Earlier, we wrote about the business offensive launched to smash the democratic movements of the 1960s and 1970s. Well, it seems our owner class is once again worried – enough to issue a public proclamation via the Business Roundtable, a non-profit association made up of various corporate executives.
This time, there is no offensive for big business and the ultra-wealthy to launch- they already own all of the commanding heights of our society, economy, and government. They instead take to an attempt at convincing us that a corporate capitalist state is a great thing for everyone and not just our tiny minority of executives and shareholders who own massive capital. But hey, just in case you may doubt us, we are now going to change our practice in order to be accountable and sustainable- just trust us on this.
The Roundtable issued their statement back in August called “Statement on the Purpose of a Corporation” (it can be read in about 2 or 3 minutes).
The press release for the statement claims (bold is mine) “Since 1978, Business Roundtable has periodically issued Principles of Corporate Governance. Each version of the document issued since 1997 has endorsed principles of shareholder primacy – that corporations exist principally to serve shareholders. With today’s announcement, the new Statement supersedes previous statements and outlines a modern standard for corporate responsibility.”
To paraphrase, in other words: ‘In the past we have consistently been blatantly irresponsible in the way our corporations operate, but now, in light of the consequences of our actions, we are proclaiming to the world that we’re turning a new leaf. We now care about ‘corporate responsibility’ and acknowledging that the world outside of our narrow corporate confines exists and does, in fact, matter’.
Oh, do go on, then.
Smoke and Mirrors
I’d urge a small mountain of skepticism regarding this claim by the Roundtable. The track record of corporate activity is as clear as day from their inception. These executives issued the statement not because after all these years of buying off our government, outsourcing millions of workers, polluting our environment, indoctrinating our citizens, selling weapons of war, etc, that they all of a sudden care to be responsible to the world around them.
So why, after over 40 years of consistently hyping up the values of shareholder capitalism is the Business Roundtable ostensibly changing course?
These executives see a population that is beginning to reject the very capitalist system that has handed them the vast sums of wealth and power that they have extracted from the system. In other words, they fear their apple cart may tip over. Poll after poll show that Americans are beginning to reject capitalism – especially the younger generations.
Fist-Fighting the Wind
“Redefining” a corporation as a general proclamation will do next to nothing. Corporate ownership and incentive structures remain unchanged, making this new statement ring as hollow as any business propaganda you’ll see. A corporation is a legal entity designed to extract as much profit as possible for shareholders. No glorified proclamation without actual legal or legislative teeth will change how corporate entities fundamentally operate.
But perhaps these executives recognize this. Perhaps they see the winds of change blowing away from them and see their statement as a futile but an at-least-we-tried measure. Regardless, this statement shows that despite possessing overwhelming power and wealth in our society, these entities individuals are ultimately out of answers- neutered from actually addressing our society’s ills that they have poured fuel on.
As the playwright, Arthur Miller, once said, “An era can be considered over when its basic illusions have been exhausted.”
It appears our society is approaching a crossroads. We haven’t yet reached it, but the basic illusions of our economic and political system have indeed been exhausted. And the masters of our society have demonstrated their feebleness with this Business Roundtable statement. They know their game is up and are attempting to clutch onto their power and wealth for as long as humanely possible. They will ride the sinking ship to the depths as long as they have first class seats- to hell with everyone else.
Here’s the kicker: all this turmoil is occurring in “the longest economic expansion in American history”. How can these two concepts possibly be true? Mentioning both is akin to saying: “that soaking wet towel is dry”.
The economy, as was discussed in a previous article, is working well for corporations and the ultra-wealthy, as shown starkly in a New York Times piece. But the incomes for the rest fall under either barely increasing or outright declining when adjusted for inflation, all while the increasing cost of living outstrips any gains many workers manage to carve out for themselves. All this amid the systematic selling off or gutting of our public services, lands, and resources, leaving workers with the undeniable reality of systematic decline all around us.
Critics of income re-distribution to the poor and working class reliably leave out the fact that the US has been re-distributing absolutely massive amounts of money from the public to the top of the income scale for decades. Ask yourself why we have crumbling infrastructure, declining schools, and all the rest? That money used to come from taxes on the wealthy and corporations, which have been slashed since the 1950s. The top income tax bracket in the 1950s was 91% (and is now 37%) and the share of taxes paid by corporations declined from 32.1% in 1952 to 9.9% by 2013.
It doesn’t take an economist to understand that this creates a situation where much less tax income is received from the centers of wealth and power compared to the 1950s/1960s.
The result is a shifting of the tax burden to the poor, middle, and working class who have much less wealth to begin with. The consequences are the steady erosion of our society that has ultimately led to the Business Roundtable finally feeling worried enough to issue their statement. It concludes with:
“Each of our stakeholders is essential. We commit to deliver value to all of them, for the future success of our companies, our communities and our country.”
Don’t count on it.