Back on the Bob Murphy Show!

TGIF: "Corporate" Is Not a Four-Letter Word

I rise today to protest the widespread and malicious use of the adjective corporate as a synonym for evil, corrupt, exploitative, or any number of other pejoratives. As a descriptor, corporate merely says that an association that makes or sells goods for profit is publicly registered as a corporation. (Nonprofits can be corporations too.) This distinguishes the association from sole proprietorships and partnerships. That in turn means the participants in the association have agreed contractually to do business and raise capital in particular ways. Its ownership shares are readily tradeable; it may pay dividends to shareholders; it has a board of directors that hires officers and managers who may not be shareholders, etc.

That's it! That this form of free association should be so despised by "left" and "right" is rooted in misunderstanding, illiberalism, or both.

Incorporation carries no privileges or special obligations under the law. It is a free arrangement arising from a contract and the efficiency-enhancing division of labor between owners and managers. As an association of individuals who have the rights to life, liberty, and lawfully acquired property, the corporation is properly subject to the same laws as anyone else, no more or less. Corporations are (groups of) people. It's as simple as that. (Thus the decision in Citizens United v. FEC was a no-brainer.)