Friends
often ask me, regarding my blog, something to the effect of, “dude, does your
boss know you write this shit?” The short answer is, yes. The DanJanifesto is
on my resume. For real. The longer question is, “how can you go to work every
day as a business lawyer - mergering and acquisitioning and joint venturing and
corporate financing - when you have so many horrible things to say about
corporations?” And the longer answer is…
The system is supposed to work like
this: the people (via government) set the rules; capitalism (via corporations)
works within those rules to make the most money possible and “expand the pie”;
and the people (via taxation, via government) decide who should get how much of
the pie. It’s when that basic structure starts to fall apart that I get all agitated.
I believe that corporations are
justified in doing anything and everything not prohibited by law and, further,
that they should not be expected to even consider any factor – moral, social or
otherwise – so long as what they are doing is legal. My general super leftie
disposition notwithstanding, I’ll go to bat for Wal-Mart’s right to pay below
poverty wages to full-time workers, Apple’s right to set up international shell
companies to shelter profits from US taxation, and BP’s right to permanently
ruin a massive chunk of coastline in exchange for penalties equal to a few day’s
revenues. However unconscionable those practices might seem, If they’re legal,
if they maximize a corporation’s profits, then that’s their prerogative, and it’s
what they should do.
When companies pretend to care about the
world beyond maximizing shareholder value and say things like “being
environmental / treating our employees well / supporting our community is not
just a good idea, it’s good business,” it’s disingenuous, not to mention
stupid-looking. It might not be 100% percent bullshit 100% of the time.
Sometimes, for purposes of building goodwill with customers, or even for cold,
hard business reasons, it turns out to be true. But, then, when it’s not true,
it’s not. And when a choice has to be made between doing what’s “right” and
what maximizes profits, profits win out every time. Period.
If a company can maximize its profits by
paying its employees sub-poverty wages or by destroying the environment, and we
the people think workers deserve to make more and that forests need to be
preserved, the solution is not to protest the company, but to change the rules.
And we the people, not companies (who are not people; I’ve voiced my opinion on
that issue plenty), are the ones who should decide what the rules are.
And that’s where things become
problematic. Companies are doing more than trying to maximize their profits
within the rules set by the people. They’re trying to set the rules themselves.
The most fundamental problem with how the rules are made these days, in my
humble opinion, is that there is no meaningful countervailing force to the
intense concentrated interests companies have in certain very precise,
industry-specific issues. If an environmental regulation would negatively
impact some particular industry, it makes economic sense for that industry to
lobby, with all its might, within one dollar of bankruptcy, to make sure the
regulation doesn’t get passed. It could be the case – and I think it very often
is – that the vast majority of the population agrees with a regulation, and
that if every person who agreed would contribute one dollar to fight for the
regulation, it would breeze through the legislative process and become law in a
flash. But when there is no centralized structure for the masses to express
that preference, it can’t compete against the targeted, coordinated message of
even a very small minority. Absent any kind of meaningful counterforce, the industry
wins.
When people get frustrated with this
result and point to corporations as the culprit, I think they’re going after
the wrong target. Whenever I hear any kind of message about “corporate greed,”
I pretty much tune it out, because it almost always misses the real point. I
wouldn’t necessarily go as far as Gordon Gecko in saying that “greed is good.”
I’d say something more like, “greed just is, like gravity.” The profit
motivation, a.k.a. “greed,” is what fuels capitalism. And capitalism really
does do a spectacular job – a better job than any other system we’ve seen on
Earth so far – of advancing progress and expanding the economic pie.
But a larger pie in and of itself is not
always better. Distribution matters. Similar to “greed,” the terms “socialism,”
“redistribution” and “class warfare” – at least as they’re generally tossed around
by the media in this country – are pretty good indicators that whatever screed
follows is not going to be very meaningful or informative. “Redistribution” in particular.
The word is a sneaky, not-so-subtly loaded term, implying that there is some
cosmic, natural order defining who should get what cut of the pie, and that any
RE-distribution of the goods is unnatural. It’s a ridiculous premise, just like
the idea of “free” markets. Every game has rules. Having no rules is, itself, a
set of rules. Human beings don’t exist to serve the needs of markets.
Markets exist to serve the preferences of people. And people should set the
rules.
The question of who should be entitled
to what relative portion of the pie gets pretty philosophical pretty fast.
Business owners may be the most visible catalysts of progress and creators of
wealth, but the forces that underlie any business success are vast and often
invisible, and usually include some significant contribution from the
government. We the people should determine the distribution. There’s no “re”
about it. It’s a democratic choice. Nobody is intrinsically entitled to
anything.
When people howl about redistribution,
they’re usually just complaining about paying taxes. To sound less complain-y,
the protests against taxes are usually said to be based on some larger philosophy.
In particular, good ol’ Ayn Rand. I certainly don’t believe the idiot Randian /
Atlas Shrugged notion that if people have to pay too much in taxes they’ll
decide to drop off the grid and stop enlightening society with their creations.
That whole idea seems to me like an entirely clueless notion about human nature
– that people will stop competing if they don’t get to keep 100% of the fruits
of “their” noble work. People compete because they love to compete. If people
had to pay a 95% tax on each dollar over $1 billion, that additional dollar would
still be an extra point on the scorecard of who’s “winning.” More is more, and
after you’ve reached the point where extra dollars have no impact whatsoever on
how your life is actually lived, the value of an extra dollar lies purely
within the realm of philosophy. (There’s another more mundane matter of people
simply not understanding how marginal tax rates work, and thinking,
incorrectly, that there is ever a situation where, after taxes, a person would
take home less by making more if making more would bump up his tax bracket). As
long as human beings like to show off and measure themselves against others
(“by height” says Ty Webb to Judge Smails – sorry, couldn’t help myself),
they’ll keep working hard even when taxes are high.
OK, so, got it? We the people should set
the rules. Corporations should compete all-out within those rules. We the
people should decide who gets to keep the spoils. And we should all stop complaining
about paying taxes.
And that, in a nutshell, is how someone
can be an angry, verbose, blogging leftie and still go to work as a corporate
lawyer every day.
