ink on paper and $150 dollars. The person controlling this legal entity is now free to buy and sell property including innovation created at the expense of the American educational system and history of American development. They can exercise all property rights including the gutting and transferring of American innovation overseas.
While America takes great caution to ensure that a person naturalized in our country has the best interest of America in their actions, our developed corporate and property laws do not require that MNCs take an oath of U.S. citizenship, such as the one taken by immigrants desiring to be part of our country, requiring the MNC to consider the interests of America as a corporate stakeholder.
A comprehensive multinational corporation reform bill should examine America’s corporate laws with regards to the new cross national boundaries in which they operate. If our multinational corporations do not intend to obligate themselves to the responsibilities of a U.S. citizens, perhaps it is time for America to view our multinational corporations in their true context.