Here, there, or delaware? How corporate threats distort democracy

Abstract

Concern for corporate influence on democratic decisions has mostly focused on campaign funding and access to legislators. While these are certainly worrisome, corporations have another tool to influence decisions, which they are increasingly using. They can threaten to move their operations or cancel expansion plans in a municipality unless its public officials pass (or kill) certain policies. In one sense, this is business as usual. Companies have the right to decide where to operate, and it is important for officials to consider how policy will impact local businesses that provide jobs and tax revenue. On the other hand, companies can use these threats to get their way on any policy, whether or not it impacts them. How do we tell when this kind of corporate action is illegitimate? We argue that such actions are illegitimate when they violate democratic norms of reason-giving, which occurs when companies offer the public “created” rather than “natural” reasons for their proposed policy.