Corporate Power & Social Responsibility

Chapter 1 The Criticism of Corporate BusinessAn institution is likely to be more searchingly appraised if attention is focused at the outset upon its faults rather than its virtues. Thus, an assessment of the social role of the business corporation, which has become a central institution of American society, is best begun by an effort to set forth and evaluate the many criticisms that are made of it. In this opening chapter, we present a systematic account of the various schools of such criticism and identify the flaws that each finds in it. In this way, we uncover those issues that are basic to the business corporation's social role, issues which we will examine and appraise in succeeding chapters.We shall use "corporation" to mean the profit-seeking company of the business system. While there are many corporations not-for-profit and the number of business partnerships and proprietorships outnumbers incorporated enterprises two-to-one, the significant fact is that profit-seeking corporations dominate the corporate population and conduct over four-fifths of the private business of the United States economy. One is not far wrong, therefore, in following the general practice of identifying the corporation with business.Many social critics, however, go further and identify corporate business with American society. Eminent scholars and able journalists contend that large business corporations dominate the polity and the society, as well as the economy, of the United States to such a degree that it may be called a "corporate state." In their view, corporate business has made all social institutions -- governments, unions, consumers, even the educational system -- subservient to its purposes. It has attained a near-monopoly of social purpose, wielding virtually untrammeled political and economic power. Standing astride the entire social structure, the giant business corporation is seen as its most basic prototype. For these critics, it follows naturally that the errors and shortcomings of society are those of corporate business: their social criticism coincides with their corporate criticism. But should not their strictures, in fairness, be brought against government, unions, and other institutions, as well as corporate business? Are not many really applicable to the weaknesses of human nature?THE EVOLUTION OF AMERICAN BUSINESS CRITICISMThe enormous diversity of grounds on which American business is condemned and denounced almost defies analysis. Consider the following statements which typify criticisms of American business in recent literature:* The United States is dominated by two hundred giant corporations.* Giant corporations control, rather than are controlled by, their markets.* Big corporations are operated for the benefit of their managers rather than their stockholders.* Corporations control the government agencies that are supposed to regulate them.* The "military-industrial complex" inflates arms expenditures for private power and profit.* The multinational corporation is the modern instrument of imperialism and neocolonialism.* Business corporations exploit workers, cheat consumers, and degrade the environment.* Businesses conspire to raise prices and to suppress improved products.* Corporate lobbying and campaign contributions corrupt public officials.* Corporations are ruled by self-perpetuating managements, responsible to no one.* The "corporate state" has made Americans corrupt, disorderly, distrustful, militaristic, and unjust.* In the "corporate state" material values always take precedence over moral, intellectual, and cultural values.The list could be extended indefinitely. Anyone seeking a recent, encyclopedic listing of all the indictments of the American business system voiced by the Radical Left can reach for Charles Reich's The Greening of America. This polemic against the "corporate state" offers a virtuJacoby, Neil H. is the author of 'Corporate Power & Social Responsibility' with ISBN 9780029159408 and ISBN 0029159407.