Dangers of Corporations Warned by William Cook, Michigan Law Quad Donor
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The title of Margaret Leary's biography of William W. Cook describes his life philosophy.
One cannot help but wonder what William W. Cook would say about the current political discussion revolving around the assertion that "corporations are people" who should have First Amendment rights of free speech.
Mr. Cook, a native of Hillsdale and son of a farmer, became a titan on the New York legal scene and earned a fortune investing in the telegraph, Cuban sugar and railways. On his death in 1930, he gave the equivalent of $240 million in today's dollars to build the law quadrangle at his alma mater, the University of Michigan.
Cook was graduated from the U-M Law School in 1882. One of his professors was Thomas Cooley, an early progressive said by Cook biographer Margaret Leary to have been "one of the leading authors, jurists and legal scholars of the 19th Century" and a great influence on Cook. The Thomas Cooley Law School in Lansing is named for him.
Mr. Cook also donated the Martha Cook Building, a dormitory for women, built at a cost of $400,000 in 1915 as a haven for young women coming to Ann Arbor for their education. The dormitory, an iconic building across from the William L. Clements Library, stands on South University Street. He also donated the John P. Cook dormitory, the Legal Research Building, the Lawyers' Club and Hutchins Hall, along with an endowment for legal research.
Cook also was a legal scholar of the first order and his "Cook on Corporations," written in 1891, had eight editions and was a standard in the field for decades.
Among his statements about corporations that would raise some eyebrows today, especially, posed severe questions about their role in American society. In an 1893 article entitled "The Corporation Problem," Cook wrote:
"The particular evils to which they have given rise will be referred to hereafter. Some of the corporations have been guilty of bribing judges, buying legislatures, corrupting public officers, and sapping the integrity of public life generally.
"Some of them have taught men that dishonesty is respectable and even honorable, provided it is successful. Some of them conduct business, not on a basis of honor, but on that of knavery. Some of them perform contracts only when it is more profitable to perform than to violate.
"The sense of honor of some of them does not inspire that easy confidence and mutual good faith which lie at the basis of most business transactions. Written contracts are not always strong enough to hold them, and the fear of the penitentiary not always able to deter them.
"The pole-star of the existence of many of them is, not what is honest, but what is profitable, and the result is that not only are corporations a source of alarm to the conservative, and a subject of doubt to the thoughtful, but there is a deep-seated hostility against them on the part of the plain people of the land."
Mr. Cook answers the obvious question: how did corporations gain the power they have?
"And they have two peculiarities which have led to these abuses. These are, first, the ease with which all responsibility for bad acts is placed upon the corporation itself, while the real perpetrators are concealed; second, the separation of the stockholders from the corporate agents, of the investor from the investment, of the principal from the agent, with the expectation on the part of the investor, the principal, the stockholder, that profits will be made, honestly if possible, but that profits will be made."
Cook's startling conclusion:
"The corporation is dangerous to the republic. It has become the tool of plutocracy. It has increased the historical dangers to government from the concentrated wealth of the few. It has been instrumental in increasing that concentration of wealth and in shielding its owners from risks and opprobrium arising from its illegal use. It is without moral responsibility or feeling. It can do more harm than individuals, and, in so far as plutocracy is a danger to the republic, the corporation has increased that danger."
The people have the power to alter corporations to benefit society, however, Cook wrote, believing that would ultimately happen.
Upon Cook's death in 1930, his will left nearly his entire estate to the Michigan Law School. However, his ex-wife, Ida Law Olmstead, from whom he had been divorced in 1898, claimed the divorce invalid and wanted half the estate. The university was able to settle her suit in 1932 with a payment of $160,000 and continue with construction of the law quad.
Margaret A. Leary, former law school library director and librarian, has written a biography of Cook entitled "Giving It All Away: The Story of William W. Cook and His Michigan Law Quadrangle." The book was published by the University of Michigan Press in 2011.
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