The word “corporation” gets thrown around a lot, usually with bad associations. A lot of people like to blame big businesses for all of our problems, but it’s not always that straightforward.
Here’s a transcript of our conversation:
Emma: Hi, Brittany.
Brittany: Hi, Emma.
Emma: Today I wanna talk about corporations, and that’s a word that gets thrown around a lot, usually with a pretty bad connotation or a bad association. a lot of people like to blame big businesses for all of our problems, and I think a lot of the times people when they, hear of a big company or a big business, they just think, oh, well that’s just a corporation. but it’s not always that straightforward. So I’m, excited to break this down a bit, Brittany. Are there any corporations that come to mind when you think of that word?
Brittany: Yeah, I mean, so Microsoft is one of the first Google, of course, it’s funny as I say that I have a Google Home, a Google’s like lighting up right now.
Emma: It’s listening.
Brittany: Happening. Ford, which is another one of my great ones. I mean, I guess, would Apple be considered a corporation? I guess it is.
Emma: I don’t believe so, but it might be, yeah. Okay. Yeah, there are all different kinds of ways, and this is why I wanted to talk about this. There are a lot of different ways that you can define businesses. So there are C-corp and there are S-corps and there’s LLCs and partnerships and all different kinds of companies. And that’s not even getting into publicly versus privately held. So maybe we’ll do a future episode on that. but I wanna just read a quick definition of what a corporation is before we get started here. a corporation is a company or a group of people authorized to act as a single entity, which means they’re legally a person and recognized as such in the law. So a lot of the original corporations were actually like church groups. So the Catholic church.
Brittany: Oh, that’s interesting.
Emma: Yeah, cuz, when you think about what, like the word corporation, it has corp, is the root word and that means person or body. So it’s basically, it’s a big group of people sort of acting as one. And you know, through the Supreme Court corporations have basically been granted the same rights as people, which a lot of people have problems with. sometimes that can come up when you’re talking about campaign donations and the amount of money that companies are able to spend in political campaigns and that sort of thing. but, I wanna also talk about how corporations are treated by the government. So Brittany, do you wanna talk a little bit about corporate welfare and what that means?
Brittany: Yeah. so have you ever heard the term corporate welfare, which you probably have from us? you can probably guess that it involves corporations, right? That’s where that word corporate comes from. Basically, corporate welfare is when certain companies get money or financial benefits from the government. And this happens all the time, unfortunately, sometimes it’s called crony capitalism, like a lot of it, crony capitalism is more of like the umbrella that corporate welfare is under, but you hear it called a bunch of different things. So we saw a lot of this recently with coronavirus stimulus packages. Billions of dollars were sent to airlines, which is hilarious because airlines were like messing everything up anyway. So airlines, defense companies, and other businesses to help them stay open during the lockdowns. So it was just, just a mess.
Emma: It was, and a lot of people on both sides politically really, really wanted those stimulus bills to pass, but also a lot of people on both sides didn’t want them to pass. It’s kind of interesting cuz it sort of split people into four groups. There was the, like the people on the left, maybe the Bernie Sanders types who were like, no, this is bad. Too much money is going to corporations, not enough is going to people. And then there are the people on the left that support it, that say, Hey, well we need this money. Like just, you know, give us our stimulus check. We don’t care how much is going to Boeing or to American Airlines. And then there were the people on the right who were saying, Hey, you know, we don’t wanna be sending all these checks to people. It’s, this is the new welfare. We don’t want people getting these stimulus checks, they won’t wanna go to work. And then some people on the right, there weren’t very many of us were saying, this is all wrong. We should not have the government handing out money to anyone. The government just needs to stop telling us how to live our lives. And that’s why it was a super backward approach because, you know, the whole reason that this pandemic had so many bad things happen economically with it is because the government responded by shutting down and forcing a bunch of businesses to close. And a third of those were never able to even reopen when you’re talking about the small businesses. So that’s a little bit of a side tangent and we’ve talked about that. I know a lot on this podcast, but it’s sort of like that cause and effect of when the government causes problems and then comes in and tries to quote-unquote fix them with other people’s money, it doesn’t always work out, right? So we’re also gonna have an episode soon on, unintended consequences. So that kind of gets into that as well. But it’s basically this idea of corporate welfare. Is the government coming in and saying, Hey, business, we like what you’re doing. Or maybe, you know, maybe there’s someone at this company that’s donating a lot of money to someone’s political campaign. It sounds crazy, but it happens all the time. Or even the corporations themselves donate a lot of money to campaigns because they can act as people, it’s part of their free speech. So it’s a crazy thing that happens. And a lot of the times it allows these big businesses to keep getting bigger and bigger than they would normally just through competition. Because as we know, you know, the free market, it helps regulate things and competition keeps prices low and people, the consumers are able to decide what they want. But when the government comes in and starts, you know, throwing around their crony capitalism tools of government welfare and bailouts and stimulus and all that kind of stuff, it totally messes things up and it takes away the market’s ability to regulate itself.
Brittany: That’s absolutely right. And you know, you talk about corporations and bailouts and one thing that comes to my mind is 2008. Now I know a lot of our listeners weren’t born yet, but the reason I am here today, the reason that my political views are as they are, there was a culmination of a lot of things, but a lot of it was because of what happened in 2008. And that was when we had this, the great recession as they call it which was, the housing bubble. And the government caused that they were, you know, artificially lowering interest rates. We’ve talked about that with creature from Jekyll Island before and you know, it was like houses were solo, people without credit were getting houses. It seemed like the economy was booming and then the market corrected itself and everything just collapsed. I mean, this was a very scary time to come of age, especially for Yeah. You know, people my age who were 18, 19, 20, you know, somewhere between that age and like 25 because we saw our parents lose everything. we saw a lot of regular people lose everything. And then even though the banks were in, you know, you know, they were working with the government in a lot of ways to harm these people. We saw big banks get bailouts. I mean, and that was shocking for people. Yeah. What was, what was the bill called? What was the one that made everybody mad? Wow. I would, I always.
Emma: Oh, man. give it.
Brittany: It was TARP.
Emma: Yes. Yes. TARP.
Brittany: So TARP was a big that stands like TRAP, but I think it stands for something. they always do just like the Patriot Act. But, so TARP basically gave bailouts to all these big corporations who didn’t need it. Meanwhile, people like you, me and our parents were suffering and we didn’t get bailouts right? And said they took our money that we didn’t have, and they bailed out big companies that didn’t need it. You know, there’s no such thing as too big to fail. There is when the government keeps printing out money, but when the market shows you that you’re not in business anymore when you don’t have a business, you should close your doors. Instead, we have the government continually propping up businesses. That are proving they can’t make it.
Emma: Yeah. And I think you touched on something really interesting. I think that’s why so many people in the millennial generation, even Gen Z and I’m sure you know, whatever we’re gonna call this next generation that’s growing up right now, it was a really hard time to grow up and watch these adults just be stressed and struggle and worry about losing their jobs. And I think this COVID pandemic has been a little bit of a taste of that, where people are worried and they’re uncertain. And when that’s happening, it’s really easy to wanna go to the government and, ask them to fix our problems. And I think that’s why there are so many young people that think that they hate capitalism when in reality they hate that crony people choosing to give tax money and give all these benefits to people that didn’t need it. And actually to people who helped create the problem in the first place that caused all of that hurt. So I think that’s a huge reason why people like Bernie Sanders and AOC are so popular with young people is because they grew up in a really tough time and I think they got a really bad taste in their mouth for, you know, business and these corporations. And that’s why you have the Occupy Wall Street people Yes. Saying we are the 99%. That’s a really powerful slogan because it basically pits everyday people against these big companies that they thought were their enemy. In reality, the government is the one that is causing us to be enemies with them because in a normal free market, people benefit from companies. They get jobs, they get payment, they get products that they need, they get their needs met, and companies benefit from consumers. And it’s a mutually beneficial relationship. And that’s the beauty of freedom and economic freedom especially. But when the government comes in and starts messing with things, it really can just wreak havoc. And that’s, why so many young people, I think just really despise the big companies. And I can understand why it was not an easy thing to watch as a kid, especially, or if you were graduating into that job market that was really tough. But we have to talk about this stuff because people need to understand the real cause of this. And we just talked on a previous episode about cause and effect and how causation and correlation are not always the same thing. And one of the things we talked about was big businesses, you know, oh, corporations, they’re just making it hard for people to get by and they’re making everything more expensive. It’s not necessarily true. you know, there, there might be some sort of connection there, but the government is the one that’s pulling the strings on so much of this stuff and it’s too bad because I think the Occupy movement almost got it right. Brittany, I’ve heard you say that before and I love the way you phrased that because they are mad about corruption, they’re mad about people, you know, getting special benefits and other people not, but they blame capitalism when in reality it is actually the government that was, that was causing a lot of those problems and hurting so many people.
Brittany: Absolutely. And I think you get both, right? Like somebody like me, I became a Ron Paul person because of what I saw in 2008. So you get half and half, right? you have the people who went for Bernie. Cause they were thinking like, no, all banks are bad. Then you had people like me, people like probably you and Connor, people like that who were like, oh, the banks are bad because the Federal Reserve has too much power, blah, blah, blah. You know, the banks are bad because of sorry, the economy is bad because of all these things. So it’s interesting to me to see which way people went because I remember Occupy Wall Street, I think had some pure intentions. People were angry, but they didn’t know where to throw their anger. And it was a really cool time as a libertarian because I remember friends going to these protests and saying like, Hey, you’re half right, but here’s what you’re getting wrong. You know, blah, blah, blah, blah, blah. Yeah. So it was a really cool learning opportunity, but again, you’re not gonna convince a lot of people’s minds, even though they’re using Amazon every day, even though they’re doing all these things, they still insist on corporations being evil.
Emma: Totally. And I think corporation too, a lot of the time is like just the scapegoat word that we use instead of, capitalism or instead of big business. It’s a lot easier to say all those evil corporations than it is to say, oh, the evil free market. So we love as people pinning our problems and our gripes that we have on other people that are easy to demonize. But, I guess since corporations are technically seen as people that I guess that sort of makes sense. You find your person to blame everything on. But yeah. at the end of the day, guys, it’s not big business. That’s the only problem. It’s when the government comes in and they get their dirty fingers into the mix and they start choosing who wins and loses. And it’s corruption is what that is. And corruption is the real problem, not capitalism. So absolutely, we will wrap it up there. Guys. Thank you so much for listening and we will talk to you all again soon.
Brittany: Talk to you soon.