I just finished reading a book called ‘When corporations rule the world’ by David Korten. It talks about the pernicious influence of corporations on economic, political and social fronts. How corporations play an active role in shaping a nation’s economic, foreign and fiscal policy which is a heavily covered issue in liberal circles. And how competing corporations can make common cause and pool their resources to together to serve mutual interests.

What I found particularly interesting was his analysis of the marketing function of corporations. How the goal is not just to sell products and promote a consumer culture but to create a political culture that equates the corporate interest with the human interest in the public mind. TV with its ability to implant identical images in the minds of millions of people can homogenize knowledge, tastes, desires and most importantly perspectives. If you achieve a certain measure of success in controlling how people think, not just what they think about that’s half the battle. How the natural evolution of a populist culture based on people’s aspirations and their interactions within and without their community has been thwarted and replaced by a global homogenized consumer culture based on a warped sense of reality.

And all the while the people are lead to believe that the ultimate power—that of choice, rests with them. Consumers can always use their dollar-votes to wield influence on the corporations is the argument of most neo-classical economists. The idea that consumer decides and the market responds is a fanciful notion which projects an exceedingly benign image of corporations. Widely dispersed consumers who make their choices independent of each other, are no match for the highly organized giant corporations united in their quest to squeeze consumers dry.

Korten is a vociferous critic of the corporate libertarian school of thought which believes in free markets, open trade and a globalized economy. He is however an avid fan of Adam Smith of the famous Invisible Hand Theory which is seen to be the cornerstone of the capitalist school of thought. Korten seeks to salvage his idol’s reputation from the machinations of neo-classical economists. He says that firstly that the Invisible Hand Theory only holds true under ideal conditions of perfect competition and absence of monopolies, externalities etc. He also takes pains to illustrate that Adam Smith was vigorously against corporations and all twelve mentions of them in The Wealth Of Nations have been unfavourable.

Korten describes himself as neither a fan of big government nor of big business . He believes in the power of the market and imagines a scenario in which almost producers are small and consume a major portion of their produce themselves and no one producer is big enough to influence the price. Something akin to rural American life in the nineteenth century before the food giants moved in. However the pastoral setting he so fondly describes seems far-fetched. And there is no reason not to believe that the present day corporation is the natural progression of the small private enterprises he vouches for.

His analysis of the problem was incisive and thought-provoking. However I found his solutions less engaging, which is why I gave the book up midway.