As a young Andrew Carnegie began to build the empire that eventually became Carnegie Steel, Charles Darwin was propounding his novel theory of evolution. The timing was fortuitous: Darwin soon became Carnegie's sacred text. "I remember that light came as in a flood and all was clear," Carnegie later wrote. "I had found the truth of evolution." The law of competition, Carnegie believed, "may sometimes be hard for the individual," but "it is best for the race, because it insures the survival of the fittest in every department."
Darwin gave Carnegie a principle for conquest: progress. Competitors and workers could complain about his methods. But Carnegie persevered and largely prevailed, because his company was making bridges and skyscrapers possible; it was making things better.
Progress is a relatively new idea: The 17th-century boy didn't reasonably expect a better life than his 16th-century father. It took America, and the American corporation in particular, to make us expect improvement. In the preface to Colossus, his excellent new business anthology, editor Jack Beatty argues that the corporation is a particularly American invention, perfectly suited to exploit both the capital and the creed of the United States.
The corporation, rather than the partnership or the sole proprietorship, worked for a few simple reasons. The form has its roots in 15th-century English law that recognized that a business could outlive an individual. More important, a business was not any one individual; that is, a corporation's debts are its own, not that of its owners or managers. Limited liability, as this notion is known, paved the way for risk, and risk allowed for speculation and invention and, one hoped, profit. It was also perfectly suited to an expanding nation. "America needed the corporation," writes Beatty, because it was the "sole business form up to the challenge of its geography."
Beatty, a senior editor at the Atlantic Monthly, has cooked up a stew of contemporary accounts, essays, investigative reports and fiction that tells the history of America through the history of the American corporation, from the Virginia Company and Standard Oil to Microsoft.
Beatty's first argument is that the corporation - more than politicians or wars - has been the decisive agent in American history. He makes a convincing case, but it's far less satisfying than his second point: that the corporation, inasmuch as it invokes the principle of progress, has been perpetually in conflict with the equally hallowed principle of individual liberty.
A century ago, muckrakers called this "the corporation problem": How can the country balance economic benefits with their toll on individuals - whether they be workers, victims of environmental damage, consumers or the general cultural landscape? It's a riddle that has vexed the nation from the days of the slave trade to today's debate over Arctic oil drilling, and to the deafening hype over Survivor.
The corporation's part of the bargain is the aforementioned gift of progress: Where would we be without cars, without steel, without plastic? These are goods for the common good, corporate titans argue, and any cost they extol - highway fatalities, factory accidents, ozone depletion - are slight compared with the benefits they bring. Only corporations can provide them.
