Saving capitalism from itself. Again.

Monday (August 19), it was reported that the Business Roundtable had decided that corporations had duties to all stakeholders, beyond the fiduciary to shareholders. Of course in reporting the declaration, the Wall Street Journal duly noted that “[c]orporate boards have a legal obligation to protect the interests of shareholders.”[1] The Journal certainly didn’t suffer from any awakening of a conscience there and maybe, probably more than likely, this will all be forgotten.

I am, of course, deeply skeptical, in part because the last time somebody tried to save capitalism from itself, we got capitalist libertarianism, with the wealthy shrieking about “property rights,” and indeed an attempt to organize a coup against Franklin Delano Roosevelt.[2] They never stopped shrieking[3] and as a consequence, we got neoliberalism, which, among other things, abandons even the pretense of a level playing field between capitalists and labor and eviscerated the social safety net that presidents from FDR through Richard Nixon—yes, even Nixon—had expanded.[4] It’s hard to imagine a resurrection of the eviscerated social safety net while conservatives seem to hanging on in hope that the last (old) defenders of Social Security will die the fuck off.

There is an evil here that needs purging, not reform, and this is why I am dissatisfied with Elizabeth Warren.[5]

But now David Ignatius is out with a column that acknowledges “[t]he system isn’t delivering.”[6] Gee, what a surprise.

Today’s corporate reformers share the same concern about saving a broken capitalist system as did President Franklin D. Roosevelt in the New Deal era and President Theodore Roosevelt in the Progressive era. [Ray] Dalio made the historical analogy in his manifesto: “We are now seeing conflicts between populists of the left and populists of the right increasing around the world in much the same way as they did in the 1930s when the income and wealth gaps were comparably large.”[7]

So here we are again. We won’t have to wait as long for the backlash as the capitalist libertarians are already well organized with, for examples, the Cato Institute and, get this, the Foundation for Economic Education, both of which take all the idiocies of economics[8] as gospel. It’s basic economics, after all.

Maybe as that backlash takes hold, we’ll go full-on feudal this time. We can swear fealty and give over what little property we have to the rich in exchange for a very minimal survival.[9] After all, the extremely impoverished have been doing so well lately and us relatively impoverished should just quit our bitching.[10]

Or maybe it will be a new corporate-style Roman imperialism: We’ve already got corporate names emblazoned on stadiums that are essentially huge public works projects. Will, as a consequence of this repeat of a historical mistake, we next be bowing our heads to corporate CEOs at the beginning of every game?

I just can’t wait.

  1. [1]David Benoit, “Move Over, Shareholders: Top CEOs Say Companies Have Obligations to Society,” Wall Street Journal, August 19, 2019, https://www.wsj.com/articles/business-roundtable-steps-back-from-milton-friedman-theory-11566205200
  2. [2]George Seldes, 1000 Americans: The Real Rulers of the U.S.A. (New York: Boni and Gaer, 1948; Joshua Tree, CA: Progressive, 2009).
  3. [3]Charles A. Reich, The Greening of America (New York: Crown, 1970).
  4. [4]Mark Blyth, Austerity: The History of a Dangerous Idea (Oxford, UK: Oxford University, 2013); Daniel Stedman Jones, Masters of the Universe: Hayek, Friedman, and the Birth of Neoliberal Politics (Princeton, NJ: Princeton University, 2012).
  5. [5]Ali Donaldson, “Why Elizabeth Warren Still Calls Herself a Capitalist,” Bloomberg, February 1, 2019, https://www.bloomberg.com/news/articles/2019-02-02/why-elizabeth-warren-still-calls-herself-a-capitalist
  6. [6]David Ignatius, “Corporate panic about capitalism could be a turning point,” Washington Post, August 20, 2019, https://www.washingtonpost.com/opinions/even-the-business-moguls-know-its-time-to-reform-capitalism/2019/08/20/95e4de74-c388-11e9-9986-1fb3e4397be4_story.html
  7. [7]David Ignatius, “Corporate panic about capitalism could be a turning point,” Washington Post, August 20, 2019, https://www.washingtonpost.com/opinions/even-the-business-moguls-know-its-time-to-reform-capitalism/2019/08/20/95e4de74-c388-11e9-9986-1fb3e4397be4_story.html
  8. [8]Hites Ahir and Prakash Loungani, “‘There will be growth in the spring’: How well do economists predict turning points?” Vox, April 14, 2014, https://voxeu.org/article/predicting-economic-turning-points; Richard Alford, “Why Economists Have No Shame – Undue Confidence, False Precision, Risk and Monetary Policy,” Naked Capitalism, July 19, 2012, https://www.nakedcapitalism.com/2012/07/richard-alford-why-economists-have-no-shame-undue-confidence-false-precision-risk-and-monetary-policy.html; Ha-Joon Chang and Jonathan Aldred, “After the crash, we need a revolution in the way we teach economics,” Guardian, May 10, 2014, https://www.theguardian.com/business/2014/may/11/after-crash-need-revolution-in-economics-teaching-chang-aldred; Barry Eichengreen, “Economists, Remove Your Blinders,” Chronicle of Higher Education, January 12, 2015, http://www.chronicle.com/article/Economists-Remove-Your/151057/; Paul Krugman, “How Did Economists Get It So Wrong?” New York Times, September 2, 2009, https://www.nytimes.com/2009/09/06/magazine/06Economic-t.html; Paul Krugman, “Triumph of the Wrong?” New York Times, October 11, 2012, https://www.nytimes.com/2012/10/12/opinion/krugman-triumph-of-the-wrong.html; Andrew Simms, “Economics is a failing discipline doing great harm – so let’s rethink it,” Guardian, August 3, 2019, https://www.theguardian.com/commentisfree/2019/aug/03/economics-global-economy-climate-crisis; Mark Thoma, “Restoring the Public’s Trust in Economists,” Fiscal Times, May 19, 2015, http://www.thefiscaltimes.com/Columns/2015/05/19/Restoring-Public-s-Trust-Economists
  9. [9]Marc Bloch, Feudal Society, 2nd ed., vol. 1., The Growth of Ties of Dependence (1962; repr., London: Routledge, 2003).
  10. [10]Improvements in the condition of the extremely poor, such as claimed in Jeffrey Sachs, The End of Poverty: Economic Possibilities for our Time (New York: Penguin, 2006), have been exaggerated and cannot be attributed to neoliberal ideology: Jason Hickel, “Progress and its discontents,” New Internationalist, August 7, 2019, https://newint.org/features/2019/07/01/long-read-progress-and-its-discontents

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