The Fanta Menace

I ended up having a rather dull weekend for two main reasons. The first is that I was stuck in the apartment much of Saturday while a repairman came and installed our new washing machine. Installed the machine is at last, but it is not quite ready for prime time; apparently, in order to get it to work, I need to turn some kind of tap under the sink, and the tap in question absolutely refuses to budge. The repairman tried to show me how to get it to work, but the language barrier inevitably got in our way. I will have to try to sort this out in my school's Central Office tomorrow.

The other reason I had a dull weekend was that I signed up to proctor mock examinations at my school. Preparation classes for the First Certificate Exam (FCE) and Certificate in Advanced English (CAE) are a big part of our business, it seems, and a few Sundays a year, we run mock examinations to help our students get used to real exam conditions. My part in this was to proctor two young women taking a practice FCE exam--that is to say, reading a travel guide to Ukraine while the young women in question worked away. Later, I got to be part of the listening section of the test, which involves getting two test-takers to try to have fairly mundane conversations with the "interlocutor" (as we are called...the name makes me wonder where Mr. Tambo and Mr. Bones are hiding), and with each other.

In the midst of all this tedium, however, I got to spend a bit of time watching YouTube videos. I have discovered lately that, because of lax enforcement of copyright laws, YouTube is a gold mine of film and television treasures and "treasures" from years past. So far, I have seen History Channel documentaries on the Ku Klux Klan, the Reformation, and religious conceptions of Hell; the entire ouevre of James Burke, famous for Connections and The Day the Universe Changed; and a couple of recent Jane Austen adaptations (including a version of Sense and Sensibility that actually managed to get the book damn near spot-on). But having little better to do this weekend, I ended up tackling Michael Moore, in his own Bowling for Columbine and in an indy documentary from five years ago called The Corporation.

When it first appeared, The Corporation was the kind of movie I would have rather died tha go see. I was far more politically conservative then, and the last thing I felt a need to watch was what I presumed would be a three-hour diatribe on the evils of the capitalist system. But, my views having mellowed a bit since then, I thought it might be time to give The Corporation a fairer hearing.

The main thesis of The Corporation is that the modern corporation, which not only claims but has been given many of the legal rights of a person, is an essentially psychopathic person: devoid of ethical standards, remorseless, and willing to do anything and everything to achieve its malevolent ends. At best, the film contends, corporations are amoral, and worst actively evil. The film traces the rise of corporations all the way back to the enclosures of the commons in England that ultimately led to the industrial revolution.

Naturally, the film trots out numerous instances of corporate wrongdoing over the years, from Bechtel's attempts to corner the Bolivian water supply in 2000 to the "business plot" to depose Franklin Roosevelt by force. Allegations that IBM was involved in the running of the Nazi death camps are given ample screen time.

While I am more sympathetic to discussions of this kind of corporate wrongdoing than I was a few years ago, I found myself largely unconvinced that the existence of the corporation per se was the ultimate cause of all these horrors. In the absence of limited liability corporations, wealthy businessmen acting alone might have committed many of the same injustices the film lays at the feet of corporations. In some instances, the film clearly chose to ignore inconvenient counter evidence (ignoring, for instance, that IBM lost control of its German subsidiaries in 1941 and also manufactured weapons for the Allies during the Second World War, all of which would indicate that IBM was not simply a villain with respect to the Nazi regime).

Moreover, the film frequently faults corporations for blind indifference to what economists call "externalities" (effects of a transaction that are borne by people who are not parties to the transaction). But the film ignores that, as economists use the term, an externality is not simply a euphemism for evils like pollution but a term that encompasses positive as well as negative effects borne by the general public. For instance, when the owner of a seed store sells someone seeds he uses to plant a garden in front of his house, this may have a positive impact on both property values and perceived quality of life in a neighborhood. But by only discussing negative externalities, the film in many ways distorts the record of corporations.

At other times, the film simply failed to prove that the evils it discussed were caused specifically by the existence of corporations as such. A case in point is its discussion of how a Fox television station chose to squelch a news story about how a hormone Monsanto manufactured to be used on cows was linked to cancer in humans. It is clear that the story was squelched largely because Fox became concerned that Monsanto would pull its advertising. But this kind of manipulation of the news occurred long before the modern corporation (look at how biased reporting was in the days of Adams and Jefferson).

But what I found hardest to stomach were the times The Corporation veered completely off the deep end. The biggest example of this came in a discussion of how Coca-Cola reacted to the beginning of the Second World War. As the film presents it, Coke's biggest concern was that it would not able to keep its bottling plants in Germany churning out Coca-Cola during the war. This ultimately proved to be the case as the war interrupted supplies of the kola nut to Germany. Coke's solution to this was to start producing an orange drink called Fanta (still marketed and popular in many countries, including the United States).

My big reaction to this was a big "So What?" It's hard to see any way in which selling or not selling Coca-Cola in Hitler's Germany would have had any effect on the Nazi regime. Selling sweetened and flavored carbonated water is a morally neutral act. Unlike in the case of South Africa, it's unclear that divestment in Nazi Germany would have produced any results, particularly with a madman like Hitler at the helm. The film made no allegation that Coca-Cola benefitted in any way from concentration camp or other unfree labor during the Nazi years, nor even that it sought to do so. Calling Fanta "the Nazi drink" (as Michael Moore did at one point in the film) is a bit like saying that, because people in Communist Russia ate bread, eating bread is somehow immoral.

In another instance, the film failed because it failed to differentiate between a real solution and mere grandstanding. Showing scenes in which a group of California attorneys called for the state attorney general to revoke Unocal's charter because of its "many crimes against humanity," the film seemed to argue that goverment can reign in corporate power by using existing powers to disband corporations that are acting against the public interest. What this argument ignores, however, is taht Unocal and myriad firms like it can just re-establish themselves in places where the law is more lax (like Delaware or South Dakota).

To The Corporation's credit, however, it at least did not devolve into calls for a communist revolution; indeed, the film did acknowledge (however briefly) that injustice has been committed in the service of proletarian revolution as well as in the service of profit. But in a way, this failure actually worked against the film, insofar as it presents no real alternative to the existence of corporations. Especially in the modern world, there does not seem to really be one. There are whole industries (automobiles, computers, airlines) that not only could not operate with their present efficiency, but could not operate at all, if they were not operated by corporations. No individual--not even a Bill Gates--has the capital to maintain and run Motorola or General Motors. In these instances, the only viable alternative to the corporation is government ownership.

I am not saying that government management of a field of human endeavor is inherently a bad thing; clearly, we are better off having municipal fire departments than we were in the days when fire protection was a private business and a fire company would just pass you buy if you weren't one of its customers. But living in a country that is still suffering the after-effects of far too much direct government management of industry, I know that having the government produce our automobiles and our toothpaste is not really a solution, either.