Saturday, September 16, 2006

Capitalism versus Corporatism

Somewhere along the way to now the old fashioned American form of Capitalism has been pretty much swallowed up by Corporatism and the result is pretty damn rotten. The old Capitalism meant a man, a family or a company making a product or providing a service while making a fair profit, paying the employees, if any, a fair wage and giving the consumer a good value for the dollar. Corporatism, on the other hand, means the providing of a product or service paying the employees as little as possible (it's especially easy to do if the work is outsourced to China or Vietnam where wages are dirt low and the executives don't have to face the workers every day), providing goods and services of indifferent quality and making big profits for stockholders who consider their dividends a major source of income instead of a source of extra income.

When a company becomes a corporation the vision of the founder is often lost. A man may have wanted to start a company to build cars or airplanes or print books or ground coffee turns into a corporation whose first concern is to make money. And when the goal is to make money the managers become ruthless. The lives of the employees become abstractions.

A case is point is Harry Stonecipher, the former CEO of Boeing Aircraft. It was during Stonecipher's tenure at Boeing that Boeing acquired McDonnell-Douglas. The result of the acquisition was that thousands of workers were laid off (former Douglas employees) and Boeing decided to abandon the Douglas plants in California except the Long Beach C-17 plant. Stonecipher made the decision and did not have to stand in the shops and face the men and women who were losing their jobs. He sat in Seattle and saw the ruined lives as nothing more than numbers on a computer screen. Stonecipher also is responsible for the outsourcing of Boeing components to Japan, China, Italy, France and Germany. It was not because any of these countries could do the work any better than American workers, but Stonecipher saw them as cheaper labor.

And old fashioned American-style capitalist, when forced to make cuts, would at least have the decency to face the the men who lives he was ruining and would have mourned with them. There were exceptions of course -- coal, textile and steel barons were especially nasty men -- but for the most part the owner of the company not only knew how to run a company, but how to build the product. The owners were seen regularly on the shop floor. They may not have known all their employees personally, but they knew them corporately. They knew they employed people, not numbers.

The result has been the shrinking of the American manufacturing base and the slow transformation of the American economy from an engine of production to a service economy. Consider Wal-Mart. When Sam Walton was alive his vow was to sell as many American made products as possible at a competitive price. Since Sam Walton died his children have taken over and become corporatized. They don't even pretend to give American made products preference. Most of the stuff sold at Wal-Mart is made in China. In fact, Wal-Mart is the largest single importer of Chinese made goods in the US. The result is that many Americans in the manufacturing sector have been thrown out of work and have been forced to seek lower paying jobs as "associates" at Wal-Mart stores. The corporate mentality of one retail giant has ruined the lives of people who don't even work for it.

It stinks. But that's life.

But there are still companies that feel responsible for not only the consumer, but for the employee. A case in point is Dr. Bronner's Magic Soap. Emil Bronner founded the company during the mid-twentieth century in Escondido, California. His purpose was to make soap specifically Castillian soap. By the time of his death Dr. Bronner had fifteen employees, a loyal following and has donated one thousand acres near Mount Palomar to the Boys and Girl Club of San Diego. Today the company makes 7 million dollars a year. It is operated by Dr. Bronner's grandson. Several corporations have offered to buy the company and have been rebuffed because it was not Dr. Bronner's vision to be part of a corporation. The family has maintained Dr. Bronner's philosophy, perhaps because of Dr. Bronner's writings, which he called The Moral ABC and which were printed on the inside of the soap wrapper. Dr. Bronner's writings were a little kooky, but they were from the mind of a man who cared more about people and the world than money.

Dr. Bronner had the best definition of what capitalism should be that we at Bloody Nib Manor have ever read: Constructive capitalism is where you share the profit with the workers and the earth from which you made it. ...Here's a link to the company web site: Dr Bronner's Magic Soaps Make sure to click on the Social Responsibilty tab to get more of the Bronner philosophy. And spend two bucks to get a copy of the Moral ABC. And buy the soap if you can. It's good stuff.

Charities often fall into a form of corporatism. Consider the Red Cross and the United Way. Top heavy and more money spent for administration than what hits the ground. We here at the Manor donate to the Salvation Army, which answers to a Higher Power than a board of directors. But there are many, many small organizations and even individuals, who make a big difference every day doing the work that many won't. An example is Gloria Kim, who runs the Zion Gospel Mission Church in Los Angeles. Miss Kim, despite having her car stolen, still ministers to the homeless every day with food and prayers. The LA Times did a short article about her: Carjacking Can't Make a Dent in Aid to Homeless - Los Angeles Times . If you have the time, say a prayer for her and those like her.

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