An OpEd by President Obama in the Wall Street Journal has, once again, thrown into stark relief the purist ideological misconceptions regarding corporations. Predictably, on the right, any inkling to regulate business in the slightest is “job-killing.” Meanwhile, from the left, Obama’s willingness to cozy up to corporations as opposed to nationalizing everything makes him, effectively, a Republican. You honestly don’t even have to read the articles any more; conservatives believe regulating corporations is evil, while liberals believe that just the corporations are evil.
And, of course, this pervades. Skim the comments on any partisan blog, read enough OpEds, and you come quickly to grips that there are two visions in this country. These two images couldn’t possibly be more diametrically opposed, just as these two images couldn’t be more grotesquely distorted and utterly wrong. As a country, we all suffer from these polarized realities because they muddy the debate, and make it next to impossible to understand and operate our economy with any semblance of rationality. Meanwhile, the American Left suffers politically as the more purist faction of the ideology alienates many while at the same time tapping into perhaps a greater neurosis this country will likely hold for generations to come.
To look at a business or a corporation from the American Right is to behold a beautiful, nearly magical, thing. It spreads freedom and opportunity and prosperity, and it even mystically is able to regulate itself so that nothing bad ever happens as a result of private industry ever. Looking through the other lens, though, shows us something that is diabolical in scope and intent. Corporations are giant, monolithic, entities that feed the very few on the broken backs of the downtrodden and the poor. Corporations should not only be heavily regulated if not dissolved entirely, but also made to pay. During the health care debate in particular, we saw just how important it was for the corporations to actually suffer in order for the American Left to give their approval.
The truth is, corporations are neither of these things. They are neither moral or immoral, but instead amoral. I feel it is necessary that, if you are to have a meaningful conversation of the economy and American life, and the role in both that corporations play, then you should have a clear and objective understanding of what they are. They aren’t good or evil, they simply are. More specifically, they are social heirarchies built of many people not necessarily united by any other traits beyond the employee, employer relationship. The prime motivator of the corporation species is, of course, profit.
And this becomes the sticking point for a lot of liberals because a lot comes at the expense of profit, especially when you put the ideals of social justice over monetary gain. But to malign such a system would be to not fully understand what it is. Think of corporations as natural predators and their ecosystem is the economy. Just as a lion’s goal is to eat that zebra across the watering hole, so to is the corporation’s goal to increase its profits. The lion doesn’t maliciously go after the zebras out of some sort of personal vendetta, it simply wants to survive. Same thing with corporations, and those corporations that are better at chasing profit are the ones that get to survive. Meanwhile, in the background, you have this web of factors that are constantly shifting the fate of the players involved. For lions, it might be age, or unfamiliar terrain, or a zebra that had more speed in it than was accounted for. For businesses it could be a down market, or bad PR from poor business practices.
This would be the free market, and it’s where conservatives tend to get hung up just as their liberal counterparts get hung up on the whole profit thing. In conservative economic circles, the last idea in the paragraph above goes by different names; invisible hand, self correcting, you get the idea. The most steadfast belief of those who have put all their faith in the free market is that it takes care of itself. Bad business practices are punished with bad business. Anything that a business doesn’t do right is rewarded with a drop in profits.
So the logic goes as such. Imagine you have a small town with two drug stores. Let’s say that one day, news leaks out that the manager of one of the drug stores physically beats his employees if they don’t show up on time. Mortified, the people of this small town boycott this drug store in favor of the other until the employee beating practice is brought to an end, and probably until that manager is fired and replaced. The invisible, self correcting, hand of the free market at work.
Only, we know that not everything works like that. If we were to continue with our biological analogy, corporations have become so highly evolved they are changing the rules of nature itself. Let’s take a real world example with Kellog, Brown, and Root, and the employee Jamie Leigh Jones. Ms. Jones, at the age of 20, was moved to Iraq to become a clerical worker for KBR. Once there, she was allegedly gang raped and held in a container against her will. Despite all circumstances, Jones is not even allowed to sue KBR in court, and after five years this story continues to be one of the single most under reported stories out there. The fact is, KBR was, and is, just too good at defending itself against its own failures. Going back to our drug store analogy, this would be the equivalent of silencing the local paper and denying the employees any rights whatsoever.
The fact is, there is an invisible hand and a self correcting nature to the free market, but what conservatives fail to see is that these are inadequate. Moreover, corporations have gotten to the point where they have developed very powerful defenses against these self correcting traits. Lawyers en masse, PR firms, etc. have been erected around corporations all designed to make sure they are not actually held accountable for their own actions.
So where does this leave us? With, hopefully, a better understanding of what a corporation is. It’s not inherently good or evil, it just wants profit. It wants profit all the time and will do anything to get it. This never ending desire is ostensibly held in check by a free market which applies a number of forces in a variety of ways which encourage or impede growth as necessary. Corporations, though, have ultimately evolved to a point where it can find end arounds to the impeding forces of the free market, and for that reason and others, require regulation in order to maintain a healthy economy, and a healthy society.
Ultra conservatives believe that everything should be deregulated, but the result would be what Naomi Klein illustrated in her book, Shock Doctrine; effectively a stratification of society between the very rich, and the dirt poor. Ultra liberals tend to want to enforce heavy regulations if not nationalize everything outright, the dreaded Socialism we keep hearing paraded about like some sort of bogeyman.
Socialism, like every other economic or governmental system, is doomed to fail, all for pretty much the same reason; it has to be run by people. People are overcome with greed, avarice, and corruption. You might start off with the right people running the show, and everyone getting their fair share, but eventually you’ll get the wrong sort of person. And, because corruption loves company, they’ll bring in other wrong sorts until the whole thing is rife with corruption.
In this way, capitalism is kind of neat because instead of being undone by mankind’s worst tendancies, it is fueled by it. Oh, don’t get me wrong, it’s also doomed to failure as well in its purist form, for pretty much the same reason. But it at least comes at the problem from a totally different angle. More importantly, it gives us a glimpse at what actually does work; a combination of both capitalism and socialism which has been what we’ve been using in America all along. It’s just a matter of getting the mixture right.
It’s also at the heart of President Obama’s very reasonable approach to our economy.
And yet, because the President wants to work with corporations as opposed to punish them, he is lambasted from his left yet again. I’m quite used to this, and further am used to the seemingly unappeasable sensibilities of the purist American Left. I’m even used to the entire anti-corporatist schtick.
But it is on the vehement anti-corporatism that I feel needs to be addressed. I think that for as long as liberals maintain this hardline stance, they will continue to do themselves a disservice both intellectually, and politically. The all-or-nothing stance against corporations shows a disturbing lack of insight into the average person, and is a very large brick in the wall that keeps liberalism from connecting with mainstream America.
The thing is, yes, corporations do only go after profit, but in so doing they provide so much in return. That’s at the very heart of capitalism, and that’s why corporations and businesses of all sizes are even allowed to chase profit in the first place. Because every corporation that is in the hunt for the all mighty dollar provides in return goods and services that we want and need. I can’t help but notice the irony that every blog post written about how evil corporations are was written on a computer built by a corporation. And on top of that, corporations provide jobs, and depending on the corporation, even a way of life.
I’ve known people who have worked for large businesses and have been proud of what they produce. Whether it’s manufacturing cars or bottling soda, people are grateful for the work, and proud to say they were part of bringing something to the market.
Until the left learns to temper their opinions with this understanding of how corporations and businesses positively impact lives, it will continue to suffer in the national debate for it.