Adolf Berle was an American lawyer, educator, writer, and diplomat. He was the author of The Modern Corporation and Private Property, a groundbreaking work on corporate governance, a professor at Columbia University, and an important member of US President Franklin Roosevelt’s “Brain Trust.”

Berle always gave us the truth, as exemplified on his 1951 memo where he remarked that controlling Middle East oil reserves meant obtaining “substantial control of the world.”

“While everyone is looking at MacArthur, this Middle Eastern territory is quietly being prepared for absorption. Wars have been won with both the Far East and the Continent of Europe pretty well dominated by hostile force; but the control of the Middle East has usually meant substantial control of the world. This is not merely sentimental: cutting of the oil supply from the Persian Gulf cripples, if is does not prevent, naval forces in the Indian Ocean and isolates India. It also gives an absolute free run to the east coast of Africa and, of course, make it possible to close the Strait of Aden.“

In the 1930’s, Berle was also giving us some revealing insights regarding the modern corporation. Notice how his assessment rings true almost 100 years later.

“In still larger view, the modem corporation may be regarded not simply as one form of social organization but potentially (if not yet actually) as the dominant institution of the modem world. In every age, the major concentration of power has been based upon the dominant interest of that age. The strong man has, in his time, striven to be cardinal or pope, prince or cabinet minister, bank president or partner in the House of Morgan. During the Middle Ages, the Church, exercising spiritual power, dominated Europe and gave to it a unity at a time when both political and economic power were diffused. With the rise of the modern state, political power, concentrated into a few large units, challenged the spiritual interest as the strongest bond of human society. Out of the long struggle between church and state which followed, the state emerged victorious; nationalist politics superseded religion as the basis of the major unifying organization of the western world. Economic power still remained diffused.

The rise of the modern corporation has brought a concentration of economic power which can compete on equal terms with the modem state — economic power versus political power, each strong in its own field. The state seeks in some aspects to regulate the corporation, while the corporation, steadily becoming more powerful, makes every effort to avoid such regulation. Where its own interests are concerned, it even attempts to dominate the state. The future may see the economic organism, now typified by the corporation, not only on an equal plane with the state, but possibly even superseding it as the dominant form of social organization. The law of corporations, accordingly, might well be considered as a potential constitutional law for the new economic state, while business practice is increasingly assuming the aspect of economic statesmanship.“

Thanks for reading,

Notes:

The Modern Corporation and Private Property: https://en.wikipedia.org/wiki/Adolf_A._Berle

Full text: https://archive.org/details/in.ernet.dli.2015.216028/page/n383/mode/2up