Matthew Bishop at the NYT reviews *Big Business*

Here is the review, it is very smart and elegant (even if I don’t agree with everything in it).  My favorite phrase: “Business may not be the face that launched a thousand ships, but it built them…”


Strangely, no one has ever before suggested that it was big business building the Greek ships of the Trojan War, but then, it was a review in the NYT.

As for the real builders of those Greek ships? Pretty much slaves, with aristocrats generally in charge.

Aristocrats and slaves. Floating off to make war, rape and pillage, and perhaps settle a love triangle.

You know. The lovable big businesses of that era.

that's funny.

otoh mebbe they were talking about the ships built by big business that helped win the second world war or the other one
there were two right?

Curiously, the big companies that built the ships for the losing side are generally still around.

Must be some sorta koinkedink

curiously the companies that built ships for the losing side
didn't build as many/as gooda ships and that is partly why they
lost the world wars they started

That business should be "socially responsible" sounds reasonable, until one defines "socially responsible". Okay, big business shifted production to China to increase profits. So what. Would one prefer that China had spent the past 40 years building bombs instead of factories. The problem with business in America isn't that business pursues profits, it's that business in America has become complacent, relying on rising profits from on overseas production and reliance on rising asset prices here at home for prosperity rather than investment in productive capital here at home. The deterioration of public infrastructure is the most obvious evidence: opposition to taxes follows from opposition to public investment. Bishop seems to believe that "ethics" in business will save business from opprobrium but ethics has little to do with it. I'd suggest a refresher course in economics for business, beginning with the lesson that real economic growth depends on investment in productive capital, public as well as private. {Tech is an entirely different topic with entirely different issues.]

The part of the economics book we need closer teaching on is the sections about externalized costs and rent seeking. And of course tax preferences

“I’m thinking he realized, or saw, all that green, all those leaves, all that grass, the trees and lawns, when the back light changed to green. Can you imagine it? I mean there aren’t clouds in San Diego. That changes everything. The red light’s like a cloudy sky, and all of a sudden, everything natural in him sees nature in that green light. And he wanted to drive under it as soon as he could, to capture it or to prove to himself that it happened or somehow the motion of moving toward it made it real for him.”
“And the birds,” I said.
“Are where he got the idea from.”

Running government like a business perhaps requires profit be the purpose of social responsibility. RIP "we the people". Long live the oligarchy.

'That business should be "socially responsible" sounds reasonable, until one defines "socially responsible"'

"Socially responsible" is whatever the left wants it to be, and it varies with time.

"When I use a word," Humpty Dumpty said, in rather a scornful tone, "it means just what I choose it to mean—neither more nor less." "The question is," said Alice, "whether you can make words mean so many different things." "The question is," said Humpty Dumpty, "which is to be master—that's all." - From "Through the Looking Glass" by Lewis Carroll

Big corporations sold out your jobs to China and now China under its Marxist leadership is doing better than the sellouts that run America. Irresponsible is putting it too lightly.

You missed the point: "socially responsible" means whatever the person making the decision believes it to mean, whether it is a socialist government, an authoritarian government, or a monopolist.

There's an article in the NYT today about citrus growers relying on antibiotics to treat their groves for the devastating greening disease that is killing the citrus industry in Florida. Regulators have largely ignored the risks, believing that no producer of citrus would do something that would endanger consumers of citrus since doing so would destroy the citrus industry. Regulators of aircraft believed the same thing. I'm not that familiar with aviation, but I am with citrus (clients). And citrus growers are in a panic mode. One cannot understand just how devastating the greening disease has been in the industry. In Florida, the vultures are circling. No, not vultures who would purchase failing citrus groves for rescue from greening disease, but vultures who would turn the many thousands of acres of citrus groves in south central Florida into new retirement villages. And the Florida legislature is cooperating with the vultures, having just passed, and the Governor having just approved, a new expressway road building project through the isolated citrus belt in south central Florida. Here's the link to the NYT article:

To be clear, citrus trees don't just grow and produce fruit. It takes about a million dollars a year to maintain a medium sized citrus grove. It doesn't take very long to run up debt to maintain a failing grove due to greening disease to put the owner at the mercy of the vultures.

For those interested in real life rather than just writing critical comments, many years ago my client, upon taking over the family citrus business (he has other business interests), decided to liquidate all of the groves. All of them. I thought he had gone round the bend. After all, the wealthiest Floridians at the time made their wealth in citrus. There's a reason the football stadium at UF is called Ben Hill Griffin Stadium. My client's reasoning was that independent growers were at such a disadvantage that generating profits would be unlikely. Anyway, one of the groves we liquidated was in the citrus belt in south central Florida. My client didn't care to drive down to the citrus belt, so I went instead. I was surprised that I couldn't get there without the last leg of the journey being on a two lane highway. This to a destination where the number of millionaire citrus growers was quite large. I assumed they preferred it that way. Life changes, including for millionaire citrus growers. And steel and auto workers. That's economics.

@rayward - have you read the book "Oranges" by John Mcphee? It's a classic.

Bonus trivia: Katherine Harris, the little girl with the curls in Mcphee's book, and the daughter of a citrus tycoon, ended up as the Secretary of State of Florida that in 2000 decided the Bush v Gore election.

Yes, she is the daughter of Ben Hill Griffin.

My family (the wealthy side) was in citrus (among other businesses), with several thousand acres of groves. As a child, we would help the adults "fire" the groves during freezes. What was used back then for fuel would shock the environmental conscience today. Unfortunately, the groves were located too far north in Florida, and recurring freezes killed not only the fruit but the trees. Global warming denialists would like that one, except the freezes occurred in the early 1970s before the China miracle. An interesting bit of history, the groves were located near the home of Marjorie Kinnan Rawlings. Her home is still there and open to the public. She is of course quite dead.

In the real world,all the blah blah about the nobility of snowing consumers with marketing claptrap about social responsibility is already baked into the law in the form of the director primacy rule. If the directors think that such marketing will pay off, they can engage in it without any feer of a shareholder suit. On top of that, directors have a fiduciary duty to shareholders to act in the corporate interest. Arguably, if such marketing schemes are in the shareholders interest, the directors have a fiduciary obligation to engage in them.

As with most economic babble babble, the business social responsibility "debate" is a red herring signifying zilch, nada, nothing.

But even those who take the social responsibility argument seriously have sound and compelling reasons to oppose it:

In the end corporate social responsibility will never be anything more than a bond sellers best friend. If Cowen sees some reason to prefer debt to equity, he ought to say so.

More on the neverending disaster over WI's $4.5 billion subsidy to Foxconn. Big businesses should compete more fairly and not look for government handouts, especially from the likes of Walker or Trump:

If it's an upfront investment that will yield returns in the future by creating a tech industry in southern Wisconsin, it could be worth it. The incentives are tied to job creation. I'm not sure it will pan out but we shall see. However, I believe many oppose the Foxconn deal because it was negotiated by Satan himself (Scott Walker) and the Left is bitter about it. I hope you're not one of those people.

IPhone sales are down. Can't see this Foxconn deal as anything but bad. Walker under pressure from Trump picked the top of the business cycle. More than just the Left will be bitter about this deal for years to come.

Walker’s work is done. The earth is scorched. His cronies a little richer. And the state’s careening around with a wrench wedged in its democracy

Tony wrote his final paper on the queerness of the Sex Pistols; asserting the violence at the concerts was Malcom McLaren’s reckoning with Gluck’s Orfeus and Euridice.

So dramatic. Did Walker touch you when you were a child? I'm so sorry...

"For Cowen, the real reason business is so unpopular, despite all it does for us, is that we humans tend to anthropomorphize companies, turning corporations “into people in our minds, and also in our hearts” (and even writing love letters to them)" [SNIP]

1) One can imagine people anthropomorphising animals, but Walmart or ConAgra? Implausible. A feeble straw man.

2) Perhaps the USA's dimmer denizens are confused regarding the 2010 Citizens' United judgement, which, as Mittens Romney so pithily summarised two years hence, "Corporations are people, my friend"
UPSHOT: Cowen can't have it both ways. A dismal 'D' for logic.

No problem with big business. Problem is ((((Big Business))).

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