Public and Private

Many times when I'm reading about government, free enterprise, capitalism, corporations, and other ways in which we organize ourselves and our affairs, the discussion turns to the question of good and evil. Evil government. Evil corporations. How often do we hear these phrases?

• Corporations are ruining the world.
• The middle class is disappearing.
• Keep the government out of my life, my house, my school, and above all, my wallet!
• Wealth is being concentrated in the hands of the few.
• Government is running amok.
• Tax and spend!
• 80% of the wealth is held by 5% of the richest people.

We usually associate these phrases, politically, with either the left or the right and they are generally charged with emotion, anger, sometimes writhing fury. The result is that our political discourse has turned into a big tug of war. Our country is effectively divided into two practically equal halves who spend much of their time and energy contending with each other over the best way to conduct our public and private affairs. Each side is convinced that its own aims are good and its motives pure; and each side is equally convinced that the other side is evil, corrupt, and wants to subjugate people to its interests and destroy our way of life. And so we fight as if we were in the crusades, blinded by our own interests, blinded by our hatred, blind to ideas and solutions that can improve our lives, blind to everything but the goodness of our cause and the wrongness of the opposite side.

I want to step back for a moment and suspend all judgment. I want to take off my good/evil filter for a while and just see the facts, not as good or evil, but as things that have costs and benefits. Perhaps this is naive, but also, perhaps, it will help me understand better.

Corporations -- the benefits

Many of the things we enjoy in life are because people have come together to form companies that produce quality goods and services. Take a minute to think about the huge intersecting, overlapping webs of interests that come together to produce your house, your car, your computer, your food, or any other things that enrich your life. Let's look at just a few of the things it takes to build a house:

• Wood from a forestry industry with employees to pay, expensive equipment to buy, government safety regulations to observe, and which wants to sustain its business over the long term. This means avoiding the total deforestation that would bring about the end of its business, and achieving sustainable harvesting.
• Metals for pipes, wires, appliances, fixtures, and decorations made from ore from a mining industry that works under constraints similar to those of the forestry industry.
• Glass for our windows, also similar constraints.
• Plastics for innumerable things from a huge array of industries that use petroleum and other chemicals as raw materials and often produce waste products that are toxic to the environment. These also employ many thousands of people to make and distribute the products we use every day.
• Windows and doors, made from wood, glass, metal and plastic.
• Materials for walls, floors, and roofs.
• Appliances and Furniture.
• Electronic devices.
• I could go on and on.

And how about the huge infrastructures that bring you clean running water, hot and cold, just by turning on a faucet. Do you ever pause to consider the people and processes that bring you this miracle for a modest cost?

How about the huge infrastructures that bring you the electricity that powers practically everything in your house? Do you ever pause to think about what happens on the other side of that wall outlet? Think about the huge coal-fired plants, hydroelectric dams, nuclear power generators, and, in teeny little amounts, solar and wind power. Think of the networks of wires and controller stations that must be expensively constructed and meticulously maintained, knitted together in an immense power grid.

How about your waste products, flushed safely away from you and whisked away in underground pipes? How about your trash and recycling picked up regularly and disposed of, hopefully, in an environmentally sustainable fashion. Do you ever pause to think of the immense collection of industries that bring about this marvelous miracle for a modest cost to you?

All these things are possible because people thought of them and invented them and improved them. They are also possible because people formed companies and concentrated the capital and political power needed to make the huge investments in infrastructure. 

If you want to continue this exercise, just think about transportation: cars, planes, boats, trains, huge cargo ships plying the ocean, quick, inexpensive delivery of packages from the farthest reaches of the earth to your door in a few days for an extremely modest cost. Think of the miracle of these things. It boggles the mind.

Corporations -- the costs

A publicly traded company is owned by its stockholders. Companies, by law, have a fiduciary duty to their stockholders. That means that they must act in the best interests of the people who provide them with their operating capital and who do so with the hope of making a return on their investment. 

It's a dog-eat-dog world. There is really cut-throat business competition. It's a jungle out there. These bloody metaphors are used for good reason. Successful companies grow rich and powerful by many means, honest and dishonest. Companies have no conscience -- they're not people. They exist to make more money by selling more goods and services by whatever means necessary and, as long as it is in the best interests of the shareholders, they are just obeying their legal mandate. Companies who have the strength and cunning to eliminate all their competition can rise to the top of the heap and form a monopoly. Then they can simply charge whatever prices they want and people will pay because they need or want the product. Ah, it's good to be the King. Too bad for the consumers, but that's the law of the jungle for you.

Under the law, a company's overriding responsibility is to its shareholders. That means that if the shareholders benefit, then the company can release the toxic byproducts of its industrial processes into the environment. If the shareholders benefit, the company can make people work long hours for little pay in bad working conditions. If the shareholders benefit, the company can fire people for any or no reason. If the shareholders benefit, the company can ruthlessly crush employees' attempts to organize into unions that will offset the power of the management. If the shareholders benefit, the company can engage in any behavior it can get away with.

The Golden Rule, or Them What's Got the Gold Makes the Rules, is a reality that people can see in action every day. Unscrupulous business leaders can misrepresent the state of the company's finances and defraud the shareholders of their investments. Shady business transacted within the board room can be very profitable for a few people at the top, but only at the expense of others.

These and many other abuses of power have occurred for many reasons: greed, hubris, cowardice, inaction, inertia, malice, or just plain ignorance. Lord Acton observed in 1887: "Power tends to corrupt, and absolute power corrupts absolutely." This may be true, but the real root of the problem is two-fold: the concentration of too much power held by too few entities or individuals, and the lack of checks and balances to that power. Let's say that you work for a real tyrant, a powerful individual who does not tolerate dissent or insubordination of any kind. This person pays you money that you need to support your family and meet your financial obligations. Now let us say that the tyrannical boss orders you to dump toxic waste in the river. He's the boss, and if you want to keep your job, you have to do it even if you may find that action to be repugnant. We could argue all day about the morals of the boss, but the plain fact of the matter is this: if you can get away with doing something, and if the benefits to you outweigh the consequences, most of the time you'll do it.

People who have been on the receiving end of these abuses of power are generally the ones who think of corporations as evil.

Balance of Power

If you enjoy the idea of a weekend, if you have clean air to breathe, if you do not work outrageously long hours in an unsafe and unhealthy work environment for meager pay, you can thank the people who banded together and fought to form a check to the power of those who could formerly get away with exploitative business practices. Everybody wants a happy, safe, comfortable life, and to be free to do what they want. There is nobody who doesn't want those things. If there was only one person in the world, then that person could do anything he wanted to make his life comfortable and happy. However, just in this country, there are 400 million of us, all wanting the same thing. 

Let me paint a picture. Here I am in my yard cooking a steak on the barbecue. It smells very delicious and I can't wait to eat. All of a sudden, my neighbor, Grog, who is bigger and stronger, stomps over and says: "Gimme the steak." If I resist, he clubs me on the head and takes the steak. Yea for bigger and stronger! That is the law of the jungle: might makes right. And steak dinners.

The next day, I make a deal with a few other smaller neighbors. I say to them: "Let us go buy some steaks and cook them together. If Grog comes to try to take the steaks, together we'll be able to prevent him. After we get rid of him, then we'll all share the steaks." Yea for banding together to level the playing field. Or, to put it another way: Yea for bigger and stronger!

For many millennia, life was just uncountable variations on this theme. Here and there, over the course of history, some people realized that the real problem was unchecked power. But it wasn't until a time that we call the Enlightenment period that some really smart people, learning from the past, were able to come up with some ideas that would help us to transcend the law of the jungle in a lasting way. These included some of these revolutionary ideas:

• The government derives its power from the consent of the governed, not from God through the divine right of a Monarch.
• Too much power, concentrated in the hands of too few entities, leads to tyranny.
• Laws should be created and enacted through an established process and enforced equally.
• People should be free to pursue happiness in whatever way they want, provided that they do not encroach on others' pursuit of happiness.

Back to the 400,000,000 people in our country. For the last 200+ years, we have been the beneficiaries of these principles. We have enjoyed a level of peace and prosperity that is literally the envy of the world. Why is that? I can hear the shouts in my right and left ears:

• Unfettered Free Enterprise and Capitalism!
• A Strong Central Government!
• Constitutionally Limited Government!
• Equal Opportunity for All!
• American Ingenuity and Know-How!
• A Level Playing Field!
• The Ability to Rise from Rags to Riches!
• Diversity and Tolerance!
• Traditional Values!
• Rule of Law!
• What's good for Business is good for America!
• Proud Union Shop!

And the thing is, the shouts from the left and the shouts from the right are all Correct! Our peace and prosperity, our liberty and freedom, any success and happiness that we enjoy are the not the products of government and are not the products of free enterprise. They are the products of the combination of these two. They are the products of the tension between these two. It is precisely the tug of war, the give and take, the ebb and flow of power, never concentrated too long or too much in one area that is the foundation for our way of life.