Peter Barnes: Capitalism 3.0 — Chapter 6: Trusteeship of Creation (pages 79-100)

Accountability and Democracy

The question I’m most often asked about commons trusteeship is: How can we be sure trustees won’t succumb to corporate influence, just as politicians have? My answer is that, while there can be no guarantees, the odds of escaping corporate capture are much better with trustees than with elected officials.

The key reason is accountability. In the world of corporations, accountability is quite clear: directors must be loyal to shareholders. In the world of government, accountability is less clear. Elected officials must uphold the Constitution, but that’s about it. If there are conflicts between workers and employers, polluters and pollutees, voters and donors, or future generations and current ones, whose side should politicians be on? There are no requirements or even guidelines. Elected officials, as sovereign political actors, are free to do as they please.

The fact that politicians operate this way is no accident; it’s what the Founders had in mind. The job of democratic government isn’t to take, consistently, one side or another. Rather, it’s to resolve disputes among factions peaceably, without trampling minorities. James Madison made this plain in the Federalist Papers. Voters can “fire” elected officials at regular intervals if a majority so chooses, but they can’t expect loyalty to any particular constituency between elections. It’s this absence of built-in loyalty that opens the door to corporate influence, a force the Founders didn’t — and couldn’t — foresee.

The decision-making of judges, it should be noted, isn’t as untethered as that of legislators and executive officeholders. Their duty is to uphold not just the skeletal bones of the Constitution but the full flesh and blood of the law, with its thousands of pages and interpretations. They may, on occasion, interpret anew, but unless they’re among a Supreme Court majority, all such reinterpretations are subject to review.

Trustees are in the same boat as judges, rather than the wide-open waters in which politicians swim. Their hands are constrained both by the law and by their fiduciary duty to beneficiaries. This isn’t to say they have no room to wiggle: equally loyal trustees may differ over what’s in the best interest of beneficiaries. Still, they are subject to court review, and they can’t betray their beneficiaries too brazenly.

The tricky thing here is that the beneficiaries to whom we want commons trustees to be loyal — future generations, nonhumans, and ecosystems — are voiceless and powerless. We must therefore take extra care when we set up commons trusts. For example, we should install strict conflict-of-interest rules for trustees and managers. We should require that all relevant information about the trusts — including audited financial reports — are freely available on the Internet. We should ensure that, if a commons trust fails, its assets are transferred to a similar trust rather than privatized. We should build in internal watchdogs and ombudsmen. And we should authorize external advocates, such as nonprofit organizations, to represent nonliving beneficiaries who, by their very nature, can’t take trustees to court. Most states assign this function to their attorneys general, but this is insufficient given the political pressures attorneys general are subject to.

With regard to the manner of selecting trustees, there’s no single method. Trustees might be elected, appointed by outsiders, or be self-perpetuating like the boards of many nonprofits. This is as it should be; we don’t live in a one-size-fits-all world. The important thing is that, once selected, trustees should have secure tenure, and — like judges — lengthy terms. Indeed, trustees should be like judges in other ways: professional, impeccably honest, well-compensated, and honored. Being a commons trustee should be a distinguished and attractive calling.

It might be argued that, by shielding trustees from direct political influence, we’d make them — and commons trusts generally — undemocratic. The same could be said, however, for our courts. The fact is, there are certain decisions, both economic and judicial, that should be shielded from politics and markets. Moreover, neither government nor corporations represent the needs of future generations, ecosystems, and nonhuman species. Commons trusts can do this. In that sense, they’d expand rather than constrict the boundaries of democracy. ... read the whole chapter

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