Saturday Sep 21

Money Matters: Free Enterprise Run Amok

In 2003, Joel Bakan released his documentary, The Corporation, based on his book of the same name. The subtitle of the book reads, “The Pathological Pursuit of Profit and Power.” Living in this current period of unassailable exercise of power by the private sector allies of our tin star dictator, it is hard not to remember the essential questions raised by Bakan’s film, the most crucial of which was essentially this: “If corporations were ‘real’ people, instead of the legal fiction that bestows on them most of the rights of people, how would we judge them?”

The film proceeds to the inexorable conclusion that corporations are essentially amoral, self-centered sociopaths. Incapable of guilt, they have memory akin to Alzheimer’s patients (none), and virtually no sense of shame. That they live forever only makes it all worse. But avarice…that they have in spades as they have shown repeatedly in scandal after scandal - Enron, Big Tobacco, Love Canal, and money laundering on the part of too many big banks to name are all patent examples of corporate avarice running rampant in the age of what some economists call “free market fundamentalism” - a premise of much conservative public policy ascendent since the Reagan years gave rise to the mantra he inspired that “government cannot solve problems, government IS the problem.”

My wife recently took me to see Arthur Miller’s wrenching play, “All My Sons,” in which a father has to come to grips with his guilt at having manufactured faulty engines for planes that killed pilots in WWII. The plot takes one from the denial through self-serving rationales that he did it for his family, even as he blamed his incarcerated partner, and to the inevitable conclusion that excruciating guilt will wring from a human soul. Now can one imagine Volkswagen, recently caught lying deceitfully to regulators about its dirty diesels, doing anything other than finagling the smallest penalties possible and just moving on to the next quarter without an apparent care that they knowingly put thousands of CO2 generating cars on the road while marketing them as a solution to climate change? Does it matter that their corporate forebears supported Hitler’s horrendous regime?

So how about a more current example. One of my favorites revolves around Randall Stephenson, CEO of AT&T for the past dozen years. He was one of the most public and high profile advocates for Trump’s huge tax cut, arguing that for every $1 billion his company might get, they would turn around and hire another 7000 workers in “good-paying” jobs of $70,000/year and more. So, what happened? According to the CWA (which represents many AT&T workers), the company, once several acquisitions are accounted for, has actually reduced its workforce by as much as 24,000 jobs by the end of 2018, continuing a long term strategy of workforce reduction begun in 2014 or earlier. In Q1 of 2019, another 10,000 jobs were cut as well. Now, was Stephenson intentionally misleading the press when he argued to Congress that they’d hire thousands if the tax cut went through? It’s hard to argue otherwise. More importantly, did the shareholders - the overseers of a CEO - give a damn?

So what happened to the $2.2 billion that AT&T is estimated to have gained by the tax cut? Well, for one thing, they’ve gone on a stock buy-back spree to raise their stock price, as have many corporate advocates of the tax cuts. The why of this is fairly understood as CEO pay is often tied to share value - raise it during your tenure, and you hit the jackpot, and (as the Brits say) “bollox” to any other claim from workers, communities, regulators, etc. The motto of “I’ll get me mine, and then we’ll talk” seems written in corporate stone.

It is at best odd that in this time of corporate overreach and dominance in our political life that a guilded lily like Trump could be so convincing to working class Americans as to have a very good chance of gaining a second term. He has shown the remarkable capacity to convince those most hurt by the emerging “gig-economy” that he’s got their back, while Mitch McConnell craftily stacks the courts with corporate toadies and pushes through legislation that diminishes the state’s ability to support those who need it most. The recently reported number that captures this: 40% of Americans would be put underwater with a $400 medical bill. Jacob Hacker’s recent article (The Economy Is Strong. So Why Do So Many Americans Still Feel at Risk? In the 5/21/19 NYTimes) adds depth to the analysis.

The mid-20th century social contract that balanced worker and employer interests provided security that has all but disappeared in our 21st Century gig world. With a great deal of justification, working people no longer believe Democrats have their back, and forty years of Reagan-esque attacks on the public sector leave people with little hope.

Until ideas like Medicare for All, Green New Deal, federally mandated parental leave, and student loan forgiveness truly and convincingly become central tenets of a campaign, the insecurities of working Americans will see them lost to a bone-spurred wannabe tough guy who will betray them again and again while making them laugh at those even less fortunate

Drummond Pike, a frequent Organizers’ Forum participant and contributor to these pages, was the founder and CEO of Tides in San Francisco, and continues to be involved in philanthropy and social change.

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