Capitalisn’t: Ralph Nader’s Capitalism

Ralph Nader: My basic two reforms are, first, subordination under the Constitution of corporate rights to human rights. And the second—and this is the most important—is to strengthen local business.

Bethany: I’m Bethany McLean.

Phil Donahue: Did you ever have a moment of doubt about capitalism and whether greed’s a good idea?

Luigi: And I’m Luigi Zingales.

Bernie Sanders: We have socialism for the very rich, rugged individualism for the poor.

Bethany: And this is Capitalisn’t, a podcast about what is working in capitalism.

Milton Friedman: First of all, tell me, is there some society you know that doesn’t run on greed?

Luigi: And, most importantly, what isn’t.

Warren Buffett: We ought to do better by the people that get left behind. I don’t think we should kill the capitalist system in the process.

Bethany: As our loyal listeners know, at Capitalisn’t, we distinguish between positions that are pro-capitalists, which we call probusiness, and positions that are pro-capitalism, which we label promarket.

Sometimes the two positions are sufficiently aligned such that it’s difficult to distinguish them. Other times, they are so far apart that it’s impossible to miss the difference.

If there is one person who, at least in the popular conception, cannot be accused of being probusiness, that’s Ralph Nader, the consumer advocate who has transformed America. Just recently, he published a book entitled The Rebellious CEO, where he celebrates some of the benefits of the free-enterprise system.

Luigi: While he never held public office, Nader was repeatedly considered one of the most influential people in America during the last 60 years. Yes, you heard correctly, 60, because Nader just turned 90 at the end of February.

Bethany: It was back in 1965 that Ralph Nader became famous with his first book, Unsafe at Any Speed, which was a fierce critique of the safety record of the American car industry, and particularly of General Motors. That helped lead to the passage of the National Traffic and Motor Safety Vehicle Act of 1966.

Luigi: He pissed off GM so much with that initiative that, actually, GM went after him. They followed him, tried to entrap him, wiretapped him, and he won a legal case against GM. With that money, he hired a group of young students who became famous as “Nader’s Raiders” to study all the failures in Washington, from the FTC to the failures of Congress. He wrote a book, Who Runs Congress?, which sold more than 1 million copies. To sell 1 million copies of a book talking about Congress, you really need to be good.

Bethany: I think it’s almost unfortunate, given Nader’s track record on really substantive policy issues, that he made four bids to become the president of the United States and that people almost know him more for that. He ran with the Green Party in 1996 and 2000, the Reform Party in 2004, and as an independent in 2008.

It’s funny, I took an Uber ride to my parents’ place in Mississippi, and he asked what I did, and I said this podcast, and I said, “We’re going to have Ralph Nader on.” And he said, “Oh, I can’t stand that guy because he’s the reason that we had George Bush as president.”

Nader got blamed for taking votes away from Gore and Bush v. Gore and leading to Bush’s presidency. It’s a shame, given his track record on so many issues that this Uber driver would have agreed with wholeheartedly, that that’s still what jumps out at people.

Luigi: Can I say something politically incorrect? Nader was the Russian interference of 2000. Whenever the Democrats lose, they need to blame somebody, and in 2016, they blamed Russian interference, and in 2000, they blamed Nader.

Bethany: But it is interesting, in thinking about him—and I’ve wondered about this, particularly with his recent book and listening to some of the podcasts that he’s been on and some of what he’s written—I wonder about how much Nader has been misrepresented and why he’s been misrepresented. If there’s something to that, going back to your comments about GM’s attack on him, which might be that his positions are actually more reasonable than people might think.

I would have dismissed him. I would have thought he was completely just an unreasonable, fringe person who wanted to destroy the American system and destroy capitalism. And that’s actually not who he is at all. I wonder if I think that because so many corporate interests were afraid of him and had to make him out to be more extreme than he is, in order to avoid grappling with his very rational views.

What was your view of him before we engaged with his work coming into our podcast?

Luigi: Can you even ask this question? Of course, I go for the conspiracy theory that he’s completely misrepresented because of the power of corporate interests. This is why I thought that it would be very interesting to have him on the show and ask him some of the questions and see how he answers them.

In 1971, when Lewis Powell wrote his famous memorandum entitled “An Attack on American Free Enterprise System,” he cited you as one of the leaders of that attack. But last year, you wrote a book celebrating capitalists dedicated to social causes. Did Powell get you wrong, or did you change your mind?

Ralph Nader: The corporate interests always confuse criticisms of corporate crime, corporate misbehavior, corporate coercion, with attacking market enterprise.

Every culture in the world has markets. They organize them differently. But I’ve always maintained that distinction, highlighting the version of Gresham’s law that unregulated and undeterred bad business drives out good business because it creates unfair competitive advantages like monopolistic practices, corporate crime, deceptive advertising, unfair corporate subsidies and guarantees by the government. That tilts the balance with companies that want to do it honestly . . . which CEOs, I have portrayed a dozen of them in my new book, The Rebellious CEO: 12 Leaders Who Did It Right.

Bethany: One of the things we talk a lot about on this podcast sounds a lot like what you just said. We talk about being promarket but not necessarily probusiness. And it sounds like you might agree that a version of capitalism that is promarket actually works and makes sense. Is that fair?

Ralph Nader: To a limited extent. The markets reflect sensory perceptions by people. There are submarkets that are more vulnerable. Children are more vulnerable to corporate manipulation, especially in the internet age. Elderly are often more vulnerable to market exploitation such as door-to-door sales.

So, there are submarkets, and then there are values of a society that cannot be anticipated by the sensory perceptions of market engagers like consumers. For example, radiation exposure, you can’t feel it, touch it, or see it, but it’s real. Latent chemical toxins, the same thing. Far-seeing perils coming on but not materializing cannot be really corralled by market mechanisms.

That’s why, in our country, we have developed, very modestly, a mixed public-private system, where some of the necessities of the people like automobile safety and safety devices ignored by the style and horsepower obsessions of the auto companies had to be installed and defended by public mandates or government regulation.

Luigi: Let me try a slightly different version of the same question. I get from your answer that maybe you think that you seem to have been portrayed as too radical vis-à-vis what you really are, that at heart you are pro-capitalist systems, but a fair system where people are protected in various ways and not an unfair system where the large corporations have a disproportionate say. Is that a correct assessment?

Ralph Nader: That’s partially correct. I make a distinction between big corporate capitalism and capitalism’s small business on Main Street, USA, for example. They are not only different in degree; they’re different in kind, Luigi. They just have a completely different impact on government.

Small business is free to go bankrupt when they don’t meet market signals. Big business often goes to Washington instead for a bailout. They have now become too big to jail. The level of corporate-crime prosecution in the Justice Department has been on a declining curve for years, and that’s because corporate lawyers have created abilities to daunt any government prosecutor, drag things on, go over their heads to the political appointees and so forth. Corporate capitalists are really often not even capitalists.

For example, corporate capitalists control their owners. Capitalism’s principle number one is, if you own property or if you own a business, you’re supposed to have reasonable control. Well, our shareholders have very little control. They’re basically told, if you don’t like what your hired bosses are doing in an executive suite and on the board of directors, you can quit and sell your stock.

Another principle of capitalism is you’re free to fail. Well, these corporations are increasingly concentrated in a few industries. They’re considered critical to the national security. They go to Washington for a bewildering variety of subsidies, handouts, giveaways, quotas, bailouts. Half of what Washington is doing really is shoehorning corporate predictability and control against risk.

Another example of why corporations defy elementary principles of capitalism: you’re not supposed to control markets; you’re supposed to obey markets. There are all kinds of ways where corporations, craving predictability and engaging in strategic planning, eliminate commercial-free zones all over our culture that were once banned.

You did not directly market to children years ago, bypassing parents. Gambling was considered a commercial-free zone. Unfortunately, it went underworld, except for Las Vegas. Public education was not supposed to be prey for commercialization. It certainly is, right up to the university.

If you look around our country, Luigi, there’s almost no area of our political economy and culture and society that is not being strategically planned by corporations. They want to be free to throw off their risks into the environment in the form of pollution. They want to strategically plan our energy future, our land-use future, and on and on. This is quite extraordinary, and I don’t think academics, with a few exceptions, are keeping up with the proliferation and insinuation of corporate power in our very society.

You’ll all remember that in the early 19th century, when the modern corporation emerged, say, in Massachusetts with the textile factories, they were put on a short leash. First of all, they got their charter to exist from the legislature, not from some government commission, and some of them were put on a 10-year renewal for good behavior.

Well, that’s long gone now, and the corporate charter is hardly ever mentioned. In fact, if you ask most business students, “Who starts corporations?” they’ll say investors. No, as you all know, it’s the state. Mostly Delaware and Reno, Nevada, they’re the ones who give out the charter that creates the pact between the government and investors to exist. As a result, that charter can be conditioned.

One of your colleagues, Hal Weitzman, wrote a great book, What’s the Matter with Delaware? The compact between the state of Delaware, state of Nevada, and others is completely obsolete.

I used to joke during my campaigns that . . . General Motors and DuPont, by the way, are chartered in Delaware. I used to joke and say GM could buy Delaware in a weekend, if DuPont was willing to sell it.

To this day, with some exceptions of good Delaware court decisions recently, Delaware relies on revenues for its state budget from a whole variety of surcharges and license fees by having 1.5 million corporations chartered in the state of Delaware. Many of them are shell corporations, of course, but many of them are the leading corporations in our country. Citigroup and JPMorgan, I think, are there, and, of course, General Motors is there because of its permissive jurisdiction.

I would like business schools to start having discussions and seminars on elevating the federal corporate chartering level to at least try to aspire to hold global corporations running from one jurisdiction to another more accountable. We need to make these very fine distinctions between big corporate capitalism that can flee the jurisdiction, go to tax havens, go abroad, download their profits, escape taxation. Small-business capitalists can’t do that. I think that distinction needs to be made in terms of clarifying the principles of capitalism that are institutionally violated by giant, multinational corporations.

Bethany: You’ve talked about the importance of staying optimistic, and yet, this as a history of American business is a pretty pessimistic view. How do you maintain optimism in the face of that, and why has this happened? Is it fixable at this stage? Or is this the inevitable decline into what some people call late-stage capitalism?

Ralph Nader: Well, the problem is that the risks of a modern technological society with weapons of mass destruction, ongoing pandemics, artificial intelligence without legal and ethical frameworks reaching generative stages, nuclear, biological, chemical weapons, elected dictatorships around the world, once that’s the operating ground for corporations, they can become very harmful.

When electricity started and you had a corporation producing electricity, it wasn’t involved with nuclear power plants whose meltdown can contaminate, radioactively, huge areas of land and people. The same is true with the food-processing area, which has become very highly chemicalized, with pesticides, herbicides, all kinds of other chemicals.

You have the same level of avarice as prior generations, but the tools that they are working with now are far more penetrating and powerful, which means that the countervailing forces that we used to rely on have to keep up to par.

Let’s look at some of them. The labor unions have gotten much weaker. Consumer groups are pathetically weaker. The countervailing power of government regulators, the brilliant intellectual advocacy of corporate lawyers is gaming that system, learning how to delay a proposed regulation for years, learning how to dilute it, oppose its enforcement, learning how to elect people who put the Consumer Financial Protection Bureau on hold under Trump. The media is increasingly commercialized, and while they do good investigations, they just can’t keep up.

My proposal is, number one, we cannot have equal justice under the law if corporations, artificial persons, have equal rights with human beings. It’s impossible, especially when, with these equal rights, they create unequal rights like bankruptcy rights. They create huge disparities in wealth and political influence.

As a result, what you’ve seen is an out-of-control system that depreciates our own yardsticks and ethical standards. I mean, we have no ethical standards for so many of these new technologies—nanotech, biotech—and no legal frameworks, as I mentioned, for artificial intelligence.

At the same time, the corporations have moved from limited liability for their investors to limited liability for the corporation itself, a transmutation that has escaped a great deal of notice.

We need to strengthen unions’ countervailing power, repeal the Taft-Hartley Act on other antiunion organizing strictures—worst in the Western world, I might add. We need to develop a reciprocity to strengthen consumer groups. I mean, why do corporations get subsidies and consumers don’t get support in any way reciprocal to what Washington and state capitals give corporations?

We need to strengthen the power of the universities to be free of commercial influence, so they can become our intellectual seedbed, and they can speak out more forcefully. Strengthen local business. With new technologies, now you can have local energy production, renewables, solar panels, et cetera. You can have banking in the form of cooperative banks and credit unions expanding. You can have health clinics replacing a lot of the unnecessary diagnosis and drug promotion, emphasizing prevention. You can have local sports that are not spectator sports but participatory sports for all ages, good for physical exercise and health. You can have local transport.

In other words, with local economies that are almost by definition more accountable, you can strengthen family businesses and make sure that you’re not going to be controlled by businesses that can close down and go to China, India, Malaysia, or Mexico at a moment’s notice, hollowing out communities and leaving workers bereft. It’s subordination under the Constitution and strengthening local economies.

Bethany: Many of the entrepreneurs, if not most of them, you celebrate in your book run privately held companies. Do you think that if being publicly traded isn’t totally incompatible with the kind of capitalism that you aspire to, do you think it makes it more difficult?

Ralph Nader: Well, it does, for the reasons I’ve just given. But these 12 CEOs . . . By the way, I really would hope that this book would be used in business courses around the country because, first of all, it’s good news.

Second of all, there need to be yardsticks. I mean, these youngsters coming out of school, undergraduate and business school, the only yardsticks they’re given thinking about giant corporations is what I call market fundamentalism, namely, the corporate executives saying: “Don’t blame us, we’re just meeting market demand. We’re just responding to the market.” Well, we know all kinds of ways that markets can be controlled and manipulated and coopted and destroyed.

These 12 CEOs, they had wildly different personalities, but they had very consistent principles and character. For example, they admitted their mistakes publicly. Today, look at Boeing, look at the opioid manufacturers, look at the tobacco companies. They would criticize their own industry unabashedly.

They wouldn’t be secretive. Saul Price, who started Price Club, which led to Costco, he actually shared his secrets with the approaching big-box competition like Sam’s Club.

They engaged in civic pursuits and persuasions. They saw themselves as citizens, not just businesses. They almost never whined, in my interaction with them, about regulation. When Anita Roddick came from England with her franchise Body Shops, she had to go to the FDA, and she was so astonished, she started badgering them about how weak they were.

They couldn’t figure her out. She would say: “What’s going on here? You hardly regulate any of these cosmetics. And a lot of them are becoming like drugs, in terms of their advertising and so on.”

They didn’t overpay themselves. Herb Kelleher, who started Southwest Airlines, paid himself the least amount, $750,000 a year—he had stock options—of any of his major competitors at United and American.

John Bogle, who created Vanguard, which now has $7.5 trillion in assets under management . . . The concentration of power by State Street, Vanguard, and Fidelity, and a couple others of the securities markets . . . In one of his last speeches, he said, “This is very dangerous,” and he included Vanguard.

Paul Hawken, needless to say, stimulated so many corporations to consider the environment, recycling, climate change, with all kinds of speeches. Bob Townsend took the issue of corporate bureaucracy on. Until he came along, bureaucracy meant government, and he excoriated multi-tiers of corporate bureaucracy, stifling initiative, getting systems of sycophancy to the executive suite.

But the one big common thing they did was, they paid attention to profits, and they said, without profits, we can’t do these things. However, they reversed the model. Instead of saying, here’s the model of profitable business, and I’m going to adjust workers and consumers and other externalities to meet that high aspiration of maximum profit, what they did is they started with the workers and the consumers and the environment as preconditions for making a profit.

One day I called up Herb Kelleher. He always took the call . . . That’s another thing, they returned calls, most of them. Try that today. I called up Herb, and I said, “As an airline passenger on Southwest—and I always choose Southwest—I want to thank you for the way you prioritize consumers.” And he said, “I don’t prioritize consumers.”

I said, “What do you mean?” He said, “I prioritize my people.” That’s what he called his workers. “And if I treat my workers well, they’re going to treat consumers well, and that’s going to make our shareholders happy.” So, they reversed.

Luigi: Speaking of Vanguard, you, Ralph, have been a model of civic engagement in many, many forms, but there is one that, if I’m not mistaken, you personally never engage in, which is at the shareholder level. I know that there was, in 1970, Campaign GM by your followers, but if I am not mistaken, you were not involved in that.

You mentioned Vanguard, and as you said, Vanguard has a disproportionate amount of power today. The power, at the end of the day, is our power because most Americans, through their 401(k)s, have shares in Vanguard and similar companies.

In principle, they own this company, or they should have some say in this company, but in practice, they’re so dispersed and so busy doing something else, they don’t exercise their right of ownership, and they delegate to people who don’t follow what they want.

My idea that is inspired by something that has been going on in political science is to try to pick random representatives of the investors in Vanguard and have them direct the way Vanguard votes its shares in the various shareholder meetings and do the same for BlackRock and do the same for State Street. This is a way to bring democracy to the corporate world. What do you think about this idea?

Ralph Nader: Well, I agree completely. We have now giant institutional shareholders who can really throw their weight around because they own large amounts of shares.

We’ve tried that. We’ve actually written to the heads of BlackRock and Vanguard to try to get them to exert their influence to turn Boeing back into an engineering company, after the crashes in Indonesia and Ethiopia and the financialization of that company pursuant to the unfortunate merger with McDonnell Douglas.

We tried to get them to exercise on other issues involving companies. For example, Apple has a supplier in China, as you know, where the workers are horribly exploited, and they have nets to keep workers who try to commit suicide by jumping out of the fifth or 12th floor of the factory to catch them. Shareholders can have great leverage with Apple, but no, they don’t even deal with executive pay.

Warren Buffett happens to think that executive pay, out of control, is a huge corrupting force inside the corporation, not only setting a bad example, but manipulating accounting, unjustifiable stock buybacks, to make the metrics look better and so forth for executive pay.

I’m at my wit’s end. I can’t answer your question with any functional response. I try to get people to start groups just focusing on that, on getting owners to start exerting more control over what they own, namely, the pension funds and the mutual funds, and I don’t get much interest on that at all.

I was a little involved in Campaign GM, and I thought that was going to launch shareholder efforts. And partly now it’s that you have virtual shareholder meetings. You can’t even stand up and eyeball the CEO anymore.

I was left with one idea. It’s called the Penny Brigade. There are trillions of outstanding shares of US companies on the stock exchanges. Less than 20, 30 billion shares at a penny each would fund one full-time overseer for these institutional shareholders for every Fortune 500 company so that they would have a whole crew of specialists, one over each company, feeding back to them and showing what they can achieve for the country beyond simply being passive shareholders.

A lot of institutional shareholder executives have told me over the years: “We’re not staffed for this, Ralph. If we don’t like the company, we express our displeasure by selling the shares or diminishing them. We’re not staffed.”

OK, well, this Penny Brigade could staff it, and it could be created overnight. Just think of the number of shares controlled by Fidelity and Vanguard alone. And all you need is . . . I forgot what the actual figure was. I calculated something like 20 or 30 billion shares to fund 500 watchdogs.

Bethany: Staffing could be one explanation for the lack of involvement of big institutional shareholders, but do you think there’s anything else going on? Is there any analogy between the disengagement of big institutional shareholders and the disengagement of the public in politics, local politics and national politics?

Ralph Nader: Well, Bethany, I’m sorry to say, I think the public, with very few exceptions, have surrendered. You can see that with the lack of pushback on fine-print contracts. Freedom of contract was a conservative pillar early in our history, coming out of England. The famous statement by the scholar Henry Maine when he said the transition from medieval to modern age can be marked by the transition from status, as a serf, to contract, an artisan negotiating for his or her work.

Now, we’re back to status. The fine-print contract has never been worse. We used to study it for one day in law school. Now, they don’t even spend two days, even though, through it, trillions of dollars of transactions occur, and the imbalance between the vendor and the buyer is staggering.

You now have compulsory arbitration provisions. You have rewriting the contract unilaterally in the fine print. If the airlines say, “Now you’re going to have 60,000 frequent flyer miles for trips,” you say, “I didn’t agree to that.”

“Oh, yes, you did. It was in the contract that is on file at the FAA, which you don’t have a full copy of.” This contract peonage, contract servitude . . . They’re blocking wrongfully injured people from having their full day in court. That’s called tort reform. We call it tort deform.

They’re now requiring workers to sign antidisparagement, or if they leave, they have to pay. These are just ordinary manual workers for franchises. And so, it’s just getting worse and worse.

I don’t know what the turnaround is. What can lead these corporate executives to have a higher sense of their own significance and not simply look to an easy retirement after a few years at the helm? I don’t know what can be done with that. The organized religious groups have given up. They don’t provide us with ethical frameworks. You don’t even hear them talking about gambling. Gambling is a serious sign of cultural decay. Now, the companies are moving into addicting youngsters, giving them advance money to teach them how to gamble over their iPhone, internet gambling.

While I sound pretty pessimistic, I know that there’s overwhelming evidence among the common folk that they’re being controlled. A Businessweek poll showed that 20 years ago, over 70 percent thought that big business had too much control over their lives.

I guess what we have to do is pick up the knowledge from Thomas Jefferson, our third president, who basically said, you’ve got to have political democracy, countervailing forces to what he called the moneyed interests.

Our channel is Congress, state legislatures, city council. We outnumber the corporations, and there’s no reason why we can’t take democratic control over these institutions in order to be the proper countervailing power to giant corporations, for whom commercialism über alles is their mandate.

Luigi: You speak against the excessive amount of power given to corporations and even rights given to corporations, but if I’m not mistaken, you were behind the famous Virginia State Board of Pharmacy case that gave the right of freedom of speech to corporations. Do you regret being involved? What went wrong?

Ralph Nader: Boy, talk about a backfire, huh, Luigi?

Here’s what happened. The pharmaceutical industry, especially retail pharmacists, got laws at the state level banning comparative pricing for over-the-counter and other drugs, so the people walking in couldn’t compare prices between stores.

Our litigation group brought a case and won it, and inadvertently gave a massive tool to corporations filing subsequent lawsuits, claiming again and again that advertisement is free speech and is to be protected. Then, they went into the political arena and basically said, political speech is to be protected under the First Amendment, which got them the Supreme Court decision called Citizens United.

You’re right, it was the biggest boomerang of a lawsuit that we’ve ever brought. My only consolation is they would have probably brought subsequent ones anyway, but our case opened the door.

Luigi: One source of countervailing power is, of course, an antitrust authority. You have lived a long life, so you grew up in the ’50s and ’60s, when antitrust in the United States was enforced very strongly. Then, you lived for a long period, from the ’70s to basically until a few years ago, when antitrust went out of fashion. And some people even accused your consumerist movement of being responsible for the demise of antitrust.

Now, we see that with Jonathan Kanter and Lina Khan, there seems to be a resurgence of antitrust. Can you tell us what your position is on antitrust, whether it’s changed over time? And what do you think of Jonathan Kanter and Lina Khan in those positions?

Ralph Nader: Well, I think very highly of them, and there is a renaissance of sorts that you allude to, under the Biden administration, in the Federal Trade Commission and the antitrust division of the Justice Department.

They’re horribly underfunded. Their budgets are absurd. I mean, you take all their lawyers, Luigi, and they don’t amount to half of one of the giant law firms that are operating in our country. Just one. I’m very impressed by the current regime, but as you know, it can disappear next January. The problem with antitrust enforcement is the antitrust lawyers for the companies can drag the cases on beyond the life of an administration and hope that another administration will drop the cases. But so far, so good.

Bethany: We’ve touched a couple of times on social media, and I’m hard-pressed to think of somebody you would disagree with more than Florida’s Ron DeSantis, and yet he just proposed banning social media for kids under the age of 14. Do you agree with him on this?

Ralph Nader: Well, not only him, a lot of right-wingers . . . The head of the Heritage Foundation spoke out the other day in an op-ed in The Washington Post.

Yes, I do. I don’t think children should be allowed to have their iPhone and credit card and unimpeded access 24/7 to avaricious, cruel marketeers. These people have no boundaries. If five hours a day is what the child spends, they want six hours a day, seven hours a day, separating them from family, community—nature, by the way—and seducing them into the virtual reality of exploitation, nastiness, narcissism, and selling junk food and junk drink and bad medicines and cosmetics to the girls at age six and weapons to boys at age six. It’s just something that society should come together on and protect our children.

Bethany: I have a last question for you. Longevity is a huge topic of conversation today. In our modern world, everybody wants to live forever, and our listeners can judge for themselves the functioning of your wonderful mind. So, what is the secret?

Ralph Nader: Well, I think the old saying is, the only true aging is the erosion of one’s ideals. If you develop your ideals, stick to your principles, have refined senses of justice and injustice, and always leave options open for revision, to use a phrase from Alfred North Whitehead, you’re going to tend to take care of yourself. You’re not going to be addicted to alcohol or drugs or tobacco. You’re going to eat good food, you’re going to exercise a bit, you’re going to have a more stable, balanced life, and you’re going to be rewarded with the great interest of human beings on earth, which is the pursuit of justice, as Senator Daniel Webster said over 150 years ago.

Luigi: Ralph, you should run for president. I think that you’re clearly more fit than the two current candidates.

Ralph Nader: Luigi, it’s easier to do that in Italy, you know that.

Luigi: Of course, that’s for sure. At age 90, you can easily be elected president in Italy.

Ralph Nader: Well, onward and upward.

Bethany: Thank you so much. Same to you.

Luigi: Thank you. Bye-bye.

Ralph Nader: OK, bye-bye now.

Luigi: I have to say, in preparation for this interview, I read and listened to more than my fair share of episodes and talks, et cetera, and the guy is really, really compelling.

First of all, in one of the things I listened to, they were saying if there was a name for all his achievements, we would have a name for everything from the seatbelt to airbags. The fact that when we get bumped from an airline, we actually get some tickets and not stranded at the airport, the reduction in pollution, the way he changed this country for the better, never holding public office, is actually quite impressive.

Bethany: It almost seems it would have been a shame, had he been elected to public office, because it seems like he’s done more being an outsider than he might have done had he become an insider, which is actually something that we should have asked him.

I could have continued talking to him forever. But that would have been a really interesting question, if he feels there’s something he could have accomplished as president that he didn’t get to accomplish without holding the office.

Luigi: That’s a very good question. I think he’s too honest to be president. Even in the answer to my question, he was very, very honest. He said, yeah, we screwed up with that particular decision under Virginia State Board of Pharmacy. I think that that level of honesty is unheard of in a politician, and I don’t think he would have gone very far.

I think that we didn’t want to detract from our conversation and enter into politics and enter into his run as a third-party candidate, but from what I read and what I saw, this is really a way to try to break a duopoly. Thinking in economic terms, there is a duopoly that doesn’t really represent the American people because, in some dimension, there’s no alternative.

What he was trying to do is to give representation and voice to the people who don’t have it. Both parties are very corporatist, and so, you need some product differentiation. We need to kill each other over abortion and the right to teach some stuff to children because when it comes to approving the corporate subsidies, we’re all in favor.

We don’t want anybody who is not in favor to even have the right to speak. That’s a suppression of a third-party run because the third-party run can break this duopoly. We play this game that you are separate, but in fact, we’re all on the same team when it comes to supporting large corporations.

Bethany: I hate that I agree with that answer because it is so profoundly cynical and dispiriting, but I think I probably do.

Although, that said, it will be interesting to see what happens with some of these proposals about banning social-media use for children because that is anticorporatist. That is taking on the social-media companies because that’s precisely where the growth is, where the money is, how they groom kids in order to become prolific users of social media as they age. If you lose kids, that’s a big blow.

I could be wrong, I’d be open to an argument about this, but I don’t think that banning social media for kids is just a distraction to the corporatist mantra that guides both parties. I think it actually is a serious, undermining blow.

Luigi: I completely agree, but let’s see whether they are serious about it because it’s easier to say we’ll ban TikTok because there is the anti-Chinese agenda. But I’m not so sure that, from that point of view, an American TikTok would be better than a Chinese TikTok.

I think that the real question is whether a conservative government would be willing and able to actually have a real impact on the business model of social media. I doubt that to be the case, but I am open to being wrong.

Bethany: It does go back to a question I asked him, which he didn’t really answer, which is how he maintains his optimism in the face of what’s happened over the decades since he’s been active.

I guess I could have asked that question a different way, which is, how, despite his activism, have things gotten worse, not better? Corporatism has only strengthened, and as he says, commercial interests dominate every area of American life now. I guess you could say that if it weren’t for Ralph Nader, it would be worse. But it’s hard to argue that he took a trend and bent the line in any meaningful way.

Luigi: Actually, I would go even further. I would say that Nader provoked the awakening of corporate power. It’s not that corporate power did not exist before, but he proved that it was possible, by using the instruments of democracy and engagement, even somebody without a secretary . . . There was an exchange in which somebody asked, “Is it true that you fought GM without a secretary?” Even somebody without a secretary could basically make the largest corporation in America at the time accountable.

I think that the Powell Memorandum, which explicitly refers to him, is the fear of large corporations saying: “Gee, if everybody understands the power of Ralph Nader, we are toast. So, we need to change the rules before we have many Ralph Naders.” That’s what happened from the ’70s to today.

Bethany: Oh, that’s interesting. For our listeners, explain the Powell Memorandum again. I actually didn’t know that it mentioned Ralph Nader. Tell me the context in which it mentions Ralph Nader.

Luigi: Let me give you a little bit of context, and you cut me off when I go too long because my kids, whenever they ask me some history story, they say I go on too long.

Lewis Powell was a very powerful corporate attorney. He was hired by the U.S. Chamber of Commerce to design a strategy to fight back. The late ’60s are not a great period for corporate power. Not only is there Nader fighting GM, et cetera, but there is the Vietnam War; there are a lot of antibusiness protests.

Lewis Powell, who later would become Justice Powell, writes this memo saying: “The American enterprise system is under attack, attacked by people like Ralph Nader. We need to fight back. How do we fight back?”

First of all, one year after Milton Friedman said that the only social responsibility of business is to make profits, he said, no, no, the social responsibility of business is not just to make profits. It’s also to give money to basically fight these people. Business should give a lot of money to lobby, to give campaign donations to change the current climate.

Second, we need to conquer the university, starting with the graduate schools of business, which are particularly aligned with our view of the world. Third, we need to have a set of people who constantly write in newspapers pushing our ideas.

Fourth, the untouched and unexploited area where we can make a difference is with the courts. We need to change the courts, starting with the Supreme Court, to be more probusiness.

The year after he wrote this memo, he was appointed to the Supreme Court. He wrote the famous Bellotti decision in 1978, which is the foundation of Citizens United. The reason why we have Citizens United is because, in 1978, Justice Powell wrote the Bellotti decision.

It was really a concerted plan that the U.S. Chamber of Commerce put through, so much so that in 1997, when the chairman of the U.S. Chamber of Commerce retired, they actually toasted him for having implemented the Powell Memorandum.

Bethany: Even if he did help catalyze this mammoth corporate response, maybe there’s a way in which his legacy will catalyze a backlash to it. Am I being too hopelessly Pollyanna-ish by saying that?

Luigi: No. I think that, in recent years, we have seen a beginning of a comeback. Even Nader recognized that antitrust is more effective and more concerned with issues of power. There, again, to his honesty, he recognized that pushing only on the consumerist side misses a very important element of the original antitrust. And he recognized that Lina Kahn and Jonathan Kanter are bringing this aspect back. Now, it’s not guaranteed that we continue because it’s not obvious that they will be in office next year, but I think that is a positive sign that things are changing.