From bank bailouts and corporate scandals to the financial panic of 2008
and its lingering effects, corporate governance in America has been
wracked by crises. Amid a weakening system of checks and balances in
which corporate executives have little incentive to protect shareholder
interests, U.S. corporations are growing larger and more irresponsible
at the same time. But dependence on corporate profit was crucial to the
early republic's growth, success, and security: despite protests that
incorporated business was an inefficient and potentially corrupting
system, U.S. state governments chartered more corporations per capita
than any other nation--including Britain--effectively making the United
States a corporation nation. Drawing on legal and economic history,
Robert E. Wright traces the development and decline of corporate
institutions in America, connecting today's financial failures to
deteriorating corporate law.
In the nineteenth century, checks and balances kept managerial interests
aligned with those of stockholders, and public opinion grew supportive
as corporations raised billions of dollars to finance infrastructure
such as transportation networks, financial systems, and manufacturing
operations. But many of these checks and balances were dismantled after
the Civil War, creating a space for the managerial malfeasance that
spiraled into economic crisis in the twenty-first century. Bolstered
with archival and original data, including the first complete count of
American business corporations before the Civil War, Corporation
Nation makes a compelling argument for improved internal governance and
more effective external government regulation.
