10 ms·

One of the most insidious ideas of our time. Interestingly, it seems directly at odds with the new dogma/mandate of BlackRock-style DEI, which is insidious in i

by Mizza 4y ago

One of the most insidious ideas of our time. Interestingly, it seems directly at odds with the new dogma/mandate of BlackRock-style DEI, which is insidious in it's own way. I wish the history of corporatocracy was taught more in schools, it seems like there was this massive, sudden leap between "the king gives you the right to build a bridge and collect tolls on it" and "the purpose of all human life is to build financial structures to increase the wealth of the shareholder class." I want to know more about how that shift occurred.

jollofricepeas 4y ago
Pick your poison. I love how people rail against shareholder value. But then, they fail to forget that… Shareholders are also pension funds, people with 401k’s and rank and file employees. The actual problem is wealth inequality and the fact that a select few burden the majority with most of the risk while they reap most of the rewards. In one way or another employees are always shareholders even when they’re not holding any certificates.
- runarberg 4y ago
  > Shareholders are also pension funds, We don’t forget that. It is simply a reality that we can’t avoid. All the profit is siphoned into the stock market, if you opt out of it (if you are even allowed to; in many European states, these funds are mandatory), you’ll loose your savings to inflation. Could we have a better system? yes. Does it make sense to add this caveat every time we complain that shareholders are exploiting workers for their own profits? No, that would be a waste of nuance.
sershe 4y ago
Why is it though? In non-obfuscated language, the whole idea is "the job of someone hired to do something is to do the thing". If I own a room full of groceries, the job of the people I hire to run it /should be/ to run it in whatever legal way I want it to be run. If I want to maximize profits and the workers give the food away to the poor, or if I want to give the food away to the poor and the workers charge them money, I'm going to fire the workers (or in extreme cases, sue them for damages). Shareholders are simply the owners of the corporation. The difficulty arises when we try to figure out what the shareholders want given the diffuse ownership (especially if you trace funds and pension plans to their ultimate owners/beneficiaries), but "maximize returns" is a reasonable assumption in absence of other expressed preferences. Moreover, I'm pretty sure if you tried to get the preferences from an average shareholder you would find out they support all the good things and are against all the bad things, as long as it's free. It would end up like the recent poll they had in Western Oregon: "Do you think we should keep Eastern Oregon as part of Oregon?" "Yes!" "Eastern Oregon is net tax subsidized, how much in taxes are you personally prepared to pay to keep Eastern Oregon?" "$0!")
- vannevar 4y ago
  What you're describing is more applicable to an ordinary partnership, where the partners are personally liable for any debts or legal judgments against the partnership. Corporations and LLPs allow shareholders and partners to escape those liabilities, and it's reasonable to expect some duty to act in the public interest in return.
  - marcusverus 4y ago
    > Corporations and LLPs allow shareholders and partners to escape those liabilities, and it's reasonable to expect some duty to act in the public interest in return. The entire concept of limited liability was created with the public interest in mind. Limiting personal liability encourages business creation, which encourages growth, which is in the interest of the public. > It's reasonable to expect some duty to act in the public interest in return. What is it that you're wanting to make these companies do, specifically?
    - vannevar 4y ago
      The question was whether a corporation is legally obligated to maximize profit. I was pointing out that, as you also note, the actual purpose of the limited liability of a corporation is to promote the public interest. Economic growth is one aspect of that interest, certainly, but it's not the only consideration. So corporations that give up short term profits to improve the environment or the well-being of their employees or the community are not shirking their legal obligation, they are living up to it.
whiddershins 4y ago
the shareholder class is everyone. we all benefit from the wealth created. it's odd to constantly see people posting on the internet, using computers, from their warm house ... etc. not noticing this.
dfmooreqqq 4y ago
A bit off topic, but William Dalrymple's book "The Anarchy" does an excellent job tracking the development of the East India Company from "the king gives you a right to establish trade with India" to the "the purpose of [all of India] is to... increase the wealth of the [EIC shareholders]."
toss1 4y ago
Yup. And even the headline question of this pernicious concept leaves massive ambiguities. Is the goal to maximize profits this quarter, or shareholder value (share price) this quarter, or over the course of a decade, or a century, or a millennium ? Merely changing the answer over those four options would entail massive changes in management goals and choices. The entire pernicious concept merely enables exploitative behavior — exploiting employees, the people in the surrounding community/society, and the environment, externalizing costs on everyone else while internalizing profits. If we are going to treat corporations as effectively persons, it is far past time to expect them to behave as good citizens. (and if they do not behave as good citizens, then treat them as bad citizens, i.e., jail or execute them)
- ampear 4y ago
  > Is the goal to maximize profits this quarter, or shareholder value (share price) this quarter, or over the course of a decade, or a century, or a millennium? Merely changing the answer over those four options would entail massive changes in management goals and choices. This is the absolutely crucial core question that gets skipped over so, so often.
  - mytailorisrich 4y ago
    This is a question that is answered in company board meetings when shareholders actually tell directors what they want. This is not a philosophical question to be pondered on in a vacuum.
    - ampear 4y ago
      Agreed there isn't a single answer to be reached in a vacuum, and obviously this is the mechanism by which majority shareholder intention may be communicated. The statement stands.
- alright_scowl 4y ago
  I am both an employee and a small-time investor in the stock market. I actually prefer to see companies as entities such as their only goal is maximizing profits, all else be damned. They will exploit every worker and will externalize every negativity in their profit-driven mandate. And typically short term profits will trump long term anything. It's the role of governments, as representatives of society, to rein in companies so that they don't act in ways that damage the society where they are inserted in. Cue in labor and union protections, environment regulations, etc and so forth. And yes, companies that break regulations should be treated as criminals, including termination.
marnett 4y ago
I shared your curiosity on this exact subject in the past. There is an interesting historiography entitled “The Transition from Feudalism to Capitalism,” originally published in the 1950s, which contains a collections of debates on this subject. It is no frills and quite scholarly, but that is often the case for hyper focused, niche subjects.
- britzkopf 4y ago
  Not sure I would describe a multi decade history exploring the transition from feudalism to capitalism as "hyper focused", or niche for that matter.
  - marnett 4y ago
    Your feedback is received. Granted, I do disagree. This is just one specific area of focus in the broader field of Marxist historiography. So it is niche. It is as niche as studying a specific subject area in the broader field of Egyptology, which again I don’t think would be a stretch to consider niche. Perhaps a takeaway we can both agree on is niche may not be the best word for describing what I’m talking about. Perhaps subfield of an academic discipline is.
whitemary 4y ago
[flagged]
SamoyedFurFluff 4y ago
> the new dogma/mandate of BlackRock-style DEI I don’t think DEI is new. The original affirmative action legal cases in the 60s was in employment, particularly in breaking up the homogeneous of all-white labor unions and other all-white labor forces. Remember that the Jim Crow laws and racial segregation in the public sphere was still occurring in the 50s and early 60s, and affirmative action policies occurred in the workplace as a response to try and actually enforce desegregation in the corporate sphere.
- squokko 4y ago
  The idea of investment managers directing capital based on their own corporate purity tests is definitely much newer than the 1960s
  - SamoyedFurFluff 4y ago
    I don’t think it is. Government had enforced diversity metrics in order to prevent hiring all-white union laborers for their contracts pretty early on in the desegregation process. The private sphere followed suit to avoid the label of segregationism.
  - Apocryphon 4y ago
    Or perhaps earlier: https://www.thebalancemoney.com/a-short-history-of-socially-responsible-investing-3025578 https://www.thebalancemoney.com/a-short-history-of-socially-... https://www.mycnote.com/blog/the-history-of-socially-responsible-investing/ https://www.mycnote.com/blog/the-history-of-socially-respons...
  - eropple 4y ago
    This can also (and, frankly, less weasel-wordishly) be framed as "directing capital based on the desires of the stakeholders involved." High-dividend ETFs have "purity tests", they just involve things you don't feel like being pejorative about. And, as 'Apocryphon notes, this is much older than you think besides.
  - object-a 4y ago
    I don’t think they’re doing it for an ideological purity test, they’re doing it because: 1. They believe there is investor demand for funds that take environmental and social impact into account 2. They believe that companies with better environmental, governance, and social Impact ratings will have higher or more stable returns over time You can disagree, but I think there are good arguments to be made for both of those points.
stevespang 4y ago
[dead]
vishnugupta 4y ago
> I want to know more about how that shift occurred. I’ve been stuck in that rabbit hole for atleast 2 years now. At the macro level it seems as if it was all planned but upon deeper reading I came to a conclusion that it was a sequence of events which while individually would have made sense collectively lead to the current mess. To get a whirl wind tour and as a starting point I highly recommend Adam Tooze’s book “Crashed”. In it he chronicles the 2008 crisis beginning with Nixon’s abolishment of gold standard. The book is full of excellent references.
- causi 4y ago
  Self-organizing behavior is a wildly underestimated and underappreciated force in the world. It's behind almost everything people regard as some sort of conspiracy.
  - krapp 4y ago
    That's just want they want you to believe.
- yieldcrv 4y ago
  I'm glad you came out on the other side, and have the cognitive ability to perceive independent parts in a large system this way. I would add one other thing, some of those steps have opportunists in them. Once you realize that, you realize you can be an opportunist too. You can play the game at the same level, by pushing chess pieces at a small level.
  - foogazi 4y ago
    > You can play the game at the same level, by pushing chess pieces at a small level. You can’t lobby to abolish the gold standard or influence federal appointees
    - yieldcrv 4y ago
      > influence federal appointees you can. you can get your people in agencies and courts when the time looks favorable, and they will transcend the Senate committee composition and the President's administration. > You can’t lobby to abolish the gold standard odd example since that's gone for 50-90 years already, but again you can. == think about it this way. periodically there's a conspiracy documentary about people pulling the strings of the elected President. what they neglect to mention is that every possible permutation of potentially electable Presidents have opportunists already waiting. You don't have to be a partisan. You don't have to actually be a partisan. Loads of people are doing things beneficial to them.
user3939382 4y ago
My inexpert assessment is that this shift was precipitated by the creation of these tycoons in the industrial revolution. Prior to that, big corporations like the India Tea Company were formally/directly associated with the State. Getting into my more controversial political opinions, I believe now these corporations and their executives also control the government almost exclusively but they at least pretend they’re separate from the State.
- Avicebron 4y ago
  I assume you mean the East India Company? And from what I understand it was somewhat different than directly controlled by the state. Getting the "Queen's permission" was more of a business license, and they actively formed a lobby within in the government to lobby for a monopoly which was roughly 100 years after they were formed as a private venture.
  - user3939382 4y ago
    > East India Company? Yep
rubyn00bie 4y ago
This is pretty much what heterodox economics is all about. Veblen hits on this with the theory of the leisure class (I think? I my heterodox knowledge isn’t as good as it once was). Heterodox economics is probably the least known category of economics, but arguably one of the most important. That importance is because it helps us think about our motivations and reasons not just quantitative results (I do love quantitative results, tho). Most folks don’t even know money wasn’t really used until the like 1500s. The wealthy bartered and used coins as a sign of wealth, using them (coins) was typically faux-pas. And even then, the church hated money because it stripped them and the monarchy of power…
- naasking 4y ago
  > Most folks don’t even know money wasn’t really used until the like 1500s Do you mean in Europe? Pretty sure money has been used quite a bit in many other places.
  - rubyn00bie 4y ago
    > Do you mean in Europe? Pretty sure money has been used quite a bit in many other places. I mean pretty much everywhere. Money wasn't used the same way it is today, and it wasn't until the 1500s that really emerged as a result of the Dutch being prolific traders. Coins existed but money wasn't spent, or used, like it is today... Barter was the primary way for people, both rich and poor, to acquire goods.
Bouncingsoul1 4y ago
yeah me too, its wide field... I'm currently working through this series https://press.princeton.edu/series/the-princeton-economic-history-of-the-western-world https://press.princeton.edu/series/the-princeton-economic-hi... Sometimes I get sidetracked by specific sources and explore tanget stuff, but most of this series is pretty approachable
HEmanZ 4y ago
"the purpose of all human life is to build financial structures to increase the wealth of the shareholder class." I have never met a single person at any level of any organization or otherwise who has expressed this sentiment. This characterization is a strawman. Usually the idea that shareholder wealth maximization is central comes with a whole bunch of other economic ideas. Like that long-term wealth is what matters, not wealth tomorrow. And that corporations aren’t the center of all life or meaning for everyone involved, just a way to generate stuff. And that in order to generate more wealth you need to constantly provide more goods for more people at lower cost. These distorted strawman characterizations of capitalists are just outrage porn, they don’t help move the world forward at all.
- rektide 4y ago
  I've heard it my entire working life, from coworkers at every step of the chain. Engineer wants to build something they think will be good & useful & help the company, and someone backhands them with "how will this make us/the company money?", sometimes followed up with "we're here to make money". It may not be the exact same statement, but it's very close in spirit. This should be beside the point; we should do things that are good because we can, not just because they make us money, but I usually tend to see there being a ton of potential for the engineer's idea to help make money.
  - foogazi 4y ago
    > we should do things that are good because we can If I hire you to fix my car I’m not paying you if instead you fix the neighbors car
    - rektide 4y ago
      ah yes, the beautiful zero-sum view of the world, where no one does anything positive ever unless the blood price is paid. thank you for your shitty shit view. looking at it the other way, a repair shop could just, like, add some washer fluid for free. or clean some wipers to help the life. good repair shops do, because they understand some small benevolent acts cost next to nothing. not everything needs to be a brutal & cold calculated exchange, priced at every point. good is allowed. sometimes it costs intensely little. i've heard this condescending bullshit used to browbeat & bully countless ideas that would make everyones lives vastly easier within an org. i dont think a mutual benefit ought be required to do a little good; sometimes the price of doing good is just tiny. but the organization/managerial class thinks their contribution is eliminating small nicenesses, without really coming to understand how much it hurts everyone to eliminate niceities. without understanding that often the price is near zero. orgs have a vastly overinflated sense that they, by preventing people from doing good, are helping the org. it causes immense internal dissonance, is unbelievably time wasting & harmful to have the org stepping in to low level shit- basically free activities- & intervening, and it rarely does good.
splitstud 4y ago
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RivieraKid 4y ago
Why? This leads to optimal results assuming high quality laws that put a price on externalities and make sure markets are competitive. These assumptions are approximately correct, so maximizing shareholder value is approximately optimal. It maximizes prosperity. It's better to create more value than less value all things being equal. If you put it this way, it's obvious.
- Arainach 4y ago
  It doesn't account for externalities. It also doesn't distribute "value" equitably. It's more profitable to dump waste in a lake than to clean it up. It's more profitable to hire children for 10 cents a day than adults for a living wage. It's more profitable to keep using ingredients even after they've started turning bad. None of these deliver value to society.
boh 4y ago
Since we weren't alive for the king's tolls we may romanticize it as a counterpoint to our corporate-centric organization structures, but while you may believe it to be "insidious" and maybe it is, it's the only reason we have a middle class. High production, high consumption models are so many people are able to have discretionary income in the modern era. And this is true for every modern economy whether it be democratic, socialist, communist etc. Maximizing productive capacity has a lot of social and environmental consequences and while we are free to hate on the corporations that make it possible, we must also admit that our way of life entirely depends on it. We are of course free to dream of other ways of life, but looking back in history there have been no alternatives that have offered our current quality of life to such a large collection of people.
- soco 4y ago
  At the same time, this is no reason to stop trying to make it even better, when looking at its inevitable drawbacks.
- sangnoir 4y ago
  > ...while you may believe it to be "insidious" and maybe it is, it's the only reason we have a middle class. What if the existence of a middle class is transitory? The billionare preppers certainly think our current social order is on borrowed time[1], not that I agree with their outlook, but I take that attitude as evidence that today's capital class does not particularly care for the continued existence of a middle class, unlike Henry Ford. Once off sales are passé now, and recurring revenue is in. I suspect the middle class gets in the way of profit maximization because of the class' propensity to saving and ability to cross-shop since they have free time. Selling Patagonia vests for leisure activities may be profitable, but it will lose out to PE squeezing out the middle class from buying homes and making them perpetual renters and unable to afford leisure activity 1. https://www.theguardian.com/news/2022/sep/04/super-rich-prepper-bunkers-apocalypse-survival-richest-rushkoff https://www.theguardian.com/news/2022/sep/04/super-rich-prep...
5040 4y ago
>One of the most insidious ideas of our time This isn't obvious to me. The idea is to pursue profits above all else, but also that giving people what they want will result in maximal profits. Is giving people what they want insidious?
- lambertsimnel 4y ago
  I think the concerns about profit maximisation include externalities. For example, if somebody not party to a transaction is harmed by unsafe behaviour, that might not inhibit that behaviour from maximising profit for those who are party to the transaction.

by Mizza 4y ago

jollofricepeas 4y ago

Pick your poison. I love how people rail against shareholder value. But then, they fail to forget that… Shareholders are also pension funds, people with 401k’s and rank and file employees. The actual problem is wealth inequality and the fact that a select few burden the majority with most of the risk while they reap most of the rewards. In one way or another employees are always shareholders even when they’re not holding any certificates.

runarberg 4y ago
> Shareholders are also pension funds, We don’t forget that. It is simply a reality that we can’t avoid. All the profit is siphoned into the stock market, if you opt out of it (if you are even allowed to; in many European states, these funds are mandatory), you’ll loose your savings to inflation. Could we have a better system? yes. Does it make sense to add this caveat every time we complain that shareholders are exploiting workers for their own profits? No, that would be a waste of nuance.

sershe 4y ago

Why is it though? In non-obfuscated language, the whole idea is "the job of someone hired to do something is to do the thing". If I own a room full of groceries, the job of the people I hire to run it /should be/ to run it in whatever legal way I want it to be run. If I want to maximize profits and the workers give the food away to the poor, or if I want to give the food away to the poor and the workers charge them money, I'm going to fire the workers (or in extreme cases, sue them for damages). Shareholders are simply the owners of the corporation. The difficulty arises when we try to figure out what the shareholders want given the diffuse ownership (especially if you trace funds and pension plans to their ultimate owners/beneficiaries), but "maximize returns" is a reasonable assumption in absence of other expressed preferences. Moreover, I'm pretty sure if you tried to get the preferences from an average shareholder you would find out they support all the good things and are against all the bad things, as long as it's free. It would end up like the recent poll they had in Western Oregon: "Do you think we should keep Eastern Oregon as part of Oregon?" "Yes!" "Eastern Oregon is net tax subsidized, how much in taxes are you personally prepared to pay to keep Eastern Oregon?" "$0!")

vannevar 4y ago
What you're describing is more applicable to an ordinary partnership, where the partners are personally liable for any debts or legal judgments against the partnership. Corporations and LLPs allow shareholders and partners to escape those liabilities, and it's reasonable to expect some duty to act in the public interest in return.
- marcusverus 4y ago
  > Corporations and LLPs allow shareholders and partners to escape those liabilities, and it's reasonable to expect some duty to act in the public interest in return. The entire concept of limited liability was created with the public interest in mind. Limiting personal liability encourages business creation, which encourages growth, which is in the interest of the public. > It's reasonable to expect some duty to act in the public interest in return. What is it that you're wanting to make these companies do, specifically?
  - vannevar 4y ago
    The question was whether a corporation is legally obligated to maximize profit. I was pointing out that, as you also note, the actual purpose of the limited liability of a corporation is to promote the public interest. Economic growth is one aspect of that interest, certainly, but it's not the only consideration. So corporations that give up short term profits to improve the environment or the well-being of their employees or the community are not shirking their legal obligation, they are living up to it.

whiddershins 4y ago

the shareholder class is everyone. we all benefit from the wealth created. it's odd to constantly see people posting on the internet, using computers, from their warm house ... etc. not noticing this.

dfmooreqqq 4y ago

A bit off topic, but William Dalrymple's book "The Anarchy" does an excellent job tracking the development of the East India Company from "the king gives you a right to establish trade with India" to the "the purpose of [all of India] is to... increase the wealth of the [EIC shareholders]."

toss1 4y ago

Yup. And even the headline question of this pernicious concept leaves massive ambiguities. Is the goal to maximize profits this quarter, or shareholder value (share price) this quarter, or over the course of a decade, or a century, or a millennium ? Merely changing the answer over those four options would entail massive changes in management goals and choices. The entire pernicious concept merely enables exploitative behavior — exploiting employees, the people in the surrounding community/society, and the environment, externalizing costs on everyone else while internalizing profits. If we are going to treat corporations as effectively persons, it is far past time to expect them to behave as good citizens. (and if they do not behave as good citizens, then treat them as bad citizens, i.e., jail or execute them)

ampear 4y ago
> Is the goal to maximize profits this quarter, or shareholder value (share price) this quarter, or over the course of a decade, or a century, or a millennium? Merely changing the answer over those four options would entail massive changes in management goals and choices. This is the absolutely crucial core question that gets skipped over so, so often.
- mytailorisrich 4y ago
  This is a question that is answered in company board meetings when shareholders actually tell directors what they want. This is not a philosophical question to be pondered on in a vacuum.
  - ampear 4y ago
    Agreed there isn't a single answer to be reached in a vacuum, and obviously this is the mechanism by which majority shareholder intention may be communicated. The statement stands.
alright_scowl 4y ago
I am both an employee and a small-time investor in the stock market. I actually prefer to see companies as entities such as their only goal is maximizing profits, all else be damned. They will exploit every worker and will externalize every negativity in their profit-driven mandate. And typically short term profits will trump long term anything. It's the role of governments, as representatives of society, to rein in companies so that they don't act in ways that damage the society where they are inserted in. Cue in labor and union protections, environment regulations, etc and so forth. And yes, companies that break regulations should be treated as criminals, including termination.

marnett 4y ago

I shared your curiosity on this exact subject in the past. There is an interesting historiography entitled “The Transition from Feudalism to Capitalism,” originally published in the 1950s, which contains a collections of debates on this subject. It is no frills and quite scholarly, but that is often the case for hyper focused, niche subjects.

britzkopf 4y ago
Not sure I would describe a multi decade history exploring the transition from feudalism to capitalism as "hyper focused", or niche for that matter.
- marnett 4y ago
  Your feedback is received. Granted, I do disagree. This is just one specific area of focus in the broader field of Marxist historiography. So it is niche. It is as niche as studying a specific subject area in the broader field of Egyptology, which again I don’t think would be a stretch to consider niche. Perhaps a takeaway we can both agree on is niche may not be the best word for describing what I’m talking about. Perhaps subfield of an academic discipline is.

whitemary 4y ago

[flagged]

SamoyedFurFluff 4y ago

> the new dogma/mandate of BlackRock-style DEI I don’t think DEI is new. The original affirmative action legal cases in the 60s was in employment, particularly in breaking up the homogeneous of all-white labor unions and other all-white labor forces. Remember that the Jim Crow laws and racial segregation in the public sphere was still occurring in the 50s and early 60s, and affirmative action policies occurred in the workplace as a response to try and actually enforce desegregation in the corporate sphere.

squokko 4y ago
The idea of investment managers directing capital based on their own corporate purity tests is definitely much newer than the 1960s
- SamoyedFurFluff 4y ago
  I don’t think it is. Government had enforced diversity metrics in order to prevent hiring all-white union laborers for their contracts pretty early on in the desegregation process. The private sphere followed suit to avoid the label of segregationism.
- Apocryphon 4y ago
  Or perhaps earlier: https://www.thebalancemoney.com/a-short-history-of-socially-responsible-investing-3025578 https://www.thebalancemoney.com/a-short-history-of-socially-... https://www.mycnote.com/blog/the-history-of-socially-responsible-investing/ https://www.mycnote.com/blog/the-history-of-socially-respons...
- eropple 4y ago
  This can also (and, frankly, less weasel-wordishly) be framed as "directing capital based on the desires of the stakeholders involved." High-dividend ETFs have "purity tests", they just involve things you don't feel like being pejorative about. And, as 'Apocryphon notes, this is much older than you think besides.
- object-a 4y ago
  I don’t think they’re doing it for an ideological purity test, they’re doing it because: 1. They believe there is investor demand for funds that take environmental and social impact into account 2. They believe that companies with better environmental, governance, and social Impact ratings will have higher or more stable returns over time You can disagree, but I think there are good arguments to be made for both of those points.

stevespang 4y ago

[dead]

vishnugupta 4y ago

> I want to know more about how that shift occurred. I’ve been stuck in that rabbit hole for atleast 2 years now. At the macro level it seems as if it was all planned but upon deeper reading I came to a conclusion that it was a sequence of events which while individually would have made sense collectively lead to the current mess. To get a whirl wind tour and as a starting point I highly recommend Adam Tooze’s book “Crashed”. In it he chronicles the 2008 crisis beginning with Nixon’s abolishment of gold standard. The book is full of excellent references.

causi 4y ago
Self-organizing behavior is a wildly underestimated and underappreciated force in the world. It's behind almost everything people regard as some sort of conspiracy.
- krapp 4y ago
  That's just want they want you to believe.
yieldcrv 4y ago
I'm glad you came out on the other side, and have the cognitive ability to perceive independent parts in a large system this way. I would add one other thing, some of those steps have opportunists in them. Once you realize that, you realize you can be an opportunist too. You can play the game at the same level, by pushing chess pieces at a small level.
- foogazi 4y ago
  > You can play the game at the same level, by pushing chess pieces at a small level. You can’t lobby to abolish the gold standard or influence federal appointees
  - yieldcrv 4y ago
    > influence federal appointees you can. you can get your people in agencies and courts when the time looks favorable, and they will transcend the Senate committee composition and the President's administration. > You can’t lobby to abolish the gold standard odd example since that's gone for 50-90 years already, but again you can. == think about it this way. periodically there's a conspiracy documentary about people pulling the strings of the elected President. what they neglect to mention is that every possible permutation of potentially electable Presidents have opportunists already waiting. You don't have to be a partisan. You don't have to actually be a partisan. Loads of people are doing things beneficial to them.

user3939382 4y ago

My inexpert assessment is that this shift was precipitated by the creation of these tycoons in the industrial revolution. Prior to that, big corporations like the India Tea Company were formally/directly associated with the State. Getting into my more controversial political opinions, I believe now these corporations and their executives also control the government almost exclusively but they at least pretend they’re separate from the State.

Avicebron 4y ago
I assume you mean the East India Company? And from what I understand it was somewhat different than directly controlled by the state. Getting the "Queen's permission" was more of a business license, and they actively formed a lobby within in the government to lobby for a monopoly which was roughly 100 years after they were formed as a private venture.
- user3939382 4y ago
  > East India Company? Yep

rubyn00bie 4y ago

This is pretty much what heterodox economics is all about. Veblen hits on this with the theory of the leisure class (I think? I my heterodox knowledge isn’t as good as it once was). Heterodox economics is probably the least known category of economics, but arguably one of the most important. That importance is because it helps us think about our motivations and reasons not just quantitative results (I do love quantitative results, tho). Most folks don’t even know money wasn’t really used until the like 1500s. The wealthy bartered and used coins as a sign of wealth, using them (coins) was typically faux-pas. And even then, the church hated money because it stripped them and the monarchy of power…

naasking 4y ago
> Most folks don’t even know money wasn’t really used until the like 1500s Do you mean in Europe? Pretty sure money has been used quite a bit in many other places.
- rubyn00bie 4y ago
  > Do you mean in Europe? Pretty sure money has been used quite a bit in many other places. I mean pretty much everywhere. Money wasn't used the same way it is today, and it wasn't until the 1500s that really emerged as a result of the Dutch being prolific traders. Coins existed but money wasn't spent, or used, like it is today... Barter was the primary way for people, both rich and poor, to acquire goods.

Bouncingsoul1 4y ago

yeah me too, its wide field... I'm currently working through this series https://press.princeton.edu/series/the-princeton-economic-history-of-the-western-world https://press.princeton.edu/series/the-princeton-economic-hi... Sometimes I get sidetracked by specific sources and explore tanget stuff, but most of this series is pretty approachable

HEmanZ 4y ago

"the purpose of all human life is to build financial structures to increase the wealth of the shareholder class." I have never met a single person at any level of any organization or otherwise who has expressed this sentiment. This characterization is a strawman. Usually the idea that shareholder wealth maximization is central comes with a whole bunch of other economic ideas. Like that long-term wealth is what matters, not wealth tomorrow. And that corporations aren’t the center of all life or meaning for everyone involved, just a way to generate stuff. And that in order to generate more wealth you need to constantly provide more goods for more people at lower cost. These distorted strawman characterizations of capitalists are just outrage porn, they don’t help move the world forward at all.

rektide 4y ago
I've heard it my entire working life, from coworkers at every step of the chain. Engineer wants to build something they think will be good & useful & help the company, and someone backhands them with "how will this make us/the company money?", sometimes followed up with "we're here to make money". It may not be the exact same statement, but it's very close in spirit. This should be beside the point; we should do things that are good because we can, not just because they make us money, but I usually tend to see there being a ton of potential for the engineer's idea to help make money.
- foogazi 4y ago
  > we should do things that are good because we can If I hire you to fix my car I’m not paying you if instead you fix the neighbors car
  - rektide 4y ago
    ah yes, the beautiful zero-sum view of the world, where no one does anything positive ever unless the blood price is paid. thank you for your shitty shit view. looking at it the other way, a repair shop could just, like, add some washer fluid for free. or clean some wipers to help the life. good repair shops do, because they understand some small benevolent acts cost next to nothing. not everything needs to be a brutal & cold calculated exchange, priced at every point. good is allowed. sometimes it costs intensely little. i've heard this condescending bullshit used to browbeat & bully countless ideas that would make everyones lives vastly easier within an org. i dont think a mutual benefit ought be required to do a little good; sometimes the price of doing good is just tiny. but the organization/managerial class thinks their contribution is eliminating small nicenesses, without really coming to understand how much it hurts everyone to eliminate niceities. without understanding that often the price is near zero. orgs have a vastly overinflated sense that they, by preventing people from doing good, are helping the org. it causes immense internal dissonance, is unbelievably time wasting & harmful to have the org stepping in to low level shit- basically free activities- & intervening, and it rarely does good.

splitstud 4y ago

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RivieraKid 4y ago

Why? This leads to optimal results assuming high quality laws that put a price on externalities and make sure markets are competitive. These assumptions are approximately correct, so maximizing shareholder value is approximately optimal. It maximizes prosperity. It's better to create more value than less value all things being equal. If you put it this way, it's obvious.

Arainach 4y ago
It doesn't account for externalities. It also doesn't distribute "value" equitably. It's more profitable to dump waste in a lake than to clean it up. It's more profitable to hire children for 10 cents a day than adults for a living wage. It's more profitable to keep using ingredients even after they've started turning bad. None of these deliver value to society.

boh 4y ago

Since we weren't alive for the king's tolls we may romanticize it as a counterpoint to our corporate-centric organization structures, but while you may believe it to be "insidious" and maybe it is, it's the only reason we have a middle class. High production, high consumption models are so many people are able to have discretionary income in the modern era. And this is true for every modern economy whether it be democratic, socialist, communist etc. Maximizing productive capacity has a lot of social and environmental consequences and while we are free to hate on the corporations that make it possible, we must also admit that our way of life entirely depends on it. We are of course free to dream of other ways of life, but looking back in history there have been no alternatives that have offered our current quality of life to such a large collection of people.

soco 4y ago
At the same time, this is no reason to stop trying to make it even better, when looking at its inevitable drawbacks.
sangnoir 4y ago
> ...while you may believe it to be "insidious" and maybe it is, it's the only reason we have a middle class. What if the existence of a middle class is transitory? The billionare preppers certainly think our current social order is on borrowed time[1], not that I agree with their outlook, but I take that attitude as evidence that today's capital class does not particularly care for the continued existence of a middle class, unlike Henry Ford. Once off sales are passé now, and recurring revenue is in. I suspect the middle class gets in the way of profit maximization because of the class' propensity to saving and ability to cross-shop since they have free time. Selling Patagonia vests for leisure activities may be profitable, but it will lose out to PE squeezing out the middle class from buying homes and making them perpetual renters and unable to afford leisure activity 1. https://www.theguardian.com/news/2022/sep/04/super-rich-prepper-bunkers-apocalypse-survival-richest-rushkoff https://www.theguardian.com/news/2022/sep/04/super-rich-prep...

5040 4y ago

>One of the most insidious ideas of our time This isn't obvious to me. The idea is to pursue profits above all else, but also that giving people what they want will result in maximal profits. Is giving people what they want insidious?

lambertsimnel 4y ago
I think the concerns about profit maximisation include externalities. For example, if somebody not party to a transaction is harmed by unsafe behaviour, that might not inhibit that behaviour from maximising profit for those who are party to the transaction.