Editors’ Note: Jared Berkowitz reviews Kyle Edward Williams’ Taming the Octopus: The Long Battle for the Soul of the Corporation (Norton, 2024).

Few issues unify Americans like the problem of corporate power. Those on the right rally against the “ideological agenda” of “woke” capital—corporations led by social justice crusaders masquerading as CEOs. Others, on the left, take a broader view and lament the political, social, economic, and environmental consequences of modern corporate excess. Although the two sides critique the corporation from competing angles, they both agree that these private institutions wield far too much power and influence. Historian Kyle Edward Williams’ new book, Taming the Octopus: The Long Battle for the Soul of the Corporation, reveals that this kind of “anxiety” about corporations is nothing new. For Williams, the story begins during the Progressive Era, a time when national policy and Populist politics converged to address the growing problem of large publicly traded corporations. Since then, Williams explains, Americans have struggled to assess what, if anything, the corporation owes to society. 

Taming the Octopus reveals the intended and untended consequences of how the corporation has been imagined and reimagined within American political and economic life. The early twentieth century, Williams explains, yielded three versions of the corporation and tactics to address the problem of corporate power. First, there was the administrative solution. This strategy, spearheaded by “many populists, progressives, and radicals” was absorbed and sanitized by President Theodore Roosevelt who believed that “direct political supervision of monopolies” alongside a cohesive system of national regulation would curb corporate excess. At the same time, corporate executives who were apprehensive of government oversight (like GE’s Gerard Swope) advocated for a voluntary solution—“responsible” executives who would direct corporate wealth and power toward public welfare. Lastly, and most impactful, was a reconceptualization of the corporation that emerged during the New Deal by influential government insiders, Adolf Berle and Gardiner Means.

In their pathbreaking book, The Modern Corporation and Private Property, Berle and Means made the case for government regulation by redefining the public corporation. Berle and Means argued that the corporation was mere shareholder property—“owned by and for the financial benefit of shareholders,” in Williams’ words. Although crafted to reinforce the legitimacy of emerging government regulation, like the Securities and Exchange Commission, the book had unintended consequences. By leaning into the notion of the corporation as mere shareholder property, Berle and Means empowered activist shareholders and provided fodder for emerging economists who were prepared to attack CSR initiatives as an utter waste of shareholder property.[1]

In the mid-twentieth century, government enlisted corporations in the fight to achieve racial equality through job creation. Industry rich cities like Chicago, Detroit, New York, Philadelphia, and Rochester—home to some of the country’s largest corporations—provided vivid examples of the racial injustices of the corporate economy. During the 1960s, “civil rights activists” and organizations like the NAACP and CORE, Williams explains, demanded “big business to guarantee full racial inclusion in the system of corporate capitalism.” Some corporations, like Chicago’s International Harvester, met these demands. Others, like Eastman Kodak in Rochester, balked. Shareholders meetings, as a result, became new sites of upheaval and political activism.

Social justice initiatives, like International Harvesters’ “New Start” program, were criticized by those who believed they conflated private wealth with public welfare. These arguments were given legitimacy by emerging legal and economic thought. At the University of Chicago, law and economics scholars—such as Henry G. Manne—and conservative economists—most famously Milton Friedman and George Stigler—worked to unravel CSR programs by reframing ethical business practices as a misuse of shareholder property while calling for deregulation. “The language of markets,” Williams succinctly explains, “spread like a contagion throughout the political culture fracturing notions of the common good—and of social responsibility—and justifying policies of deregulation.” One person’s “conscious capitalism,” soon became another’s economic tyranny.

One of many thought-provoking episodes in Williams’ book is his discussion of how financialization redirected corporate protest. In the 1970s, as debt altered the character of corporations, the institution operated less as a piece of shareholder “property” than a securitized “bundle of assets.” Not only were the visible acts of business subject to boycott or critique, but intangible investments were as well. Williams explains how throughout the late 1970s and 1980s, Catholic, Protestant, and Jewish organizations as well as nonsectarian charitable institutions spearheaded a protest movement that called upon public corporations to divest and purge their portfolios of investments that contributed to “environmental pollution,” “racial segregation,” or “apartheid in South Africa.” These “social audits” and “peace portfolios” exposed spending and attacked the moral character of corporations. Williams’ book reveals how in the final decades of the twentieth century, social responsibility and ethical investment shaped a corporation’s reputation almost as much as did its market power. 

Although CSR remains a noble campaign, one cannot help but feel uneasy. While I believe that business should be accountable to stakeholders as much as shareholders and that corporations should be strictly regulated, individuals should not concede their moral responsibility to legal fictions like corporations. Doing so collapses the role of citizen, consumer, and shareholder. Williams captures this sentiment in the final chapter of the book. “Hidden beneath the surface of this history,” Williams reflects, “is a longing for an economy that puts the human person at the center and heeds weightier matters of justice and human flourishing.” Williams’ observation points our attention toward another piece of the corporate puzzle—the role of legal personhood.

During the Progressive Era, the “corporation question”—“to whom or to what” should the corporation be accountable?—animated politics at local and national levels. This same question lies at the heart of Taming the Octopus. And I would argue, perhaps Williams would agree, that one answer can be found by paying careful attention to the curious but critical legal doctrine of “corporate personhood.” After all, the institution that we are continuously struggling to control is, according to longstanding Anglo-American law, a person.

The personification of the business association has divided legal scholars and practitioners for decades. Woodrow Wilson, for example, in a 1910 speech to the American Bar Association explained how corporate personhood—by separating the person from the entity—enhanced the moral hazards of incorporation. Prevailing interpretations of personhood and limited liability, for Wilson, allowed responsibility to follow the entity and not the individual. Such thinking enhanced the power of corporations by nullifying regulation. The corporation, Wilson explained, could not be put in jail. Individuals—directors, managers, stockholders—could. “Punish men,” Wilson implored, “not corporations.”[2] Failing to do so, some Progressives believed, threatened to undermine the burgeoning regulatory state.

Others saw corporate personhood as an avenue for control. Chicago’s Ernst Freund, for example, struck by the German political theorist Otto Von Gierke and his concept of the “organic corporation,” believed that legal personhood held the key to accountability.[3] Similarly, the progressive economist Richard T. Ely, argued that legal personhood rendered “artificial persons [corporations] amenable to the moral law.”[4] Ely’s vision of the corporation heightened the social expectations of business. Decades later, the pragmatist philosopher John Dewey weighed in to argue that corporate personality rendered the incorporated business association a “right-and-duty-bearing unit.”[5] Government, as such, could direct corporate persons by imposing duties and responsibilities in consideration for corporate privileges—the rights that followed incorporation. Although these ideas circulated widely, they failed to gain meaningful traction among federal lawmakers and influence cohesive policy initiatives. Nonetheless, this kind of broad thinking about corporations initiated a deep conversation about the social responsibility of business.

Personhood, as a legal category, infuses corporations with the capacity to bear rights while making the institution visible to the court. In the past, corporate personhood was a mere legal expedient. It was an award of economic vitality necessary to participate in and, at times, accelerate the growth of American market capitalism—not a means of serving what Williams terms the “freakish” ends of private power. The quintessential octopus or “[t]he Standard Oil person,” as one Iowa newspaper quipped, “cannot always escape…it shall behave itself like any other.”[6] Unfortunately, it seems we have neglected this powerful regulatory component of personification. A political economy that elevates the natural person above the corporation, a system that fulfills Williams’ ideal, remains elusive.

-Jared Berkowitz

Jared Berkowitz is an Assistant Instructional Professor of Law, Letters, and Society at The University of Chicago. He is a historian of law and capitalism with particular interest in the history of corporations. Currently, he is working on a book manuscript, provisionally titled Creature of Capitalism: A Legal History of Corporate Personhood in America, 1789-1890, which tells the story of how the law of corporate personhood changed from an instrument of regulation to a source of corporate power during the nineteenth century. He received his PhD in History from Brandeis University and JD from Rutgers School of Law-Camden.

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[1] Dodge v. Ford, a consequential legal decision, codified this free market vision of the corporation and particular brand of shareholder activism decades before the publication of Berle and Means influential work.

[2] Woodrow Wilson, “The Lawyer and the Community,” Annual Address before the American Bar Association August 31, 1910 (Chattanooga, TN)

[3] Ernst Freund, The Legal Nature of Corporations (Chicago, 1897): 13-14.

[4] Richard T. Ely, “Social Studies – The Nature and Significance of Corporation,” Harper’s (May 1887): 977

[5] John Dewey, “The Historic Background of Corporate Legal Personality,” Yale Law Journal vol. 35, no. 6 (April 1926): 655 – 673

[6] “A Standard Blunder,” The Courier July 29, 1908 (Waterloo, Iowa)