Halloween Kills…so does capitalism, as in this metaphor we all become Laurie Strode constantly running from the depredations of the haute bourgeois Michael Myers…think of me as your Dr. Sam Loomis in this horrific installment...
Law is created by paid-for ruling class representatives (“our democracy”) to further their own interests: benefits accrue privately to the few while risks—including both risks to finances and health—are socialized and spread to the many. Profit-seeking capitalists cannot be expected to use surplus value extracted from workers to improve proletarian living standards—quite the opposite.
The latest example: this week healthcare giant Johnson & Johnson (we “believe good health is the foundation of vibrant lives”) filed for bankruptcy—neatly sidestepping its massive liabilities. As of July, J&J faced roughly 34,600 lawsuits, $1 billion in legal bills in the last five years, and settlements and verdicts of another $3.5 billion related to claims it knew its talc powder—used by generations of Americans—contained deadly asbestos.
The filing stops jury verdicts, protect assets and pressure plaintiffs to accept settlements.
“This stinks. They claim their product is safe and then attempt to hide behind bankruptcy,” said Andy Birchfield, an injury lawyer pressing talc claims against J&J. “Here’s another example of the wealthy and powerful using bankruptcy as a hiding place to protect their profits and avoid responsibility.”
But J&J is a ginormous company—did it really declare bankruptcy?
Here’s the bourgeois legal shell game: J&J used a law allowing liabilities to separate from assets and split off the talc claims from the rest of its business! Voila—no more claims!
Filing for chapter 11 protects a corporation (here J&J’s liability-ridden spinoff) from its creditors, bankruptcy judges routinely extend those same legal protections to its owners (here, fat healthy J&J) with interests at stake. Shielding these owners from liability, in exchange for settlement payments, has become an increasingly common feature of corporate bankruptcy. (Try that with student loans in bankruptcy—not so fast there buckaroo!!!)
This is not a new trick: several companies have arranged these transactions in recent years to offload asbestos liabilities into new entities that can then be placed in bankruptcy. More recent examples: USA Gymnastics and the U.S. Olympic and Paralympic Committee (sexual abuse claims), Purdue Pharma LP (opioids) have used similar tactics.
The bigger picture: under capitalism, big business, having achieved a monopoly or cartel position in important markets, fuses with the government apparatus. A kind of oligarchy results, whereby government officials become servants aiming to provide the framework within which giant corporations can operate most effectively. In this case, the law ensures J&J and its owners’ profits stay healthy—healthcare for the ruling class pocketbook is all that really matters under capitalism.
Don’t hide in the closet. You may think you have the weekend off…but Michael Myers never sleeps and is as relentless and uncaring as your socio-economic order.
Notes
https://www.jnj.com/about-jnj
https://www.wsj.com/articles/johnson-johnson-places-talc-injury-claims-in-bankruptcy-11634248563?mod=article_inline
https://www.wsj.com/articles/bankruptcy-courts-face-congressional-backlash-over-legal-releases-11628593201?mod=article_inline