Published online by Cambridge University Press: 14 October 2011
Since its first widespread use during World War I, the public corporation has figured prominently as an instrument of government on the federal and state level. Its policy domain has progressively expanded from wartime financing and procurement to broadly defined developmental, lending, and investment activities. Functioning outside the regular structure of the executive branch, the public corporation operates as a separate legal entity invested with independent borrowing authority and the power to retain earnings derived from its activities. The institution's proliferating presence on the political landscape reflects the continuing appeal of its hybrid form, designed to wed market efficiency to the pursuit of public purposes.
1. The most comprehensive historical and institutional examination of the public corporation is Annmarie Walsh's The Public's Business (Cambridge, Mass., 1978).Google Scholar
2. In his important essay, “The Discovery that Business Corrupts Politics,” American Historical Review 86 (1981): 247–74CrossRefGoogle Scholar, McCormick, Richard argues for greater attention to the moral dimension of Progressivism, which has been obscured by “organizational” interpretations led by Hayes, Samuel, The Response to Industrialism (1957)Google Scholar, Wiebe, Robert, The Search for Order (1967)Google Scholar, and Galambos, Louis, The Public Image of Big Business in America, 1880–1940 (1975).Google Scholar On the importance of the moral dimension, see Sealander, Judith, Grand Plans (Lexington, Ky., 1988), 9–10.Google Scholar
3. See McCormick, 253–56. As McCormick makes clear, this remedy was far from universally endorsed, “the fear that business corrupted politics exerted only a minor influence in the late nineteenth century.” It was confined to “elite spokesmen” like Charles, and Admas, Henry, Chapters of Erie (1871)Google Scholar and Godkin, E. L., Nation 16 (1873).Google Scholar
4. Scholars have differed over the extent to which collectivist norms informed the Progressive movement. Larry Gerber, for example, stresses the enduring influence of Lockean liberalism on the Progressive mind. Gerber, Larry, The Limits of Liberalism (New York, 1983).Google Scholar From another direction, the collectivist reading of Progressivism is challenged by Gabriel Kolko's interpretation of the movement as a corporate-led attempt to establish a stable monopolistic economic order. Kolko, Gabriel, The Triumph of Conservatism (Chicago, 1967).Google Scholar
5. Crunden, Robert M., Ministers of Reform (New York, 1982).Google Scholar
6. Link, Arthur S. and McCormick, Richard, Progressivism (Arlington Heights, Ill., 1983).Google Scholar
7. Danbom, David, ”The World of Hope”: Progressives and the Struggle for an Ethical Life (Philadelphia, 1987).Google Scholar
8. See Danbom, 93–97. The role of public opinion as a mechanism of social control was emphasized in the work of Christian Progressives, i.e., “From all sections comes evidence that conscience has begun to speak again, that both in business and in public affairs there is coming a new sense of the moral elements involved, a new determination to enforce the moral law.” The Outlook 83 (1906): 152.Google Scholar
9. See Pocock, J. G. A., The Machiavellian Moment (Princeton, 1975)Google Scholar, chap. 14. See also Wood, Gordon, The Creation of the American Republic (Chapel Hill, 1969)Google Scholar; Appleby, Joyce, Capitalism and a New Social Order (New York, 1984).Google Scholar
10. Croly, Herbert, The Promise of American Life (New York, 1963), 117.Google Scholar
11. Brooks, Robert, Corruption in American Life and Politics (New York, 1910), 53.Google Scholar
12. Diggins, John, The Lost Soul of American Politics (New York, 1984), argues that references to “corruption” and “virtue” by the Progressives served only an accusatory function.Google Scholar
13. “The people are not Sovereign as individuals.….They become Sovereign only in so far as they succeed in reaching and expressing a collective purpose.” Croly, Promise, 280.
14. On the Progressives’ attraction to the German Idealist tradition, see Miewald, Robert, “The Origins of Wilson's Thought: The German Tradition and the Organic State,” in Rabin, J. and Bowman, J., eds., Politics and Administration (New York, 1984), 17–30.Google Scholar The interpretation of German Idealism with Civic Humanism is evident in Croly's use of the civic humanist principle of “restoration” within an “evolutionary” persepctive: “…a democracy cannot dispense with the solidarity which it imparted to American life, and in one way or another such solidarity must be restored.… I have used the term ‘restoration’ to describe this binding and healing process; but the consistency which would result from the loyal realization of a comprehensive coherent democratic social ideal would differ radically from the earlier American homogeneity of feeling. “Croly, Promise, 139. Emphasis mine.
15. Croly, Promise, 283.
16. On this strand of Progressivism, see Thelen, David, The New Citizenship (Columbia, Mo., 1972).Google Scholar
17. Wilson, Woodrow, “The Study of Administration,” Political Science Quarterly 2 (1887): 197–222.CrossRefGoogle Scholar
18. Goodnow, F. J., Politics and Administration (New York, 1914).Google Scholar
19. Croly, Herbert, Progressive Democracy (New York, 1914).Google Scholar
20. On the significance of the business model, see Gilbert, James, Designing the Industrial State (Chicago, 1972).Google Scholar
21. This logic provided a foreshadowing of the Berle and Means thesis regarding the separation of corporate ownership and control. See Berle, A. and Means, G., The Modern Corporation and Private Property (New York, 1932).Google Scholar
22. Haber, Samuel, Efficiency and Uplift (Chicago, 1964), 48.Google Scholar
23. Gnatt, Henry, Organizing for Work (New York, 1919), 108.Google Scholar
24. Croly, Promise, 444–48.
25. “The individual who is forced to create his own public is forced also to make his own special work attractive to a public; and when he succeeds…his work tends to take on a more normal and human character.” Croly, Promise, 447. Woodrow Wilson, too, envisaged an “organic” connection between administrators and citizens. See Miewald, 24.
26. The failure of Progressives to endow the “public interest” with operational meaning has been criticized by scholars like McConnell, Grant, Private Power and American Democracy (New York, 1966); the concept's symbolic function, however, has been little appreciated.Google Scholar
27. Scientific management also eroded public-private boundaries related to the domestic sphere. See, for example, Gilman, Charlotte Perkins, “The Waste of Private Housekeeping,” Annals of the American Academy of Political and Social Science 48 (1913): 91–95.CrossRefGoogle Scholar
28. Jordan, David Starr, “Unrest and Progress,” The Independent 72 (1912): 312.Google Scholar This moral complexity is underestimated by scholars like Lustig, R. Jeffrey, Corporate Liberalism (Berkeley, 1982), who interpret Progressivism as laying the foundation for a narrowly instrumental model of politics.Google Scholar
29. I am indebted to an anonymous reader of this essay for the term “corporate humanism.”
30. For a brief history of the public corporation, see Abel, Albert, “The Public Corporation in America,” in Friedmann, W. G. and Garner, J. F., eds., Government Enterprise: A Comparative Study (New York, 1970), 181–200.Google Scholar
31. Quoted in Haber, Efficiency and Uplift, 47.
32. Kennedy, David, Over Here (New York, 1980).Google Scholar
33. Quoted in McDiarmind, John, Government Corporations and Federal Funds (Chicago, 1939), 84.Google Scholar
34. Baird, E. W., The Port of New York Authority (New York, 1942), 16–17.Google Scholar
35. Brief on Behalf of the State of New York, the Chamber of Commerce of the State of New York, and the Merchants’ Association, Intervenes. Cohen, Julius Henry, Counsel, 14 April 1917, 125–27.Google Scholar Quoted in Baird, The Port of New York Authority, 19–20.
36. 47 ICC, 732–34. Quoted in Baird, The Port of New York Authority, 23. Italics added.
37. Baird, The Port of New York Authority, 329. For a critical analysis of the Port Authority's operations, see Walsh, The Public's Business, 89–103. Italics added.
38. Representative George Huddleston (Alabama), Cong. Rec., 67 Cong., 2d sess., 2979. Quoted in Hubbard, Preston, Origins of the TVA (Nashville, 1961).Google Scholar
39. Hubbard, Origins of the TVA, 95.
40. See Hays, Samuel P., Conservation and the Gospel of Efficiency (Cambridge, Mass., 1959).Google Scholar
41. Quoted in McCraw, Thomas, TVA and the Power Fight 1933–1939 (Philadelphia, 1971), 33.Google Scholar
42. Quoted in McCraw, TVA and the Power Fight, 41.
43. Lilienthal, David, TVA: Democracy on the March (Westport: Conn., 1977).Google Scholar For critical assessments of the TVA's performance, see Selznick, Philip, TVA and the Grass Roots (New York, 1966)Google Scholar, and Callahan, North, TVA: Bridge over Troubled Waters (S. Brunswick, N.J., 1980).Google Scholar
44 Weldon, T. D., The Vocabulary of Politics (London, 1953).Google Scholar
45. On this history, see Richter, Melvin, ed. Political Theory and Political Education (Princeton, 1980), 3–15.Google Scholar See also Gunnell, John, Political Theory (Cambridge, Mass., 1979)Google Scholar; Mackenzie, W. J. M., Politics and Social Science (Harmondsworth, 1967).Google Scholar It is important to note that several scholars have traced the roots of the pluralist political model to the perspectives of Progressivism. My own reading of the moral dimension of the Progressive movement leads me to emphasize the critical role of logical positivism in the evolution of the modern pluralist model. See David Thelen, The New Citizenship, and R. Jeffrey Lusting, Corporate Liberalism.
46. On this, see Staniland, Martin, What is Political Economy? (New Haven, 1987).Google ScholarMyrdal, Gunnar, The Political Element in the Development of Economic Theory (New York, 1954), chaps. 1–2.Google Scholar
47. Walsh, The Public's Business, 341.
48. Ibid., chap. 12.
49. See also Henriques, Diana, The Machinery of Greed: Public Authority Abuse and What to Do About It (Lexington, Mass., 1986). For a critique of Walsh that focuses on the concept of leadership, see Jameson Doig, “If I See a Murderous Fellow Sharpening a Knife Cleaverly: The Wilsonian Dichotomy and the Public Authority Tradition,” in Rabin and Bowman, Politics and Administration, 175–99.Google Scholar
50. See, for example, Thompson, Dennis, The Private Exercise of Public Functions (Port Washington, N.Y., 1985).Google Scholar
51. See Walsh, The Public's Business, 29–33. For an earlier attack on the public corporation from a market-oriented perspective, see Keezer, D. and May, S., The Public Control of Business (New York, 1930).Google Scholar
52. For a thorough exposition of this approach, see Wagner, Richard, Public Finance (Boston, 1983), parts I and II.Google Scholar See also Rees, Ray, Public Enterprise Economics (New York, 1984)Google Scholar, and Marchand, Maurice et al., The Performance of Public Enterprises: Concepts and Measurement (New York, 1984).Google Scholar
53. The sale of Conrail is a leading example of policy informed by this perspective.
54. For a discussion of this view, see Melvin Richter, Political Theory and Political Education, 2–56.
55. Taylor, Charles, The Explanation of Behavior (New York, 1964).Google Scholar
56. Sen, Amartya, Collective Choice and Social Welfare (New York, 1970).Google Scholar
57. Michael Walzer, “Political Decisionmaking and Political Education,” in Richter, Political Theory and Political Education, 159–76.
58. Flathman, Richard, The Public Interest (New York, 1966).Google Scholar
59. Ibid., 13.
60. Walzer, “Political Decisionmaking,” 173.
61. Huxtable, Ada Louise, Kicked a Building Lately? (New York, 1976).Google Scholar
62. Interview with Cooper, Alexander in Diamonstien, Barbaralee, American Architecture Now, vol. 2 (New York, 1985), 58.Google Scholar
63. Ibid., 58.
64. Ibid.
65. Interview with Frucher, Meyer, New York Magazine, 16 June 1985, 41.Google Scholar
66. Rawls, John, A Theory of Justice (Cambridge, Mass., 1971).Google Scholar
67. For a wide-ranging discussion of this perspective on community, see Jencks, Charles, Modem Movements in Architecture (New York, 1973).Google Scholar
68. See, for example, Jacobs, Jane, The Life and Death of Great American Cities (New York, 1963).Google Scholar
69. See Miller, David, Social Justice (Oxford, 1976)Google Scholar, chap. 4, and Braybrooke, David, Meeting Needs (Princeton, 1987).CrossRefGoogle Scholar