The Separation of State and Corporation in Capitalism

In her essay ‘The Separation of the Political and the Economic in Capitalism’, Ellen Meiksins Wood chastised Marxists for having “perpetuated the rigid conceptual separation of the ‘economic’ and the ‘political’ which has served bourgeois ideology so well”. This paper examines a particular subset of this separation, namely that between the state and the corporation. Despite Marx’s characterization of joint-stock corporations as ‘powerful engines’ of capitalism, the corporation has rarely been thoroughly analysed by neither Marx nor Marxists. This lack has only increased with the multinational corporation rising to become the main engine of contemporary capitalism. In the vein of Meiksins Wood, this paper holds that Marxists and leftists have perpetuated the rigid conceptual separation of the ‘state’ and the ‘corporation’. On the right, in neo-classical and (neo-)liberal thought, corporations are treated as a nexus of individual (voluntary) market-transactions and equated with individuals or small enterprises. On the left, corporations are treated as economic creatures separate from the state, encroaching upon and threatening the sovereignty and autonomy of the democratic state. The paper traces the roots of this separation in early liberal thought, where it holds that our way of understanding corporations and their relation to the state was founded, and which still haunts us today. Here, because of their similarity to the state, corporations were constructed as individuals subject to the power of the state, and thereby subordinate to, dependent upon, and separate from the state. At the same time, corporations were a central way through which to govern social life and achieve ends of government – mainly the accumulation of profit – by granting corporations a wide range of legal exemptions, immunities and privileges. This tendency continues today, where corporations are granted wide-ranging authorities to protect private property, minimize individual liability, and transgress international borders in search for profit.