Written by Collin Boyd
A response to “Give Amazon and Facebook a Seat at the UN” by Ben Schott
A few months ago, an article was published by Bloomberg describing the need for the UN to open up seats for large multinational corporations. Described as having similar structures as nation-states with customers as citizens, boards of directors as legislators, and terms and conditions equated to laws, the author views the scale and scope of what the giants of capitalism can do as proof that they should be included in the United Nations. Whether or not the author intends for this article to be satirical in the vein of Jonathan Swift’s “A Modest Proposal,” or a genuine response to the growing strength and influence of such powerful companies, such a radical project would surely do more to increase income inequality, decrease sensible global governance, and create conflicts of interest to the detriment of citizens of all countries.
At a time when income inequality is growing globally, it is hardly the time to grant multinational corporations the legal capacity for global decision-making. In the past few decades, purely for financial advantages, companies moved their corporate headquarters to countries with lower tax rates. Even if the majority of their business is conducted in more populous or wealthier nations, companies tend to seek out the best financial deals while reaping the benefits of operating globally. For example, around 4,000 out of Amazon’s 950,000 employees rely on food stamps to survive, showing that citizens, customers, and employees should not be subjected to a more powerful entity if granted international representation at the UN. Plus, despite Amazon PR representatives’ best attempts to spin stories about working conditions, time crunches have led to delivery drivers peeing in water bottles, and massive HR tech issues led employees to be shorted on paychecks, or worse, unfairly fired due to systems involved with leaves of absence not communicating with attendance systems.
Certainly, there is unlikely to be a “perfect” company. There is also never a “perfect” government in the sense that scandals from the corrupt happen in the public sector as well. The difference is that the social contract of citizens and government implies that the government has the right to act in the public’s interest, but acting against it opens up the potential for change whether through elections or, worst case, violence. What social contract exists in regards to multinational corporations? The terms and conditions most users gloss over to utilize the services technically would be a legal contract. And multinationals have little incentive to act in the public interest, instead, companies are run with a profit motive. Including such entities in the UN would not keep them in check, but would open up new avenues to boost profits. Whether or not it helps global citizens would not be a primary concern.
For their part, it is doubtful that multinational corporations like Amazon and Facebook have been pushing for UN seats even in closed executive discussions. It’s not like governments ignore business interests entirely. From the local level up to the international, chambers of commerce work with businesses and governments to promote business growth. The public and private sectors do have to work together. Fair incentives to spur business innovation as well as sensible regulation to protect the public are just the beginning of the good governance practices that over time help a local community grow, or a country to increase GDP. The International Chamber of Commerce is a business association that promotes business concerns on a global scale. It is already involved with numerous UN, World Trade Organization, and G-20 business issues. In 2016, the organization was given observer status at the UN, showing that multinational corporations already have access to the UN. Allowing individual companies their own seats at the UN would erode sensible global governance at a time when such governance is vitally needed, especially since the coronavirus pandemic continues to hit lower-income countries, and full recovery is still years away. Having companies involved in areas outside of business wouldn’t yield the best results. What would Coca-Cola have to say about the conflict in Nagorno-Karabakh or the continued embargo of Cuba?
Conflicts of Interest
There are problems with the direct inclusion of companies into the UN or the government at any level. Companies would be involved with decisions well outside the scope of business and could contribute to possible conflicts of interest. Would large defense contractors like Lockheed Martin also be given the opportunity to join the UN? If so, would their voting decisions promote peace or leave the company open to supporting conflicts big and small around the world? Currently, Amazon is disputing a hefty $887 million dollar fine for violating EU data privacy laws. Involving companies in the international regulatory process opens the possibility of companies obfuscating regulations meant to keep them in check. At a time when much of domestic legislation is increasingly written by corporate lobbyists, even closer involvement at the hands of the government feels ill-advised. On top of that, involvement in the UN may open up companies with new ways to retaliate against countries. There is already precedent with businesses boycotting certain areas in protest against laws, such as the Texas abortion law, and the Georgia voting law both passed in 2021. On the international scale, this not only may mean a full country boycott but also voting on sanctions or on other international agreements that favor some countries over others.
Corporations as Country?
The main purpose of the original article by Mr. Schott seems to take a 130-year-old Gilded Age concept and extend it to the modern day. In the 1880s, the idea that corporations should be treated like people in the eyes of the U.S. Constitution is a legal precedent that has stuck for all these years. Even with the potential that the legal justification for this idea was fraudulent, given its staying power for over a century, extending a corporation’s legal authority from personhood to nation-state-hood will likely exacerbate many corporate issues that are with us today. The author cites a lack of government action to tame the large multinationals as justification for their inclusion in the UN, but the problem of government inaction should be the target to work on, not the other way around. Just a few days after the original post, Democrats in the U.S. House released a report on the growing monopoly power of major U.S. businesses, like Amazon, Google, Apple, and Facebook. In their recommendations, they promote an overhaul of antitrust legislation to fit in modern times. It also promotes the break up of these large companies due to their multi-industry branches. Is Amazon a book store, a grocery store, a delivery company, or a movie production company? It does all these things. Is Facebook a social media platform or a public marketplace? It has both. In the past week, two major companies have already announced a break-up of their entities. GE is splitting into three parts: one for healthcare, one for aviation, and one for energy. Johnson & Johnson is splitting into two to separate its pharmaceutical business from its consumer business. Real economic and business reforms are necessary for the government to fulfill its part of the social contract. The U.S. and the world will still rely on global companies, especially the tech companies, for growth into the middle of the 21st century and beyond, but a seat at the UN table is something citizens should stand against.