E.3 Does economic power affect pollution controls?

In the last section (E.2), we noted that wealth can affect how environmental and other externalities are dealt with in a capitalist system. This critique, however, deliberately ignores other important factors in society, such as the mobility of capital and its resulting economic and political power. These are important weapons in ensuring that the agenda of business is untroubled by social concerns, such as pollution.

Let us assume that a company is polluting a local area. It is usually the case that capitalist owners rarely live near the workplaces they own, unlike workers and their families. This means that the decision makers do not have to live with the consequences of their decisions. The "free market" capitalist argument would be, again, that those affected by the pollution would sue the company. We will assume that concentrations of wealth have little or no effect on the social system (which is a highly unlikely assumption, but never mind). Surely, if local people did successfully sue, the company would be harmed economically -- directly, in terms of the cost of the judgement, indirectly in terms of having to implement new, eco-friendly processes. Hence the company would be handicapped in competition, and this would have obvious consequences for the local (and wider) economy.

Also, if the company were sued, it could simply move to an area that would tolerate the pollution. Not only would existing capital move, but fresh capital would not invest in an area where people stand up for their rights. This -- the natural result of economic power -- would be a "big stick" over the heads of the local community. And when combined with the costs and difficulties in taking a large company to court, it would make suing an unlikely option for most people. That such a result would occur can be inferred from history, where we see that multinational firms have moved production to countries with little or no pollution laws and that court cases take years, if not decades, to process.

Furthermore, in a "free market" society, companies that gather lists of known "trouble-makers" would be given free reign. These "black lists" of people who could cause companies "trouble" (i.e. by union organising or suing employers over "property rights" issues) would often ensure employee "loyalty," particularly if new jobs need references. Under wage labour, causing one's employer "problems" can make one's position difficult. Being black-listed would mean no job, no wages, and little chance of being re-employed. This would be the result of continually suing in defence of one's "absolute" property rights -- assuming, of course, that one had the time and money necessary to sue in the first place. Hence working-class people would be in a weak position to defend their "absolute" rights in free market (or "libertarian") capitalism due to the power of employers both within and without the workplace.

All these are strong incentives not to rock the boat, particularly if employees have signed a contract ensuring that they will be fired if they discuss company business with others (e.g. lawyers, unions),