Early Stages of Corporatocracy in America

      In the early 1800's the authority of the Federal Government appeared to be nonexistent with regards to allowing newly formed monopolies in America to bring about a severely unbalanced distribution of wealth and using this new-found wealth to gain control over their industries.

      "In the thirty years leading up to the Civil War, the law was increasingly interpreted in the courts to suit the capitalist development of the country." (Zinn, 239)  This wrecked havoc upon the lower and middle classes by giving big corporations the upper hand against smaller businesses in the economy.  For instance Zinn goes on to state that large corporations were able to get away with destroying competitors property via flooding in order to stay ahead of the competition.  Also the law of "eminent domain" was abused by the government.  Taking land away from farmers in order for larger corporations to come in and build canals, factories and railroads.  In turn the government would be rewarded for their assistance.   

"Railroad men traveled to Washington and to state capitals armed with money, shares of stock, free railroad passes. Between 1850 and 1857 they got 25 million acres of public land, free of charge, and millions of dollars in bonds-loans-from the state legislatures. In Wisconsin in 1856, the LaCrosse and Milwaukee Railroad got a million acres free by distributing about $900,000 in stocks and bonds to fifty-nine assemblymen, thirteen senators, the, governor." (Zinn, 220)

Zinn states that railroad companies traded cash, stocks and free railroad passes to members of the local governments in exchange for large amounts of land.  This allowed corporations the ability to blow any and all competition off of the table.  For instance fifteen families know as the "associates" had control over "20 percent of the cotton spindleage in the United States, 39 percent of insurance capital in Massachusetts, 40 percent of banking resources in Boston." (Zinn, 220)  The numbers recorded are just go to show that the leaders of the United States, during the mid 1800's, were more focused on profits and loading their own pockets with cash.  Rather than, regulating the distribution of wealth throughout the country if not equally then fairly.  As a result of this inequality the lower and middle classes suffered a huge hit in 1873 during another economic crisis.  Thousands of small businesses closed down due to the fact they could not pay off their loans and mortgages.  As a result, it brought about cold, hunger, and death to working class while the fortunes of the Astors, Vanderbilts, Rockefellers, Morgans, continued to grow.

      In essence, the way in which corporations conducted themselves and with the governments help they were capable of passing laws in order to monopolize certain areas of the economy. However, even to this day corporations continue to have support from the government in what they do.  Some would say that corporations have an enormous influence over the economic decisions that are passed in the legislature today in order to help themselves create more profit.  “A corporate firm enjoys special privileges and powers granted in a charter from the government, among them that investors and directors are not personally liable for the company’s debts.  Unlike companies owned by an individual, family, or limited partnership, in other words, a corporation can fail without ruining its directors and stockholders.  Corporations were therefore able to raise far more capital than these traditional forms of enterprise.”  (Foner, 322)

Works Cited:
1. Zinn, Howard. A People's History of the United States: 1492 - Present. New York, NY: HarperCollins, 2008. Print.

2. Foner, Eric. Give Me Liberty!: an American History. New York: W.W. Norton &, 2009. Print.