Cradle to Cradle: Remaking the Way We Make Things

industries, for example, banking, railroads, or in charted monopolies (e.g., toll roads). The modern for-profit legal person usually is an unregulated company assumed to be operating in a competitive market. Thus, he writes off antitrust legislation more quickly than, in my view, is appropriate. He notes the explosion of new corporations between 1893 and 1905. Given the passage of the Sherman Act in 1890, this may have been a sign of lesser corporate power, not more. Note also that this is the time period of the Muckrakers—a time when anticorporate backlash was at a zenith. Instead, he develops in chapters 8 through 10 the development of corporate personhood. The stories of this period and the Fourteenth Amendment were new to me, and I found this topic to be the strongest element of the book. But this leads to other blind spots. By not discussing the restrictions on limited-liability companies in other countries of the developed world, we never learn whether the United States is a unique case or the norm. Also, there is a strong California bias in the book. There is much more said about the power of the Southern Pacific Railroad and the Pacific Gas and Electric Company than is said about the influence of the eastern business establishment on legislation and legal decisions near the close of the nineteenth century. There is no mention of the rest of the world after the eighteenth century. Even his discussion of the past fifteen years has a strong emphasis on California. The consumer movement of roughly 1906 to 1937 really gets short shrift. He does say corporate rights were not expanded between 1922 and 1962 (chapter 14). While being rather detailed in his coverage of 1868 to 1885, he then jumps to the J. F. Kennedy period much too quickly. Consequently, all the work in the economics and corporate governance literature, such as Adolf Berle and Gardner Means (1932) and others, that were involved in analyzing the case for and against further limitation of corporate power receives scant attention. He fails to realize that organized efforts against corporate power are not new but rather have followed a cyclical pattern with the growth and decline of antibusiness, populist movements. Had he done so, he may have provided a better frame in which to ask the question: Why should the current anticorporate movement be any different, that is, yielding some transitory reforms but no major changes in corporate governance, limited liability, and personhood? For example, I hear long-term students of this problem saying that SarbanesOxley and campaign finance reform (should it survive current legal challenges) are unlikely to place a fundamental or long-lasting check on corporate power. That is the beauty of the author’s thesis for attacking personhood. Unfortunately, in the final chapters of the book, 16 through 18, Nace loses his way from making an operational plan for limiting personhood. Instead, these final chapters go off on a number of hotbutton issues like union power, globalization, compensation for taking, corporate lobbying, and campaign financing. Each of these is a very complex subject that could merit a chapter of its own with much more serious legal and historical analysis. With little or no analysis, Nace suggests the following reforms: (1) revoke the doctrine of corporate constitutional rights; (2) curb corporate “quasi-rights” as appropriate, for example, institute five-year charters; (3) ban corporations from political activity; (4) shore up the boundaries of “noncorporate” spaces in society, for example, advertising to children; (5) expand the scope of worker and customer rights; (6) strengthen countervailing institutions, especially unions; and (7) promote noncorporate institutions like public schools, municipal utilities, and family farms. In short, the book is a page-turner that does a better job of telling stories than of providing guidance for the future health of the nation. It deserves a look.