Would geographical borders exist in a near-future world ruled by corporations instead of nation-states?

Question

Following on from my previous question, where we brainstormed the events that might lead up to such a hellish world, I've been thinking over what the social structures and divisions of power might be like here. What are the implications of living in a society where profit-maximising organisations write the laws and print the money?

The fundamental principle I want to start from is a world where 'employee' and 'citizen' are synonymous. Corporations don't just hold land, they rule it independently of any oversight. They have their own military forces and intelligence agencies. You don't just work for a corporation – you live in it. The corporation provides your accommodation, your utilities, your food, your entertainment, your news. The corporation pays you (of course, in currency that you can only spend with the same corporation). Perhaps the divisions between corporations are so entrenched that they have different accents or dialects – replacing the languages that exist today across geographical nation-state borders. You don't just leave your job – you defect, becoming a stateless traitor who exists outside the jurisdiction of the (corporation's) law, and no longer has any legal rights.

At first I thought it would be interesting if the boundaries on the world map were redrawn, not around nations, but around huge regions corporate control. Big coloured blocks that say things like “Maxicorp” and “Worldnet Telecoms” and “Rainbow PLC”, because that's a compelling mental image and it would be fun to run with the equivalence for a while. But I became less sure about it after going over the implications. If huge mega-corporations who own land on a national level are supposed to provide for all their citizens, they would have to have many subsidiaries that provide those services. Worldnet News, Worldnet Energy, Worldnet Hydroponics (for instance).

It would be more interesting if all the subsidiaries had their own brand identities and personalities – and perhaps even if they weren't monopolies, but competed with each other, all under the umbrella of the e.g. Worldnet parent corporation. In my head, this looks kind of like a feudal system, with minor firms fighting and out-competing and spying on each other all under a single mega-corporation that keeps them in line. But this is getting a little strange, and sort of undermines the central conceit a little.

Maybe, because of the internet, geographical borders are no longer important, as all corporations operate globally and monopolise different parts of human society (but this limits the potential for competition and delicious industrial espionage plotlines). Or, maybe each corporation-state not only has its own geographical borders, but has its own internet, making it easier to control the news from their perspective and maintain public opinion and brand loyalty.

Basically, I guess I want to write a story set in a world where the horrors of corporate profit-seeking are combined with the powers that come with being an established government, but I'm unsure whether those horrors should come from corporation-governments as monopolies (which is chilling), ruling entire country-like entities on the map, or from corporation-governments as competitors (which is also chilling, but in a different way), ruling different aspects of society but independently of geographical boders. Are those two themes compatible within the same story set in the same society? Or am I overthinking it?

Answer 1

As you mentioned in your question, you're basically describing a feudal system of government. This type of crossover between government, economics, and military has existed several times in our world's history, including medieval Europe and feudal Japan. More explicitly, the difference between a middle level manager in your corporate autocracy and a 17th century English baron is spelling.

To illustrate: Land is owned by the King of England Incorporated, which is managed by the CEO Charles I. KoE Inc needs someone to manage food production, so Charles hires Jacob Astley to manage several farms and other production facilities at Reading. Jacob gets the fancy new job title "Baron Astley of Reading", which sounds fancy, but really his life is made up of accounting nonsense and dealing with low employee satisfaction.

Unfortunately for Charles, some of his managers decided they wanted the Board of Directors to have more say in business decisions. Charles wasn't keen on this, so these managers staged several strikes, protests, and riots which eventually led to open war between departments. At the end of it all, Charles was forced into making concessions to the unionized managers and then publicly assassinated.

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Hopefully, this little historical illustration demonstrates that corporate government is nothing particularly new to the world. Whether you pay 30% of your paycheck to a government in taxes, or 30% of your paycheck is withheld by your employer for benefits and license fees, the practical consequences are more or less the same.

But now that we've established that governments are corporations, we can look at your question in a very different way. Today, most existing governments lack competition. If you don't like the way Wal-Mart does business, you can shop at Target. But if you don't like the way Congress does business, your only option is to emigrate - a very painful, expensive, and uncertain process. But what if it wasn't so?

Suppose it was as easy to move to a different government as it is to shop at a different store? Open borders, more or less, with reduced transportation and housing costs. The stiff competition between governments would drive efficiencies in government, reducing costs and increasing benefits all around. Great for employee satisfaction! But obviously this would mean less profit for the politicians, so open borders is definitely not a profitable option for those in power.

And that, I believe, is the answer to your question. Corporations competing against each other for labor is bad for profit. It means offering more benefits, higher wages, and better workplace conditions - i.e. higher operating expenses. So closed borders with a captive labor pool is the ideal for maximized corporate profit. How your corporations keep those borders closed - whether through economic incentives, propaganda, or military enforcement - is up to you. I think it'd be a combination of all of them, as it is with government today.

Answer 2

To answer the title question, you must first decide the nature of your corporations. Do they still specialize? Or does each one partake in literally every every sector of industry? I'll tackle the latter scenario first.

Scenario A: Corporations participate in every field

The mega corporations that have become nations have done so by expanding horizontally, until they monopolize all sectors of industry for a geographic region. This scenario results in clearly defined maps, and the mission statement of each company is (ostensibly) to provide the best quality of life for it's employees. I suspect there would be a lot of superficial effort to make the regions seem more like nations than companies, i.e. names such as "The United States of Google" or "The Employees' Republic of Samsung". This would be a classic dystopia where wars are referred to as hostile takeovers.

Scenario B: Corporations specialize in specific fields

These are companies that more resemble the ones we have today, but have grown to monopolize their specific field. In this scenario, geographic borders don't make sense, because the companies are still very dependent upon each other. What would be plausible is if the companies had been integrated into existing governments and became synonymous with the appropriate branch/cabinet/department of government, e.g. Verizon is now "The Department of Communication" and Walmart becomes "The Cabinet of Consumer Purchasing". In this case, employees are still citizens of the parent nation, but which "department" of government they work for can greatly affect their rights (guaranteed now by union contracts rather than a constitution). Note that this scenario could plausibly evolve into the first.

Answer 3

Coase's Theorem suggests that corporations will tend to out-source (keep outside the company) any and all services that are cheaper to purchase on a per-transaction basis than to keep in-house. As the example of communist societies shows, large organizations are rather bad at the kind of information gathering required to fully manage an entire society, from land to work, to food, to transportation, to shelter, to entertainment and security.

However, imagine a world managed by AI-run corporations. It may be within their grasp to rule with the kind of totalitarian attention to minutia ("all employees must brush their teeth in the morning!") that current bosses can only dream about.

It is further conceivable that there would be a concept of market-share. An AI corporation could gradually expand its reach into a new neighborhood, getting individuals to "switch allegiance", up to the point where it has captured so much of the market, it is prohibitively expensive for other corporation to maintain a presence in that market, and they withdraw. Hence, the local monopoly you were mentioning in the OP.

Answer 4

Yes they would. There's a lot of profit to be made in war and borders is one easy way to get into war. Just think about how many REAL wars were "officially, a war about borders but actually, a war driven by profit".

The corporations would segregate us all into tiny pieces.
They would enforce different languages and cultures so that we cannot sympathize with each other.
They would invent senseless rules about which weapon can be used where in order for them to sell a more wide-range of weapons for all the different legal cases.

Answer 5

Why would corporations want to treat their employees as citizens? A citizen and a state have mutual obligations, allegiance for equal protection under the law, taxes for defense against foreign enemies.

Even an employment relationship is too restrictive for some modern corporations. They want subcontractors, or they match "independent" contractors with consumers for a piece of the action -- the contractor pays costs and taxes out of his or her percentage, of course. No corporate healthcare or retirement fund, either.